The UK market regulator sees too many similarities between Figma’s and Adobe’s offerings. A follow-up investigation will put the acquisition on hold for a while.

CMA, de Competition and Market Authority from the United Kingdom announces that it is launching a “Phase 2” investigation into Adobe’s acquisition of Figma. That simply means the regulator isn’t getting into it. The CMA issued a negative opinion on June 30, after which both parties were given an opportunity to convince the agency. This was unsuccessful and further investigation is needed.

The problem lies in the great similarity of the offers. Figma was one of the few online design software packages that can truly compete with Adobe. According to the CMA, Figma and Adobe XD are virtually identical, which means that the disappearance of Figma would negatively impact competition in this niche market. Adobe has promised to continue offering a free version of Figma after the acquisition, but that promise isn’t enough to convince authorities.

patience is a virtue

The second investigation runs until December, after which the CMA will make a final decision for or against the acquisition. On August 7th we will learn whether the European Union will also move to a phase 2 trial. Adobe and Figma announced the deal in September 2022, but the goal is still a long way off.

Sometimes it pays to be patient. For example, Broadcom waited more than a year for the go-ahead to acquire VMware. Now this controversial deal finally seems to be going through. So Adobe doesn’t have to give up hope just yet.