Microsoft’s Activision Takeover Probed in The UK

Microsoft’s Activision Takeover Probed in The UK

In a statement Wednesday, the Competition and Markets Authority (CMA) said it seeks to determine whether the acquisition would “result in a substantial lessening of competition” within any UK markets. Such a result could constitute a violation of the Enterprise Act 2002, which authorized the government to intervene with mergers that could potentially threaten national security, media plurality, financial stability, or public health.

Microsoft appears unbothered by the probe. “We will fully cooperate with the CMA’s merger review. We expect and think it’s appropriate for regulators to take a close look at this acquisition,” corporate VP and general counsel Lisa Tanzi told CNBC reporter Ryan Browne. Tanzi added that Microsoft was committed to answering regulators’ questions.

“We remain confident the deal will close in fiscal year 2023 as initially anticipated,” Tanzi said.

Microsoft’s Activision Takeover Probed in The UK

The CMA’s review follows the US Federal Trade Commission’s, which launched in early February. The FTC’s review coincides with the organization’s attempts to strengthen its antitrust reviews as several industries become “more concentrated and less competitive.” It’ll also require the FTC to consider the impact by and on Microsoft’s physical and digital assets: namely, its video game titles and hardware. From the consumer’s perspective, a merger could mean removing Blizzard games from PlayStation—Microsoft’s biggest console competitor—and turning them into Xbox and PC exclusives, which would muddle many gamers’ libraries.

But due to the CMA’s incredibly brief statement, it’s unclear as to whether the UK will be focusing on hardware at all. Australia’s antitrust authority, the Australian Competition and Consumer Commission (ACCC), is also reviewing the potential acquisition, though its focus appears to be on Microsoft’s and Activision’s software. The ACCC’s probe is considered an informal review and may not carry as significant an impact on the bid as the reviews occurring in the US and UK.

The CMA has invited third parties—which would in this case likely include other players in the gaming industry, such as developers and sales platforms—to comment on the bid through most of July, during which the organization will conduct an ongoing consultation. Regulators hope to have made an initial decision regarding the proposed merger by September 1.

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