The Competition and Markets Authority has launched a Phase 1 investigation into Vodafone UK’s joint venture agreement with Three UK.
The deal would combine the companies’ telecommunications operations under one single network provider. Three is owned by Hong Kong-based CK Hutchinson Holdings.
Having now received the required pre-notification evidence and information from both Vodafone UK and Three UK, as well as early views from stakeholders, the CMA is starting its formal investigation.
The CMA now has up to 40 working days to assess the deal as part of a Phase 1 investigation. This review is designed to identify whether the deal may lead to a ‘substantial lessening of competition’ and – if so – whether a more in-depth Phase 2 investigation is required.
Sarah Cardell, chief executive of the CMA, said: “This deal would bring together two of the major players in the UK telecommunications market, which is critical to millions of everyday customers, businesses and the wider economy.
“The CMA will assess how this tie-up between rival networks could impact competition before deciding next steps.”
The CMA’s remit, by law, is to assess the potential impact of a merger on competition. It cannot consider other potential effects that a merger might have, for example, on access to personal data.
CK Hutchinson is based in Chinese-controlled Hong Kong. National security concerns are a matter for the UK government, which may choose to intervene under the National Security and Investment Act if it finds concerns.