EU Commission to investigate Adobe's proposed acquisition of Figma over competition concerns

Commission is concerned for competition in the global markets for supply of interactive product design and digital asset creation tools

The European Commission will be investigating Adobe's proposed acquisition of software provider Figma, under the EU Merger Regulation.

The move has come as the Commission shared concerns over the transactions impact on competition in the global markets for the supply of interactive product design software and for digital asset creation tools.

The Commission's preliminary investigation indicates that the transaction may allow Adobe to restrict competition in the global markets for the supply of interactive product design tools.

This is because the EU Commission recognises Figma as the clear market leader and Adobe one of its largest competitors, that Adobe and Figma are close competitors and that the transaction would remove an important competitive force, and the unlikely timely and credible entry of other players in the market.

The Commission also sees the acquisition as a potential restriction of competition in the supply of digital asset creation tools.

It outlined that this would take place by eliminating Figma's current constraining influence over Adobe's digital asset creation tools, and preventing Figma's potential growth into an effective competitor to Adobe's asset creation tools, absent the transaction.

Furthermore, the Commission will further investigate whether the transaction may foreclose rival providers of interactive product design tools by bundling Figma with Adobe's Creative Cloud suite.

The Commission said it will now carry out an in-depth investigation into the effects of the proposed transaction to determine whether its initial competition concerns are confirmed.

It is now to closely cooperate with other competition authorities during the initial investigation and will continue such cooperation during the in-depth investigation.

The proposed transaction was notified to the Commission on 30 June 2023. The Commission now has 90 working days, until 14 December 2023, to take a decision.

The opening of an in-depth inquiry does not prejudge the outcome of the investigation.

The EU Commission has been known to conduct these investigations as to protect competition within the market.

Earlier this year, it cast doubt on the Broadcom acquisition of VMware which was later cleared and allowed to go through.