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The consultation aims to make jurisdictional thresholds more predictable, enhance the CMA’s political accountability, and improve interactions between businesses and the regulator.

By Stephanie Adams, Greg Bonné, Ludmilla Le Grand, David Little, Jonathan Parker, and Simon Pritchard

On 20 January 2026, the UK government launched a consultation on a package of reforms to the UK competition regime — aimed at supporting economic growth while delivering benefits for consumers and businesses and maintaining the independence of the Competition and Markets Authority (CMA).

This package of reforms includes proposed changes to the UK merger control regime — some of which, if implemented, will directionally likely be welcome news to companies and investors doing business in the UK.1 That said, while the proposals bring more direct CMA board and executive political accountability over its merger control decisions, in particular on the “big picture”, they also abolish the quasi-judicial Phase 2 internal procedure of the CMA without improving external judicial checks and balances.

The latter has already prompted concerns that the UK regime will accrue more agency power with less judicial accountability than peer regimes in the US, EU, and elsewhere.

Amendments to Jurisdictional Thresholds

In past decisions, the share of supply and material influence jurisdictional thresholds have afforded the CMA significant flexibility to intervene in transactions where parties may have legitimately expected the CMA not to have had jurisdiction. In this context, the government is proposing reforms designed to increase predictability for businesses as to how these thresholds may be applied by limiting their non-exhaustive or open-ended approach.

Share of Supply Thresholds

Currently, when assessing whether the CMA has jurisdiction over a transaction based on parties holding a 25% share of supply of goods or services in the UK (the normal share of supply test; or 33% in the case of the hybrid test applicable to acquirers with UK turnover over £350 million), the CMA may have regard to any of the criteria specified in Enterprise Act 2002 (EA02) (i.e., value, cost, price, quantity, capacity, and number of workers employed) it considers appropriate “or some other criterion, of whatever nature”.2 The government proposes to remove the ability to consider “some other criterion, of whatever nature” and limit the assessment of shares of supply to a defined set of criteria. The consultation moreover asks for feedback as to whether those criteria currently set out in the EA02 are appropriate.

Material Influence Test

Similarly, under the EA02 the lowest level of “control” in which the CMA can intervene is “material influence”. The CMA can currently consider a broad and non-exhaustive range of factors that may result in a finding of material influence, and indeed it has done so in the past. The government is proposing to establish a closed list of factors that the CMA can consider for material influence, namely:

  • Shareholding or voting rights thresholds (for example, at least 15%), or any shareholding or voting rights in combination with other factors
  • Board representation or appointment rights
  • Special voting rights or veto rights over strategic decisions
  • Access to confidential strategic information
  • Commercial, financial, or consultancy arrangements

The effect of this proposal would appear to be that the CMA keeps its ability to review a broader range of minority acquisitions compared to many of its peer regimes, but at least the closed list would give a greater degree of certainty to merging parties as to whether the CMA would have jurisdiction over their transaction.

For context, there have been only three Phase 2 inquiries where the jurisdictional theory was material influence in the 22.5 years of the EA02, of which two resulted in intervention and one in an unconditional clearance. All three cases were not close to the outer boundary of material influence, as they involved either (1) a shareholding in excess of 15% plus a board seat or (2) a shareholding of well over 25% and almost 30%.

Changes to Decision-Making Structures

Phase 2 merger investigations are currently led by members of an Inquiry Group made up from members of an independent panel (the Panel), who act as a “fresh pair of eyes” to review mergers at Phase 2 and reach their decisions independently of the CMA board, the executive, and Phase 1 decision-makers. The premise was that independent Panels act in a quasi-judicial capacity, and ensure “double independence” — that is, independent Panels inside an independent agency — which justifies more light-touch and generous external judicial oversight after the event.

