The UK's Competition and Markets Authority (CMA) looks for comments on key AI partnerships

The Competition and Markets Authority (CMA) in the UK recently opened invitations to comment (ITCs) as it tries to determine whether the partnerships between Amazon and Anthropic, and Microsoft and Mistral AI, as well as the arrangements between Microsoft and Inflection AI, are within the jurisdiction of UK merger rules, and to investigate the effect such partnerships and arrangements could have on competition within Foundation Model markets in the UK. The ITCs are a necessary first step in any CMA information-gathering process, and they must precede the launch of formal Phase 1 reviews. However, ITCs are not the beginning of a formal Phase 1 review, and their taking place does not entail that the CMA has jurisdiction over the discussed matter. However, where the CMA considers that a partnership or arrangement may fall within UK merger rules and raise competition concerns in the UK, it may open an investigation.

The announcement follows a recent CMA report that outlines key risks to open, fair, and effective competition in the AI Foundation Models market. The report focuses on the concerns that partnerships involving strong players could be deepening the existing positions of power in the market. The report also details the CMA's findings on an interconnected web of over 90 partnerships and strategic investments involving a small number of firms. Although partnerships aren't inherently bad, the CMA must ensure that the incumbent technology firms are not using their partnerships and investments to shield themselves from competition.

The ITCs on the Amazon - Anthropic partnership, the Microsoft and Mistral AI partnership, and the arrangement between Microsoft and Inflection AI former employees —including Mustafa Suleyman, who was recently appointed Microsoft AI EVP and CEO—, will be open until May 9, 2024. In parallel, the CMA continues to evaluate the feedback it received earlier this year on Microsoft’s partnership with OpenAI as it awaits the information it requested from both parties. A formal Phase 1 review of this partnership is yet to be launched.