CMA asks EC to allow it to review O2 UK/Three UK merger

6 Oct 2015

Britain’s Competition and Markets Authority (CMA) has made a request to the European Commission (EC) to allow it to review the proposed acquisition of Telefonica Europe, owner of O2 UK, by Three UK Hong Kong-based parent company CK Hutchison Holdings.

As previously reported by TeleGeography’s CommsUpdate, following the confirmation earlier this month that CK Hutchison had filed an application seeking approval of its bid for O2 UK to the EC, the CMA revealed that it was seeking views on the proposed tie-up to determine whether it might substantially lessen competition in the country’s mobile sector.

Now, the CMA has confirmed that its initial view, following this consultation and preliminary analysis, is that the transaction ‘threatens to affect significantly competition in the UK retail mobile and wholesale mobile markets’. As such, it has said it believes it is appropriate for the case to be referred to it for investigation because any impact on competition resulting from the merger will likely be limited to UK consumers. It also cited its experience in investigating mergers as another reason that it should be allowed to tackle the case, saying in particular that its ongoing investigation into the proposed merger of fixed line incumbent BT and cellco EE meant that there were ‘clear links between these two cases’ which meant it would be ‘more efficient’ for it to examine the O2 UK/Three merger, while also ensuring it avoids ‘duplication and fragmentation’.

A decision by the EC on whether or not to refer the case to the CMA must be made by 30 October 2015.

United Kingdom, CK Hutchison, Hutchison 3G UK (Three UK), O2 UK, Telefonica