CAT says that UK merger review deadlines need “urgent consideration” in the event of EU withdrawal

The Competition Appeal Tribunal has urged “urgent consideration” of UK statutory deadlines for the review of complex mergers in the event of the UK’s withdrawal from the EU.

The CAT’s plea came as a postscript in a judgment approving an application by Sainsbury’s and Asda in their challenge to the Phase 2 timetable set by the Competition and Markets Authority for investigation of their proposed merger.

The CAT overruled the CMA’s refusal to allow the parties more time to respond.  It said that the timetable “crossed the line to unfairness” in view of the complexity of the transaction and the importance of the parties’ response in directing the CMA’s assessment.

The CMA has 24 weeks to complete a Phase 2 merger review, subject to a possible extension by another 8 weeks.

The case highlights the difficulties presented by statutory review deadlines, against the public interest in undertaking a proper investigation. The tension is likely to be compounded in the event of Brexit, assuming that more international and complex deals will be subject to the CMA’s review.

It is rare for a court or tribunal to ask for urgent consideration of procedural rules laid down in legislation. This shows some judicial activism on the CAT’s part, which will no doubt resonate with stakeholders.

Sainsbury’ and Asda v Competition and Markets Authority [2019] CAT 1