Spotlight on the UK’s Competition & Markets Authority

This year has dispelled any doubts that the post-Brexit Competition & Markets Authority (CMA) would be a high-profile player in the domestic and international competition law worlds. With its new Chair and Chief Executive settled into their leadership positions and its 10th anniversary next year, the CMA looks set to continue the momentum it has shown in 2023. This blogpost highlights some initiatives to watch for in 2024 and beyond.

Changes to CMA’s Phase 2 merger investigations

Prompted at least partly by the challenges of now having jurisdiction alongside the European Commission and other antitrust agencies around the world to investigate global mergers, the CMA is proposing changes to some aspects of its phase 2 processes. It describes the changes as “an evolution” of how it investigates mergers. Others may see the changes as more of a direct reaction to the situation that arose earlier this year when the CMA first prohibited and subsequently approved the “fundamentally restructure[d],” according to the CMA, merger between Microsoft and Activision.

According to the CMA, the changes:

“reinforce the importance of a robust, independent and evidence-based regime to protect against anti-competitive mergers, while also highlighting the importance of open and transparent processes which offer parties extensive engagement with decision-makers including on remedies.”

The changes follow a wide-ranging consultation, including with businesses, legal and economic advisors on UK and international merger cases, consumer and industry groups, and other competition agencies. The changes include:

  • streamlining the start of the Phase 2 investigation – to enable an earlier focus on the key issues at stake
  • improving the opportunities for all businesses affected by a merger to engage with the CMA Inquiry Group overseeing the investigation
  • changes to the remedies process to help “incentivise” merging parties to “bring forward credible remedies to address concerns at the earliest possible stage.”

None of these changes requires amendments to the underlying legislation and so they can come into effect after the current consultation period ends on 8 January 2024.

Introducing the proposed changes, Sarah Cardell, CMA Chief Executive said:

“While the legal tests that we use to assess mergers remain unchanged, these process reforms should improve the running of our investigations, and have the potential to deliver a real step-change in aspects of the way the UK merger regime operates.”

Martin Coleman, Chair of the CMA’s Panel of Independent Experts highlighted what these changes could mean in practice:

“No system is so good that it cannot be made better and the recent consultation has helped highlight a number of areas for improvement. In particular, enhancing the quality of interaction with the decision-making group; improving the level of feedback to the parties as the process develops; tempering the inquisitorial aspects of the system with more discursive approaches; and adopting a new approach to the discussion of remedies.”

He also emphasized that this would be a two-way street:

“I emphasise that the outcome of a phase 2 investigation may depend also on the strategy that businesses and their advisers decide to pursue and on how merger parties decide to constructively approach the many choices that have to be made throughout the process.”

Sarah Cardell also spoke about “international alignment” between the CMA and other competition agencies investigating the same merger:

“Our experience is that it is generally beneficial to merging parties and competition authorities for there to be open channels of communications between different authorities internationally when reviewing the same transaction. This can bring procedural benefits – in allowing us, as far as possible, to align on process and timing. And it can also assist our substantive assessment where the markets concerned have regional or global dynamics. In many cases this can and does result in aligned outcomes across different jurisdictions. But it is inevitable that there will be instances of divergence – whether that reflects differences in market features, evidence base, differences in our statutory duties and legal frameworks or, on occasion, differences of judgment. This is true both for our assessment of the competition concerns raised by a merger, and the appropriate solution to remedy those concerns.”

She added:

“When we carry out a merger assessment on a global deal, we are highly attuned to the fact that we do not operate in an international vacuum. But ultimately, our responsibility is to take our decisions applying our rules for the protection of UK consumers.”

She also emphasized the independence of the CMA from politics:

“Of course, it is natural for there to be some political interest in high-profile transactions. Whilst we take our decisions independently, the CMA is accountable to Parliament and needs to be able to explain the actions it is taking and reasons for them. However, there is an important distinction between political interest and intervention. It is fundamental to the integrity of the UK merger regime that, outside of specific statutory exceptions, the CMA’s decision-making is free from political interference. And that has been – without exception – my experience in 10 years at the CMA, both as General Counsel and then as Chief Executive.”

In APCO’s experience, it is not unusual for there to be commentary about the “political” aspects around high profile competition law matters. It therefore remains necessary for companies fully to understand the Government’s political and economic objectives (see below) in order to formulate their business strategies with these in mind and maximize the chances of successfully navigating the competition and regulatory hurdles they may face.

