Antitrust lawyers have questioned ministers' “unusual” decision to forcibly remove the UK's competition watchdog, suggesting it could have a “chilling” effect on other UK regulators. did.
The government confirmed Marcus Bockelink's resignation as head of the Competition and Markets Authority on Tuesday night, after the Financial Times reported that Business Secretary Jonathan Reynolds had intervened.
Prime Minister Rachel Reeves implicitly criticized Bokkelink in an interview with Bloomberg in Davos on Tuesday. “The Prime Minister has recognized that the time has come for him to step forward and make way for someone who shares the mission and strategic direction that this government is taking.”
Ministers this month ordered 17 of Britain's biggest regulators to reveal how they intend to help boost the country's economic growth. But many lawyers and lobbyists said Bockelink's resignation was sudden.
“To be honest, I was a little surprised,” said one business lobbyist. “We've had a number of conversations with the CMA. . . . and they really seemed to get it and make changes.”
One antitrust lawyer at a London law firm said the move would have a “chilling and coercive impact” on independent regulators across the country.
“While this may seem reassuring for businesses in the short term, if competition policy is subject to political trends, it becomes less stable and predictable, which undermines business confidence,” they said.
“This is an unusual step for a government to intervene with competition authorities to this extent,” they added.
Bockelink's resignation raises questions about whether ministers are putting the demands of big business ahead of competing priorities such as consumer rights and the environment.
The government has appointed Doug Garr as the new interim CMA chair. Doug Garr led Amazon's UK operations during the company's battle with the CMA over a minority stake in Deliveroo, which the regulator ultimately approved in 2020.
One source said the forced withdrawal appeared to be a “desperate move by a beleaguered government” to regain popularity with business leaders after last year's budget imposed additional regulations and taxes on companies. said.
The move has also led to speculation about the fate of CMA chief executive Sara Cardel and whether she too may be sacked.
Shadow business secretary Andrew Griffiths told the House of Commons on Wednesday that the Conservatives want regulatory reform to “relieve the burden” on businesses.
“But removing the CMA's non-executive chairman seems like an odd starting point,” he told the House of Commons. “He is not responsible for day-to-day decision-making at the CMA. That is the CEO's job. Did they hit and miss?”
Cardel has been at pains in recent weeks to stress that regulators are taking the government's growth mandate seriously. Mr Cardel told the FT in November that the agency was planning a review of its merger relief measures, so more mergers would be approved on the basis of promises such as price freezes, rather than forced asset sales. suggested that it was possible.
A person familiar with the matter said Mr. Cardel had had “positive discussions” with ministers about his role since Mr. Bockelink's resignation.
Max von Thun, European director of the Open Market Institute, said the CMA had been at the forefront of global efforts to counter growing market concentration, particularly in “monopolistic” high-tech sectors.
“The government's decision to replace the agency's chairman with a former Amazon executive is a major strategic failure, at a time when a handful of US tech giants are tightening their grip on the future of artificial intelligence,” he said. said.
Lawyers and competition experts say Claire Barclay, who most recently headed Microsoft UK and now holds another senior role at the company, will chair the government's new Industrial Strategy Advisory Board. pointed out.
In a two-page statement released Tuesday night, Mr. Bockelink said the CMA would “not be held back by a few powerful incumbents setting the rules for everyone else, but rather He said he helped refocus the CMA to ensure it was committed to empowering “competition”.
Business groups welcomed the government's intervention. Craig Beaumont, executive director of the Federation of Small Businesses, said he expected the CMA to “do more about growth going forward”, while Stephen Phipson, head of manufacturing lobby group Make UK, said: He praised ministers' efforts to make regulations “fit for purpose”. .
One banker said the CMA was seen as a roadblock and Bockelink's ouster could be a way to send a message to regulator officials.
His departure comes after the CMA was given new powers to regulate digital markets.
The company announced last week that Google would be the first company the watchdog will examine to determine whether the company's position in search services warrants a special position in the market. Google could be bound by stricter rules of conduct.
The government is expected to issue “strategic instructions” to the CMA in the coming weeks, setting out its priorities for the regulator. But lawyers said it was unclear what Labor actually wanted from the CMA beyond the watchdog's desire for it to focus on growth.
“It's clear that the government is unhappy with the CMA, but they don't seem to have a concrete view on what the problem is,” said a senior antitrust lawyer.
Additional reporting by Ivan Levingston
