Ticket prices on rail journeys between London and Exeter are to be capped due to fears over a lack of competition.
The route between the capital and the Devon city is currently served by both the Great Western Railway (GWR) and South Western rail franchises.
The Competition and Markets Authority (CMA) raised concerns about the route after First Group and MTR were awarded the new South Western franchise - they are due to take over the running of this franchise on Sunday (August 20). First Group already operates the Great Western network.
The CMA has now accepted an offer by the train companies to implement a price cap on unregulated fares between London and Exeter on both GWR and South Western services.
This means that prices will be “linked to those on a number of other comparable services to ensure they are kept in line with the market”.
The CMA said it had consulted the public on this price-capping plan – First Group and MTR will have to submit regular reports to the CMA to show that they are complying with this agreement.
The deal means the transfer of the South Western franchise can go ahead without the CMA holding a more in-depth competition investigation.
Rachel Merelie, executive director of markets and mergers at the CMA, said:
“We examined the proposals very thoroughly during the consultation period to ensure that they addressed all of our concerns.
“We believe that they will protect passengers from fares being pushed up due to lack of competition on this key route between London and Exeter.”