Collective Competition Actions: Challenges for Case and Costs Management

It is timely to reflect on the mounting scale, complexity and scope of collective actions in competition cases. I have just had an article published in Issue 10 of TL4’s Disputes Magazine where I discuss how the ongoing Interchange Fees and Trucks Litigation cases and others will continue to pose challenges for case management in the Competition Appeal Tribunal. I also note that some funding agreements will need to be revised to reflect the Supreme Court’s recent ruling R (on the application of PACCAR Inc and others) (Appellants) v Competition Appeal Tribunal and others (Respondents) [2023] UKSC 28. Navigating the future landscape will require a delicate balancing exercise between proportionality, fairness and reasonable cost.

This article was first published with ThoughtLeaders4 Disputes Magazine.

Collective Competition Actions

CMA gives green light to reworked Microsoft-Activision Blizzard merger

 

The Competition and Markets Authority (CMA) has approved Microsoft Corporation’s acquisition of the major part of Activision Blizzard, Inc (Activision), excluding Activision’s cloud streaming rights outside of the EEA.

In April 2023, the CMA prohibited Microsoft’s proposed acquisition of the entirety of Activision. The CMA opened a new Phase 1 investigation in August 2023.

The reworked transaction involves Activision's global cloud streaming rights (outside the EEA) for all current and future Activision PC and console games released during the next 15 years (the Activision Streaming Rights), being divested to Ubisoft Entertainment SA, pursuant to a divestment agreement between Activision and Ubisoft, immediately before Microsoft acquires Activision.

The CMA is satisfied that the new deal will stop Microsoft from “locking up competition in cloud gaming as this market takes off, preserving competitive prices and services for UK cloud gaming customers.”   

This has been a high-profile transaction, attracting the criticism of commentators who challenged whether the UK’s merger control regime was suited to handle large tech mergers in a dynamic environment.  It was then subject to a stayed appeal before the UK’s Competition Appeal Tribunal and where Microsoft has made the case for the CMA to depart from its original order. The case culminated in a new Phase I probe to assess Microsoft’s restructured proposal.

Whether we will see a similar saga play out in the future remains to be seen. It may be conjectured whether the restructured deal proposal might have been offered earlier to avert the costs, delay and uncertainty that has prevailed in the interim.

But it is not all over (yet).  The transaction has yet to be approved by the Australian Competition and Consumer Commission.

https://www.gov.uk/government/news/microsoft-concession-a-gamechanger-that-will-promote-competition

 

 

CMA investigation into freelance and employed labour in the production of TV content

 

The Competition and Markets Authority (CMA) is investigating suspected violations of competition law in relation to the purchase of services from freelance providers, and the employment of staff, who support the production, creation and/or broadcasting of television content in the UK. The probe, announced on 12 October, excludes sport content.

The CMA has announced that it suspects infringements of the Chapter I prohibition of the Competition Act 1998 by a number of organisations.  These include at least, the British Broadcasting Corporation, Hartswood Films Limited, Hat Trick Productions Limited, ITV PLC, Red Planet Pictures Limited, Sister Pictures Limited and Tiger Aspect Productions Limited.

The investigation is at a preliminary stage and the CMA  expects to complete its information gathering by March 2024. 

The CMA is separately investigating suspected breaches of the Chapter I prohibition in relation to the purchase of freelance services and the employment of staff supporting the production and broadcasting of sports content in the UK. This other investigation was opened in July 2022.

The CMA has not set out its exact theory of harm.  However, last year The Financial Times and Daily Telegraph reported that the sports content investigation is examining whether broadcasters colluded over how much they paid freelance sports production staff.

https://www.gov.uk/cma-cases/suspected-anti-competitive-behaviour-relating-to-freelance-and-employed-labour-in-the-production-creation-and-slash-or-broadcasting-of-television-content-excluding-sport

Competition and Markets Authority investigation into cloud services

 Competition and Markets Authority investigation into cloud services

This morning I was interviewed on BBC’s World Business Report about Ofcom’s probe into practices and features that could limit competition in cloud infrastructure services. The regulator was expected to refer the market to the Competition and Markets Authority to examine the strength of competition and any features that could limit innovation and growth. Shortly after the broadcast was aired, the CMA launched its investigation as expected.

The referral comes on the back of a market study where Ofcom found that there are two leading providers of cloud infrastructure services in the UK: Amazon Web Services (AWS) and Microsoft who have a combined share of 60-70% and where Google is their closest competitor with a share of 5-10%.

Further details can be found on the CMA's case page here: https://www.gov.uk/government/news/cma-launches-market-investigation-into-cloud-services