Welcome to BIG, a newsletter on the politics of monopoly power. If you’d like to sign up to receive issues over email, you can do so here. Yesterday, the UK’s Competition and Markets Authority told Microsoft that it has to either abandon or seriously rework
The allignment between CMA, EU and FTC is going to be vital to the enforcement of new anti-trust principles and to reverse the horrible basis that the consumer welfare model has set.
FTC/DOJ can get a lot of abandoned deals just by suing to block and drawing out the deal, however we all know how pro-monopoly US courts are, resulting in many large companies taking the extra legal fee and winning in courts.
The CMA however has higher rights in the UK. After making a decision, while there are appeals, these are nearly always on judicial grounds (not on the case) and any corrections are sent back to the CMA to amend. The result is near 0% decision reversal after a decision is made.
The CMA also heavily agrees and presrcibes with the FTC's merger guidelines. Nasceant markets should be protected, more scrutiny on vertical mergers, beahvioural remedies are largely useless and should be rejected.
While the EU has now become the most friendly regulator to big companies. They often prescribe beahvoural remedies, have blocked only a handful of deals, vertical merger blocking is extremely rare, and their marketshare analysis is very outdated on market definition. Ironically, the most stringent regulator on post merger enforcement doesn't have the foresight to see how to prevent post merger violations. Hint, it's by blocking the merger!!!
We can only hope the FTC and CMA apply serious pressure to get the EU back on track, because if not, the CMA is going to be the sole killer of deals and that is going to add tremendous political pressure on the CMA as more big company deals are killed and lobbyists make twisted claims of the CMA killing the UK economy. Something could constitutionally buckle.
CMA has already killed Meta/Giphy, and pretty much MSFT/ATVI, both Big Tech companies heavily lobbying on how anti-innovation or business the UK will become as a result. They are also investigating Amazon/iRobot and Broadcom/VMWare.
The allignment between CMA, EU and FTC is going to be vital to the enforcement of new anti-trust principles and to reverse the horrible basis that the consumer welfare model has set.
FTC/DOJ can get a lot of abandoned deals just by suing to block and drawing out the deal, however we all know how pro-monopoly US courts are, resulting in many large companies taking the extra legal fee and winning in courts.
The CMA however has higher rights in the UK. After making a decision, while there are appeals, these are nearly always on judicial grounds (not on the case) and any corrections are sent back to the CMA to amend. The result is near 0% decision reversal after a decision is made.
The CMA also heavily agrees and presrcibes with the FTC's merger guidelines. Nasceant markets should be protected, more scrutiny on vertical mergers, beahvioural remedies are largely useless and should be rejected.
While the EU has now become the most friendly regulator to big companies. They often prescribe beahvoural remedies, have blocked only a handful of deals, vertical merger blocking is extremely rare, and their marketshare analysis is very outdated on market definition. Ironically, the most stringent regulator on post merger enforcement doesn't have the foresight to see how to prevent post merger violations. Hint, it's by blocking the merger!!!
We can only hope the FTC and CMA apply serious pressure to get the EU back on track, because if not, the CMA is going to be the sole killer of deals and that is going to add tremendous political pressure on the CMA as more big company deals are killed and lobbyists make twisted claims of the CMA killing the UK economy. Something could constitutionally buckle.
CMA has already killed Meta/Giphy, and pretty much MSFT/ATVI, both Big Tech companies heavily lobbying on how anti-innovation or business the UK will become as a result. They are also investigating Amazon/iRobot and Broadcom/VMWare.