Antitrust lawyers have questioned the “extraordinary” decision by ministers to force the head of Britain’s competition watchdog out of office, suggesting it could have a “chilling” effect on other UK regulators.
The government confirmed the departure of 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, implicitly criticized Bokkerink: “He understood that it was time for him to move on and make way for someone who shares the mission and the strategic direction that this government is taking. “
This month, ministers ordered 17 of Britain’s biggest regulators to set out how they intend to help boost UK economic growth. But a number of lawyers and lobbyists said Bokkerink’s resignation had come out of nowhere.
“It was a bit of a surprise to be honest,” said one business lobbyist. “We have been in many discussions with the CMA. . . and they seemed to really be picking it up and making changes.”
An antitrust lawyer at a London firm said the move would have a “chilling and chilling effect” on independent regulators across the country.
“Although in the short term it appears reassuring for business, if competition policy is at the mercy of political fashion, it becomes less stable and predictable, which undermines business confidence,” they said.
“It is an extraordinary move by the government to interfere so much with a competition authority,” they added.
Bokkerink’s departure raises questions about whether ministers are prioritizing the demands of big business over competing priorities such as consumer rights and the environment.
The government has appointed Doug Gurr, who ran Amazon’s UK business during the company’s battle with the CMA over its minority investment in Deliveroo, which the regulator finally approved in 2020, as the CMA’s new interim chairman.
One person said the forced exit seemed like a “desperate move by a struggling government” trying to regain popularity with business leaders after it imposed extra rules and taxes on corporations in last year’s budget.
The move has also led to speculation about the fate of CMA chief executive Sarah Cardell and whether she could also be replaced.
Andrew Griffith, the shadow business secretary, told the House of Commons on Wednesday that the Conservative party wanted regulatory reforms so that businesses “have less of a burden”.
“But sacking the part-time non-executive chairman of the CMA seems a curious place to start,” he told the House of Commons. “He is not responsible for day-to-day decision-making at the CMA. This is the job of the chief executive. Did they aim and miss?”
Cardell has been at pains in recent weeks to emphasize that the regulator is taking the government’s growth mandate seriously. In November, Cardell told the FT that the agency was planning a review of its merger rulings, signaling that more mergers could be approved based on undertakings such as price freezes rather than forcing asset sales.
A person familiar with the matter said Cardell had had “positive discussions” about her role with ministers since Bokkerink’s resignation.
Max von Thun, director of Europe at the Open Markets Institute, said the CMA had been at the forefront of global efforts to push against growing market concentration, particularly in the “monopolistic” technology sector.
“The government’s decision to replace the seat of authority with a former Amazon executive, at a time when a handful of US tech giants are tightening their grip on the future of artificial intelligence, is a major strategic mistake, he said.
Competition lawyers and experts noted that Clare Barclay, until recently head of Microsoft UK and now in another senior role at the company, is chairing the government’s new Industrial Strategy Advisory Council.
In a two-page statement released on Tuesday night, Bokkerink said he had helped refocus the CMA to ensure it empowered “consumers and effective competition – rather than being hindered by a few powerful officials setting the rules for everyone else.”
Business groups welcomed the government’s intervention. Craig Beaumont, chief executive at the Federation of Small Businesses, said he hoped the CMA would “already do more for growth”, while Stephen Phipson, head of manufacturing lobby group Make UK, welcomed ministers’ efforts to make the regulation ” fit for purpose”. .
One banker said the CMA was seen as an obstacle and that Bokkerink’s ouster could be a way to send a message to the regulator’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 the watchdog would investigate to decide whether the tech giant warrants special market status in light of its position in search services, which could see it restricted. from stricter rules of conduct.
The government will issue a “strategic direction” for the CMA in the coming weeks, setting out its priorities for the regulator. However, beyond its desire for the watchdog to focus on growth, it was unclear what Labor actually wanted the CMA to do, lawyers said.
“The government is obviously unhappy with the CMA, but it doesn’t seem to have concrete views on what’s wrong,” said a senior antitrust lawyer.
Additional reporting by Ivan Levingston
