A public interest intervention notice was not issued in the Paramount Skydance acquisition of Warner Bros. Discovery, because the Culture Secretary accepted a legally binding deed of undertaking instead. The CMA cleared the deal on competition grounds on 6 August 2026. The two decisions were published the same day, and the second is the more interesting one.
What did the CMA decide?
The CMA found no realistic prospect of a substantial lessening of competition in the UK and declined to refer the merger to phase 2 under sections 33(1) and 34ZA(2) of the Enterprise Act 2002. The decision carries reference ME/7144/26.
Jurisdiction rested on the turnover test, the target having UK revenues above £100m. The CMA examined theatrical film distribution and the wholesale supply of linear children’s television channels, and dismissed concerns about the other overlaps including subscription video on demand and vertical foreclosure. On theatrical distribution the finding is finely put: the parties compete closely, but do not appear closer to each other than to Universal, Disney or Sony, and although the merged entity becomes the UK’s largest distributor it remains constrained by those three and by smaller studios.
On children’s channels the reasoning turns on decline. The parties hold a strong position in linear pay-TV children’s channels, but consumers have free-to-air and on-demand alternatives, and demand for linear pay-TV children’s channels is falling along with their importance to pay-TV providers.
The statutory timetable ran from the launch of the merger inquiry by notice to the parties on 9 June 2026, following an invitation to comment between 13 and 27 April. The decision landed a day before the deadline.
The parallel public interest track
Running alongside the competition assessment was something practitioners see rarely enough to be worth setting out properly. On 30 June 2026 the Secretary of State for Culture, Media and Sport wrote to both parties under the Enterprise Act public interest regime to say she was minded to intervene on media plurality grounds, covering children’s programming, editorial independence and news media. A written ministerial statement was issued to the same effect.
The parties were given until 6 July to make representations. Paramount put forward assurances, and after discussions with departmental officials offered to strengthen them and convert them into legally binding commitments through a deed of undertaking made in the Secretary of State’s favour.
She then decided not to issue a public interest intervention notice at all. The stated basis is that the assurances and binding commitments secured at this point provide protections that help safeguard the availability of a diverse range of broadcasting and on-demand services, their distinct editorial identities, and the distinct editorial identities of key UK news programmes.
Why does a deed of undertaking matter here?
Because it produces a regulated outcome without the regulatory process. Had a PIIN been issued, Ofcom would have reported, the CMA’s phase 1 report would have been laid alongside it, and the Secretary of State would have taken a decision on the public interest consideration within a statutory framework subject to the usual scrutiny. None of that happened. What exists instead is a private instrument, redacted in publication, with an annual compliance statement to the Secretary of State and departmental monitoring.
The commitments run for five years from completion, except those relating to Channel 5, which run until 31 December 2034 when its current public service broadcasting licence ends. That is a materially longer horizon than the usual life of merger remedies, and it is tied to a licence expiry rather than to a market review.
There is a precedent point buried in the written ministerial statement. The Secretary of State had said that if she intervened she would bring forward secondary legislation to amend the plurality of control public interest consideration so that Ofcom could examine the impact on video-on-demand services. She is no longer doing so for this transaction, but has reserved the position for future cases given the role on-demand viewing now plays.
Phase 1 outcomes set the timetable for everything downstream, but the more portable lesson here is the second track. A merger can clear the CMA and still be shaped by an intervention that never formally begins, through undertakings given to a Secretary of State rather than remedies accepted by a competition authority. Deal teams advising on media, broadcasting or news assets should be building the public interest question into the timetable at the same point as the competition analysis, not after it.
What Paramount has committed to
The published summary of the assurances covers four areas. Linear channels are not to be consolidated with on-demand services in the UK, and are to retain a distinct editorial identity. The children’s channels are to remain editorially distinct and to continue commissioning and acquiring original UK children’s content.
The news commitments are the most detailed. Channel 5 News is to maintain editorial independence with its editorial direction entirely separate from CBS News and CNN International, CNN International is to remain available in the UK, and bona fide licensees are to retain access to the CNN, CBS News and Channel 5 news archives on standard commercial terms. Channel 5 is to continue operating as a public service broadcaster fulfilling its licence obligations, with a UK-focused commissioning strategy and additional funding for news, original children’s programming and drama.
The Secretary of State has been explicit about what these powers do not reach. Her intervention powers under the Enterprise Act 2002 are confined to public interest considerations concerning broadcasting and news media. Film and cinema are for the CMA. She has said she will meet Paramount to seek assurances about the wider creative industries, and is considering changes to existing powers or further legislation.
The foreign state influence regime
The statement also records a separate assessment under the statutory foreign state influence regime, and this is the part most likely to be overlooked. The Secretary of State concluded that she does not have reasonable grounds to suspect that her duty to issue a foreign state intervention notice has arisen, and is therefore not minded to intervene.
That conclusion is expressly provisional. She will reassess if new information comes to light. A transaction can therefore complete having been assessed under the regime without receiving anything that operates as a clearance.
What does this mean for deal teams?
Three practical points. The competition analysis and the public interest analysis run on different clocks and produce different instruments, and only one of them is a decision in the ordinary sense. Undertakings given to a Secretary of State to avert an intervention are not undertakings in lieu of reference under the merger regime, and they are not enforced by the same body or on the same terms.
The commitments will be monitored departmentally rather than by a regulator with a published enforcement policy, which changes what a compliance function has to build. Paramount has undertaken to provide annual statements of compliance, and DCMS says it will monitor implementation closely.
The Secretary of State will update Parliament formally when it returns from summer recess in September.
Sources: the CMA merger inquiry case page, the summary of the phase 1 decision and the DCMS public statement. We covered the CMA’s opening of the Sky and ITV merger inquiry, and, for another negotiated resolution with a UK authority, the SFO’s £10m deferred prosecution agreement with Ultra Electronics.