New UK Government Strategic Steer to guide the CMA

On 23 November 2023, the UK Government issued a new Strategic Steer setting out top priorities “to ensure the continued effectiveness” of the CMA. Strategic Steers which are periodically issued by the UK Government of the day, are a notable transparency feature of the UK competition regime.

The Minister for Enterprise, Markets and Small Business, Kevin Hollinrake, said:

“The need for a robust competition regulator is crucial at a time when competition, innovation and the cost of living are high on people’s list of concerns. That’s why we have set out our top priorities to the CMA to ensure more investment, innovation and growth for the economy, and brought forward legislation to foster more competition in digital markets and enhance the CMA’s consumer powers.”

The Strategic Steer’s top priorities for the CMA to focus on are:

  • Supporting investment, innovation and growth by promoting competitive markets
  • Prioritizing action that addresses cost of living challenges
  • Responding to the challenges and opportunities created by the growth of the digital economy
  • Acting as a thought leader at home and abroad
  • Being a strong and independent voice.

These are reflected in the CMA’s recently published draft Annual Plan for 2024/25.

The CMA’s draft Annual Plan for 2024/2025

The CMA published its draft Annual Plan for 2024/2025 for consultation on 11 December 2023. The CMA’s practice of publishing annual plans also adds to the transparency of the UK competition regime.

The new draft plan highlights the continuing difficult economic situation in the UK:

“People and businesses continue to grapple with the higher cost of living and cost of doing business, cumulative inflation pressures, and a higher cost of debt. The UK, like countries around the world, continues to strive for higher economic growth against a backdrop of stagnating productivity, pervasive debt, global geo-political and military conflict, and a deteriorating climate”

as well as the potential impact of technological changes:

“Meanwhile, the accelerating technology revolution continues with landmark advances in artificial intelligence, matched by equally rapid development of business models and commercial alliances amongst the main players, with potentially transformative implications for our economies and societies in the near as well as the far future.”

Notably, the draft plan continues:

“… given the clear relationship between competition, innovation and growth, as well as the rapid pace at which new technologies develop and get adopted, we will continue to take an explicitly more forward-looking approach in nascent markets, to help these markets develop in a positive direction for competition and consumer protection, and therefore for further innovation, investment, and economic growth over the long run.”

The draft plan also draws attention to the new responsibilities and powers the CMA will receive when the Digital Markets, Competition and Consumers Bill (DMCC) becomes law (expected in 2024):

“The targeted ex-ante powers that the Bill provides in digital markets will enable the CMA to tackle competition and consumer protection problems swiftly, proportionately, and effectively, maximising opportunities for sustained innovation in these critical economic sectors.”

The DMCC, if adopted, will provide the UK with its own “tailored” regime for digital platforms with “strategic market status”, alongside the EU’s Digital Markets Act, as well as a range of other competition and consumer law powers.

The plan readopts the CMA’s 2023/24 triple ambitions:

  • “People can be confident they are getting great choices and fair deals”
  • “Competitive, fair-dealing businesses can innovate and thrive”
  • “The whole UK economy can grow productively and sustainably”.

It particularly highlights the work it is doing in the face of the cost-of-living crisis, including:

  • a market study on road fuels;
  • a review of unit pricing practices in the grocery sector;
  • a review of the vet sector;
  • a market study on housebuilding; and
  • two investigations into suspected anti-competitive practices in UK labor markets,

as well as in relation to innovation and sustainability:

  • an in-depth investigation into public cloud infrastructure services;
  • an initial review of AI foundational models;
  • a statement that collaborations to produce “combination therapies” will not be prioritized for competition investigations; and
  • guidance for businesses to cooperate on environmental goals in compliance with UK competition law.

The draft plan’s overall message is that the CMA intends to keep its focus and maintain its momentum during 2024 and beyond.


APCO recommends that those doing, or seeking to do, business in the UK should keep their focus on the wider context of the UK competition regime. This is laid out in the UK Government’s Strategic Steer and the CMA’s draft annual plan for 2024/25 summarized in this blogpost. The focus on cost-of-living concerns and the state of the UK economy alongside how to unleash technological advances and attract business to the UK post-Brexit in a pro-competitive manner is particularly noteworthy. The forthcoming UK General Election, which seems likely to be held in 2024, should also be kept in mind.

The UK competition regime does not operate in a vacuum. Appropriate engagement with the Government at the right time as well as with the CMA and other relevant agencies is, in APCO’s experience, a must-have rather than a good-to-have in some cases.

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