Microsoft-Activision deal back in hands of UK regulator after court stays appeal

LONDON, July 21 (Reuters) – Microsoft’s Activision Blizzard deal is back in the hands of Britain’s antitrust watchdog after an appeal court granted a stay and published reasons why Britain should reconsider its block on the acquisition of the US software giant.

The Competition and Markets Authority (CMA) set out on Friday Microsoft’s arguments for the reconsiderationwhile the US fights for get UK approval to buy the maker of “Call of Duty” Activision.

Having initially blocked the $69 billion deal in April over concerns about its impact on competition in the cloud gaming market, the CMA has since reopened the file, after it became increasingly isolated among global regulators in its opposition.

The CMA said it was likely to be able to come up with a new tentative view on the restructured deal in the week beginning August 7.

Explaining why the deal must now be given the green light, Microsoft argued that binding commitments accepted by the European Union shortly after Britain blocked the deal turned the tables, published court documents showed.

The software company gave legally binding data commitments with the European authorities that Activision games can be streamed for a decade after the merger, and has signed deals with NVIDIA, Boosteroid, and Ubitus.

As part of that, a monitoring and compliance regime will be put in place, which Microsoft says should alleviate some of the CMA’s concerns.

Microsoft also argued that the terms of the CMA’s proposed block went beyond what was necessary to address its concerns about cloud gaming, for example by covering Activision Blizzard’s King unit, which makes mobile games like Candy Crush Saga.

The CMA said it understood that Microsoft considered the recent license agreement it entered into with Sony to be an additional material change of circumstances or a special reason.

For its part, the CMA dismissed its decision to review the deal as “irrelevant and immaterial” the fact that US authorities failed to block it in court there.

Competition Appeal Tribunal of Great Britain provisionally approved the postponement on Monday subject to further submissions by the parties. He formally conceded it on Friday.

Reporting by Sarah Young, Paul Sandle and Sam Tobin; Edited by Alistair Smout and Louise Heavens

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