The Competition and Markets Authority has cleared Sony Music’s acquisition of AWAL, following an in-depth merger inquiry.
The CMA referred the merger to an in-depth phase 2 inquiry in September 2021, after identifying competition concerns during its initial investigation.
In February 2022, the CMA provisionally concluded that the deal does not substantially reduce competition in the UK and may not be expected to do so in the future. Following a consultation that ended on March 4, 2022, the CMA has upheld its provisional findings and cleared the deal.
The CMA found that there are many other label and artist services providers who will continue to compete effectively with both firms.
In the course of its investigation, the CMA also found that many other firms have begun providing similar services which can be expected to make up for the limited loss of competition from AWAL.
Margot Daly, chair of the independent CMA Inquiry Group, said: “We launched this inquiry as we wanted to be sure that this deal wouldn’t lead to worse outcomes for artists and fans. The music industry is vital to the UK economy and effective competition ensures that it works for everybody.
“Having carefully assessed the merger we found that it is not likely to affect competition in a way that will reduce the choice or quality of recorded music available or increase prices.”
“We welcome the decision by the CMA to clear Sony Music’s acquisition of AWAL and Neighbouring Rights, allowing us to focus on offering the best service for their artists, in an intensely competitive market with multiple competitors and many offerings," said a statement from Sony Music Entertainment. "This is the start of an exciting new venture for SME, AWAL and Neighbouring Rights, and ensures we can continue to deliver real benefits for artists globally as the music industry continues to evolve.”