This has sparked debate over whether the EU is stifling innovation and growth, particularly for startups and scaleups, by blocking too many tech deals. Is the current regulatory approach overly cautious, or is it necessary to maintain a fair and competitive market across the region?

This year already, Amazon scrapped its planned $1.45 billion acquisition of iRobot, the maker of the Roomba, as EU antitrust regulators had raised a formal objection over the deal, which was seen as a precursor to the EU blocking the deal. Another high-profile deal that was broken was Microsoft’s splitting of Teams from its Office software, originally in the EU as it faced an antitrust fine, and then globally. And most recently, it has been announced that US tech firms are holding back AI releases from the EU market. Apple decided against launching certain new AI features for the iPhone, and Meta excluded Europe from the release of its most advanced AI model.

Even more recently, both Apple and Google have lost some high-profile cases in the EU, resulting in some hefty fines. On the 10th September, The Court of Justice of the European Union dismissed Google's appeal against a €2.4 billion (£2 billion) fine in a case where the company was accused of "abusing its dominant position" to outcompete rivals in online shopping. On the same day, it was ruled that Apple must pay Ireland €13 billion (£11 billion; $14 billion) in back taxes, concluding an eight-year legal battle. The dispute began in 2016 when the European Commission claimed that Ireland had granted Apple unlawful tax breaks, a charge the Irish government has continually contested. Despite Ireland’s reluctance, the ruling now demands that the tech giant settle the amount in full.

European startups have often viewed partnerships and M&As with Big Tech as a fast track to scale, tapping into vast financial resources to fuel their growth. Notable deals include Microsoft’s $8.5 billion purchase of Luxembourg-based Skype in 2011 and Apple’s acquisition of UK-based Shazam for $400 million in 2018.

However, regulators have become more cautious, increasing scrutiny even on smaller transactions. This shift is partly a response to earlier deals, such as Facebook’s acquisitions of Instagram and WhatsApp, and Google’s buyout of DoubleClick, which boosted the market dominance of these tech giants more than initially anticipated.

Whilst the EU’s blocking of tech deals has been seen as a problem within the industry, Linklaters found that Britain’s antitrust watchdog, the Competition and Markets Authority (CMA), has blocked more deals than its European counterpart. Between 2019 and 2023, the average deal failure rate in the UK reached 57%, significantly higher than the EU’s 41%.

The UK has emerged as the second most sought-after market for mergers and acquisitions worldwide, trailing only the US. In the first quarter of the year, deal values surged to $76.1 billion (£60.2 billion), marking an 88% rise compared to the same period in 2023.

So whilst the EU’s blocking of tech deals has been in the headlines a lot this year, it isn’t just the EU that is blocking these big deals. The CMA has blocked more deals than the EU in recent years, indicating that Britain's regulatory landscape is becoming equally, if not more, challenging for large-scale transactions. Though, the UK is still attracting investment, especially from international markets. This rise highlights the UK's prominence in the global M&A landscape, but also suggests that investors must navigate an increasingly complex regulatory environment to finalise deals. The CMA’s assertive stance, while aiming to protect market competition, adds another layer of complexity to what is already a highly regulated process. Thus, while the EU’s antitrust actions dominate headlines, the UK is quietly proving to be just as formidable a regulator.

The EU’s careful oversight of tech deals has certainly raised concerns over its impact on innovation and market growth. While regulators argue that their actions protect competition and consumers, critics believe that the current approach risks stifling progress, particularly for startups and smaller firms trying to scale.

The recent scrapping of multiple high-profile deals involving Amazon, Microsoft, Apple, and Meta highlights the EU's firm stance on maintaining a competitive landscape. However, as US firms begin to withhold certain technologies from the European market, it raises an important question: is the EU's regulatory approach promoting fairness or driving tech giants to limit their presence in the region? Ultimately, the balance between competition and innovation will continue to be a key focus for policymakers and businesses alike.