CAT rejects CMA’s request to adjourn hearing of Microsoft's appeal against decision to prohibit Microsoft/ Activision Blizzard merger

 

CAT rejects CMA’s request to adjourn hearing of Microsoft's appeal against decision to prohibit Microsoft/ Activision Blizzard merger

The Competition Appeal Tribunal has dismissed a request by the Competition and Markets Authority for the adjournment of the substantive hearing of the application brought by Microsoft Corporation, for review of the CMA's final report on the anticipated merger between Microsoft and Activision Blizzard Inc.

Following a phase 2 investigation the CMA concluded  that only the prohibition of the merger would be an effective and proportionate remedy to address the competition concerns identified.

The CAT listed the substantive hearing to begin on 28 July 2023. The CAT considered that a delay to October 2023, as requested by the CMA, would not appropriately reflect the need for and public interest in the swift resolution of Microsoft's application.  The CAT did not accept that the CMA's legal team would not be able to prepare itself in time.

 

Case No. 1590/4/12/23 Microsoft Corporation v Competition and Markets Authority: Ruling on application for adjournment [2023] CAT 43

 

https://www.catribunal.org.uk/sites/cat/files/2023-06/2023.06.29_1590_Microsoft_Ruling_Adjournment_Final.pdf

Mobile Merger: Is Three Enough?

 

Mobile Merger: Is Three Enough?

 

A merger has been announced between Vodafone and the owner of Three UK.

 

The firms plan to merge their UK-based operations.  The transaction would if completed give them around 27 million customers making it the biggest mobile network in the UK behind Virgin Media O2.

 

The transaction has yet to be approved by regulators, and it can be expected that the Competition and Markets Authority will scrutinise it closely.

 

The merger revisits the question of how many mobile operators are needed to maintain competitive markets.  The UK has a history of aggressive mobile competition prompting commentators to speculate that if a four-to-three merger cannot be approved here, then the hopes for similar consolidation in the mobile sector may now be more limited.  There are however already precedents for allowing consolidation from four to three players in other countries, for example the merger between KPN and Telfort in the Netherlands. 

 

The CMA is likely to look at the impact on consumer choice and prices, as well as the implications for development of future infrastructure, including 5G. A further area concerns the impact on mobile virtual network operators, or “MVNOs” to the extent that the transaction would reduce the number of operators effectively willing to host MVNOs on their networks.

 

It’s been argued that the merger would in fact be efficiency-enhancing leading to much needed investment in 5G in the sector.  In the current economic climate, it is perhaps understandable that merging parties would lay claim to such efficiencies to support a more moderated view of a merger between the larger players.  It is also understandable that regulatory authorities will continue to want to be assured that such efficiencies are clearly substantiated by robust economic evidence and argument.

CMA increases the value of informant rewards

 

CMA increases the value of informant rewards

The Competition and Markets Authority (CMA) has increased the maximum value of financial rewards that it will pay to informants who provide the CMA with information about a cartel from £100,000 to £250,000.

In 2008 the Office of Fair Trading introduced a policy of paying financial incentives of up to £100,000 to people who provide information about illegal cartels.  The CMA continued this policy.

The grant of an award and its amount is at the discretion of the CMA. The CMA has stated that it will pay a reward if the information concerned is significant in nature and leads to enforcement action by the CMA against those involved in the cartel. 

When considering the amount of the reward the CMA will have regard to factors such as the value of the information, the amount of harm that the information has helped to stop, and the effort and risk taken by the informant in providing the information.

Under the CMA’s leniency policy a company or individual which confesses its involvement in a cartel can gain complete civil and criminal immunity from sanctions provided certain conditions are met.  The CMA does not consider that an individual in such circumstances should ordinarily also gain a financial reward.

 

https://www.gov.uk/government/news/blowing-the-whistle-on-cartels