Under the proposed reforms to Phase 2 decision-making, Panel-led Inquiry Groups would be replaced with decision-making involving sub-committees of the CMA Board, appointed by a Mergers Board Committee.3 This is broadly modelled on the approach taken to digital market regulation decisions by the Digital Markets Unit for tech firms with designated Strategic Market Status. Under the proposals, day-to-day decisions on Phase 2 cases (e.g., sending information requests, taking decisions as to publication of material, confidentiality redactions, etc.) would be handled by the CMA case team (instead of the Panel-led Inquiry Group, as is currently the case).4

The stated purpose of this proposed reform is to ensure that the CMA Board, which — unlike the Panel — is directly accountable to Parliament, is also involved in the most significant mergers decisions as opposed to being formally excluded from them by the Panel system. This is with the aim of improving political accountability at the CMA, while also improving consistency and predictability of decisions.

While the consultation asks participants whether this proposed reform would improve predictability, consistency, and accountability, it does not probe for further discussion on whether the replacement of the independent Panel would remove one of the only checks on the CMA’s decision-making powers. Absent the Panel system, the only part of the decision-making process not in the hands of the CMA would be the ability to challenge the CMA’s decision in court on narrow judicial review grounds. Moving day-to-day decision-making in Phase 2 cases to the case team should, however, help in streamlining the process.

Providing More Time to Agree Remedies at Phase 1

The government proposes to extend the statutory period for the CMA to consider Phase 1 remedies following a decision finding a substantial lessening of competition (SLC) from up to 10 working days to up to 20 working days. Merging parties would still need to submit a proposal by working day 5. However, the CMA would have discretion to grant the merging parties a five-working-day extension to further develop their proposals if there is a reasonable prospect of resolving concerns at Phase 1. This aims at avoiding near-misses, where merging parties fail to get a remedy over the line in the currently very small Phase 1 window. With this reform, the government hopes that some merging parties could avoid a more intensive Phase 2 investigation — and the associated significant cost and burden that this brings to both the CMA and businesses.

Other “Business-Friendly” Proposals

A theme throughout the proposals is the government’s desire to improve the experience that businesses have when interacting with the CMA. In this vein (and applicable to merger control and other CMA functions), the government is proposing:

  • Excluding the Christmas period from statutory time limits. The government suggests that having to respond to CMA information requests over Christmas in order to meet a statutory deadline may be having the effect of undermining the goal of positive relationships between the CMA and the parties with a stake in its investigations.
  • Providing the Secretary of State with a formal role in a wider range of guidance documents (such as the Merger Assessment Guidelines) to ensure guidance is fit for purpose and delivers increased predictability for businesses. The government indicates that this could be done while respecting the independence of the CMA, although it does not provide further details as to how.

Reform has been in the air at the CMA for over a year now. In May 2025, the UK government published a “growth-focussed” Strategic Steer to the CMA, and the CMA’s CEO Sarah Cardell responded by launching the “4 Ps” framework to improve pace, predictability, proportionality, and process across all areas of the CMA’s work. This has already resulted in some tangible improvements to the experience of merging parties, such as a 40-working-day KPI for completing pre-notification (versus a prior average of 65 working days).

The stated purpose of the present consultation is to provide the CMA with the legislative change considered necessary to further deliver on these objectives. Recognising that “prolonged uncertainty of potential legislative change does not bring the predictability that these changes look to deliver”, the government has indicated that it will bring forward legislation that incorporates views expressed in the consultation exercise as soon as Parliamentary time allows.

  1. Alongside reforms to the UK merger control regime, the consultation also proposes reforms to the CMA’s Markets work, Market Remedies, and stronger investigative powers for algorithms. ↩︎
  2. Section 23(3) EA02. ↩︎
  3. Equivalent reforms are also proposed for the Markets regime, with decision-making involving sub-committees of the CMA Board, appointed by a Markets Board Committee. ↩︎
  4. Equivalent reforms are also proposed for the Markets regime, with decision-making involving sub-committees of the CMA Board, appointed by a Markets Board Committee. ↩︎