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Hunt urges competition chiefs to encourage growth after Microsoft deal blocked

Chancellor Jeremy Hunt says regulators need to focus on encouraging investment - TOLGA AKMEN/Shutterstock
Chancellor Jeremy Hunt says regulators need to focus on encouraging investment - TOLGA AKMEN/Shutterstock

Jeremy Hunt has told competition chiefs that they must “understand their wider responsibilities” after the regulator was attacked by Microsoft for blocking a gaming mega-merger.

The Chancellor insisted that he did not want to undermine the independence of the Competition and Markets Authority (CMA), but said regulators also needed to focus on encouraging investment.

Microsoft and Activision have accused the UK of discouraging investment after the CMA blocked Microsoft’s $69bn (£55bn) takeover of Activision, the video games giant behind Call of Duty.

Speaking at the British Chambers of Commerce annual conference on Wednesday, Mr Hunt said: “When it comes to Microsoft, there was a merger between two American companies that the US regulator is seeking to block, and the UK regulator took the same view.

“I think one of the reasons that companies like Microsoft and Google want to invest in the UK is because we have independent regulators that are not controlled by politicians and therefore they can be confident there will be a level playing field.

“I would not want to undermine that at all, but I do think it’s important all our regulators understand their wider responsibilities for economic growth.

“But for our tech sector, it isn’t just about being able to get through big deals, competition really matters.”

The comments are the first Mr Hunt has made on the blocked takeover bid.

Last week the Government published a “strategic steer” document encouraging the CMA to take into account “the impact that [enforcement] has on economic growth”.

The CMA’s decision to block the deal was brought into focus earlier this week when EU regulators approved the takeover.

Microsoft’s Brad Smith has suggested that the CMA’s ruling means the EU is a more welcoming environment than Britain for technology companies.

When the deal was blocked, Activision said the decision meant the UK was “clearly closed for business” and said it would reconsider its investments in Britain.

The CMA’s leaders defended their decision on Tuesday, telling MPs that they had not created a “hostile environment” for tech businesses.

Sarah Cardell, the regulator’s chief executive, said that the decision to block Microsoft’s takeover of Activision was taken by an independent panel.

Microsoft is set to appeal the decision in the coming days.