UK CMA Proposes Tougher Rules on Microsoft in Business Software
UK Competition and Markets Authority proposes strategic market status for Microsoft.
Why it matters: Legal and compliance teams must prepare for tighter antitrust scrutiny impacting technology providers, especially in business software markets.
- On October 16, 2026, the CMA proposed designating Microsoft with strategic market status (SMS) in business software.
- Microsoft’s products like Word, Excel, Teams, and Copilot serve over 20 million UK monthly users.
- The CMA’s probe targets Microsoft’s control in operating systems, productivity, security, server OS, and databases.
- Consultation on the proposal runs until November 13, 2026, with a final decision expected by February 2027.
On October 16, 2026, the UK’s Competition and Markets Authority (CMA) took a significant step by proposing to designate Microsoft with strategic market status (SMS) for its business software ecosystem.
This move follows an investigation launched in May 2026 examining Microsoft’s dominant position across five key areas: operating systems, productivity software, security software, server operating systems, and relational database management systems.
Microsoft’s software suite, including Word, Excel, Outlook, Teams, and Copilot, is used by over a million organizations and sees 20 million monthly users in the UK. The CMA’s provisional findings suggest Microsoft’s market strength is bolstered by high switching costs, bundling of software products, and tight integration that limit customer choice and reduce competition.
Sarah Cardell, CMA Chief Executive, emphasized the importance of business software for the UK economy, noting: “Business software is a cornerstone of how the UK economy functions, from small businesses to major public services and infrastructure.” The CMA aims to ensure these services deliver competitive and fair outcomes.
Microsoft responded by highlighting openness and interoperability: “All our products—including Copilot—are open and interoperable, giving customers the ability to use them alongside competing services.”
The CMA has opened a consultation period lasting until November 13, 2026, inviting feedback from stakeholders and industry participants. A final decision on the strategic market status designation is anticipated by February 2027. This heightened scrutiny signals possible upcoming conditions or interventions to address competitive concerns in the evolving business software space, particularly as AI functionalities become more integral.
By the numbers:
- 20 million — monthly UK users of Microsoft business software products
- November 13, 2026 — deadline for CMA consultation on Microsoft SMS proposal
- February 2027 — expected date for final CMA decision on Microsoft’s strategic market status
What's next: The CMA’s consultation period closes November 13, 2026; final SMS decision expected February 2027.