The UK is ditching a 50-year-old competition framework to boost business confidence
The UK is poised to overhaul its longstanding competition rules, scrapping elements of a framework that traces its roots back over half a century.
The Competition and Markets Authority (CMA), the nation’s top antitrust watchdog, has thrown its full support behind the government’s proposed reforms, describing them as targeted refinements that will make the system faster, more predictable, and less burdensome.
In a detailed response to the government’s consultation, the CMA outlined its enthusiasm for the changes. The regulator, which investigates mergers, market practices, and consumer protections, said that the updates align with its own internal push to prioritise “Pace, Predictability, Proportionality, and Process” – dubbed the “4Ps” – in its operations.
“The CMA welcomes the Government’s consultation… and supports the vast majority of the proposed package of reforms,” the response states.
It notes that these tweaks will help foster a regulatory environment that “attracts investment and instils business confidence,” ultimately contributing to broader economic prosperity.
Roots in a bygone era
The current UK competition regime has evolved from laws dating back to the post-war period, with key elements stemming from the Monopolies and Mergers Commission established in 1948 and later institutions like the Office of Fair Trading (OFT) in 1973.
The CMA itself was formed in 2014 by merging the OFT and the Competition Commission, but vestiges of the old bifurcated system – particularly the separation between initial market studies and deeper investigations – have lingered, creating inefficiencies.
The government’s proposals aim to ditch this outdated dual-track approach in favor of a streamlined, single-phase market review tool.
Under the existing model, the CMA must decide early on whether to launch a lighter ‘market study’ or a more intensive ‘market investigation’, which can lead to prolonged timelines of up to three years. This path dependency often forces the authority to pivot mid-process, wasting time and resources.
“The long-standing separation between market studies and market investigations gives rise to what can be seen as a ‘path dependency’ problem,” the CMA noted in its response.
By consolidating into one flexible process, the CMA believes it can adapt more nimbly to emerging evidence, slashing review times and making the regime more proportional to the issues at hand.
The CMA strongly endorsed this shift, arguing it would address institutional hangovers from before its creation and allow for “more agile” work.
“The ability to adjust flexibly as the CMA’s understanding of the market develops would be fully engaged by the more agile new single-phase market review proposal,” the group said.
Boosting accountability without sacrificing independence
Another key pillar of the reforms targets decision-making in mergers and market cases.
Currently, the CMA’s board – including its CEO and chair – is legally barred from involvement in these high-stakes probes, a quirk that has drawn criticism for lacking direct accountability.
The proposals would introduce board committees or sub-committees comprising at least 50% non-executive members, drawn from the board’s non-executive directors or a pool of external experts similar to the current panel system.
This model, the CMA argues, would enhance consistency and predictability by ensuring decisions align with broader policy goals, such as the government’s strategic guidance to the authority.
“Such increased accountability means that the CMA Board can ensure markets and mergers decision-makers have regard to such CMA policy positions… thereby increasing consistency and predictability,” the response states.
Importantly, safeguards like a required two-thirds majority for adverse findings and oversight by the Competition Appeal Tribunal would maintain the regime’s independence from government influence.
The CMA views this as a way to preserve the UK’s “highly regarded, robust and rigorous” merger control while making it more accountable to stakeholders.
Why it matters for business
These changes come at a critical time for the UK economy, which has grappled with post-Brexit uncertainties, inflation, and sluggish growth. Businesses have long complained about regulatory red tape stifling innovation and investment.
By modernising the competition framework, the government and CMA hope to signal that the UK is open for business.
Feedback from companies has already been positive on the CMA’s 4Ps initiative, with the authority noting “consistent feedback from businesses that the 4Ps are building confidence and reinforcing the UK’s global reputation.”
The reforms are positioned as evolutionary rather than revolutionary – “specific refinements” rather than “sweeping or fundamental changes” – to avoid creating uncertainty.
Still, the CMA cautions that more radical overhauls could disrupt its work and harm long-term prosperity.
