CMA is an acronym for Competition and Markets Authority, a non-ministerial government department in the United Kingdom, responsible for strengthening business competition and preventing and reducing anti-competitive activities. This is similar to the Federal Trade Commission and the Antitrust Division of the U.S. Department of Justice. The CMA aims to prevent large companies from exploiting consumers with tactics such as inflated pricing. The CMA was brought about through the Enterprise and Regulatory Reform Act of 2013 and was launched in shadow form on 1 October 2013. It began operating fully on 1 April 2014, when it assumed many of the functions of the previously existing Competition Commission and Office of Fair Trading, which were abolished. The agency can be found, amongst others on our comprehensive list of global competition regulators.
The CMA makes regular announcements of their investigations as well as progress updates throughout each business day. In order to keep traders informed of these events, Merger Arbitrage Limited has produced a specialized CMA news feed listing these announcements. Some of the more significant events are reported via our Twitter feed.
CMA and Brexit
On January 29, 2020 the CMA published its “Guidance on the functions of the CMA under the Withdrawal Agreement“. Section 3, Merger control explains how the CMA will function since the UK left the EU on January 31, 2020.
During the Transition Period, pursuant to the Withdrawal Agreement and the withdrawal Agreement Act, the UK will broadly continue to be treated as if it were a Member State under the EU Merger Regulation (EUMR), such that the ‘one-stop shop’ principle under the EUMR continues to apply. The division of jurisdiction between the European Commission and the CMA over mergers which are notifiable under the EUMR or the EA02 will therefore remain the same during the Transition Period.
The UK Withdrawal Agreement with the EU specifies that the transition period will last until 31 December 2020. As there continues to be a number of uncertainties associated with Brexit, the publication is described as a “live” document and therefore subject to change.
The CMA has stated its commitment to increasing its advocacy and advisory work with government and public bodies on “designing and implementing policy in a way that harnesses competition and protects the interests of consumers”. It also states its intention to increase its understanding of climate change issues and contribute towards a move to a low-carbon economy.
