Activision Blizzard and Microsoft have been blocked from investing in each other

The United Kingdom’s Competition and Markets Authority (CMA) has published an interim order to limit Activision Blizzard and Microsoft from investing in each other until it’s determined whether Microsoft will be allowed to purchase the company.

In 2022, Microsoft announced its intentions to purchase Activision Blizzard. Its stockholders approved Microsoft’s $68.7 billion USD (roughly $85.96 billion CAD) bid in April. The deal needs to be reviewed and approved by regulators in the United Kingdom, the United States, and the European Union to go through.

Late last year, the American Federal Trade Commission filed a lawsuit to block the deal over concerns that Microsoft would be able to “suppress competitors.” An evidentiary hearing will be held on August 2nd.

The UK’s CMA was the first regulatory body to rule on the acquisition this April. It rejected it, arguing it would result in a “significant lessening of competition” in cloud gaming.

Xbox Cloud Gaming running on a smartphone.

Following that ruling, the CMA has published an interim order requiring Microsoft and Activision Blizzard to obtain “prior written consent” before making any acquisitions between the companies. For example, this would stop them from investing in each other. The CMA said it was “preventing pre-emptive action” by either company.

Microsoft and Activision Blizzard have said they will appeal the CMA’s decision. “We remain firmly committed to this deal and look forward to presenting our case to the Competition Appeal Tribunal,” said a Microsoft spokesperson to the BBC.

“Microsoft has already shown that it can and will withhold content from its gaming rivals,” said Holly Vedova, the director of the FTC’s Bureau of Competition. “We seek to stop Microsoft from gaining control over a leading independent game studio and using it to harm competition in multiple dynamic and fast-growing gaming markets.”

Since Microsoft acquired Bethesda, it has announced that future games from the developer will be exclusive to Xbox. Sony, among others, has raised concerns that acquiring Activision Blizzard would mean more games would become exclusive to Microsoft. To alleviate concerns, Microsoft has offered Sony a 10-year deal to bring Call of Duty games to PlayStation. Sony has not accepted yet, but Nintendo and Steam were offered the same deal and agreed.

“Any claim the deal is anticompetitive ignores facts; the deal benefits gamers and the industry, especially given competition from abroad,” said Activision Blizzard executive Lulu Cheng Meservey on Twitter.

Sources: BBC Via: Game World Observer, iPhone in Canada