Guidance

Mergers: how they are investigated

Updated 23 June 2025

This guide summarises how the CMA investigates a merger. It should help you if you’re:

• thinking about merging your business with another one
• aware of a merger that you think could affect your business or competition generally

We also have more detailed guidance. For more information about our remit and processes, read our guidance on the CMA’s jurisdiction and procedure (CMA2).

Our role in merger control 

The CMA is the independent, non-ministerial government department responsible for keeping markets open and competitive. One important duty we have is to ensure that UK businesses and consumers are not harmed by mergers that would reduce competition. Those harms include lower quality goods or services, less choice or higher prices. 

Tens of thousands of mergers take place every year that we don’t consider – and many more we do not find concerns with. We only intervene if the merger meets the legal criteria (see below) and we think it could have a negative effect on consumers, businesses or the UK economy. 

When we investigate, we gather evidence from merging businesses and others, such as customers or competitors of the merging businesses. This helps us to decide whether the merger will affect competition. At the end of the investigation, we publish a report explaining our decision.

What counts as a merger?

A merger is when 2 or more businesses (or parts of businesses) join to become one. This could be through:

• a business buying another business, part of a business, or a shareholding in a business (an acquisition)
• businesses agreeing to work together on something new (a joint venture)

Legal criteria for investigating a merger

To be investigated a merger must meet certain criteria, including at least one of the following legal tests:

• turnover test 

• share of supply test 

• hybrid test

‘Turnover test’

The business being acquired has a UK turnover of at least £100 million. 

‘Share of supply test’

The businesses have a combined share of at least 25% of a good or service in the UK (or a region of it), the merger would increase this share, and one of the businesses has a UK turnover of at least £10 million. 

‘Hybrid test’

One of the businesses supplies at least 33% of a good or service in the UK (or a nation or region of it) and has a UK annual turnover of over £350 million. The other business must also have a connection to the UK. 

How we find out about mergers 

Unlike in many other countries, the UK merger regime is voluntary. This means you do not have to tell the CMA about your merger, but you can choose to if it meets one of the legal tests set out above. There can be significant benefits to telling us before completion where a merger is between companies with material overlapping activities or supply relationships. 

The CMA may investigate on its own initiative if it thinks that your merger meets one of the legal tests, and that it is reasonably likely to find competition concerns after an initial investigation.

Tell the CMA about your merger.

Assessing the merger 

Where we investigate a merger, we consider whether it could lead to a substantial lessening of competition.

What is a substantial lessening of competition? 

Competition is when businesses seek to attract customers by offering them a better deal than their rivals. Both price and non-price aspects of competition (such as service, innovation and quality) are often important parts of the competitive process. 

In most cases, any reduction in competition resulting from a merger will not be substantial, as after the merger there will be sufficient rivalry remaining between those businesses who are left in the market. For example, a merger between 2 companies in a large market (with many other similar competitors) would be unlikely to affect competition across the whole market, as there would still be sufficient rivalry between those businesses who remain after the merger. 

However, some mergers remove important rivalry between businesses, which can influence how other businesses in the market might behave (for example, how they price their products or whether they develop new ones). This can lead to a lessening of competition that is substantial, and could lead to lower quality goods or services, less choice or higher prices. 

How we decide if there is a substantial lessening of competition 

Each merger is unique, so we consider it on its own terms and with an open mind. We focus on whether the merger could reduce rivalry in a way that could lead to less competition. The potential consequences or outcomes that we typically consider during merger investigations include: 

• whether the merged business could raise its prices, reduce the quality of its goods or services, or reduce innovation efforts as a result of the lessening of competition 

• whether other businesses in the market could realise they could coordinate their activity, for example to raise prices, by not competing as much 

• whether other businesses in the market could be prevented from buying goods or services that are a crucial input to the goods or services that they want to sell (this is called ‘input foreclosure’), or whether a business could stop selling its products to other customers and instead supply only to the business it has merged with (this is called ‘customer foreclosure’) 

To find out more about how we assess whether competition law concerns might be raised by a merger, read our merger assessment guidelines (CMA129).

How our investigations work 

The CMA follows a careful, transparent process when we investigate a merger. To make an informed decision, we: 

• make sure that the merging businesses and other stakeholders can engage with us 

• gather the necessary information so we have a clear picture of the merger’s likely effect on competition 

We also try to finish our investigation as quickly as possible, to reduce the uncertainty, costs and burdens for businesses. Our investigation has strict deadlines set out in law. 

Pre-notification: information gathering 

First, we make sure we have enough information to launch a phase 1 investigation. We call this the ‘pre-notification’ phase. 

