CMA opens the door to behavioural remedies in merger cases

On 16 October 2025, the Competition and Markets Authority (CMA) launched a consultation on its approach to remedies in merger cases, which follows the CMA's Mergers Charter and Call for Evidence published in March 2025 (see our March 2025 update).

What you need to know

• The proposed changes to the CMA's guidance incorporates the CMA's 4Ps framework into the merger remedies process. 
• As widely anticipated following the CMA's Call for Evidence, behavioural remedies are expected to play a greater role in future merger cases, particularly following the CMA's removal of the presumption against behavioural remedies at phase 1.
• This is the latest in a series of consultations run by the CMA, including the CMA's July 2025 consultation on its merger procedure guidelines (see our July 2025 update).

The remedies guidance consultation (Draft Revised Guidance) builds upon a concerted shift by the CMA to entrench the '4Ps framework' as part of the UK Government's wider strategy to promote economic growth in the UK. In March 2025, the CMA announced that it would be reviewing its merger remedies guidance by launching a formal review and call for evidence (Call for Evidence). 

The CMA has historically preferred structural remedies, such as divestiture, over behavioural remedies that seek to change aspects of the future conduct of the merging parties. This is because structural remedies offer a "one-off" intervention (i.e. they do not require significant ongoing monitoring) and are more likely to deal with the change in market structure brought about by the merger by restoring competitive rivalry. In recent years, the CMA has come under criticism for adopting an overly cautious approach to behavioural remedies and rarely accepting such remedies in practice. However, the CMA has recently signalled a willingness to consider certain behavioural remedies, including in Vodafone / Three (which the CMA cleared at phase 2 subject to behavioural remedies) and Schlumberger / ChampionX (which the CMA cleared at phase 1 subject to undertakings being offered by the parties including a behavioural remedy).

For a summary of the Call for Evidence and the CMA's contribution to the UK growth agenda, and previous approach to merger remedies, see our March 2025 update.

The CMA is now seeking feedback on its proposed changes to its merger remedies guidance, including on its application of behavioural remedies, by 13 November 2025. The main changes are explained below. 

When the CMA considers merger remedies, it has a statutory duty to achieve as comprehensive a solution as is reasonably practicable for the purpose of "remedying, preventing or mitigating the substantial lessening of competition" (SLC).

In practice, the CMA adopts a two-stage assessment:

• an assessment of the remedy's effectiveness, which involves a consideration of whether the remedy effectively addresses the SLC and its adverse effects; and

• an assessment of whether the remedy is proportionate, which involves the CMA identifying the least costly and intrusive remedy that it considers to be effective and ensuring that the proposed remedy is not disproportionate in relation to the SLC and its adverse effects.

In response to feedback received as part of the Call for Evidence, the CMA has concluded that the current analytical framework for the assessment of remedies allows for "greater flexibility in the effectiveness assessment" than is set out in the CMA's existing merger remedies guidance, with the Draft Revised Guidance seeking to broaden the range of potentially effective remedies that may be considered. For example, the CMA has removed the presumption that behavioural remedies are unlikely to be as effective in dealing with a SLC comprehensively than structural remedies from the Draft Revised Guidance.

The CMA has also added further clarification in relation to its assessment of proportionality, in particular by outlining the key steps it will apply to: (i) identify any relevant costs (in particular where imposed on third parties, the CMA and other monitoring agencies); (ii) ensure that the remedy is no more onerous than it needs to be; and (iii) choose the least onerous remedy, before assessing whether the chosen remedy is proportionate in relation to the SLC. The Draft Revised Guidance acknowledges that there may be exceptional circumstances where "even the least onerous but effective remedy" might still incur costs that are disproportionate to the SLC and its adverse effects. In these rare instances, the Draft Revised Guidance proposes that CMA may instead consider remedies that are only partially effective in resolving the SLC and its adverse effects and select the most effective and proportionate remedy available. 

The Draft Revised Guidance states that behavioural remedies "can be effective in some cases" and that effectiveness will be assessed on a case-by-case basis. This represents a departure from the CMA's previous approach of generally only accepting behavioural remedies in cases where: (i) there is a time-limited SLC; (ii) there are substantial relevant customer benefits (RCBs); or (iii) structural remedies are not feasible.

The CMA's consultation acknowledges that there is academic evidence indicating that behavioural remedies may be more appropriate than structural remedies, including certain cases involving vertical and/or conglomerate, rather than horizontal, theories of harm.

