Downing Street reacted to Microsoft’s criticism of the UK as a less attractive place to do business than the European Union.
The reaction followed Microsoft president Brad Smith’s attack on the Competition and Markets Authority’s (CMA) decision to block the tech company’s $69 billion (£55 billion) acquisition of game maker Activision Blizzard. The CMA vetoed the deal due to competition concerns in the cloud gaming sector.
In a BBC Radio appearance, Smith called the move “bad for Britain” and called it “the darkest day for Microsoft in our four decades in the UK”. He warned that “the channel has never looked so wide.”
“We are not confident that in the future a technology company in the UK will grow faster than ever,” he said.
“People are shocked, people are disappointed and people’s trust in technology in the UK has been severely damaged.
He added: “There is a clear message here: the EU is a more attractive place to start a business if one day you want to sell it.
“For all of us who hoped the UK would create a more flexible post-Brexit structure, we are now seeing the opposite.”
Prime Minister Rishi Sunaka’s spokesman said Smith was wrong. “These kinds of claims are not supported by the facts,” the spokesman said, noting that the UK gaming sector has doubled in the last 10 years and contributed £7bn to the UK economy last year.
Last year, the UK became the third country in the world with an estimated $1 trillion in technology sector value, the spokesman said.
The government will continue to work with Microsoft, he said, adding that the CMA is independent.
Microsoft and Activision Blizzard want to appeal the CMA decision.
If the deal were approved, it would be the largest acquisition in the gaming industry to date and would give Microsoft control over hugely popular games such as Duty, overexpected and wWorld of Warcraft as well as mobile games such as candy crush.
Mr Smith said he expected Brussels to approve the deal and said regulators are more interested in negotiating and “finding solutions than in the reasons that prevent people from moving forward.”
He criticized the broad independence of British regulators and called them “inexplicable”.
CMA CEO Sarah Cardell defended her decision. “I think this decision shows how important it is to keep the UK competitive and that the UK is absolutely open for business.
“We want to create an environment where different companies can effectively compete, grow and innovate. This is the best for British consumers and the best for British businesses,” she said.