CMA consults on merger remedies approach

The Competition and Markets Authority (CMA) has initiated a consultation on its revised merger remedies guidance (CMA87), striving to adapt the UK merger control framework to the dynamic needs of businesses and consumers. As part of its broader initiative to ensure effective, evidence-based regulations, the CMA aims to provide greater flexibility in the adoption of behavioural remedies without compromising its commitment to reject ineffective proposals that could harm competition.

The proposals reflect the CMA's implementation of the ‘4Ps’ framework, focusing on pace, predictability, proportionality and process. This approach is intended to boost growth, investment, and business confidence, making the merger regime more transparent, efficient, and predictable. The CMA has taken extensive feedback from businesses, advisors, and other stakeholders into consideration when formulating these changes.

Key updates in the proposed guidance include an expansion of the scope for behavioural remedies, which may now be deemed effective during both Phase 1 and Phase 2 reviews. While structural remedies are generally preferred, the guidance clarifies scenarios where behavioural measures could be beneficial, providing merging businesses with clearer expectations regarding the acceptance of such remedies by the CMA.

Additionally, the proposed guidance aims to support pro-competitive efficiencies and customer benefits by recognising that certain remedies can enhance competitive rivalry. It offers more clarity on the assessment of relevant customer benefits (RCBs), ensuring that beneficial deals can progress while fostering competition, ultimately benefiting UK consumers.

Enhancements to the merger remedy process are also on the agenda. The updated guidance builds on recent procedural improvements designed to deliver greater transparency and improved engagement with businesses, including opportunities for early feedback and closer interactions with decision-makers at the CMA. These changes are expected to facilitate the clearance of more deals with remedies at an earlier stage.

Joel Bamford, Executive Director for Mergers at the CMA, commented on LinkedIn, saying that today's consultation marks a significant milestone in the CMA's continuous efforts to refine its guidelines. He noted, "We’ve listened carefully to feedback – from businesses, advisers, academics and other stakeholders – and our proposals reflect this." Bamford emphasised that the changes aim to give businesses greater clarity while prioritising effective outcomes for UK consumers.

The CMA's consultation is now open for stakeholder feedback, which must be submitted by Thursday 13 November. The draft guidance can be accessed on the CMA’s consultation page, with the finalised merger remedies guidance anticipated for publication in late 2025. This comprehensive refresh, built on insights gathered through extensive engagement, aims to strike a balance between fostering competition and ensuring regulatory clarity in the evolving business landscape.