The Fall And Rise Of CMA Merger Remedies

I’ve talked in recent posts (here, here and here) about the noticeable rise in CMA merger remedies, both at Phase 1 and Phase 2.

Here’s the overall picture…..

For most of the CMA’s existence the number investigations each year that conclude with competition problems being dealt with by remedies has been between four and ten.

Since last summer, however, there’s been a noticeable increase beyond the normal range – especially noticeable given that the number of public merger investigations has fallen to record low levels.

The rise in remedies seems strong but the chart helps keep things in perspective.

First, the recent number of remedy outcomes, while striking, is not unprecedented.

And, second, the number of remedies has risen and fallen several times. Short-term ‘trends’ have a habit of disappearing.

Even so, an interesting question is whether we have yet to reach ‘peak remedy’ this time around, especially given the changes to the CMA’s remedy processes that I noted in a previous post.

Other interesting ‘remedy’ topics include

  • how the pattern compares with that for merger prohibitions
  • the extent to which the greater use of remedies deters companies from proceeding with deals that may harm competition or chills transactions that might benefit competition.

Which remedy topics would you, dear reader, like to know more about? Do feel free to leave a comment or to drop me a line.

I’m expecting to say more about merger remedies in future posts. Do feel free to click the ‘follow’ button at the side of the main blog page to subscribe to the blog series.

Notes on the above chart:

For each period of 12 months the graph tracks the number of final merger decisions in that period that have been remedy outcomes. Cases are taken into account in the 12 months in which the final decision for the case is published. A Phase 1 case therefore appears in the series when the full written decision is published, unless it is referred to Phase 2, in which case it appears in the series when the full Phase 2 decision is published or the case is abandoned by the merging parties.

One Of The Above

Here’s a question that’s worth asking if you’re assessing the prospects for the outcome of a CMA merger investigation:

In recent years which minority type of merger accounted for 100% – yes, 100% – of the marked rise in CMA Phase 1 references to an in-depth Phase 2 investigation?

Was it…

  1. Cases that the CMA selected for investigation (as opposed to cases notified by the parties)?
  2. Cases involving a so-called non-horizontal theory of harm?
  3. Cases that attracted complaints from customers and competitors?
  4. Cases launched by the CMA in the second quarter of the year?
  5. Cases that are anticipated (rather than completed) and that were qualified for investigation under the turnover test?
  6. Cases that involved so-called ‘platform’ businesses?
  7. Cases involving concerns about potential competition (as opposed to the removal of existing competition)?

Which answer would you choose? (Do drop me a line or put your answer in the comments box below)

If there’s sufficient interest I’ll look at the main candidates in future posts.

And, no, it’s not a trick question!

One of the above is the correct answer!….

…..Which in turn means revisiting the simple ‘rising CMA intervention’ narrative that often appears in commentaries.