Overview
The UK Competition and Markets Authority (CMA) published transparency data on 10 April 2025 relating to its 'Merger Investigation Outcomes' for 2024. A short accompanying summary suggests that the intervention rate for 2024 was below 1%.
Yet, on closer inspection, taking into account how cases were dealt with at Phase 1, the data shows that 2024 appears to have been one of the most interventionist on record. This is consistent with the recent experience of business and competition lawyers alike and forms important context for the urgent calls for root and branch reform of the CMA’s approach to merger control.
The CMA's summary
The CMA's short summary published on April 10, states that for 2024, it considered 1,037 mergers (i.e., including via voluntary notification by the parties and on its own initiative through its 'Mergers Intelligence' function) but only formally investigated 38 of them (i.e., less than 4%).
Of the six mergers referred for an in-depth investigation, two resulted in conditional clearances with remedies, one was blocked, one was abandoned, and two were cleared. Of all considered mergers, only 0.2% were blocked or abandoned.
This appears to compare favorably with 2023 (when the CMA considered 848 mergers, reviewed 56 at Phase 1, and referred 10 to phase 2, of which four were unconditionally cleared, two were cleared subject to remedies, two were canceled or abandoned by the parties and two were cleared subject to remedies) and 2022 (when 48 mergers were reviewed at Phase 1 and 15 were subject to an in-depth investigation, of which six resulted in conditional clearances, three were blocked, three were canceled or abandoned and three were unconditionally cleared).
Our take – the CMA's summary significantly understates the number of interventions in 2024
While the 2024 data suggests that the CMA is becoming less interventionist, at least in relation to final outcomes of merger inquiries at Phase 2, a closer look at the more detailed transparency data the CMA is required to publish alongside its summary tells a different story.
First, if one measures 'interventions' not just in terms of Phase 2 outcomes but also cases finally disposed of at Phase 1 (whether in the form of 'undertakings-in-lieu of a reference' or 'UILs' that parties can offer the CMA to avoid a Phase 2 reference, or abandonment), then 2024 was one of the most interventionist on record.
In 2024, the data shows that the CMA accepted UILs in a large number of cases (if the figures published by the CMA are accurate, 26 in total, though this does not appear to align with the CMA's accompanying summary or individual case information on its website). That would mean an intervention rate at Phase 1 of just under 50% of the total cases the CMA reviewed that year. By way of historical comparison, in the 10 years prior to 2024 (i.e., 2013-2023), the CMA accepted UILs in just 12% of the cases it reviewed in Phase 1. In addition, the data also shows that two cases were abandoned in Phase 1 in 2024.
When the number of cases recorded by the CMA in its transparency data as subject to UILs or abandoned in Phase 1 are included with in Phase 2 cases of abandonment, prohibition and those where structural remedies were required, the intervention rate appears to have been over 50%. This compares to an average intervention rate (taking into account Phase 1 and Phase 2 outcomes) of less than 20% over the preceding ten years.
Interventions at Phase 1 are as important, if not more so, than those at Phase 2
It is unclear why the CMA chose not to mention Phase 1 interventions in the summary accompanying its transparency data for 2024, which focused only on Phase 2 outcomes.
While Phase 1 remedies (UILs) are often touted as a win-win for agency and business alike, avoiding the cost and uncertainty of Phase 2, allowing the agency to win a remedy and the business an early clearance, the reality is much more mixed.
In fact, the UIL process at Phase 1 is heavily weighted in favor of over-intervention (i.e., offering a remedy greater than the actual SLC is likely to be) since:
- to refer a case to Phase 2, the CMA must meet a lower evidential and legal standard than in Phase 2 (simply finding a ‘reasonable prospect’ of a substantial lessening of competition ("SLC") in Phase 1, compared to the requirement to find an SLC on the 'balance of probabilities' in Phase 2);
- the low legal threshold in Phase 1 means that the Phase 1 SLC Decision is likely to contain more widely scoped SLCs, in more markets, than the Phase 2 Inquiry is likely to find (indeed, on average, 30% to 40% of cases referred to Phase 2 are ultimately cleared unconditionally, with no SLC identified);
- conversely, for the parties to secure clearance in Phase 1 where SLCs are identified, they must propose remedies that are ‘clear-cut’ and easily implementable, a higher standard than Phase 2 that is weighted towards structural divestitures; and
- crucially, the period to offer UILs is incredibly short (even if engagement occurs well in advance between the agency and parties), with just five working days to offer them once the Phase 1 Decision is announced.
These factors together pressure companies to offer remedies, which are likely to go beyond the actual SLC (if one is ultimately present at all). Therefore, excluding cases where the CMA accepts a UIL at Phase 1 from the definition of 'interventions' makes no sense at all and paints a partial picture of the intervention rate.
Cases found not to qualify should also be included when calculating the intervention rate
The data also shows that five cases in 2024 were found not to qualify ("FNTQ" cases). Unhelpfully, the data so far into 2025 already identifies four FNTQ cases. These are cases where the CMA ultimately found it had no jurisdiction to investigate them and should arguably not have been investigated in the first place. As we have previously highlighted, these cases have been overwhelmingly in the AI space and have served little purpose – even those that were not FNTQ cases were cleared unconditionally at Phase 1.
A (dim) silver lining – use of IEOs has finally begun to fall
One cautious note of optimism from a detailed review of the transparency data is the sharp fall in the number of Initial Enforcement Orders required during the course of 2024 (just 8, compared to 36 in 2023). This is overdue and is to be welcomed.
Conclusion
Reading the CMA's summary, one would be forgiven for thinking that interventions had hit a historic low in 2024. This was patently not the case. A closer inspection of the data shows that the level of intervention in 2024 appears to have been higher than any previous year, appearing to hit a high of over 50% of all cases investigated (compared to a 10-year average of less than 20%). Even if the number of cases recorded as UILs in 2023-24 is lower than the CMA recorded in its transparency data (as appears to be the case from a comparison with actual case data available on its website), any examination of the intervention rate which includes case disposal at Phase 1 paints a very different picture to that put forward by the CMA.
Companies have increasingly felt pressured into offering remedies in Phase 1 rather than going through a protracted Phase 2 process, even where they firmly believe that the CMA's case is weak. That is not good administration, nor a good outcome for business or consumers. Giving remedies where none are ultimately required does nothing to promote competition, improve resource allocation or promote economic growth.
This reality forms important context for the Labour Government’s decision in the early part of 2025 to replace the Chair of the CMA and to institute widespread reform of the CMA's approach to merger control. Such an intervention rate is inappropriate and reflects an excessive burden on business. Taking also the number of Phase 1 investigations that went to CRM and the number of found-not-to-qualify (FNTQ) decisions, representing almost 10% of all cases in that year and so far in 2025 (compared to a historical average of 1-2%) confirms the picture that the CMA has become heavy-handed in its approach to merger control.
The full report is available here: https://www.gov.uk/government/publications/phase-1-merger-enquiry-outcomes. The CMA is also currently consulting on proposed changes to its approach to remedies (this consultation is open until May 12, 2025 and can be viewed here).
Please do not hesitate to reach out to Steptoe to discuss a prospective merger and how best to mitigate risk from a UK merger control perspective.
