2025 marked a turning point for competition enforcement in the digital sector in both the European Union and the United Kingdom. The EU started to move away from rule-setting to active enforcement under the Digital Market Act (DMA) with ever increasing fines imposed on Big Tech, while in the UK, the Digital Markets, Competition and Consumers Act 2024 (DMCC) came into force. We discuss the key highlights for each jurisdiction below.
European Union
Digital regulation moves into full enforcement mode
2025 was the first full year of substantive enforcement under the DMA. The European Commission (Commission) began to actively investigate designated “gatekeepers” and issued financial penalties for alleged non-compliance, including issues such as self-preferencing, enabling access to data and interoperability. There are currently several appeals in front of the General Court of the European Union under the DMA which will clarify important points in the legislation when judgements are issued.
Merger control
EU merger control continues to evolve, with sustained scrutiny of so-called “killer acquisitions” and transactions affecting innovation. With a number of EU Member States adopting additional powers to review transactions that fall below typical national thresholds, combined with the Commission’s willingness to accept referrals from Member States under Art.22 of the European Union Merger Regulation (EUMR), there remains a material investigation risk for deals that would not traditionally meet merger turnover thresholds but where there are substantive competition concerns.
As of early 2026, the Commission is scheduled to decide on large mergers such as Anglo American’s proposed combination with Teck and Alphabet’s acquisition of cybersecurity firm Wiz, illustrating continued scrutiny of large digital and industrial transactions.
Foreign Subsidies Regulation (FSR) becomes business as usual
In 2025, the FSR became a routine part of deal analysis. Companies receiving non-EU state support face an additional layer of review for acquisitions and public tenders, alongside merger control and foreign investment screening.
Policy developments
The Commission launched a major review and reform process of EUMR Guidelines. The Commission’s initiative involved two parallel public consultations — a general consultation on high‑level principles and an in‑depth technical consultation addressing topics such as market power, innovation, sustainability, digitalisation, efficiencies and public policy considerations. We expect draft Guidelines to be put out for consultation in due course, before being finalised as part of a longer‑term update to EU merger control policy.
The Commission is also preparing a major overhaul of its competition legislation, Regulation 1/2003, with a view to modernise EU antitrust enforcement for the digital era and strengthen the powers and coordination of national competition authorities. The reform process is underway following a 2024 evaluation and a public consultation launched in July 2025. The proposals involve:
- strengthening investigative powers for both the Commission and national competition regulators (eg dawn raids, digital evidence collection)
- improving case allocation and cooperation within the European Competition Network to handle cross‑border cases more efficiently
- streamlining procedures to reduce delays and increase legal certainty for businesses
- adapting enforcement tools to digital markets, potentially aligning with the DMA
- clarifying commitments and interim measures to ensure quicker intervention where needed.
An issue that has been widely discussed is the status of legal privilege for in-house lawyers in the EU. Following substantial lobbying by associations of in-house lawyers, the Commission published a brief in which it details all the reasons why it is not possible to recognise privilege for in-house lawyers in competition law cases and why it will not be included in the reform of Regulation 1/2003.
United Kingdom
New digital competition regime enters into force
The DMCC Act fundamentally reshapes the UK competition landscape, and shortly after it entered into force, the Competition and Markets Authority (CMA) began designating firms with Strategic Market Status (SMS) and imposing tailored conduct requirements. Crucially, under the DMCCA the CMA can now intervene if SMS entities breach the conduct requirements, without needing to establish a traditional competition law infringement. At present, Google and Apple have been designated as having SMS.
Government pressure on the CMA
The current Government has made economic growth and investment a central policy priority and has repeatedly emphasised that regulators should support, rather than inhibit, growth. In an unprecedented move, the Chair of the CMA was removed from his position in January 2025, in what was widely reported as a politically influenced leadership change tied to the Government’s pro-growth priorities.
The CMA has since then showed a growing sensitivity to the ability of the UK to attract international investment and innovation, the risk of deterring such investment, and the perception that the UK is a difficult and uncertain jurisdiction for transactions that may require competition approval.
