With the CMA in the headlines following a change in leadership and mounting government pressure, we take a look at what recent pronouncements are likely to mean for the future of UK competition policy.

Our previous article on the CMA's role in driving economic growth – published just a few short months ago in early December – concluded that a dramatic shift in competition policy seemed unlikely, despite the pro-growth zeitgeist.

The “ripping up of bureaucracy” promised by the Prime Minister, in a speech to the business community, was not evident in the Government’s Industrial Strategy Green Paper (Green Paper), at least as far as competition enforcement was concerned. Moreover, the CMA’s response to the Green Paper indicated that it saw its approach to enforcement as fully aligned with the Government’s growth objectives (albeit with a concession offered in the form of a commitment to consider taking a more flexible approach to merger remedies).

Since then, however, the landscape has shifted. The removal of former CMA Chair Marcus Bokkerink in January, and the appointment of interim Chair Doug Gurr – a former senior Amazon executive – signalled that "more of the same" was insufficient for the Department for Business and Trade (DBT).

This raised questions about what further changes to expect from the CMA, and how far it would go to meet the Government's demand for pro-growth initiatives. 

Gurr’s initial public statements did relatively little to answer those questions. He highlighted planned increases in the CMA's efficiency, industry expertise, and stakeholder engagement. Central to these promised improvements were the "4Ps" (pace, predictability, proportionality, and process) framework announced by CEO Sarah Cardell in November, though details were sparse.

Nevertheless, the fact of Gurr's appointment suggested that we should expect more concrete proposals, addressing business community concerns about CMA processes and outcomes. And on 13 February, the new path forward for the CMA became clearer. 

The draft Strategic Steer

The Green Paper stated that the Government would soon consult on a new Strategic Steer (the Steer) setting out its priorities for the CMA and its expectations as to how the CMA should approach its work. This will replace the last such Steer issued by the then-Conservative government in late 2023. Given the context to that announcement, it was reasonable to expect that the new Steer would feature a strong pro-growth element. 

The draft Steer issued by DBT for consultation¹ on 13 February confirmed those expectations, outlining "how the government expects the CMA to support and contribute to the overriding national priority of [the] government – economic growth". 

It emphasises that the CMA operating in a way that supports growth and investment is as important to the Government as fulfilling its statutory duties. The Government also expects CMA action to be "swift, predictable, independent and proportionate".

Key among the specific directions in the Steer are that the CMA should:

• prioritise pro-growth and pro-investment interventions, and support growth and competitiveness within the eight “high growth” sectors identified in the Green Paper, when deciding which investigations or studies to commence, and when assessing remedies;
• take account of action being taken by overseas competition authorities, to ensure the CMA’s interventions are timely, coherent, and avoid duplication;
• use its new digital markets powers flexibly and proportionately, to unlock opportunities for growth – particularly in the AI sector;
• prioritise intervention in areas where competition can enhance and make more efficient the provision of public services;
• proactively, transparently and responsively engage with businesses – including during investigations – and work collaboratively to resolve issues; 
• review its procedural guidance, to make it as useful and accessible to business as possible; and 
• evidence the impact its action has on the UK economy, including how it drives innovation, investment and growth across the UK.

The Government will expect the CMA to explain how it is implementing the Steer in its annual report. The Framework Agreement between the CMA and Government will be updated to this effect, as well as to require regular feedback from CMA stakeholders including consumers and business.

CMA merger control reforms

Shortly ahead (and in anticipation) of the release of the draft Steer, the CMA published a blog post from Sarah Cardell elaborating on the “4Ps” framework. The post announced a “package of carefully considered proposals for rapid change”, addressing each of the framework’s four elements:

The CMA hopes this package will deliver a UK merger control regime that compares favourably to its international peers, enhancing business and investor confidence. 

Whilst the 4Ps framework is to be rolled out across all areas of CMA activity, the mergers regime has been prioritised on the basis that it is here the CMA’s approach to enforcement has received the most criticism from the business community.

What does this all mean for competition enforcement? 

Inherent limitations

These pronouncements suggest that both the CMA and the Government take complaints about the proportionality and predictability of CMA enforcement seriously. However, one can question how much of what has been announced is genuinely new, and what can be achieved under the current legislative framework.

In particular, whilst the draft Steer looks to embed the Government’s pro-growth agenda in CMA policy, the 2023 Steer already directed the CMA to prioritise growth-boosting outcomes, and the CMA’s 2023-24 Annual Plan listed promoting economic growth as a key objective. 

On the other hand, the Steer's emphasis on ensuring the CMA’s approach to performing its statutory duties supports growth and investment is new. And the CMA’s commitment to accelerating Phase 1 mergers is welcome and tangible. However, these cannot override the statutory tests the CMA must apply, or the evidential burden it must satisfy. Further, the fact remains that, with the growth of the informal briefing paper process, fewer straightforward mergers are being notified, and this has likely been contributing to an increase in the average pre-notification period. 

Similarly, in looking to align CMA enforcement action with that of overseas authorities, it seems the Government and CMA are seeking directly to address the criticism the CMA received from some quarters for diverging in its treatment of high-profile international mergers (Microsoft’s acquisition of Activision a case in point here)². To do this, however, the CMA must be able to satisfy itself that there are no UK-specific issues that need addressing through UK-specific interventions. And there will be sequencing issues to address, with other authorities likely running to different timetables (assuming the CMA already has a merger case open). The recently-introduced ability for merger parties and the CMA to agree to pause the Phase 2 review timetable will help, but it remains to be seen how many mergers will suit this “wait and see” approach. 

That said, it was notable that Sarah Cardell’s blog post invited the Government to “lock in” some of its intended changes through legislative action, as well as to make “further legislative changes to embed [the CMA’s] 4Ps approach”. Therefore, despite the UK competition regime only recently having been overhauled by the Digital Markets, Competition and Consumers Act 2024, further legislative changes over the coming Parliament should not be ruled out.

What’s left unsaid

What the Government has discarded from the previous Steer is, arguably, as instructive as what it has added.

There is no more mention of addressing cost-of-living issues (a key driver of recent CMA interventions, particularly in the form of market studies/investigations), of acting as a “thought leader” to shape the international debate on competition policy, or of being a “strong and independent voice” promoting competition amongst business and consumers. Sustainability – a key issue for competition policy in recent years – is also not mentioned, though the CMA is asked to "support the positive benefits of innovation, recognising the key role it plays in driving net zero".

Overall, the Government appears keen for the CMA to be less interventionist and take a slightly lower profile than it did in its first years as a fully independent authority post-Brexit. The emphasis is on a more targeted enforcement approach, informed by the likely impact on innovation, investment and growth, while engaging collaboratively with business stakeholders. 

The Steer, however, is non-binding, and the CMA is (for now) independent from ministerial control. Whether the CMA is prepared to play a lesser role on the world stage remains to be seen.

¹ The consultation closes on 6 March 2025.
² The other significant area of potential impact in this regard is the UK’s new digital markets competition regime – where the CMA might opt to align the Conduct Requirements it will in due course impose with the conduct obligations that apply under the EU’s Digital Markets Act.