The UK competition regulator has announced it will conduct an in-depth investigation into Adobe’s $20bn (£15.2bn) acquisition of Figma.
The Competition and Markets Authority (CMA) previously flagged the deal as potentially harmful to competition in the digital design space and gave the firms time to offer potential solutions to mitigate risks.
However, Adobe did not offer any acceptable solution to address those concerns, the CMA said, and so it is launching a deeper investigation into the deal.
“We look forward to establishing these facts in the next phase of the process and successfully completing the transaction,” said a spokesperson for Adobe.
The in-depth investigation has been given a deadline of 27 December to determine if the acquisition would harm competition.
Figma is a collaborative cloud-based design software, launched in 2016.
When the CMA first aired its concerns, it said that because design products from firms like Adobe and Figma have become “critical for the development of digital services” in the UK, the regulator was “worried” the consolidation would “stifle innovation” and lead to “higher costs”.
It is the latest clash between the CMA and deals involving major US tech firms. The competition watchdog’s most high-profile case this year has been its decision to block Microsoft’s acquisition of Activision Blizzard.
The US’ competition regulator, the Federal Trade Commission (FTC), shared the CMA’s concerns over the deal. However, a US court has ruled in favour of the tech giant.
The CMA will continue talks with Microsoft and Activision Blizzard over the deal following the decision across the Atlantic.