The new strategic steer reflects the new Labour government’s key policy aim of economic growth, and the CMA is directed to do the following:
- Use its tools proportionately, and consider pro-growth and pro-investment intervention;
- Focus on transactions that particularly impact UK-based consumer and businesses;
- Support growth and international competitiveness in the industrial strategy’s eight key sectors;
- Consider the actions taken on the same issues by other regulators and seek to ensure that parallel regulatory action is timely, coherent and avoids duplication;
- Minimise uncertainty by engaging with those affected by the CMA’s work by providing transparent, timely, predictable, and responsive engagement with businesses; and
- Engage with the government on key policy issues and identify where it can support the agenda of the government.
Just before the publication of the strategic steer, the CMA’s head Sarah Cardell released a blog post setting out several proposals, with the aim of aligning the CMA’s enforcement with the expectations of the new government.
The proposals seek to reshape the CMA’s work in line with four core values: pace, predictability, proportionality, and process, with the objective of driving growth and investment in the UK.
The key proposals with respect to the merger clearance process are:
- First, the CMA intends to establish a new key performance indicator (KPI) to complete the pre-notification phase within 40 working days, a reduction from the current average of 65 working days. This reduction in time is welcome, if it speeds up the overall time of obtaining an approval decision.
- Second, the CMA plans to clear straightforward Phase I mergers in 25 working days as opposed to the current 35 working days, bringing the duration of Phase I in line with other competition authorities, such as the European Commission. We expect that this change is likely to apply to a limited number of cases, as the CMA can already “weed” out straightforward transactions at an early stage in the process (during pre-notification).
- Third, the CMA will likely focus more on mergers that have a “distinct and direct” impact on UK consumers, while deprioritising international mergers in which any negative effects on the UK market could be pre-empted by the action of competition authorities of other jurisdictions.
As part of this process, the CMA has also launched a consultation on its approach to remedies. In addition, the UK government has also launched a consultation on potential legislative changes to the “material influence” and “share of supply” tests (see below).
The CMA Merger Remedies Review and Merger Chart
The first action that the CMA undertook in line with its ongoing shift was to launch, on March 12, 2025, a review to assess how it approaches remedies in merger control cases.
In the call for evidence, the CMA requests feedback on three key areas from various stakeholders to develop guidance proposals on how the CMA shall treat remedies in the future.
- First, the CMA will look at how it approaches rem¬edies. We expect the CMA to become more open to accept behavioral remedies to resolve the al¬leged competition concerns arising from transac¬tions under review.
- Second, the CMA will assess how remedies can be used to preserve any pro-competitive effects of a merger, and other customers benefits and ef¬ficiencies. The CMA will guarantee that the rem¬edies ensure those benefits (1) are protected, (2) outweigh the competitive harm identified, and (3) are ultimately passed on to consumers. “Relevant customer benefits” may also include benefits that occur outside the market in which the potential competition concerns arise.
- Third, the CMA intends to make the process of as¬sessing remedies as efficient as possible, by en-abling timely discussions on the competition issues that the remedy will need to address.
The CMA also published the Mergers Charter, which sets out principles and expectations for how the CMA will engage with businesses and their advisors during merger investigations. The Mergers Charter makes it clear that the CMA is committed to engaging directly with businesses on its processes and the outcomes these generate.
The CMA’s merger review will be aligned with its four core principles: pace, predictability, proportionality, and process. The charter is a statement of intent, and the CMA will publish additional guidance in due course.
The UK Government’s New Approach to Regulators
On 31 March 2025, the UK government published its “New Approach to Ensure Regulators and Regulation Support Growth” policy paper, outlining next steps for reforms across the UK regulatory landscape. The policy paper aims to create a more business-friendly regulatory system and includes a consultation on potential legislative changes to the jurisdictional tests the CMA uses when evaluating its jurisdiction over mergers.
While the government has not yet announced the changes it plans to make, we would expect that these will include:
- Clearer notification thresholds: Currently, when applying the “share of supply” test, the CMA calculates the relevant “supply” based on a variety of factors (e.g., sales, employees, patents). It would be advisable that the concept of “share of supply” becomes closer to a “market share” test, based on sales in the UK. In addition, the share of supply test currently uses “a substantial part” of the UK as opposed to a geographic market definition, and it may be advisable to limit the CMA’s discretion in interpreting a “substantial part” of the UK when applying the share of supply test.
- A clearer definition of “relevant merger”: The concept of exercising “material influence” could also benefit from clarification. For example, the law could set a 25% shareholding threshold, under which the transaction would not qualify as a relevant merger. Alternatively, “material influence” could be defined as the acquisition of certain powers within an organization (e.g., veto powers on strategic decisions, appointment of a certain proportion of board members).
These reforms would align the CMA merger control regime with many of its national and supranational peers, whose merger control rules provide for (1) well-defined turnover thresholds for notification and (2) a heightened definition of “relevant merger,” which only covers changes in control of a company.
This consultation and the UK government’s aim to increase certainty in the UK merger control system may result in more certainty to businesses interested in growing or investing in the UK.
