The Competition and Markets Authority (CMA) is 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 works with a variety of organizations in both the UK and abroad which include but are not limited to
- National Trading Standards
- Citizens Advice
- the International Competition Network (ICN)
- the European Competition Network (ECN)
The UK Competition Network (UKCN) forum acts as an intermediary between the CMA and all the UK sector regulators with competition law powers. The main goal of the UKCN forum is to encourage stronger competition across the economy for the benefit of consumers and to prevent anti-competitive behaviour in regulated industries.
Competition and Markets Authority in Action
Most importantly, the CMA is responsible for investigating phase 1 and phase 2 mergers. Recently, market watchers had been watching the CMA’s progress on investigating the now abandoned takeover of Pacific Biosciences (PACB) by Illummina (ILMN) and the takeover of Spark Therapeutics (ONCE) by Roche.
The Competition and Markets Authority differs from the Takeover Panel in that the focus is on the maintaining competition within the market.
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.
