Canada’s Department of Justice has recently expressed concerns regarding Microsoft’s acquisition of Activision Blizzard, stating that the deal is likely to result in reduced competition in certain areas of the gaming industry. This information was revealed in a court filing on Thursday, which included a letter from the department to Microsoft’s US lawyers. The letter, dated Wednesday, explained that the department had informed both Microsoft’s and Activision’s lawyers in Canada about the anticipated decrease in competition specifically in the realms of gaming consoles, multigame subscription services, and cloud gaming.
Legal Proceedings Aim to Halt the Transaction Temporarily
The letter from Canada’s Department of Justice was submitted as part of a US federal court proceeding initiated by the US Federal Trade Commission (FTC). The FTC is seeking a temporary injunction to prevent the proposed transaction from proceeding so that an FTC judge can thoroughly evaluate its potential consequences. The closing arguments for this legal battle are scheduled to take place later on Thursday. Microsoft has been pushing for a swift resolution before the deal’s termination date on July 18, with a ruling potentially being delivered as early as next week.
Microsoft Addresses Concerns and Cooperation with Antitrust Enforcers
In response to the concerns raised by Canada’s Department of Justice, Microsoft released a statement assuring that it is actively collaborating with antitrust enforcers to address these apprehensions. The company acknowledged that it had received notice from the Canada Competition Bureau, stating that it would continue to monitor Microsoft’s acquisition of Activision Blizzard even after the expiration of the formal waiting period that prevented the deal from closing. Microsoft remains committed to working towards a resolution that satisfies all parties involved.
Additional Obstacles from British Competition Authorities
Apart from the challenges posed by Canada’s Department of Justice, Microsoft’s bid to acquire Activision Blizzard is also facing opposition from British competition authorities. Microsoft has filed an appeal with Britain’s Competition Appeal Tribunal, and a hearing is scheduled to take place on July 28. This indicates that the acquisition faces scrutiny and potential hurdles not just in Canada but also in the United Kingdom.
In summary, Canada’s Department of Justice has expressed concerns about Microsoft’s acquisition of Activision Blizzard, highlighting potential decreases in competition within the gaming industry. This information was shared in a letter submitted as part of a legal proceeding initiated by the US Federal Trade Commission. Microsoft is actively collaborating with antitrust enforcers to address these concerns and is determined to reach a resolution. Additionally, the acquisition is facing opposition from British competition authorities, further complicating the process. The outcome of these challenges remains uncertain, with the possibility of a ruling being delivered in the near future.
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