Microsoft & CMA’s Joint Request to Delay Appeal in UK Conditionally Granted

Microsoft & CMA's Joint Request to Delay Appeal in UK Conditionally Granted

Following a long case management conference before the British Competition Appeals Tribunal, the CAT conditionally granted the adjournment of the hearing of the appeal hearing jointly requested by the local antitrust regulator CMA and Microsoft, supported by Activision.

There are two conditions for the approval of the delay of the hearing. One is that the Judge will have to revise all the transcripts and submissions carefully in due course, as the decision came after a very long conference.

The second is that the parties and in particular the CMA will have to provide the Tribunal with evidence justifying the delay. Specifically, the judge asked the CMA for a witness statement by the officer in charge that will explain in detail what the change in the situation behind the acquisition is or what special circumstances apply to require the adjournment of the hearing, which was originally scheduled to start on July 28.

The judge also added that the negative outcome of the attempt by the American FTC to block the transaction must be clarified as completely immaterial to the change of course by the CMA, which the CMA’s counsel confirmed.

The CMA offered to provide the witness statement by tomorrow at 5:00 pm BST, but the Judge opted to give them until Thursday, July 20 at Noon, which the parties agreed to.

Despite the fact that the parties jointly requested the delay of the hearing, granting it was no simple matter from a legal standpoint, which is why the case management conference lasted several hours. Incidentally, during the proceeding, we heard that the ongoing discussions between the CMA and Microsoft have been productive.

The granting of the delay of the scheduled appeal hearing (pending the fulfillment of the conditions mentioned above) provides Microsoft with the time to provide the CMA with all the details of the newly proposed deal, and the regulator with the ability to rule on it.

If the appeal went through as scheduled, it would have been an adversarial process on top of costing the CMA significant money and resources. This is obviously a situation that both parties want to avoid now that they have agreed to further negotiate and the CMA extended the deadline for its final order.

A Microsoft spokesperson reached out to TechRaptor with the following statement commenting on today’s proceedings:

We’re grateful the UK’s Competition Appeal Tribunal has conditionally agreed to pause the formal appeal process subject to additional information.

As we’ve said before, we are considering how the transaction might be modified to address the CMA’s concerns. Microsoft and Activision Blizzard have agreed with the CMA that this is in the best interest of finding a prompt path forward.

This happened after the American antitrust regulator FTC failed in its last-ditch attempt to correct its defeat in court in the attempt to block the acquisition. While the regulator’s administrative process still hasn’t been canceled, its chance to stop the acquisition before it consumes are very low.

Elsewhere, most regulators have ruled in favor of the acquisition, including recent decisions by the European Union, China, South Korea, South Africa, and Turkey, with a total of 40 countries clearing the acquisition. New Zealand expressed doubts about the deal and Canada expressed its disapproval with a letter, but neither has formally moved to block the acquisition yet.

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