Member Article

A recent Financial Times newspaper article raises the question whether the mandate underlying the UK's competition authority (the CMA) should be reviewed.  The argument is based on the CMA's blocking of the Microsoft/Activision merger, compared to the EU's conditional consent decision.

The CMA's decision is being appealed by the merger parties. The legal test for a decision under the legislation is judicial review, and while this is somewhat limited there seems to be a belief among some commentators that the appeal will only be successful if there are errors in the procedure undertaken by the CMA. Actually, judicial review is a more nuanced and complex test. What will be interesting is the extent the appeal tribunal (the CAT) examines the CMA's reliance on its own guidance in relation to mergers in the technology sector. As I have argued elsewhere, the CMA - among other competition authorities - is arguably promoting 'theories of harm' that are theory based rather than evidenced based. More specifically to the current matter, there are statutory questions the CMA must address which leads to the question whether remedies offered by the merger companies did objectively meet the concerns held by the CMA.

To extrapolate blocking a merger to a fundamental question about the role of a competition authority seems too early a call.

 

https://www.ft.com/content/b72bd1d8-8a92-47ec-b9fb-a4d415bcab03