CMA largely successful in defending the Tobii/Smartbox merger decision

10/01/20

The Competition Appeal Tribunal (the "CAT") has handed down judgment on Tobii AB (Publ) v Competition and Markets Authority [2020] CAT 1. The judgment is significant because it considers a number of important aspects of the CMA's duty of procedural fairness, the CMA’s approach to the collection of evidence, the approach to market definition and the robustness of merger analysis.

Tobii and Smartbox both supply hardware, software, accessories and related services to enable people with speech, language and communication needs to communicate (known as augmentative and assistive communication solutions).

The CMA investigated the completed merger between Tobii and Smartbox and concluded that the merger would harm competition in several ways and that Tobii had to sell the Smartbox business to a suitable purchaser.

Tobii ultimately challenged the CMA's decision on five grounds, which raised some 22 issues. In a judgment handed down on 10 January 2020, the CAT rejected grounds 1 to 5(a), but upheld ground 5(b).

The CAT rejected Tobii’s case that the CMA had failed to comply with its duty of procedural fairness. The CAT also dismissed Tobii’s challenge to the CMA’s approach to the collection of evidence, market definition, horizontal unilateral effects and vertical customer foreclosure effects was unreasonable or irrational. However, Tobii did succeed in demonstrating that the CMA’s finding of harm to competition due to partial input foreclosure did not have a sufficient evidential basis.

The judgment is here.