Britain’s antitrust watchdog will overhaul its merger evaluation system, including improving interaction with parties and allowing remedies to be brought in sooner, after coming under criticism over the Microsoft-Activision Blizzard deal.
The Competition and Markets Authority (CMA) moved to the top tier of global regulatory bodies when Britain left the European Union in 2020, giving it a greater role in massive mergers such as Microsoft’s acquisition of the “Call of Duty” maker for $69 billion.
It blocked the deal, angering both US companies, but then tore up its rulebook to reopen it and then approve the case after Microsoft came back with the changes.
The companies were surprised by the ban, saying that the full extent of the CMA’s objections had not been made clear to them.
Microsoft has lobbied the British government, including Finance Minister Jeremy Hunt, to try to get the deal back on track.
Sarah Cardell, chief executive of the CMA, said she wanted to “put an end once and for all” to speculation that political interference had affected the final result.
“There was no attempt by any politician, political advisor or government official to influence our decision-making process,” she said on Monday.
But it said in a statement that the CMA is an organization that “listens and learns”, both in the course of its investigations and in how it develops its processes to ensure merger control works as effectively as possible.
Martin Coleman, who chaired the Microsoft panel, noted that Microsoft President Brad Smith recently said his company had to accept a level of accountability for the process, and Microsoft should have figured out how to open it up sooner.
Coleman said that under the new proposals, the merging parties would have the opportunity to make representations after seeing the case against them in an interim report that would be published earlier in the process.
He said the hearing “will allow more time for the parties to submit their submissions and adopt a more discursive approach.”
“Throughout the process, it will be open to the merging parties to discuss solutions with the group at an early stage if they wish.”
The Capital Markets Authority reviews deals in two stages: an initial stage to decide whether they can reduce competition, and a second stage to study remedies, including a complete ban or divestment.
Cardell, who was appointed head of the regulatory body nearly a year ago, said the unusual move to reopen the Microsoft case did not indicate the existence of a new third phase.
“There is no point in holding back” from providing treatments, she said.
The agency strongly favors structural solutions, she said, adding that changes will only succeed if the merging parties participate in good faith.