UK Merger Review Reform: From Merger Mystery To Remedy Rodeo

In a display of its new core principles (pace, predictability, proportionality, and process), the UK Competition and Markets Authority (CMA) has, in the space of a couple of weeks, made a raft of announcements signaling changes in the way it reviews mergers.

First, the CMA opened a public consultation on its draft revised merger remedies guidance (Draft Remedy Guidance). Second, it published its revised mergers guidance on jurisdiction and procedure (the Merger Control Guidance). And third, the UK government announced a parallel proposal for a major institutional overhaul of the CMA’s Phase II decision-making process.

The underlying purpose of many of the proposals is to align competition enforcement with the UK government’s growth agenda, following significant political pressure and a change of the CMA’s Chair earlier this year.

Most of the proposals formalize incremental changes and continued optimization of the process, which the CMA has already trialed pragmatically over the past year or so. The proposed changes to remedy discussions and the likely abolition of the CMA’s panel system for Phase II reviews are most significant.

Below, we look at each strand of the proposed reform in a little more detail: (1) Strategic Reform of Merger Remedies, (2) Updated Guidance on Merger Jurisdictional Rules and Procedure, and (3) Institutional Overhaul of Phase II Decision-Making.

Strategic Reform of Merger Remedies

The CMA held a public consultation on proposed changes to its assessment of remedy proposals in the merger review process. The Draft Remedy Guidance signals increased openness to behavioral remedies, proposes adjustments to CMA’s approach to assessing efficiencies and consumer benefits in mergers, and plans to make further procedural changes to its process of assessing and negotiating remedies. The deadline for public consultation closed on November 13, 2025.

Behavioral Remedies Are Now Clearly “On the Table”

While the CMA continues to prefer structural remedies, the Draft Remedy Guidance clarifies that behavioral remedies can be effective in some cases, including in Phase 1. Any proposed remedy must still be clear-cut and supported by robust evidence. This change formalizes, to some extent, a shift in the CMA’s practice that has already taken place in recent cases in the telecommunications sector and in the market for the supply of production chemical technologies to the energy sector. This developing trend, in some ways, moves merger remedies (slightly) closer to those in national security reviews, where behavioral remedies are well-established, even if the issues are different.

The Draft Remedy Guidance explains how risks related to behavioral remedies, such as the potential for circumvention or the complexity they create, can be mitigated through objective metrics, robust monitoring and enforcement tools, as well as the support of a monitoring trustee, where needed.

The Draft Remedy Guidance retains the current framework for assessing remedies, which means the CMA will first assess the effectiveness of a remedy and then its proportionality in the context of the proposed merger. This means that where an effective structural remedy would be disproportionate in the overall context, an effective behavioral remedy might be acceptable.

However, overall, the CMA still retains its preference for structural over behavioral remedies and full divestitures over carve-outs and more complex divestment structures.

Efficiencies and Relevant Customer Benefits

The CMA proposes some modest amendments in relation to its assessment of how customer benefits and efficiencies may offset merger-related competitive harm. CMA sources suggest further developments in the context of its review of the substantive assessment of efficiencies.

While the CMA acknowledges that remedies can, in some cases, help secure merger-specific efficiencies that enhance rivalry and prevent a prohibition (e.g., in the Vodafone/CK Hutchison JV merger inquiry), it does not address stakeholders’ concerns about their broader applicability beyond regulated sectors. Instead, the Draft Remedy Guidance outlines criteria for the acceptance of such remedies, including that they must be clearly defined, enforceable, and not easily circumvented — all of which already form part of the CMA’s assessment even if not formalized.

It is encouraging that the Draft Remedy Guidance provides more detail on how relevant customer benefits beyond price — such as better quality or increased innovation — will be assessed. This has been a recurring theme of criticism, as competition authorities around the world are often accused of focusing too much on price considerations alone in their assessments. A difficulty with non-price considerations is how to quantify them in the trade-off between positive and negative merger effects, and the evidential hurdle for the parties will remain high.

Process Changes for Earlier, Focused Engagement on Remedies

In the past, discussions about remedies often started late in the Phase I process, so that both parties and the CMA were squeezed by formal deadlines. The Draft Remedy Guidance encourages earlier and more meaningful engagement, including more explicit instructions on initiating discussions without prejudice, the introduction of dedicated meetings focused on remedies, and streamlined procedures tailored for fast-track cases.

To some extent, this change puts the onus on the notifying parties to articulate remedies at a stage where the CMA’s substantive assessment is not yet complete.

Hence, the CMA has pledged to share its concerns earlier in the process through initiatives such as teach-ins and more regular update calls. Importantly, the CMA confirms that such early remedies discussions will not influence the outcome of the Phase I assessment.

Such early, without-prejudice discussions are now well established at the European level, where they do not automatically lead to remedies if the parties are able to disprove some of the substantive concerns.

