Open Markets Institute Urges Stronger Merger Remedies in Submission to UK CMA
The Open Markets Institute, alongside other partner organizations, has made a submission to the CMA in response to its consultation on merger remedies, emphasizing the importance of ensuring that merger control remains effective, with a focus on designing appropriate remedies able to address the expected anticompetitive effects arising from proposed transactions.
The submission makes the following key points:
The application of the new pace and proportionality principles, which the CMA intends to follow, must not result in unworkable remedies. These principles should not be at the expense of the thorough analysis needed to assess and address the anti-competitive harms arising from complex concentrations.
There is a broad and longstanding agreement that structural remedies are generally the most effective type of merger remedy. Increased reliance on behavioural remedies, which the CMA is considering, could weaken merger control and thus harm businesses, consumers and the UK economy. The CMA should keep on pursuing its existing policy as there is insufficient evidence to justify an increased acceptance of behavioural measures.
Claims of efficiencies or other benefits made by merging businesses are often overstated and rarely materialise. They should not become the focus of merger control. The CMA should also assess the long-term effects of transactions and consider their impacts on a wide range of parameters. When assessing Relevant Customer Benefits, the CMA should not view the consumer interest in isolation; it should consider workers, suppliers, citizens, supply chain resiliency, diversity and other broader societal interests such as pluralism and democracy.
The CMA intends to increase its dialogue with businesses during the review of merger remedies. It should extend this dialogue to a wider range of stakeholders including civil society organisations and labour unions. It should also put in place safeguards to ensure that this dialogue does not jeopardize its independence.