By: Alex Hazell & Rebecca Saunders (CMA)
On the 18 March, the Competition and Markets Authority (CMA) adopted revised guidelines on how it assesses mergers. The previous Merger Assessment Guidelines were updated in 2010 and changes were needed to reflect that our economy, the goods and services that we consume and sometimes the way in which we consume them have changed considerably over the past decade. In 2010, for example, the majority of the world’s largest companies were energy companies, and although these remain large, global companies today, it is so far only the world’s largest tech companies that have joined the ‘trillion dollar company’ club.
The CMA needs to evolve and adapt its approach to the assessment of mergers in digital and other new markets to ensure that it is delivering on its duties to promote competition for the benefit of UK consumers. Whilst this is an ongoing process, the revised guidelines give the CMA the opportunity to set out in writing its current approach to the assessment of mergers.
The statutory test the CMA is applying to mergers has not changed; however, the revised guidelines capture what the CMA has learned from its own experiences in merger control since 2010, as well as developments from recent case law and recommendations from external reviews of its previous investigation (eg the Lear report on digital mergers and the KPMG report on entry and expansion analysis) and other studies into digital markets (eg the Furman report and the Stigler Center study of digital platforms in the US). The CMA has also engaged with a range of different stakeholders and published a consultation on the guidelines, receiving a number of very helpful submissions which were carefully considered. The CMA has published a summary of how it has taken these submissions on board when finalising the guidelines…