UK
Answer ... Merger control in the United Kingdom is governed by Part 3 of the Enterprise Act 2002, as amended by the Enterprise and Regulatory Reform Act 2013.
The United Kingdom is also currently subject to the EU merger control regime, as set out in the EU Merger Regulation (139/2004). The EU Merger Regulation will cease to apply on Brexit occurring.
UK
Answer ... Certain mergers of water or sewage undertakings are subject to a mandatory reference to a Phase 2 investigation. Generally, a merger of two or more ‘water enterprises’ (meaning an enterprise carried on by an undertaking appointed under Section 6 of the Water Industry Act 1991) will be subject to a mandatory reference unless the turnover of one or both of them falls below a threshold of £10 million.
In addition, across a number of industries, the Competition and Markets Authority (CMA) will seek the views of the relevant regulator:
- Energy: OFGEM will report its views on gas or electricity mergers and may recommend licence amendments.
- Rail: The Office of Rail Regulation will provide its views to the CMA on any rail merger (including the grant of a franchise where the relevant thresholds are met).
- Airports and aviation: The CAA will report its views on a merger to the CMA.
- Financial services: The provisions of the Financial Services and Markets Act 2000 may require a merger to be approved by the Financial Conduct Authority or the Prudential Regulation Authority
- Healthcare: Certain mergers involving the National Health Service (NHS) will require NHS Improvement to give its views to the CMA.
Finally, special rules exist for public interest mergers (see question 1.3) and for mergers involving listed companies.
UK
Answer ... Following the Enterprise and Regulatory Reform Act 2013, all merger control investigations (both Phase 1 and Phase 2) are carried out by the CMA.
Under the Enterprise Act 2002, the CMA has wide-ranging powers. Broadly speaking, the CMA is entitled to:
- restrict or prohibit an enterprise from taking an action;
- impose obligations as to the carrying on of particular activities or for the safeguarding of particular assets;
- appoint a person to conduct or supervise the carrying out of particular activities;
- unwind steps already taken which it considers to be, or to potentially be, anti-competitive; and
- accept undertakings from the relevant parties to take such actions as it considers appropriate in lieu of taking other steps against those parties.
The secretary of state for business, innovation and skills has ultimate responsibility for merger control law and policy. In addition, in certain circumstances the secretary of state has the power to issue a public interest intervention notice and assume responsibility for referring a merger to a Phase 2 investigation if he or she considers that there are relevant public interest considerations at play. In these circumstances the secretary of state will have the final decision on whether the merger is against the public interest and, if so, on any remedies to address these concerns.
Under Section 42 of the Enterprise Act 2002, the secretary of state is entitled to issue a public interest intervention notice in relation to mergers affecting national security, the media and the stability of the UK financial system.