EU Merger Guidelines telecoms reset: what the draft means for UK M&A
In short: the draft EU Merger Guidelines telecoms reset elevates dynamic competition, scale, innovation, investment and resilience to a heavier weighting in the substantive test. The European Commission opened the public consultation on 30 April 2026 and feedback closes on 26 June 2026. UK telecoms deals that engage EU jurisdiction now need to be argued in two registers.
For UK telecoms deals with EU jurisdiction, the substantive test for clearance sits in Brussels, not London. The European Commission is rewriting that test for the first time in two decades. The proposed EU Merger Guidelines give greater weight to dynamic competition, innovation, investment and resilience, and on their face they back scale arguments that the old Guidelines treated cautiously. UK telecoms deals with EU jurisdiction now need to be argued in two registers.
Regulatory background and consultation timing
EU merger control sits in Council Regulation (EC) 139/2004, the EU Merger Regulation. Article 2 requires the Commission to assess whether a concentration significantly impedes effective competition in the internal market. Commission Guidelines explain how the Commission applies the test in practice. The 2004 Horizontal Merger Guidelines and 2008 Non-Horizontal Merger Guidelines have governed the assessment for two decades. On 30 April 2026 the Commission published a single Draft Communication that consolidates both, opened a public consultation and invited feedback by 26 June 2026. Final adoption is expected later in 2026.
The UK position runs in parallel after Brexit. UK deals are caught by Part 3 of the Enterprise Act 2002, with the Competition and Markets Authority applying the substantial lessening of competition test under sections 35 and 36. The Digital Markets, Competition and Consumers Act 2024 raised the target turnover threshold to £100 million and added a 33%/£350 million hybrid test in section 23A of the Enterprise Act 2002 from 1 January 2025. The CMA Merger Assessment Guidelines (CMA129) date from 2021 and apply unchanged.
Analysis: four shifts in the EU merger guidelines telecoms test
The Draft Guidelines do four things that matter for telecoms transactions.
First, they treat scale, innovation, investment and resilience as procompetitive factors. The Draft says the assessment should give “adequate weight to scale, innovation, investment and resilience as procompetitive factors that can benefit from a degree of consolidation”. For telecoms, that is a structural shift. Mobile and fibre consolidation cases routinely turn on whether scale is rewarded or penalised. The previous Guidelines treated scale primarily as a market-share input feeding into unilateral and coordinated effects analysis. The Draft elevates scale to a positive factor in cases where the merging firms need to reach the size to compete in the internal market or against a small number of global incumbents.
Second, the Draft introduces explicit theories of harm built around loss of investment and expansion competition and loss of innovation competition. The “innovation shield” subsection at II.B.4.3 deals with acquisitions of start-ups, with the headline that such acquisitions are “unlikely to give rise to competition concerns” subject to specific guidance. For telecoms, that engages altnet roll-ups, satellite ventures and software acquisitions where the target is pre-revenue or pre-scale.
Third, resilience is now defined and operative. The Draft defines it as the readiness and ability of the internal market to continue servicing customers and to anticipate, withstand and recover from serious shocks. For telecoms, that picks up critical infrastructure security, cybersecurity, supply-chain diversity and defence readiness. The Commission lists, as examples of mergers benefiting resilience, those securing access to critical inputs and those enabling defence projects without creating excessive dependencies.
Fourth, the Draft enumerates the parameters of competition explicitly: capacity, investment, innovation, privacy, sustainability and resilience including security of supply. The previous Guidelines led with price, output, quality, range and innovation. The change widens the Commission’s working vocabulary in directions that telecoms transactions have argued informally for years.
