In a closed hearing scheduled for 8 December, Adobe is set to counter European Union (EU) antitrust charges related to its proposed $20bn acquisition of the cloud-based design platform Figma, according to Reuters.

The European Commission had raised concerns two weeks ago, and now warns that the deal could potentially diminish competition in the global market for interactive product design software, where Figma currently competes with ADOBE.

The Commission specifically highlighted that the acquisition might eliminate Figma as a competitor in the supply of vector editing tools and raster editing tools, reinforcing Adobe’s dominance in the market.

This follows the EU’s initiation of hearings that allow companies to present their arguments to senior Commission officials, lawyers, and national antitrust watchdogs, with rivals and interested third parties also granted attendance rights.

While the EU antitrust enforcer is set to make a decision on the deal by February 5, Adobe has expressed openness to proposing remedies to address regulatory concerns. Dana Rao, chief counsel for Adobe, conveyed this position to Reuters.

In addition to EU scrutiny, the deal has raised concerns in the UK, where the Competition and Markets Authority (CMA) stated on Tuesday that Adobe’s $20bn acquisition of Figma could harm the UK’s digital design sector.

 On 25 April 2023, the UK government passed new legislation aimed at boosting competition in digital markets. The bill will further empower the CMA “to address the root causes of competition issues”, giving the regulator powers to fine companies up to 10% of global turnover for breaching consumer law.

The CMA’s provisional findings suggest that the deal may “eliminate competition,” “reduce innovation,” and “remove Figma as a threat to Adobe’s flagship Photoshop and Illustrator products.”

The regulator indicated its intention to investigate potential remedies, including the possibility of blocking the deal outright.

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Adobe expressed disappointment and disagreement in response to the CMA’s perspective. The company highlighted the significant value the Adobe-Figma partnership would bring to customers and stated its intent to review the provisional findings while engaging with the CMA on the facts and merits of the case.

While Adobe aims to close the deal this year, it has agreed to pay Figma $1bn if the merger is not completed by March 2024 or if it is rejected by regulators.

The CMA has requested responses from Adobe and Figma by 19 December, and a final decision is expected to be issued by 25 February 2024.