UK competition regulators are spooking tech investors in the country with an implied threat to clamp down on startup M&A, according to a new survey of the industry.
As the UK’s Chancellor of the Exchequer engaged with the tech industry at a ‘Chatham House’ style event today, the Coalition for a Digital Economy (Coadec) think-tank released a survey of over 50 key investors which found startup investors are prepared to pull capital over the prospect of the Competition and Markets Authority’s (CMA) new Digital Markets Unit (DMU) becoming a “whole-economy regulator by accident”. Investors are concerned after the CMA recommended the DMU be given ‘expanded powers’ regarding its investigations of M&A deals.
Controversy has been stirring up around the DMU, as the prospect of it blocking tech startup acquisitions – especially by US firms, sometimes on the grounds of national security – has gradually risen.
In the Coadec survey, half of investors said they would significantly reduce the amount they invested in UK startups if the ability to exit was restricted, and a further 22.5% said they would stop investing in UK startups completely under a stricter regulatory environment.
Furthermore, 60% of investors surveyed said they felt UK regulators only had …read more
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