Summary

  • The CMA’s 20 October invitation says the parties have proposed no remedy and identifies prohibition as the only specified option so far.
  • Third parties may suggest other practicable remedies by 5pm on 27 October; the CMA has not decided that any option works.

The neatest merger remedy is often the one someone else has to design. The CMA’s 20 October invitation on nexfibre’s planned acquisition of Substantial says the parties have made no remedy proposal. The document names prohibition as a possible remedy and asks interested parties to propose any other practicable option by 5pm on Tuesday, 27 October.

That is a short menu for a transaction the authority provisionally says may substantially lessen competition in wholesale fixed broadband across the parties’ combined FTTP footprints. The finding is provisional; the case remains open, with a statutory deadline of 15 December.

The wording matters. The CMA has not chosen prohibition or ruled out alternatives. It says it has reached no decision on remedy effectiveness. Nor has it identified another structural remedy involving divestiture of a standalone business. Third parties may still suggest other practicable measures. “One item” means the only option the invitation specifies, not the only idea the CMA can consider.

The design gap is plain. A remedy is easier to test when the businesses that must execute it explain how assets, customers, systems, contracts and incentives fit together. The CMA says detailed design often needs significant input from the parties. Here, that proposal is missing, so the invitation turns to customers and other interested parties to fill part of the engineering brief.

A useful submission needs more than a vote for or against the deal. It should say what changes in the wholesale market, who controls the service, how other providers get access, what transfers, how compliance is monitored and who pays when implementation gets difficult. The CMA seeks the least costly and intrusive remedy it considers effective against the provisional competition concern and its effects.

The invitation asks for views on relevant customer benefits too. The statutory categories are lower prices, higher quality, greater choice and innovation; a benefit must be likely within a reasonable period because of the merger and unlikely without it. That gives the consultation a useful discipline: put a claimed benefit beside the remedy that might preserve it, then show the causal link.

Wholesale competition is easy to miss because households usually buy a retail package, while providers negotiate access farther upstream. The CMA’s provisional concern is defined at that wholesale layer and inside the combined FTTP footprints. A remedy has to operate there: it must say which providers can obtain which service, on what terms, across what area and for how long. A slogan about more competition cannot answer those questions.

That is why implementation cost belongs in the evidence, not in a footnote after the announcement. The CMA asks for views on the cost of each option and chooses the least costly measure it considers effective. A proposal should separate the cost of transferring or maintaining access from the cost of monitoring it, identify who carries each expense and say what record would show the arrangement is working. The same detail lets the authority compare a blunt stop with a continuing obligation on a live business.

A rule that sounds gentle but cannot be enforced is a promise wearing a broadband logo. A remedy dependent on perfect cooperation has an obvious weak joint. Prohibition is severe but legible: the deal does not complete. Any alternative must show how it preserves effective competition in the market the CMA identified.

Evidence may still change the diagnosis and the remedy. The clock is tight: third-party proposals are due seven days after publication, while the final report is due 15 December. The parties know their businesses best; the invitation records that they have proposed no remedy. If outsiders are asked to design what is missing, they need evidence and time for more than a clever paragraph.