The UK’s competition regulator is set to undergo its most significant overhaul in over a decade, with plans to radically reshape how it scrutinises corporate mergers, takeovers, and entire industry sectors, Sky News has learned.
The planned reforms, which are expected to be unveiled this week, aim to give the Competition and Markets Authority (CMA) greater powers and flexibility in investigating deals and market dominance. This comes amid growing concerns over the pace of consolidation across the British economy and its potential impact on consumer choice and prices.
Under the proposed changes, the CMA will be granted enhanced information-gathering abilities, allowing it to compel companies to hand over sensitive data and documents more easily. The regulator will also be given the power to impose interim measures, such as ordering the unwinding of a merger, while an investigation is ongoing.
Additionally, the CMA’s jurisdiction is set to be expanded, enabling it to review a wider range of transactions, including those that fall below current thresholds for mandatory notification. This could see the watchdog taking a closer look at smaller deals that may still have significant implications for competition.
“The government recognises that the current merger control regime needs to be updated to keep pace with the evolving nature of competition,” a Whitehall source told Sky News. “These reforms will give the CMA the tools it needs to be a more proactive and effective competition enforcer.”
The overhaul also aims to address concerns that the CMA has been too slow and reactive in its approach to mergers and market investigations. By streamlining processes and providing the regulator with greater resources, the government hopes to enable quicker and more decisive interventions where necessary.
However, the proposed changes have already faced some opposition from the business community, with concerns raised over the potential for increased regulatory burden and uncertainty. Industry groups have warned that overly aggressive merger scrutiny could stifle investment and innovation, particularly in fast-moving, technology-driven sectors.
“There needs to be a careful balance struck between protecting competition and allowing businesses the flexibility to grow and adapt,” said a spokesperson for the Confederation of British Industry. “We will be closely engaging with the government to ensure these reforms don’t inadvertently create unintended consequences.”
The CMA itself has welcomed the planned reforms, with Chair Jonathan Scott stating that the changes will “equip the authority with the tools it needs to be a more agile and effective competition enforcer.” The regulator has faced criticism in recent years for its perceived leniency on some high-profile mergers, such as the proposed Sainsbury’s-Asda deal, which was ultimately blocked.
The government’s proposals are expected to be outlined in a white paper in the coming days, with a public consultation to follow. Any resulting legislation would then need to navigate the parliamentary process before being implemented.