Competition | UK Regulatory Outlook January 2026

Digital markets 

In 2024, the Competition and Markets Authority (CMA) flexed its new digital markets regulatory powers, designating both Apple and Google as having strategic market status, with both online search and mobile ecosystems joining the list of the UK’s regulated sectors. These designations last five years, establishing a framework for the CMA to mandate changes to improve competition, though the specifics of these conduct requirements are now being consulted on. 

For search services, the initial measures focus on giving consumers meaningful choice over their search provider (including AI assistants), ensuring fair ranking of search results, giving publishers control over how their content appears in AI-generated responses, and enabling users to move their data between services.  

For mobile platforms, the priority is ensuring app reviews and rankings are fair and transparent, and preventing platform operators from misusing data gathered through the app review process. 

For both investigations, the CMA is expected to consult on additional measures in the first half of 2026. Updated timelines for these interventions are expected in early 2026. 

The CMA has also signalled that it may designate another major digital firm as having SMS in the first half of 2026. 

Predictions: Implementation will be gradual – SMS investigations take nine months and designated firms may challenge decisions in court. Even firms without SMS designation should prepare for increased regulatory engagement, as the CMA has broad powers to request information and can reach conduct outside the UK.  

Products using AI will face particular scrutiny around how they access data, work with other services, and present choices to consumers. Legal challenges to designations and conduct requirements could slow the process. 

Merger remedies 

The CMA published revised merger remedies guidance (CMA87) on 19 December 2025, allowing more flexible use of behavioural remedies at Phase 1 and 2 while maintaining effectiveness requirements. The guidance recognises remedies can lock in rivalry-enhancing efficiencies and provides detail on assessing relevant customer benefits (RCBs).  

Parties should expect greater CMA receptiveness to behavioural remedies at Phase 1 as well as increased consideration of rivalry-enhancing efficiencies, and RCBs. They must provide detailed implementation plans, monitoring mechanisms and compliance frameworks. 

Predictions: More Phase 1 clearances with behavioural undertakings are likely to reduce Phase 2 references. We anticipate increased scrutiny of remedy design, requiring detailed monitoring mechanisms and potentially independent trustees. The guidance aligns with the government's pro-growth agenda and CMA's commitment to supporting investment and innovation, particularly in tech. 

Civil engineering 

The CMA published its interim report on 17 December 2025 examining civil engineering for public road and railway infrastructure, identifying poor market outcomes and options for improvement regarding pipeline uncertainty, procurement policy, capacity constraints and regulatory barriers. Consultation deadline: 28 January 2026; final report: spring 2026. 

Expected recommendations include procurement reforms for competition and value, regulatory streamlining to reduce barriers, fairer risk allocation frameworks, and improved pipeline visibility. 

Predictions: The Procurement Act enables CMA information-sharing with contracting authorities on competition infringements, signalling sustained focus on anticompetitive conduct in public procurement. Regulatory barriers to entry and expansion will be addressed. Fragmentation in procurement and regulatory approaches across government may be identified as a key problem. Significant competition problems could trigger a full market investigation with remedy powers. 

Regulatory action plan 

HM Treasury's Regulation Action Plan includes competition reforms, with the Department for Business and Trade (DBT) consulting on merger control certainty, remedy reviews and CMA decision-making changes. The government will consult on opt-out collective actions reform to strengthen predictability, incentivise alternatives to litigation, and ensure meaningful consumer redress while protecting against speculative litigation. 

Expect early 2026 DBT consultation on jurisdictional thresholds, remedy reviews and replacing the CMA's panel model with a committee structure. Collective actions reform will address certification criteria, funding and costs, and settlement incentives. The CMA's "4Ps" programme (pace, proportionality, predictability, process) and new KPIs will enhance business confidence. 

Predictions: Pro-growth reforms will continue with increased regulatory accountability through the Regulator Dashboard and Regulators Council. The CMA must balance pro-growth agenda with enhanced enforcement against anticompetitive behaviour. Legislative merger control changes will take time; parties should engage with consultations. 

Subsidy Control Act 

The Subsidy Advice Unit (SAU) must publish its first report on the Subsidy Control Act's effectiveness by summer 2026 (reporting period ends 31 March 2026). Following a call for inputs (closed 24 June 2025), the government is consulting on refining thresholds for mandatory CMA referral and creating streamlined routes for subsidy delivery. 

Expected 2026 reforms include revised thresholds for mandatory/voluntary CMA referral, streamlined routes for community regeneration and arts/culture subsidies, and revised sensitive sectors list. 

Predictions: Calls for simplification will address complexity criticisms. Reforms must balance flexibility in subsidy delivery with effective scrutiny to prevent competition distortions. Competition considerations will remain central to the regime. 

For further information or advice on any of the issues covered in this Regulatory Outlook, please contact the experts listed below.