The removal of the CMA’s seat raises warnings of interference with UK law

Anti-trust lawyers have questioned the “unusual” decision by ministers to force the chairman of Britain’s competition body, suggesting it could have a “chilling” effect on other regulators. UK.

The government confirmed that from Marcus Bokkerink as chairman of the Competition and Markets Authority on Tuesday evening, after the Financial Times reported that business secretary Jonathan Reynolds had intervened.

Chancellor Rachel Reeves, speaking to Bloomberg in Davos on Tuesday, bluntly criticized Bokkerink: “He realized it was time for him to move on to someone who shares the mission and the direction of the policy. that this government is taking.”

This month, ministers ordered 17 senior British officials to explain how they intend to help boost UK economic growth. But several lawyers and businessmen say Bokkerink’s resignation came out of nowhere.

“To be honest it was a surprise,” said one business expert. “We have had many discussions with the CMA. . . and they seemed to really get it and make changes.”

A lawyer at a London firm said the move would have a “shocking and alarming effect” on independent regulators across the country.

“Although in the short term it seems to encourage business, if the competition policy is at the mercy of political fashion it becomes unstable and unknown, which destroys business confidence,” they said.

They added: “It is an unusual step by the government to interfere with the competition authority in such a way.

Bokkerink’s departure raises questions about whether ministers are prioritizing the needs of big business over competing rights such as consumer and environmental rights.

The government has appointed as the CMA’s new interim chairman Doug Gurr, who ran Amazon’s UK business during the company’s dispute with CMA about its limited investment in Deliveroo, which the regulator finally approved in 2020.

One person said the forced exit looked like a “desperate move from a struggling government” which was trying to regain favor with business leaders after imposing more regulations and taxes on businesses. last year. Budget.

The move has also led to speculation about the fate of CMA chief executive Sarah Cardell and whether she too could be replaced.

Andrew Griffith, the shadow business secretary, told the House of Commons on Wednesday that the Conservative party wants regulatory change so that businesses “bear less of the burden”.

“But sacking the interim chairman of the CMA seems like a good place to start,” he told the House of Commons. “He is not responsible for making day-to-day decisions at the CMA. It is the job of the chief executive. Did they plan and make a mistake?”

Cardell has been at pains in recent weeks to emphasize that the governor is taking the government’s growth mandate seriously. In November, Cardell told the FT that the agency was planning to a review of its compounding remediessignaling further consolidation may be permitted based on objectives such as price freezes rather than forced divestitures.

A person familiar with the matter said Cardell had had “good discussions” about his role with ministers since Bokkerink’s resignation.

Max von Thun, European director at the Open Markets Institute, said the CMA was at the forefront of global efforts to stand up against the rise of the market, especially in the “monopolistic” technology sector.

“The government’s decision to replace the executive chair with a former Amazon executive, at a time when several US tech giants are confirming the future of artificial intelligence, is a major policy mistake,” he said.

Lawyers and competition experts have noted that Clare Barclay, until recently head of Microsoft UK, and now in other senior positions at the company, is chairing the new Industrial Policy Advisory Council .

In a two-page statement released on Tuesday night, Bokkerink said he helped focus the CMA to ensure it provides “consumer power and effective competition – rather than being held back by a powerful few.” who make laws for all people”.

Business groups welcomed the government’s intervention. Craig Beaumont, chief executive of the Federation of Small Businesses, said he hoped the CMA would “now do more about growth”, while Stephen Phipson, head of manufacturing lobby group Make UK, praised the efforts of staff to make regulations “fit for purpose”.

A banker said that the CMA was seen as an obstacle and that Bokkerink’s dismissal could be a way to send a message to the manager’s staff.

His departure comes as the CMA has been given new powers to regulate digital markets.

It announced last week that Google would be the first company that the watchdog would investigate to determine whether the technology giant was offering a special market position based on its position in search services, which can see that it is bound by strict rules of conduct.

The government is due to deliver a “strategic approach” to the CMA in the coming weeks, setting out the regulator’s priorities. However, apart from its desire for the watchdog to focus on growth, it was unclear what staff actually wanted the CMA to do, lawyers said.

“It is clear that the government is not happy with the CMA but it doesn’t seem to have a firm opinion on what is wrong,” said a senior antitrust lawyer.

Additional reporting by Ivan Levingston