The Draft Revised Guidance therefore sets out a wider range of circumstances in which behavioural remedies would satisfy the effectiveness criteria. In particular, whilst maintaining the position that "most behavioural remedies do not directly address the SLC at source" and that such remedies are subject to a "variety of risks" which might limit their effectiveness, the Draft Revised Guidance sets out the following factors in which the risks associated with behavioural remedies may be reduced: 

• where the behavioural remedy has a limited duration;

• regulated sectors where the regulator has the ability to effectively monitor the remedy; 

• industries with certain characteristics (e.g. a high degree of transparency) which make it more likely that third parties are in a strong position to identify non-compliance;

• the behavioural remedy aligns with pre-existing market practices and norms in the relevant industry; 

• the market is sufficiently stable and mature, such that competitive conditions are unlikely to materially change in ways which mean that the behavioural remedy becomes ineffective; and

• the merging parties appoint and pay for a monitoring trustee. 

The Draft Revised Guidance distinguishes between: (i) enabling remedies (such as access remedies), which it notes may "work with the grain of competition" by seeking to address the causes of an SLC and, in certain cases, may directly stimulate competition in a long-lasting way; and (ii) controlling remedies (such as price caps) which seek to control market outcomes. For example, a remedy involving the licensing of intellectual property may stimulate competitive rivalry and/or enable market entry (and therefore have a similar effect to a structural remedy). Some enabling remedies may also be used to secure merger-specific rivalry-enhancing efficiencies (e.g. Vodafone / Three, where the CMA adopted a behavioural remedy to secure the merging parties' efficiency commitments). The Draft Revised Guidance notes that controlling remedies are unlikely to be appropriate other than for a limited duration or if there are no other effective remedies.

New guidance on 'carve-out' remedies

The CMA has maintained its position that there are considerable risks associated with carve-out remedies (that involve the divestiture of part of a business or a collection of assets). In particular, the CMA refers to its recent ex-post study, conducted in 2023, which found that carve-out remedies are generally prone to greater composition and purchaser risk than the divestiture of a standalone business. The CMA's consultation document also states that it did not identify academic literature or receive submissions in response to its Call for Evidence that described specific circumstances in which carve-out remedies would be a more appropriate remedy choice. 

The changes introduced in the Draft Revised Guidance mainly provide additional examples of the types of evidence that the CMA may have regard to when assessing carve-out remedies (such as, for example, data relating to the performance of previous comparable divestitures or the performance of the relevant assets to be divested). 

Additionally, the Draft Revised Guidance outlines several ways in which the risks of a complex divestiture remedy may be mitigated, thereby increasing the likelihood that the CMA will consider the remedy to be effective. This includes, for example, early engagement between the merging parties and the CMA in relation to the proposed remedy, requiring an upfront buyer to mitigate increased purchaser and mitigation risk, the appointment of divestiture and monitoring trustees, and requiring a "fall-back" remedy comprising a more marketable divestiture remedy (often referred to as 'crown jewel' remedies). 

The Draft Revised Guidance maintains the existing standard that undertakings offered by merging parties at the end of phase 1, in lieu of a reference to phase 2 (UILs), must be "clear cut" and "capable of ready implementation".

However, the Draft Revised Guidance sets out three significant changes to the CMA's current approach to the acceptance of UILs at phase 1: 

• the CMA is proposing to remove the presumption against behavioural remedies being accepted at phase 1. Although the CMA considers structural remedies more likely to satisfy the "clear cut" standard, it will nevertheless consider proposals put forward by merging parties for behavioural remedies that "fully substantiate, with appropriate evidence, the proposed remedy's effectiveness to the clear-cut standard";

• the earlier merging parties engage with the CMA in relation to remedies, the more likely a remedy will meet the "clear-cut" test as it gives the CMA time to fully assess the risks and consider appropriate safeguards. The Draft Revised Guidance also encourages parties to, if possible, facilitate early engagement with third parties who would be affected by a proposed remedy; and

• in cases involving local markets and where the CMA applies a "filter" or "decision rule" (which sets a threshold for when a realistic prospect of an SLC arises, typically based on market share), the CMA may accept divestitures that do not remove the entire increment caused by the merger. This approach contrasts with the CMA's previous approach in some local markets cases, in which it required divestitures to remove the entire increment (i.e. to restore the pre-merger market structure).

The Draft Revised Guidance recognises that, in cases where merging parties propose a remedy that is complex or highly technical in nature, it may be useful to appoint an independent expert (or extend the role of a monitoring trustee) to perform this role.

In this regard, the CMA notes that the appointment of a trustee or independent expert may provide additional comfort to the CMA that a remedy proposal will be effective and enable the CMA to reach a decision on remedies within shorter timescales. For example, in Schlumberger / ChampionX, the merging parties appointed a monitoring trustee during the UILs process and prior to the CMA's final acceptance of UILs to assist the CMA in the assessment of a potential upfront remedy taker's scale and capability and to provide independent advice on its overall suitability as a remedy taker. 

RCBs are benefits resulting from a merger, which can take the form of lower prices, higher quality, greater choice, or greater innovation. The CMA may assess the effect on RCBs in the context of considering phase 1 UILs and has a discretion not to refer a merger to phase 2 if it believes that any RCBs outweigh the SLC concerned. RCBs are also considered when assessing remedies at phase 2. In order for a benefit to constitute an RCB, the CMA must believe that: (i) the benefit may be expected to accrue within a reasonable period as a result of the merger; and (ii) the benefit is unlikely to accrue without the creation of that situation or a lessening of competition. 

