Strategic steer and CMA policy proposals: UK government consults on its steer to the CMA

The Competition and Markets Authority (CMA) has been in focus and under extreme pressure to be seen to be making tangible changes to accommodate such ambitions. The forced resignation of the CMA’s Chair, Marcus Bokkerink, three weeks ago, ratcheted up the pressure even further. A new statutory “strategic steer” has been highly anticipated as an indication of how far the government will go in seeking to influence the CMA and the degree to which investors in the UK can expect a more lenient competition regulatory environment going forward.

The draft “steer” was released on February 13, 2025 with, unusually, an accompanying speech by Jonathan Reynolds, the Secretary of State for Business and Trade, and media pre-briefing, reflecting the degree to which the UK government is using its interventions in the competition regulatory regime to signal its openness to business and the seriousness of its growth agenda. The draft steer itself is light on specific proposals, broadly telling the CMA to:

• Use its powers in ways that enhance growth, international competitiveness and/or investment.
• Focus on markets that particularly impact UK-based consumers and businesses, and coordinate closely with other UK and international regulators.
• Act in ways that minimise uncertainty for affected businesses – for example, being proactive, transparent, timely, predictable, responsive and collaborative.
• Act proportionately.

These are all welcome, but are well-trailed ambitions following the resignation of the previous CMA Chair. The objectives correspond to areas in which the CMA has, in recent years, faced criticism from various stakeholders across its merger control, investigations and markets functions. While the steer is at pains to say that the CMA should still take action where warranted – tackling harmful anti-competitive conduct and “deterring poor corporate practices”, particularly in areas where risk to consumer harm is greatest – there is a clear message that certain CMA practices must change.

CMA proposals for mergers

Reflecting this and, more concretely, in a coordinated blog post, Sarah Cardell, chief executive of the CMA, suggested various areas for merger control improvements. Reynolds referred to these proposals in his speech, noting that “[He] fully endorse[s] these measures.”

Cardell repeats the “4Ps” framework she introduced last year – pace, predictability, proportionality and process – with specific proposals for mergers.

1. Shortened timeframes. The CMA will aim to complete pre-notification of a merger within 40 working days. And, for a straightforward phase 1 case, it will aim to release its decision within 25 working days (compared to current target of 35). If these are effective, it should shave around six weeks off the review time for a typical phase 1 merger review.
2. Better delineation of CMA jurisdiction. The CMA has previously made a virtue of the “flexibility” of its jurisdictional reach, letting it look at potentially problematic mergers in a wide range of settings. It has faced intense criticism for what some parties consider to have been jurisdictional overreach in certain cases, aggravated by the CMA not taking a firm view on jurisdiction until it completes a full phase 1 review, drawing parties into a lengthy merger investigation even where it ultimately decides it lacks jurisdiction. The CMA has now proposed to “clarify and delineate [its] remit (as far as legally possible)” with updated guidance, on which it will consult in June. This will hopefully make it easier for merging parties to form a confident view at the outset of transactions that do not obviously fall within the CMA’s jurisdiction. Combined with the CMA’s recent statutory “safe-harbour” for mergers that have only a small nexus to the UK, this should bring additional, welcome certainty to businesses.
3. “Mergers Charter”. To be published next month, this will make commitments for how the CMA will deal with businesses in a merger review, including “more senior meetings early in the review process.” This will be welcome to parties in a phase 1 review process, where the early interactions with the CMA tend to be at the level of the case team, and it can be difficult to meet with decision-makers until relatively late in the process.
4. Considering a back-seat role on some global deals? Chastened by the criticism it received in a string of cases, culminating in Microsoft/Activision, where it assertively took jurisdiction over global mergers and considered global theories of harm alongside the U.S. and EU regulators, the CMA says it is “carefully exploring how far (under existing law) [it] might be able to distinguish between” deals that have a specific UK impact, and cases where the global impact is broadly similar and “action by other authorities could resolve UK concerns.”
5. Remedies review. The CMA has previously said it will review its current, relatively inflexible, approach to merger remedies. It has now confirmed the review will launch next month. Please see our in-depth discussion of this important topic.

Proposals for other CMA powers

Notably, many of these proposals focus on phase 1 merger reviews, rather than other CMA powers. This perhaps reflects that the CMA has only just started to apply new procedures for phase 2 mergers, and that in many other areas – antitrust enforcement, consumer law, market studies/investigations, and digital markets – the legal regimes have just changed or are about to change as the Digital Markets, Competition and Consumers Act 2024 takes effect. It is reasonable to expect, however, that the CMA will take into account its “4Ps” principles across all of these areas and as those regimes bed in.

A notable commitment in the draft steer, however, is by the government to the CMA, in situations where the CMA makes law reform proposals after a market investigation. The government commits to “a presumption that the government will accept the [CMA’s] recommendations unless there are compelling policy reasons not to do so.”

A shot across the bow for other regulators

While the government appears to be comfortable, for now, with the steps the CMA is taking, it seems other regulators will move into focus. The government has already said that it will “call in” 17 regulators in the “coming weeks” to “scrutinise” their growth proposals. The Secretary of State for Business and Trade today added: “[w]e have to ask the question: have we got the right number of regulators?” There are no specific proposals to merge or dissolve regulators, but the trailing of this will surely add to pressure on regulators to deliver pro-growth reform initiatives. As he said: “watch this space.”