In recent years the UK has become a bigger regulatory risk factor in global M&A, with the Competition and Markets Authority (CMA) taking on a much more significant role post-Brexit and the passage of a powerful new National Security and Investment Act (NSIA).
What does the election of a new Labour government mean for dealmaking? Will there be more intervention to protect UK consumers, more openness to foreign investment or a combination of the two?
How can the government influence the CMA?
The CMA was set up as an independent ‘non-ministerial government department’ so that it would be free from political interference. But politicians still have several levers of influence:
Legislation: The last two changes of government (in 1997 and 2010) led to new legislation changing the structure and powers of the UK competition authorities.
Guidance: The government can issue a new strategic steer to the CMA and under the Digital Markets, Competition and Consumer Act (DMCCA) it is responsible for approving the DMU’s guidance on how it will use its powers.
Board appointments: CMA Chair Marcus Bokkerink’s four-year term is up for renewal in September 2026. The term of Martin Coleman, Chair of the CMA Panel, ends in the same month. CEO Sarah Cardell’s five- year term runs until December 2027.
Funding: The CMA receives most of its funding from the Treasury. Its budget is set out in the Treasury Spending Review, the last of which was announced in 2021 and lapses before the end of this year.
Scrutiny: Parliamentary select committees can summon the CMA leadership to give evidence and make recommendations to them, though the CMA is not obliged to follow them.