CMA asks EC to refer proposed O2 UK-Virgin Media merger to it for investigation

9 Oct 2020

A formal request has been made by the UK’s Competition and Markets Authority (CMA) to the EC requesting that the latter transfers the review of the proposed merger of O2 UK and Virgin Media to it. In a press release regarding the development, the CMA noted that, while the planned tie-up falls under the remit of the EC to review, it can be transferred to the UK authority – subject to the agreement of the European body.

In requesting the transfer, the CMA has argued for this on the basis that of case’s ‘potential impact on competition in several retail and wholesale telecommunication markets in the UK’. Further, the CMA claimed that the legal requirements for the case to be transferred to it have been met, while highlighting that any impact on competition ‘will be limited solely to UK consumers’. Lastly, the competition body noted that, while the EC has previously highlighted its strong interest in ensuring consistency across different merger cases in the telecoms sector, the CMA believes that this is not relevant in this case given the imminent end of the transition period following the UK’s exit from the EU.

Commenting, Andrea Coscelli, Chief Executive at the CMA, said: ‘We’ve sent a formal request to the European Commission to review the proposed deal between Virgin and O2. Ultimately, this is a decision for the EC, but as the merger will only impact UK consumers – and any effects would only be felt after the end of the transition period – it is only right for the CMA to request it back.’

With the CMA said to have liaised closely with the EC on its investigation to date, it has said it will continue to do so in the event that the EC decides jurisdiction should not be transferred. Meanwhile, the initial deadline for the EC to respond to the British watchdog’s request is 19 November 2020.

United Kingdom, Liberty Global (incl. LGI), O2 UK, Telefonica, Virgin Media