More than three years after the UK's Subsidy Control Act 2022 came into force, the Competition and Markets Authority (CMA) has published its first review of how the regime is operating. The CMA's conclusion, echoed by the government, is broadly positive: the framework appears to be functioning effectively while giving public authorities greater flexibility than the previous EU state aid system.

In our latest article, we look beyond the headline conclusions and examine evidence suggesting a more nuanced picture. While the CMA identifies several areas for improvement, including clearer guidance, better streamlined routes and a more effective subsidy database, the implications of those shortcomings may be more significant than the report suggests.

We explore:

• Why public authorities continue to struggle with key aspects of subsidy assessments, particularly competition and market impact analysis.
• Whether weaknesses in subsidy design risk distorting competition and reducing value for money for taxpayers.
• How limitations in the subsidy database may be restricting transparency and effective scrutiny of subsidy decisions.
• The surprisingly limited use of pre-action information requests (PAIRs), an important mechanism that allows potential challengers to obtain information from public authorities and pauses the statutory challenge deadline while a response is provided.
• Our research into PAIRs, which found that most public bodies approached had received none at all, with only a modest increase in usage between 2025 and 2026. With one notable exception relating to the energy sector, most of the requests that were made related to disputes that ultimately reached the Competition Appeal Tribunal, raising questions about why this important tool is not being used more often to provide transparency and scrutinise potentially problematic subsidies.
• What the limited number of PAIRs may tell us about the accessibility of information under the regime and the practical difficulties facing potential challengers.
• The significant procedural and legal hurdles facing parties seeking to challenge subsidies before the Competition Appeal Tribunal including its approach to the review standard and the relevance (or not) of expert evidence to its work.
• Whether the emerging case law coupled with the CMA’s reports on the assessments undertaken by public authorities lead in the round to effective oversight of public spending decisions.

Taken together, these issues raise an important question: if public authorities' assessments continue to attract criticism, transparency remains imperfect and challenges are difficult to bring successfully, are the regime's safeguards providing sufficient real-world checks and balances?

For more detail read the full article.