Government tells CMA to focus on growth after Microsoft criticism

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The CMA came under fire for its initial move to block the Micrsoft Activision merger before waving it through in October
The CMA came under fire for its initial move to block the Micrsoft Activision merger before waving it through in October.

The government has told the Competition and Markets Authority to boost its focus on UK growth as it laid out a list of new priorities for the watchdog following criticism of its handling of some mergers this year.

In a statement yesterday, ministers issued a ‘strategic steer’ to the CMA and told the body to focus on “supporting investment, innovation and growth” in a bid to “encourage greater competition and grow the economy”.

Among the other new priorities laid out by the government yesterday was “prioritising action that addresses cost of living challenges” and “responding to the challenges and opportunities created by the growth of the digital economy”.

“The need for a robust competition regulator is crucial at a time when competition, innovation and the cost of living are high on people’s list of concerns,” said minister for enterprise, markets and small business, Kevin Hollinrake.

“That’s why we have set out our top priorities to the CMA to ensure more investment, innovation and growth for the economy, and brought forward legislation to foster more competition in digital markets and enhance the CMA’s consumer powers.”

The missive from the government comes as the CMA prepares for fresh powers under the Digital Markets Act and will serve as a “steer” in its goal of delivering economic benefits to the UK economy “of at least 10 times its relevant costs”.

However, it follows a string of bruising attacks for the CMA over the past few months for its handling of the $69bn blockbuster merger between Microsoft and Activision Blizzard.

Though the takeover was approved in October, the CMA initially blocked the deal on the grounds it would hamper competition in the nascent cloud gaming market.

President of Microsoft Brad Smith said the watchdog’s initial decision was “bad for Britain” and marked the firm’s “darkest day in our four decades” in the UK.

A spokesman for the CMA told The Times: “We welcome the government’s strategic steer and, as set out in our annual plan, will continue to promote competitive markets and tackle unfair behaviour, prioritising people, businesses and the UK economy in everything the CMA does.”