The Competition And Markets Authority (CMA) has raised competition concerns over Viagogo’s $4.05 billion (£3.16bn) acquisition of StubHub.
With the secondary ticketing companies having a combined market share of more than 80% of the resale market, the watchdog is concerned the loss of competition brought about by the merger could result in customers losing out as a result of higher prices and fewer options.
Andrea Gomes da Silva, CMA’s executive director for markets and mergers said: "Viagogo is already the largest secondary ticketing company in the UK by some considerable margin and has purchased an established rival, with no other significant competitors in the market. We are therefore concerned that this transaction could lead to customers losing out through higher prices, less innovation and a lack of real choice."
As part of its investigation, the CMA says it undertook extensive market testing and looked at evidence from a number of third-party stakeholders including consumer groups, customers and competitors. It also examined the companies’ internal documents.
Viagogo now has five working days to address the CMA’s concerns. If the company is unable to deliver a "clear-cut solution that will preserve effective competition in the UK market", the deal will be referred for an in-depth Phase 2 investigation.
Adam Webb, campaign manager for anti-touting campaign group FanFair Alliance, said: "We welcome today's announcement from the CMA and hope it leads the way to an in-depth Phase 2 investigation.
"Viagogo remains a highly controversial business. The company has widely flouted consumer protection law in the UK, and remains under investigation in numerous other countries. Even today, amidst this terrible crisis that has decimated live music, Viagogo’s suppliers are attempting to sell tickets to cancelled events.
"Such a company, that has created thousands of consumer victims, should not be allowed to monopolise for-profit 'secondary ticketing'. That outcome would raise significant competition concerns in the UK and threaten to reverse hard-won reforms to prevent abuses in this market."