Fewer investigations = More growth or just paving the way for monopolies?

Rachel Reeves is rolling up her sleeves to overhaul how the Competition and Markets Authority (CMA) investigates certain business mergers.

She’s promising to tighten the rules so that fewer deals get caught up in drawn-out probes—something she insists will make the UK more attractive to investors and promote economic growth.

So why is the government so concerned about the CMA’s role, and how exactly will these changes affect British consumers, businesses, and the economy at large? 

What is the CMA?

First, a quick refresher :

The CMA is the UK’s principal competition regulator. It’s in charge of promoting and enforcing fair competition so that no single company (or handful of companies) can gain an unfair stranglehold on a market. It investigates everything from potential monopolies to shady cartel behaviour, all with the idea of protecting consumers from being overcharged, and businesses from being crowded out.

When Did It Come About?

Although Britain has enforced competition rules for many years, the CMA in its current form is relatively new. It officially launched on April 1, 2014, after merging two older agencies—the Office of Fair Trading (OFT) and the Competition Commission—under the Enterprise and Regulatory Reform Act 2013.

The idea was to create a single, more efficient body to handle everything from routine inquiries to major antitrust cases. Ever since, the CMA has had sweeping powers to investigate entire industries and, if needed, block mergers or impose remedies on companies that threaten competition.

What Exactly Does the CMA Do?

1. If a proposed deal looks like it could reduce competition (for instance, if the merging parties would end up controlling a huge slice of a market), the CMA can stop it or add conditions—sometimes forcing the company to sell off certain parts of its business.

2. Cartels, price-fixing, and other collusive behaviours are firmly in the CMA’s crosshairs. When the authority finds such activities, it can levy hefty fines and even refer cases for criminal prosecution.

3. Beyond just policing mergers, the CMA also examines unfair practices toward customers—anything from hidden fees to exploitative contracts.

Before deciding whether to investigate a merger, the CMA generally looks at two key legal tests:

a) Share of Supply: If the combined entities will control at least 25% of a specific market, that deal could wind up on the CMA’s radar.

b) Material Influence: Even if a business doesn’t buy a controlling stake, purchasing a substantial share—enough to influence decisions—can also spark a review.

If the CMA finds a merger (or business practice) is harming competition, it can intervene—by blocking the deal, insisting on structural changes, or imposing fines. Its decisions can be appealed through the Competition Appeal Tribunal, but the CMA’s rulings usually carry significant weight.

So Why Shake Things Up Now?

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