Canada regulator says Microsoft-Activision deal "likely" to harm competition

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Update: Microsoft responded to the Canada Competition Bureau, making it clear the window during which the regulator could have blocked the deal has now closed.

According to The Verge, the platform holder's spokesperson Rebecca Dougherty said it only received notice the Bureau would continue to monitor the transaction "after the formal waiting period preventing the deal to close expired."

"We continue to work with regulators around the world to address any remaining concerns," she said.

Original story: The FTC vs Microsoft hearing has revealed Canada's stance on the latter's proposed acquisition of Activision Blizzard.

The Verge reports the nation's Competition Bureau believes the deal is likely to harm competition in both the console and multi-game subscription spaces.

The Bureau wrote to Judge Jacqueline Scott Corley, who is overseeing the hearing and will rule on whether or not the Federal Trade Commission is granted a temporary block against the merger, to correct "factual inaccuracies" in some of the documents Microsoft is using to support its case.

According to the Bureau, Microsoft claimed that "every single worldwide regulator that has examined the deal other than the FTC" has dismissed the idea that it would make Call of Duty exclusive to its ecosystem.

The Xbox firm also claimed "all but one foreign regulator" has accepted its solutions to the potential issues with cloud gaming, referring to the UK's Competiton Markets Authority which is blocking the deal due to concerns in this area.

In its letter to Judge Corley, the Bureau wrote that it has already informed Microsoft and Activision Blizzard it believes "the proposed merger is likely to result in a substantial prevention and/or lessening of competition with respect to gaming consoles and multi-game subscription services (as well as cloud gaming)."

However, it's worth noting this is not a final ruling like that of the CMA, as the Bureau emphasised it is "continuing to monitor the transaction."

It's true that Microsoft has won over several regulators around the world, including China, Japan, and European Union – the latter being one of three key markets that need to approve the deal.

However, the FTC continues to push for a preliminary injunction ahead of its own administrative hearing in August, and the CMA will reassert its decision when Microsoft makes its appeal in July.

You can follow the latest from the FTC vs Microsoft hearings in our roundup, and learn more about the regulatory hurdles Microsoft faces in our extensive primer.