Thread by @FOSSpatents

The public part of the UK parliamentary oversight hearing on CMA's work has finally started.

Chair says "we're gonna ask about some topical cases ... most widely covered news is Microsoft-ActivisionBlizzard, please give us a quick summary"

🧵1/X

Sarah Cardell says decisions are taken by "independent" inquiry groups. But it is well-known that she very much pushed for the blockind decision. Also, "independent" doesn't necessarily mean that they make the right call.

🧵2/X

Mentions remedy proposed by Microsoft and now explains UK position: legislation required remedy to be comprehensive and effective. Well, same basically in the EU, but the Commission is not as unreasonable as the CMA, more pragmatic and consumer-focused.

🧵3/X

Now Sarah Cardell mentions the EU Commission decision. Says EU agreed that there were also concerns about cloud gaming but different conclusion on remedy. Now pointing to the fact that the U.S. FTC is suing to block the deal.

🧵4/X

Chair now asks Cardell to be more specific about the Commission's rationale on the remedy. Cardell says "we looked very, very carefully at this" => yeah, we've seen throughout the process what it means when they look "very, very carefully at something"...

🧵5/X

Now Cardell is essentially making the argument that when there's a nascent market, you should just block.

But the law works the other way round: nascent market means you have a weak theory of harm and your remedies must be less extreme.

🧵6/X

Chair now asks whether lobbyists hired by tech industry have an effect on the CMA's work. Cardell says engagement with tech industry is positive, wants constructive dialog. Right, but she also has to make sure they act constructively when they decide cases.

🧵7/X

She says it's critical to "maintain a constructive dialog" but yesterday's Twitter thread in response to the EU decision did not really indicate a constructive, solution-oriented attitude. Instead, the CMA came across as entrenched yesterday.

🧵8/X

Parliamentarian now asks question about what this means for the UK's international reputation.

She says competition is key to innovation, but the parliamentarian insists he wants to know what this means for the INTERNATIONAL REPUTATION OF THE UK and if the CMA considers!

🧵9/X

That parliamentarian is GREAT! He wants her to answer yes or no, if they consider whether the UK will be seen internationally as being open for business.

Her answer is evasive and devoid of substance. Now the CMA chair responds, too.

🧵10/X

CMA chair says CMA encourage open competitive markets.

Right, that's why the CMA made a decision that only benefits Sony, Google, and by extension Apple (with a view to app store competition).

🧵11/X

That great parliamentarian who wanted he yes/no answer now takes them to task even further: he points out the CMA simply comes from the assumption that its decision is right.

Between the lines it's clear this Member of Parliament is unconvinced of the CMA being right

🧵12/X

CMA chair says they only block "a handful" of mergers per year and only if there's a serious concern about anticompetitive effects.

Still, the CMA fails to address the international aspect. The Member of Parliament again has to insist they comment on int'l dimension.

🧵13/X

Cardell speaking, evasive, MP insists to know whether they had international interaction. Cardell says general conversations but only later they talked more specifically.

🧵14/X

MP discusses difference between U.S. and UK legal standard in terms of what constitutes a theory of harm to block the deal.

Cardell denies doing the bidding of other agencies, meaning the FTC, refers to rumors in the press.

🧵15/X

Cardell says standard in the UK is that it's "more likely than not" that a merger will result in a substantial lessening of competition. Assessment is subject to judicial review by @CATribunal she mentions.

🧵16/X

MP insists to know more about interactions between CMA and FTC, but Cardell points to confidentiality restrictions.

The longer this takes, the more it looks like Activision's CEO may have had a point about an alleged Khan-Cardell conspiracy to block the deal in the UK.

🧵17/X

Now Cardell says they generally want to take a more forward-looking perspective and help companies shape markets, and mentions AI as an example of a key area.

🧵18/X

Now another Member of Parliament asked a question that was mostly about UK telecommunications carriers.

In her reply, Cardell mentioned employees are not considered in CMA merger reviews. That is, of course, the traditional approach also in many other jurisdictions.

🧵19/X

CMA chair Bokkerink comes back to the previous discussion and says they have a "vigorous, objective, unbiased process" that makes the UK great for business.

Yeah, so vigorous that they didn't even get basic math right. And "objective and unbiased": 70% market share?

🧵20/X

Now -- after they discussed seveal other questions -- @BimAfolami raises another great question: accountability as opposed to a standard of court review that is basically limited to procedure.

Very important answer by CMA chair:

🧵21/X

In his reply to @BimAfolami about accountability, the CMA's chair unequivocally says that the CMA is accountable to Parliament.

And that's what the CMA can see today: its radical merger ruling is not viewed favorably in Parliament.

🧵22/X twitter.com/i/web/status/1…

CMA chair says it is important to understand the policies of the government because the government has levers.

OK, then they should heed what Prime Minister @RishiSunak says, focus on markets where there is a lack of competition and the games market is not one of them.

🧵23/X

LOL Cardell just claims "mutual high regard" between @CMAgovUK and @EU_Competition and that those working relationships are great.

Then the CMA should refrain from Twitter threads like the one yesterday.

Her answer shows she's aware of (actual/potential) criticism.

🧵24/X

I'd like to add something to parts 22 & 23 of this thread:

That @BimAfolami raised the question of the standard of judicial review shows to the CMA that its regulatory excess may dissuade lawmakers from giving them too much power under the present standard of review.

🧵25/X twitter.com/i/web/status/1…

Only 9 minutes remaining. Committee chair has 2 final questions. First is what they think of Prime Minister @RishiSunak's strategic steer document. CMA chair obviously says it's all great, wasn't going to disagree here. Second question is about digital transformation.

🧵26/X

Committee hearing is closed. This was great with a view to the #Microsoft-#ActivisionBlizzard merger. The
@CMAgovUK can see that what it has done is not viewed favorably by lawmakers, with @BimAfolami taking the CMA to task very effectively. This deal will go through.

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