The heads of the UK’s competition regulator have insisted they are not creating a ‘hostile’ environment for tech companies after the agency was criticized for blocking the $75 billion takeover of Activision Blizzard from Microsoft.
Answering questions from members of the British Parliament on Tuesday, Marcus Bokkerink, chairman of the Competition and Markets Authority, and his chief executive Sarah Cardell defended their stance on the video game industry’s biggest deal, despite the European Commission accepted Microsoft’s commitments e approving the draw on Monday.
“I think it is absolutely essential to maintain a constructive dialogue [with the tech industry] and it’s something I try to do and am doing on a regular basis,” Cardell said, “so I don’t find that we’re operating, broadly speaking, in a hostile environment.”
Cardell added that he told tech companies in preparatory meetings before the creation of a new unit for digital markets, managed by the CM: “This is an area where we want to work together.”
After Microsoft and Activision executives prompted the CMA’s decision threatened to damage the UK’s profile among overseas firms, Conservative MP Bim Afolami challenged the regulator’s top executives on how his decisions take into account Britain’s “international reputation”.
“I will challenge the premise that there is an impact on international trust in doing business in the UK, that the best way to ensure trust is to turn a blind eye to anti-competitive mergers,” Bokkerink said. “We are vigilant. . . on investments that consolidate and strengthen market power”.
In response to the conflicting decisions from the CMA and the EU, Activision boss Bobby Kotick said “the UK is clearly out of business” while saying his company would “significantly expand our investment and workforce across the EU”.
Cardell told lawmakers CMA and Brussels officials agree on the Activision deal’s potential harms in the cloud gaming market, but differ in accepting Microsoft’s proposed remedies.
While the EU said Microsoft had agreed to allow buyers of Activision’s games to stream them to rival cloud gaming platforms for up to 10 years, Cardell said after “very carefully” considering “different iterations” of that proposal, CMA officials “ultimately concluded such a remedy would not be effective in resolving competition concerns.”
He also denied allegations made by Kotick that the CMA was acting as a “tool” of US antitrust forces, which also opposed the deal.
“We are absolutely not bidding on other agencies. We embark on our own analysis,” she said.
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