Microsoft and a UK regulator have been given more time to resolve Activision merger issues

and the UK’s antitrust regulator have been granted a conditional two-month break in their legal battle as the company seeks to resolve the (CMA) is concerned about its proposed acquisition of Activision Blizzard for $68.7 billion. Competition Appeals Tribunal (CAT) Judge Marcus Smith, who hears appeals of CMA decisions, wants proof from the watchdog that this is the right course of action, but has suspended all the same the legal battle at the moment.

Smith wants the AMC to justify its adjournment request by providing evidence that shows a material change in circumstances or “special reasons” for delaying litigation. He also wants the regulator to detail any new consultation process he plans to undertake “so that everyone knows how it will work”, according to . The judge asked the AMC to present evidence on Thursday.

Microsoft appealed the CMA about cloud gaming issues. The CAT was to hear this case from July 28. However, shortly after the Federal Trade Commission to block the acquisition in the United States last week, the CMA said it . The CMA, Microsoft, and Activision all asked CAT for more time, and the court granted the request.

CMA attorney David Bailey told CAT that the FTC’s legal loss “was not part of the CMA’s thinking” in terms of whether it would consider a new proposal from Microsoft. “Based on discussions to date, both parties – Microsoft and the CMA – are satisfied that Microsoft notifying a restructured transaction is capable of addressing the concerns identified by the CMA,” he said.

It emerged during Monday’s hearing that Microsoft has yet to submit an amended proposal to the CMA, even though the deadline for the merger is tomorrow, July 18. It seems unlikely that everything will be resolved by then. Otherwise, Microsoft and Activision will either have to agree to an extension of their current deal (the more likely outcome given their desire to complete the deal) or renegotiate the terms. Otherwise, Activision can walk away from the deal with a big $3 billion breach check from Microsoft in its pocket.

Microsoft may sell some UK cloud gaming rights to address CMA concerns. Microsoft signed agreements with third-party cloud gaming companies to offer its games on their platforms, which was enough for the European Union to .

Meanwhile, the FTC is still scheduled to hold its own hearing on the acquisition starting Aug. 2. The agency and he requested a preliminary injunction to stop Microsoft and Activision Blizzard from closing the deal until he could take the case to court, but that was unsuccessful.

As such, Microsoft and Activision will surely be eager to seal things off by early August. It has been suggested that they will try to close the merger before the original deadline despite the dispute with the CMA and find a workaround to continue doing business in the UK, but with all parties willing to find a amicable solution seems unlikely at this stage. until August 29, to make a final decision on the case.

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