FTC Reportedly Sued Microsoft to Prevent EU Approval of Activision Deal

Sources close to the matter claim that the US regulator filed its lawsuit earlier than expected in an attempt to pre-empt any potential agreement between the EU and Microsoft that would allow the merger to go through.

The US Federal Trade Commission has reportedly sued Microsoft in order to discourage EU regulators from approving the settlement and allowing the deal to proceed.

The FTC filed an antitrust lawsuit against the tech giant in an attempt to block it from the acquisition of Activision Blizzard in December last year. The agency claimed that the merger would negatively affect the competition in the market, citing Microsoft's record of acquiring studios and making their games exclusive to its gaming ecosystem and bringing the upcoming Starfield and Redfall as examples.

According to a new report from Bloomberg, the FTC filed its lawsuit earlier than expected in order to influence the decision of the European Commission, another regulatory body reviewing the acquisition. The FTC filed the lawsuit on December 8 which reportedly happened shortly after the two agencies held a call about their investigations and learned from EU officials that they were planning to discuss potential remedy proposals with Microsoft.

Apparently, the FTC wanted to take the initiative and set the terms of the Microsoft-Activision Blizzard merger, rather than being pressured into approving the acquisition by the European Commission, as Fried Frank Harris Shriver & Jacobson LLP’s antitrust head Barry Nigro noted in a comment to Bloomberg.

Regulatory authorities like the European Commission and the UK's Competition and Markets Authority are set to announce their final decisions on the Microsoft-Activision Blizzard merger in spring 2023, with the EU expected to issue its verdict on April 11 and the CMA on April 26. Additionally, the CMA plans to announce a preliminary decision in late January or February.

Microsoft has repeatedly addressed regulators' concerns about exclusivity emphasizing that its interest in acquiring Activision Blizzard is primarily driven by the company's strong presence in the mobile gaming market. As a demonstration of its commitment, Microsoft entered into a 10-year agreement to release Call of Duty on Nintendo Switch and Steam. The company also attempted to negotiate a similar deal with Sony for PlayStation, but no agreement was reached.

You can find Bloomberg's report here. Also, don't forget to join our 80 Level Talent platformour Reddit page, and our Telegram channel, follow us on Instagram and Twitter, where we share breakdowns, the latest news, awesome artworks, and more.

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