In our earlier blog on recent changes affecting the Competition and Markets Authority (CMA), we anticipated more changes to come. The month of March has lived up to our expectations. On 12 March, the CMA launched a “call for evidence” for the review of its approach to merger remedies as well as a “Mergers Charter” for businesses, stating that:

“Both the merger remedies review and the Mergers Charter are part of the CMA’s programme of work to implement the ‘4Ps’ – pace, predictability, proportionality and process – across all its work, helping to drive growth and enhance business and investor confidence.”^[1]

The Mergers Charter^[2]

The charter sets out principles as well as expectations for how the CMA will interact with businesses as well as their advisers during merger reviews – but also how the CMA expects businesses to act in return.

While carrying out merger reviews, the CMA is committed to four principles: process, proportionality, pace and predictability.

These principles are meant to help the CMA ensure they reach the correct decisions, as quickly as possible, while minimising the burden on businesses.

The “charter is a statement of intent”, but the document itself has no legal status.

In relation to the 4P’s, the following is said:

• Pace – “The CMA is committed to reaching sound decisions as quickly as possible. Cooperation of businesses is a vital part of this process.”
• Predictability –“Predictability is important for investor confidence and business decision-making. This includes being as clear as we can be to minimise uncertainty over whether we will review a particular deal or not.”
• Proportionality – “The CMA is committed to acting proportionately in the conduct of its merger reviews.”
• Process– “The CMA is committed to engaging directly with businesses during its merger reviews … Open and constructive engagement is a crucial part of this.”

The Call for Evidence^[3]

This call for evidence will remain open until 12 May 2025.

“The CMA is seeking feedback on 3 key areas:

1. How the CMA approaches remedies, including the circumstances in which a behavioural remedy may be appropriate.
2. How remedies can be used to preserve any pro-competitive effects of a merger and other customer benefits.
3. How the process of assessing remedies can be made as quick and efficient as possible.”

Additionally, the CMA will also be running a series of outreach and roundtable sessions to gather input.

As Joel Bamford (executive director for mergers at the CMA) has stated:

“Casting the net widely for input for the merger remedies review is crucial to getting a range of views – to this end we’re going to be holding webinars and hosting roundtables so we’re gathering the best quality feedback directly from those impacted by UK merger control.”

“We’re moving rapidly to deliver on our commitment to update the UK’s mergers regime, focusing on pace, predictability, proportionality and process. The remedies review and charter represent crucial progress as we turn those principles into practice.”^[4]

Sarah Cardell Speech^[5]

Around the same time of the announcement of this call for evidence, a recent speech from Sarah Cardell (the CMA chief executive) also highlighted a paced and proportionate approach to two areas of focus for the CMA’s new consumer protection powers under the Digital Markets, Competition and Consumers Act 2024 (DMCCA): drip pricing and fake reviews.

Fake Reviews

The CMA confirmed that it is ready to take action against fake reviews under the new regime. However, Sarah Cardell went on to say:

“Although we can tackle fake reviews under our existing powers … we recognise that new provisions may require changes to systems and compliance programmes … so for the first 3 months of the new regime we will focus on supporting businesses with their compliance efforts rather than enforcement.”

Drip Pricing

In relation to drip pricing, Sarah Cardell mentioned how:

“I am announcing today that we will take a phased approach to the guidance here. In April, we will provide a clear framework for complying with the parts of the law which are already well understood and largely unchanged … These ‘dripped fees’ harm consumers, and fair dealing businesses, by hindering effective price competition – which we know primarily happens on headline prices.”

Conclusion

The CMA continues to adapt its approach in response to the UK government’s steer towards growth. Business should reflect how to adapt to these changes in turn, and the call for evidence provides a first opportunity for businesses to help the CMA put its 4P’s principles into practice.

[1] CMA launches review of merger remedies approach and publishes new mergers charter – GOV.UK

[2] Mergers charter – GOV.UK

[3] CMA launches review of merger remedies approach and publishes new mergers charter – GOV.UK

[4] CMA launches review of merger remedies approach and publishes new mergers charter – GOV.UK

[5] Promoting competition and protecting consumers in the digital age: a roadmap for growth – GOV.UK