Friday, 18 October 2024

CMA decides that Amazon/ Anthropic does not qualify for investigation

 


The Competition and Markets Authority (CMA) has published its decision that the partnership between Amazon.com, Inc and Anthropic does not qualify for investigation under the merger provisions of the Enterprise Act 2002.

 The partnership involves a US$4 billion investment by Amazon in Anthropic, which is convertible into non-voting equity in certain circumstances. The tie-up also involves a long-term non-exclusive licensing of Anthropic's Foundation Models (FM) to Amazon for use in Amazon services.

Amazon argued that it has not acquired material influence over Anthropic as a result of the partnership.

The CMA noted that agreements to provide infrastructure to an FM developer as well as distribution agreements between an FM developer and a cloud service provider may result in an acquisition of material influence.  This may arise where conditions are such that the agreement creates a relationship of dependency such that it enables the partner to influence materially the commercial policy of the FM developer.

The CMA also considered that the other categories of agreements and rights set out in the description of the Amazon/Anthropic partnership, including consultation and advice rights in relation to significant Anthropic business issues, are, in principle, capable of contributing to a finding of material influence.

However, the CMA did not need to reach a conclusion on material influence as Anthropic's UK turnover does not exceed £70 million in the UK, nor do the parties together account for a 25% or more share of supply of any description of goods or services in the UK.

https://assets.publishing.service.gov.uk/media/6710ba44e84ae1fd8592f52c/Full_text_decision.pdf

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