We’ll ask merging businesses to submit a merger notice form to tell us things such as: 

• who they are 

• what goods or services they supply and procure 

• who they compete with 

• how competition works in their industry 

We will also meet with the merging businesses early in pre-notification to discuss the process and to allow the merging businesses to provide a ‘teach-in’ about the businesses and the relevant industry to CMA staff. We will also arrange informal update calls with the merging businesses. 

Our information gathering powers 

If we investigate your merger, we’ll gather information from you. This can happen at any stage during the investigation, including pre-notification, phase 1 and phase 2. We have legal powers (known as ‘section 109 notices’) to gather information that will be relevant to our investigation. If we use these powers, you must provide that information in the format we ask for and by the deadline we set. We sometimes use similar powers to request information from other businesses.

To find out more about our information gathering powers, go to Mergers: Guidance on the CMA’s jurisdiction and procedure (CMA 2, from paragraph 9.5) and Administrative Penalties: Statement of Policy on the CMA’s Approach (CMA4).

We might also ask anyone who might be affected by the merger, or who could tell us more about the relevant products, services or markets (your customers or competitors, for example), to get in touch. For example, we can publicly invite comments from these stakeholders and assess their responses. We will typically publish an invitation to comment early in the pre-notification phase.

We might also speak to other organisations, like competition authorities outside the UK, or other regulators. 

We expect pre-notification to be conducted within 40 working days in typical cases.  

Our approach to reviewing mergers is currently under consultation.

Phase 1: initial review 

At phase 1 we’ll carry out an initial review of the merger, to decide if the legal test for referring the investigation to phase 2 has been met. The legal test asks whether the merger has a realistic prospect of substantially lessening competition. 

We have a legal deadline of 40 working days at phase 1 (starting on the day we launch our formal investigation) to decide whether the merger needs a more in-depth (or ‘phase 2’) review. We’ll announce our decision by the last working day of our deadline (at the latest) and publish the reasons for it soon after that. 

If we do not find any competition concerns, we’ll clear the merger.  

Remedies 

If we do find concerns and think that we should refer the merger to phase 2, we’ll first give the merging businesses a chance to propose remedies (or ‘undertakings in lieu’) to address our concerns. If offering a remedy, you’ll need to notify it to us after we have announced our phase 1 decision and given our reasons for it, so you can design the remedy to address our specific concerns. 

The period for submitting and considering remedies is short: 

• we announce our phase 1 decision (on or before the 40th working day of our phase 1 investigation)

• merging businesses then have 5 working days to submit any remedies

• the CMA then has up to 5 more working days to consider the remedies. If none are offered or we do not accept them, we’ll refer the merger to phase 2. If we decide to accept the remedies provisionally, we’ll publicly consult on them and consider any responses

• we have a deadline of 50 working days (after announcing our phase 1 decision) to decide whether to formally accept the remedies. 

Although this process happens at the end of a phase 1 investigation, businesses should think about possible remedies early. You can propose remedies to the CMA case team at any time. Discussing possible remedies with us early will allow the case team to share its preliminary view in advance. In turn this may help you propose effective remedies in the short time available, if needed. 

The fact that you’re willing to discuss possible remedies will not: 

• be taken to mean that you believe your merger raises competition concerns

• mean that we’ll necessarily decide that the merger is expected to raise competition concerns

Most of our investigations end at phase 1, and in most cases the merger is allowed to go ahead without any remedies. Only a few need remedies and even fewer need to be referred to phase 2. Find out more about our investigation outcomes.

Phase 2: more in-depth review (in some cases) 

If you do not offer any remedies or, in our view, the ones you offer do not address our competition concerns, then we have a duty to carry out a more in-depth, phase 2 review. Unlike at phase 1, at phase 2: 

• there is a higher legal test for us to conclude that the merger will lead to a substantial lessening of competition 

• an independent ‘inquiry group’ – 3 to 5 people with a range of business, finance, economic and legal experience – leads the investigation and makes the final decision 

• our deadline to reach a decision is 24 weeks, but in special circumstances we can extend by up to 8 more weeks 

If the inquiry group, usually having reviewed more evidence in line with the higher legal test, decides that the merger does not raise any competition concerns then it will clear the merger.

Remedies 

If the inquiry group has competition concerns, it will consider any remedies that are proposed to address them. 

Remedies might involve: 

• selling part of the merged business 

• a legal commitment from the merging businesses to behave in a certain way 

The inquiry group will only accept remedies if they address its concerns comprehensively and effectively. If the merging businesses do not offer appropriate remedies, the group can decide on some remedies (recommended by CMA experts) instead – or decide to block or unwind the merger as a last resort. 

For more information about our approach to remedies and the types we consider, go to merger remedies. 

Next steps 

If you’re ready, tell the CMA about your merger. 

If you need more information, read our  other guidance and resources for businesses involved in a merger investigation.