Liberal Vision

Governments are like a box of chocolates…

You really do not know what you’re going to get…

Like what has come to be known as the Cadbury Law. Unveiled in Labour’s election manifesto the law “would put curbs on hostile takeovers of businesses deemed to be of national interest” and has been proposed as a reaction to the public outrage over Kraft’s takeover of Cadbury’s. Not a moment too soon after it was unveiled the law is already being slammed by business leaders.

The plans include changing British takeover regulations to insist that two-thirds of shareholders must approve big transactions, as opposed to the simple majority required at the moment. It is also expected to contain rules designed to limit the influence of short-term investors such as hedge funds, by excluding them from buying shares during bids and from voting on the transaction.

The law is shockingly anti-competition “…the threat of takeovers makes management efficient. If they underperform, someone else will take advantage and have a go.”

But aside from all the legitimate concerns from the City, what I find most interesting is the fact that Cadbury’s chocolate is not going to begin to taste like chalk just because Kraft owns it. There may be no difference to the product at all. So the ‘national interest’, which in this case is chocolate, is not necessarily at stake. Labour’s policies are becoming more excruciatingly tenuous by the minute.