IN COMPETITION… COMPETITION AND PUBLIC PROCUREMENT LAW: JANUARY 2026 UPDATE
January 2026Welcome to the sixth edition of In Competition.
Already, 2026 has brought significant movement across both competition and procurement, with the UK Government consulting on major reforms to the competition regime, fresh CMA merger activity data, and continued analysis of the civil engineering market study highlighted last month. Procurement activity has accelerated, with a suite of updates to Procurement Act guidance and the annual threshold changes that took effect on 1 January. These developments point to a system settling into place while raising expectations on compliance, transparency and early planning.
Antitrust highlights
CMA civil engineering market study (continuing storyline)
Following the CMA’s December interim report on competition conditions in roads and rail civil engineering, the authority is maintaining its focus on market fragmentation, weak innovation incentives and procurement features that may limit competitive pressure.
Industry feedback to the CMA continues to underline that the biggest challenge in civil engineering is scaling rather than entry. Firms can enter the market, but growth is constrained by pipeline uncertainty, short term funding cycles and procurement processes that favour incumbents and cost focused scoring.
Responses also emphasise that fragmentation and misallocated risk remain systemic. Design and Build models, compressed timelines and limited early engagement often push risk onto SMEs, who are least able to absorb it. At the same time, prescriptive specifications and duplicated accreditation requirements suppress innovation and increase administrative burden.
There is strong support for practical measures that would genuinely improve market functioning, including more effective Early Supplier Involvement, clearer innovation evaluation, multi year funding for authorities and regional pooling of commercial and engineering expertise. These themes align closely with the CMA’s interim findings and will inform the authority’s next phase of recommendations.
Why does this matter? The study aligns with the real world challenges we see across infrastructure procurement, including incumbent advantages, inflexible delivery models and limited scope for innovation. This work will influence future recommendations on pipeline visibility, risk allocation and supplier capability expectations.
UK Government consultation on competition regime reform (20 January 2026)
The Department for Business and Trade has launched a consultation on significant reforms to the competition regime (see here for more information). Many of the proposed changes focus on increasing the efficacy of the merger control regime. Proposals include tightening and clarifying the share of supply and material influence tests to improve predictability, extending the statutory window for Phase 1 remedies, and replacing the independent Phase 2 inquiry group with dedicated CMA board sub committees.
Critics argue that this could reduce the degree of separation between investigation and decision making and introduce a risk of political influence over complex mergers. Any move to bring clarity to the pace of investigations is to be welcomed, provided that it does not lead to short cuts around due process.
Why does this matter? These proposals are directly relevant to construction, engineering and infrastructure firms planning strategic transactions. Greater clarity around jurisdiction may reduce uncertainty at the outset of deals. A longer Phase 1 remedies window may give parties more scope to resolve issues without a full Phase 2 investigation. However, revised governance of Phase 2 decisions may alter risk assessments for transactions involving vertical or multi market effects. Professional Indemnity and D&O insurers and deal advisers should review the potential impact on transaction risk allocation and timelines.
CMA merger activity data (annual figures to end 2025)
New data shows that the CMA reviewed 881 mergers in 2025. Of these, 39 were considered at Phase 1, and four were referred to Phase 2. Outcomes were; one blocked, two unconditionally cleared and one cleared with remedies.
Why does this matter? The blocking rate remains very low, however Phase 2 referrals continue for transactions raising structural or dynamic concerns. Comparatively, the CMA still blocks more mergers than most. This reinforces the importance of early competition analysis for firms considering acquisitions in concentrated or regulated markets.
Public procurement highlights
EU consultation on revision of the EU Public Procurement Directives (consultation closed 26 January 2026)
The European Commission’s consultation on revising the EU Public Procurement Directives closed on 26 January. Consultees broadly supported modernisation of the directives but raised consistent concerns about complexity, administrative burden and the limited ability of current rules to support strategic objectives such as sustainability, innovation and the resilience of European supply chains.
Earlier, the Commission published a review of how well the Directives are functioning. Its report is available here.
Responses by consultees repeatedly highlighted four themes:
- current procedures were overly complex and resource intensive, especially for SMEs;
- accreditation and compliance requirements were fragmented and duplicative;
- procurement rules did not sufficiently support EU strategic autonomy or innovation; and
- there was significant variation between authorities, leading to inefficiency and burden for cross border suppliers.
Consultation responses are available here.
Why does this matter? Clients active in EU markets should expect proposals later in 2026 aimed at simplifying procedures, enabling more strategic procurement choices and improving consistency across member states. While the UK regime now diverges, these reforms will affect cross border bidders and EU‑funded programmes.
Financial thresholds updated for 2026 (from 1 January 2026)
The Public Procurement (Amendment of Thresholds) Regulations 2025 introduced updated financial thresholds under the Procurement Act 2023 to align with WTO GPA obligations and currency changes.
New thresholds for the key contract types are included below:
| Category | Threshold |
| Works contracts (general) | £5,193,000 |
| Concession contracts (general) | £5,193,000 |
| Light touch services | £663,540 |
| Central government goods and services | £135,018 |
| Sub‑central goods and services | £207,720 |
The full note can be found here.
Why does this matter? Threshold changes can alter procedural requirements and determine whether a procurement is regulated. Bid teams should ensure all live opportunities are assessed against the new thresholds.
Cubic Transportation Systems Ltd v Transport for London [2026] EWHC 61 (TCC)
The issue
Application by TfL to lift the automatic suspension preventing award of the Proteus revenue collection contract to Indra.
The outcome
The Court lifted the suspension. Damages were held to be an adequate remedy for Cubic, despite the size and prestige of the contract and Cubic’s claim that losing it would harm future competitiveness. The judge accepted that Cubic may face significant business disruption and workforce loss, but considered these losses capable of compensation in damages. By contrast, TfL faced operational risks, passenger impact and delay to system upgrades if the suspension continued, which could not be compensated.
Why does this matter? The judgment reinforces the high threshold for maintaining suspension in large technology procurements and shows that allegations of reputational harm must be evidenced with real specificity.
Mak Systems Group Ltd v Velindre University NHS Trust [2026] EWHC 8 (TCC)
The issue
Challenge to the Welsh Blood Service procurement of a new blood establishment computer system (BECS). MAK, the incumbent supplier since 2015, came third in the competition and alleged multiple breaches of the PCR 2015, including failure to exclude the winning bidder (GPI), lack of transparency, failure to investigate abnormally low tenders, and scoring errors.
What the Court held
The Court accepted that there was a serious issue to be tried, but held that damages would be an adequate remedy for MAK and that damages would not be an adequate remedy for the Trust if the suspension stayed in place. The Trust had an urgent need to implement the new BECS, given its statutory responsibilities for blood safety and the system’s role in processing, testing and tracing donations. On this basis, the Court lifted the automatic suspension.
Why does this matter? The judgment confirms that in specialist public health procurements, public interest in operational continuity remains a decisive factor in suspension applications. It also shows that arguments based on alleged reputational harm or lost future opportunities require detailed evidence, not general assertions.
If you have any questions about the information discussed in this update, please contact Paul Henty, Deen Taj, and Charlie Bayliss.
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