Flint advises international businesses and investors on policy, politics, regulation and competition.
Flint advises international businesses and investors on policy, politics, regulation and competition.
Quick links
Sectors
Follow Us
2024 provided a comparatively stable regulatory environment for dealmakers. With more than half the world’s population going to the polls, policy reform was on hold, while legislators focused on winning domestic elections in an uncertain international outlook.
2025 is shaping up differently. Global politics is changing. Adversarial relationships are deepening, while traditional alliances are under pressure. Established global heavyweights are facing greater political and economic competition from emerging markets, which is driving rising nationalism and protectionism. We see an underlying trend of political fragmentation at both domestic and international levels. This is likely to intensify, with direct consequences for cross-border M&A.
For dealmakers, three common themes emerge:
Trump’s MAGA agenda — including a mix of deregulation, reindustrialisation and protection from international markets — has a clear read across to M&A.
On antitrust, the new administration is expected to roll back some Biden-era policies, including the expansive view of merger control championed by outgoing FTC Chair Lina Khan. Incoming FTC Chair Andrew Ferguson’s promise to stop the “war on mergers” should, in principle, make deal making easier, with fewer outright prohibitions and greater openness to divestiture remedies. But some sectors will probably remain a target for closer scrutiny. We expect a continued brake on Big Tech (with possible exceptions for AI and those in Trump’s circle) and transactions that could drive up consumer prices (e.g. energy).
Trump knows the Committee on Foreign Investment in the US (CFIUS) well. He issued four Presidential prohibitions during his first term and expanded the scope of the regime. Notwithstanding the mixed signals coming out of the new administration on China, we expect hawkishness to generally win the day. Elsewhere, we see significant scope for ‘national security’ to become code for broader ‘national interest’ to promote protectionism and economic competitiveness. The Nippon Steel decision may not be the last time the US tries to block a deal involving one of its closest allies on ‘national security’ grounds.
Trump’s day one flurry of Executive Orders pressed pause on key Biden administration M&A reforms. The administration will review controls on US investment in advanced technologies in China to determine whether they should be ‘modified, rescinded or replaced’. The Biden Administration’s new rules for foreign subsidies in M&A, due to come into force on 10 February, could also be delayed after Trump issued a wide-ranging ‘regulatory freeze pending review’.
The new European Commission has taken office with an ambitious reform agenda that has implications for deal clearance. However, lack of political unity, a Member State leadership vacuum and an economic competitiveness problem mean that policy-making will be slower, subject to compromise and unpredictable.
Calls for revising the EU’s merger control rules to permit large homegrown champions have intensified after the Draghi report. Teresa Ribera will oversee competition policy under a broader ‘clean, just and competitive transition’ portfolio – a signal that the EU wants to harness competition tools in support of broader industrial, energy and sustainability objectives. She has indicated a more flexible approach to creating ‘European champions’ and committed to revising the EC’s Horizontal Merger Guidelines. This could provide greater scope for considering efficiencies in mergers and include radical reforms, such as incorporating security and resilience criteria in competitive assessments.
Alongside a possible ‘security’ element to competition, FDI and other economic security reforms remain in play. At this stage, proposals to expand both FDI and outbound investment screening powers are unlikely to be introduced until 2026. However, we will be closely watching von der Leyen’s strategic autonomy agenda for signs of greater ambition, including a focus on the US.
On the Foreign Subsidies Regime, dealmakers should be encouraged by the Commission’s pragmatic approach so far and apparent willingness to accept behavioural rather than structural remedies. Given the more volatile outlook, we could see greater use of the FSR’s ex officio procedure (where the Commission can open investigations into non-notified situations) and greater politicisation — possibly impacting future US-EU deals should the bilateral relationship sour.
The UK’s comparatively stable centrist government should mean less uncertainty for dealmakers. Renewed concerns about the government’s fiscal position have underscored the importance and urgency of the government’s ‘growth mission’. This will be at the heart of government thinking on M&A and points towards permissiveness – notwithstanding the potential growth benefits that competition can bring. But the government is also under pressure to deliver an ambitious policy programme and faces the possibility of being caught in the middle of a spat between the US and EU. While we expect the UK to be generally pro-business, we cannot rule out the possibility of surprises on a case-by-case basis.
The CMA’s senior leadership, keen to demonstrate responsiveness to political priorities, has emphasised “growth, opportunity and prosperity” in its 2025/26 Annual Plan. It has also launched a review of its merger remedies policy, plans to engage more openly with businesses, and signalled a greater willingness to accept novel remedies (e.g. Vodafone/Three, on which Flint advised).
Yet, that may not be enough. On Tuesday, the government replaced CMA Chair, Marcus Bokkerink, as it felt the organisation was not sufficiently focused on growth. We do not expect the CMA to ‘go soft’. Although it faces increasing pressure to align with the government’s growth mission, it will fiercely defend its independence. Nevertheless, a modest shift towards a more permissive merger regime is likely – particularly in mergers involving inward investment (a key government priority), the CMA may be more attuned to the risk of driving investors elsewhere.
We expect the UK’s FDI regime to remain relatively open. The government will consult on some small amendments to the National Security and Investment Act (NSIA) to reduce regulatory red tape. Notwithstanding the Chancellor’s recent overtures to Beijing, Chinese investment will remain a particular target, as will investment in sectors such as green tech and infrastructure. While the UK has no dedicated outbound investment screening regime, the NSIA could, in principle, apply to UK investment abroad. This is one area where we could see further action by the UK, either in response to specific cases or simply to remain in step with broader international trends.
China’s integration in global supply chains means it will often have strong grounds for claiming jurisdiction over global deals — and we now have evidence that it is willing to do so to advance geopolitical objectives.
Recent probes into previously cleared deals and deals falling below thresholds — such as Nvidia/Mellanox and Synopsys/Ansys — demonstrate the State Administration for Market Regulation’s (SAMR) willingness to ‘call in’ foreign-to-foreign deals if they raise strategic concerns. Although Chinese officials frame these actions as ensuring compliance with the Anti-Monopoly Law,they should be read as part of a broader pushback against US decoupling pressure on China. Tech companies in particular should plan for longer and more unpredictable regulatory timelines in China, given the sector is the key vector for US-China competition.
China’s Economic Work Report, expected in March, will likely reveal some changes to the Negative List (sectors that are off bounds to foreign investors). While we might see a de jure loosening, this is unlikely to be meaningful in practice. The focus on data security and regulatory compliance is likely to continue to grow, which could get in the way of closing. Other developments to watch out for include the scope for ‘nationalisation’ of entire sectors — as part of ever-tightening controls on critical minerals, China passed a law in June 2024 that all rare earth resources belong to the state. China will also spend much of 2025 preparing for the 15th Five-Year Plan, which could mean some early signalling of what to expect from Fortress China.
This blog was written by Partner Katie Whitting, Director Kah Loon Tham and Manager Dylan Salaris. Katie advises clients on politics, policy and regulation with a focus on economic security, investment and geopolitics. Previously, Katie was a career diplomat with the Australian Foreign Service. Kah Loon supports clients on competition, regulatory, and economic issues with a focus on transaction clearance. Dylan advises businesses and investors on political, policy and commercial strategy, with a focus on private markets. He specialises in due diligence and transaction clearance across a range of sectors.