| Theme | EU Draft Merger Guidelines (30 April 2026) | UK position (CMA129 + DMCC Act 2024) |
|---|---|---|
| Scale and consolidation | Adequate weight to scale as procompetitive factor; positive treatment for mergers reaching internal-market scale or competing against global incumbents | SLC test under EA 2002 ss.35 to 36; CMA129 (2021) treats scale through market-share and concentration analysis without an equivalent positive presumption |
| Innovation and start-up acquisitions | “Innovation shield” at II.B.4.3; start-up acquisitions unlikely to give rise to competition concerns subject to guidance | Hybrid test in EA 2002 s.23A captures killer-acquisition risk above £350 million UK turnover; SMS-firm reporting under DMCC Act 2024 Part 1 mandatory and suspensory for designated firms |
| Resilience | Operative parameter of competition; covers supply-chain diversity, cybersecurity of critical infrastructure, defence readiness, security of supply | Not a parameter of CMA129 assessment; National Security and Investment Act 2021 runs in parallel for sensitive-sector deals |
| Parameters of competition | Capacity, investment, innovation, privacy, sustainability, resilience including security of supply | CMA129 emphasises price, output, quality, range and innovation as parameters; resilience and security of supply not enumerated |
| Remedies | Article 8 EUMR remedies framework; structural and behavioural remedies considered alongside efficiencies and dynamic benefits | CMA Merger Remedies Guidance CMA87 revised December 2025; structural-remedies presumption at Phase 1 removed, behavioural undertakings expanded |
EU merger guidelines telecoms: commercial implications for UK M&A
For UK telecoms M&A with EU jurisdiction, three sets of implications follow.
Cross-border deals where the target has EU footprint will be argued differently. The scale argument for European telecoms consolidation has run against the previous Guidelines’ price-effects emphasis for years. The Draft brings that argument inside the Commission’s own framework. Lawyers running EU notifications can argue scale, resilience and innovation upside as part of the substantive defence rather than parking them as efficiencies. The Commission’s restated burden of proof makes the argument easier to land with the case team and in any reasoned decision.
UK to EU divergence is now real. The CMA’s SLC test under the Enterprise Act runs in parallel with the EU significant impediment to effective competition test. The two have produced broadly similar outcomes in practice, and UK practitioners still draw heavily on EU analytical work even though no statutory rule of alignment applies to UK merger control after Brexit. The substantive emphases are now pulling apart. The CMA Merger Assessment Guidelines do not use the same language on resilience or scale, and the CMA has not updated its published practice to track the Draft. A CMA filing and an EU filing now have to read consistently to each authority but argue from different starting points.
Deal documentation will reflect the new shape. Anti-trust risk allocation, conditions precedent, long-stop dates, clean-team protocols and reverse break fees are negotiated bilaterally, and the substantive merger landscape sets the deal team’s appetite for risk. Sellers will test whether the Draft framing supports lower remedies risk and tighter buyer obligations. Diligence on EU jurisdiction and on the EU substantive arguments now belongs at heads of terms, not at signing. Our regulatory due diligence page sets out the scope on EU and UK competition risk in telecoms transactions.
Viewpoint
The Draft Guidelines change the substantive shape of telecoms M&A in the EU. They do not change the SIEC test in Article 2 of the EU Merger Regulation. What they change is the inputs the Commission accepts as relevant and the weight it gives them. The headline that scale supports competition is the most important shift; it strips out the subtext of the 2004 Guidelines that scale was usually a problem dressed up as a benefit. For UK clients, the gap with the CMA’s calibration is the practical issue. The CMA will draw on EU thinking as authoritative on competition analysis, but its statutory test, its remedies framework and its case practice are pulling away from the Commission’s stated direction. Until the CMA refreshes CMA129, anyone running parallel filings has to manage two different substantive arguments rather than one.
The cross-link to the EU’s wider telecoms reset matters too. The proposed EU Digital Networks Act and the consolidation impulse in the Draft Merger Guidelines pull in the same strategic direction: a Commission that sees European-scale champions in telecoms as part of the resilience answer, not the resilience problem. UK firms with EU exposure should expect that direction to harden into case practice through the consultation period and into Q4 2026.
Contact
For advice on EU and UK merger control on a telecoms transaction, contact Rob Bratby at Bratby Law. We also advise on telecoms regulation and transactions across the UK and EU regulatory layers.