It is interesting that most of the CMA documents discuss growth as well as the 4P framework (Pace, Predictability, Proportionality, and Process) that has been recently introduced by the CMA to guide its investigations.
New merger thresholds
While filings to the CMA remain largely voluntary, the UK updated its merger jurisdictional tests for the first time in over two decades under the DMCCA 2024:
- The turnover test was raised from GBP70 million to GBP100 million of UK turnover for the target.
- A new “small merger safe harbour” was introduced: mergers where each party’s UK turnover is GBP10 million or less are now exempt from CMA review.
- A new “hybrid” or one-party threshold enables the CMA to review transactions where one party has 33% share of supply in the UK and UK turnover of GBP350 million, even if the traditional share test (25% combined) is not met — expanding scrutiny of certain non-horizontal deals.
New Merger process
In Guidance effective from June, while the CMA has shortened the period for a phase 1 merger review it has introduced an additional initial discussion period before pre-notification. So, while the statutory term has in principle been decreased, the whole process might actually become longer.
It is worth noting that in 2025 the CMA did not block any merger.
Competition and consumer law powers convergence
Consumer protection is now firmly integrated into the CMA’s enforcement strategy. From April 2025, the CMA gained the ability to decide whether certain consumer protection laws have been breached without having to go to court, and to impose fines directly as part of its enforcement action — a major change from the prior model where court action was typically required. The regulator now has direct fining powers for misleading practices and unfair terms, increasing exposure for businesses with consumer-facing operations.
Other Notable Developments in 2025
Minority shareholdings and influence (Delivery Hero/Glovo)
Competition authorities are paying closer attention to minority shareholdings, particularly where they confer governance rights or access to sensitive information. In June 2025 the Commission fined Delivery Hero and Glovo, two companies active in the online food delivery sector, EUR329m for conduct while Delivery Hero was a minority shareholder of Glovo.
When Delivery Hero originally became a minority investor, it was able to appoint a member of Glovo's board. This board member subsequently shared with Delivery Hero the board documents and other competitively sensitive information that it had access to as a result of the board membership. Delivery Hero also used its position as a shareholder to influence Glovo’s business strategy, which enabled Delivery Hero to align it with its own strategy.
This enforcement action underlines that even non-controlling stakes can raise competition concerns where they reduce competitive incentives or facilitate coordination.
For investors and corporates alike, this reinforces the need to assess:
- board representation and veto rights
- information rights
- strategic alignment between portfolio companies operating in overlapping markets.
Information exchanges and investor communications (Michelin)
Authorities are continuing to scrutinise information exchanges, including those occurring indirectly through investor communications, analysts’ calls or market disclosures. Recent enforcement activity (including a case in which Michelin was dawn raided in relation to statements given by its directors on investors’ calls) highlights the risk that forward-looking or strategic information shared publicly may facilitate coordination or reduce uncertainty between competitors.
What might previously have been viewed as standard investor relations activity can now attract competition law scrutiny if it effectively signals market behaviour.
Employment and competition law (“labour market” enforcement)
Competition authorities in both the EU and the UK are increasingly focused on labour markets as a dimension of competition enforcement. This includes scrutiny of:
- wage-fixing or no-poach arrangements
- information sharing on salaries, bonuses or headcount planning
- restrictive employment clauses with broader market effects.
HR practices are no longer viewed as peripheral to competition law. Employment-related conduct can give rise to significant fines and reputational damage, even where no product market harm is alleged.
What next in 2026
In 2026, competition law is likely to continue evolving in response to rapid technological developments, globalisation, and increasing scrutiny of market power. Regulators are expected to focus more on digital markets, data-driven business models, and artificial intelligence, particularly where these raise concerns around consumer choice, transparency, or unfair dominance. Cross-border cooperation between competition authorities is also likely to continue, reflecting the global nature of many markets. A cooperation agreement between the UK and EU is likely to be signed. And last but not least, there may be continued attention to the interplay between competition law and other regulatory frameworks, including national security and consumer protection.
As a result, companies operating across borders and in fast-moving sectors will need to factor competition risk into wider regulatory and strategic decision-making.
