Microsoft has now sent its final submission to the UK Competition and Markets Authority to reconsider its blocking of the Activision Blizzard proposal.
A few months ago in April 2023, the UK CMA revealed its Final Report on the Microsoft Activision Blizzard acquisition. It stated that it has competition concerns regarding cloud gaming in the UK.
After that announcement, Microsoft won against the US Federal Trade Commission in court, got an agreement with Sony for the provision of Call of Duty games on PlayStation for at least 10 years, and approval from the key regular European Commission. Only the UK CMA stands in its way now.
This new submission by Microsoft is its attempt to convince the UK CMA to reconsider its stance. It mentions plans to put forward a proposal for a modified merger situation “which would mean that the current approach in the FR and a potential final order would be superseded. Reports say that Microsoft and the UK CMA are now negotiating these unannounced proposals outside of the court. It might involve a licensing deal for the cloud.
Microsoft and Activision Blizzard have postponed their merger deadline for three months to give more time for the deal to gain approval from the UK CMA. Microsoft must now complete the acquisition deal before October 18, 2023 or else face the consequence of paying billions of dollars in a reverse termination fee.
“Submissions under section 41(3) of the Act regarding material change of circumstance or special reasons are very rare,” the UK CMA said. “It is not a usual part of the CMA’s process during a remedies implementation period to consult on submissions received in response to a consultation on a proposed undertaking or order. However, in light of the guidance provided by the Competition Appeal Tribunal on this specific case, the Inquiry Group has decided it is appropriate to do so in this case.”