Competition Authority CEO Refutes Claims of US Influence in Microsoft-Activision Blizzard Deal Rejection

 Competition Authority CEO Refutes Claims of US Influence in Microsoft-Activision Blizzard Deal Rejection

The CEO of the UK's Competition and Markets Authority (CMA) has dismissed allegations that the authority blocked Microsoft's $69 billion acquisition of Activision Blizzard on the instructions of the US Federal Trade Commission (FTC). Sarah Cardell, speaking before the business and trade select committee, emphasized that the CMA acts independently and makes decisions based on its own analysis.

Cardell responded to inquiries from Conservative MP Bim Afolami, who sought clarification on the CMA's communications with the FTC during the merger inquiry. Cardell explained that while they were able to discuss details with the European Commission, no such waiver was in place for the FTC, limiting the extent of their communication during the later stages of the investigation.

In contrast to the CMA's decision, the European Commission recently approved the merger, while the FTC has filed a lawsuit seeking to block it, leaving the final verdict to the courts.

Cardell clarified that the CMA's standard for evaluating mergers is based on establishing, with a balance of probabilities, whether the merger is likely to result in reduced competition. She highlighted that although the litigation standard in the US differs, the underlying analysis is fundamentally the same, and the evidence base is comparable. The European Commission also employs a similar approach. The CMA's assessment is subsequently subject to judicial review by the competition appeal tribunal in the UK, a thorough process that ensures a well-supported case.

Both Cardell and Marcus Bokkerink, the chair of the CMA, vehemently refuted claims that the decision to block the deal had damaged the UK's international reputation. Bokkerink stressed that turning a blind eye to anti-competitive mergers would be detrimental to the country's commitment to open competitive markets. He further expressed concern about the perception that the UK would permit anti-competitive mergers, leading to market restrictions. The CMA's mandate is to promote open competitive markets, allowing innovators to operate freely.

Cardell concluded by stating that the competition authority takes into account the impact of its decisions on the UK's reputation and overall stance on competition when strategically assessing its role. She firmly believes that strong competition sends a positive signal about the UK's business environment.