The CMA has historically adopted a restrictive approach to RCBs which, in turn, has deterred some parties from putting forward and evidencing RCBs. Merger parties will be expected to provide "verifiable" evidence (changed from "convincing" evidence in the current guidance) in relation to the nature and scale of any claimed RCBs. In order to encourage engagement on RCBs, the Draft Revised Guidance signals the CMA's openness to "early without-prejudice discussions" during phase 1 (including in pre-notification) or at early stages of phase 2. The Draft Revised Guidance also provides guidance and examples of how the CMA will consider certain types of RCBs.

In relation to rivalry-enhancing efficiencies, the Draft Revised Guidance confirms that in some cases, such as in Vodafone / Three, remedies can address concerns that the CMA may have about the likelihood or timeliness of merger-specific efficiencies which, if realised, would enhance rivalry, benefit UK customers and be sufficient to prevent an SLC. In response to the Call for Evidence, stakeholders argued that the Vodafone / Three decision should not set the standard which claimed rivalry-enhancing efficiencies would need to meet (in particular as that case has limited application outside of regulated sectors). Whilst deciding not to address these concerns in the Draft Revised Guidance, the CMA has noted that it will consider its approach to the substantive assessment of efficiencies more widely in due course.

Enhancing the merger remedy process 

The CMA recently consulted on its phase 1 merger procedure in June 2025 (see our July 2025 update). However, the CMA considers that additional changes can be made to improve its merger remedies process at phase 1, and intends to introduce further changes to its procedural guidelines in due course.

Specifically, the proposed changes include:

• additional guidance on how merger parties can engage with the CMA on remedies throughout the process, including specific guidance before and after a phase 1 'issues letter';

• earlier opportunities to engage with the CMA in relation to remedies during the phase 1 process (including, if the merging parties wish, with the involvement of the phase 1 decision-maker);

• offering the parties a standalone meeting to discuss remedies following submission of their response to the issues letter (rather than at the end of an issues meeting, as is current practice); and

• providing guidance on the relevant considerations applicable to cases involving a fast track to UILs, including "fix it first" remedies.

The Revised Guidance does not include any further changes to the remedies process at phase 2 (in light of recent changes to this process (see our May 2024 update)).

Comment

The CMA's Call for Evidence in March 2025 (which followed the publication in February 2025 of the UK Government's draft strategic steer to the CMA to support growth and investment) launched the review of its merger remedies guidance and set out much of the groundwork for the changes that have been introduced into the Draft Revised Guidance. In particular, the modifications to the analytical framework for assessing the effectiveness of behavioural remedies, and the removal of the presumption against behavioural remedies being accepted at phase 1, were anticipated, and reflect the CMA's recent practice in cases such as Vodafone / Three and Schlumberger / ChampionX. These changes to the CMA's approach to behavioural remedies have been anticipated since November 2024, when Sarah Cardell (the CMA's Chief Executive) announced the CMA's intention to review its merger remedies process and in particular to look at when behavioural remedies may be appropriate.

However, other welcome changes introduced by the Draft Revised Guidance include the CMA's revised approach to divestment UILs in local markets cases and the willingness to signal early engagement on RCBs. The CMA's Executive Director for Mergers, Joel Bamford, has described the changes introduced by the Draft Revised Guidance as a "comprehensive refresh of our remedies guidance, designed to give greater clarity and certainty about our approach while keeping the focus firmly on effective outcomes".

The CMA's consultation on its Draft Revised Guidance is the latest in a growing list of updates to CMA guidance documents (from refining the UK subsidy control regime (see our April 2025 update) to changing its procedural guidelines for phase 1 mergers (see our July 2025 update)). These announcements form part of the recent shift by the CMA to demonstrate a more pragmatic and flexible approach to reviewing merger cases, with the aim of supporting the UK's wider growth agenda. The common theme across these guidance updates is the incorporation of the CMA's 4Ps framework into its approach across all areas of its work. At the time of writing, the CMA has not formally announced any changes to its Merger Assessment Guidelines (MAGs), which were last updated in 2021. However, the CMA's consultation hints that a review of the MAGs may be imminent; as noted above, in the context of rivalry enhancing efficiencies, the CMA confirms that it "will be exploring further our approach to the substantive assessment of efficiencies and will say more about this in due course". 

Want to know more? 

• CMA consults on further reform to UK merger procedure guidelines, 4 July 2025. 

• Consultation outcome: refining the UK subsidy control regime, 17 April 2025.

• CMA reconsiders approach to merger remedies and publishes Mergers Charter, 17 March 2025.

• CMA adopts new Phase 2 merger process, 3 May 2024.