The success of such a change will therefore largely depend on parties’ perception of their continued ability to persuade the case team in parallel.

Updated Guidance on Merger Jurisdictional Rules and Procedure

On October 28, 2025, the CMA issued the Merger Control Guidance. The new guidance takes immediate effect and applies to newly notified or newly referred mergers.

Again, the key changes are designed to reflect the CMA’s focus on pace, predictability, and proportionality.

More Pace: Shorter Review Periods

The CMA has committed to key performance indicators in terms of the speed of its formal review process — with pre-notification discussions to last generally no longer than 40 working days (against a previous average of 65 working days), and clearance decisions in straightforward cases to be issued by working day 25 (compared to 35 working days currently).

More Predictability: Clearer Jurisdictional Test

Concept of Material Influence. The CMA has now provided much-needed clarifications as to the main factors that are likely, individually or collectively, to amount to “material influence” — which is the lowest level of control that may give rise to a relevant merger situation in the UK. The CMA is adopting a brightline rule according to which shareholdings conferring voting rights of less than 25% will be unlikely to confer material influence in the absence of other factors. While this is not a safe harbor, it provides a somewhat stronger indication than previously.

Share of Supply Test. In an attempt to perhaps address past criticism that, in recent years, the CMA may have adopted overly broad and unpredictable interpretations of the share of supply test, the CMA confirms that — for the purpose of determining whether the 25% threshold is met — it will typically only focus on the metrics specified in the legislation (most notably value and/or volume, but also, for example, cost, price, capacity, and number of workers employed).

More Proportionality: Short Informal Reviews Continue To Be Expanded

A majority of cases are reviewed (and cleared) informally using a short briefing paper rather than a formal review. In this context, instead of a full formal filing, the parties submit a five-page informal briefing memorandum either of their own volition or in response to a request from the CMA.

The CMA recognizes that this process is working well for both parties and for the CMA, and hence confirms that briefing papers will continue to play an important role in non-problematic deals, as well as in international transactions with no UK-specific impact.

The CMA now confirms its openness to receiving short briefing papers in lieu of formal filings, which, again, largely formalizes recent CMA practice. As set out in the Merger Control Guidance, the CMA is more likely to prioritize investigations of global mergers that have a specific impact on the UK market, and less likely to focus on deals involving exclusively global or broader-than-national markets (even in complex cases) if remedies agreed in other jurisdictions are likely to address any UK competition concerns. This so-called “wait and see” approach can also resolve potential UK-specific concerns and, while it already largely reflects the CMA’s pragmatic approach over the last few years, its formalization is certainly welcome news.

Institutional Overhaul of Phase II Decision-Making

In parallel with the CMA’s consultation on remedies and wider changes to its merger review process, the UK government announced proposals to abolish the CMA’s Independent Panel model, which currently oversees in-depth merger reviews, and transfers that decision-making power to the CMA’s board.

The CMA’s independent panels are a relic of its previous institutional setup, which had a different authority and case teams conducting the Phase II reviews. The aim of retaining the panels, which consist of independent external experts drawn from business, law, and economics, was to ensure good independent decision-making, prevent confirmation bias, and provide a semi-external view on cases.

The proposed shift aims to allow for more efficient decision-making. This proposal also comes against the backdrop of a highly publicized replacement of the CMA’s Chair at the beginning of the year, following governmental pressure.

What Does This Mean for Deal Teams?

Ensure Appropriate Contractual Provisions. The UK regime will remain a key consideration for global deals, and contractual provisions should be designed to address the risk of a call-in (e.g., with the use of “springing” conditions similar to those dealing with a potential Article 22 EUMR referral to the European Commission).

Prepare for Responsiveness. Be sure to engage efficiently with the CMA in any dialogue, whether you plan an upfront, informal outreach to the CMA, or respond to an unsolicited outreach from the CMA.

Plan the Filing. Where a formal filing is necessary or likely, prepare for more involved and iterative pre‑notification submissions. Expect to provide detailed data and internal documents upfront, teach the case team, and engage in update calls; align internal timetables accordingly.

Align Timing. Regardless of whether there is an informal or a formal filing, keep the timing aligned with other key jurisdictions, notably the EU and the U.S.
Evidence Efficiencies. Where you are likely to rely on rivalry‑enhancing efficiencies or relevant consumer benefits, assemble robust, merger‑specific evidence early and be ready to show timely, likely, and sufficient positive effects in UK markets.

Plan Remedies Early. When remedies may be required, it is important to plan early by taking into account the likely remedies in other jurisdictions, and to align them as closely as possible in both substance and timing. Pan-European remedies may avert a separate UK review in some circumstances. If behavioral remedies are possible or likely, plan for objective measures, monitoring, and governance from the outset.

© Arnold & Porter Kaye Scholer LLP 2025 All Rights Reserved. This Advisory is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.