A review of the £31bn merger of O2 and Liberty’s Virgin Media has been handed to Britain’s competition watchdog,  a rare win for a regulator about to become a key player in many global deals.

The European Commission said on Thursday that it accepted the Competition and Markets Authority request to take charge of the probe because it affects British customers.

The merger of mobile network O2, owned by Spain’s Telefonica, and Virgin Media, the broadband provider owned by US cable baron John Malone, is due to create a communications firm with 46 million customers.

The EU has rarely handed back mobile-phone deals and has often taken a tough line on telecoms consolidation.  The EU has frequently refused to hand over complicated telecoms deals to smaller national authorities in the past, citing its better resources and know-how.

Although Britain quit the EU earlier this year, EU law still applies and large deals are handled by the Brussels-based authority during a transition period until Dec 31.

Earlier this year, Liberty Global and Telefonica pushed back against the attempts by the UK to wrest control of the deal, saying shifting the it to another regulator would delay approval.

They have asked the CMA to accelerate the inquiry to an in-depth, Phase 2, investigation. 

The CMA said it expected to accept the decision to fast-track, which would allow it to make a final ruling more quickly.

Andrea Coscelli, chief executive of the CMA, said: “These are incredibly important UK markets, that continue to evolve, and the deal needs to be carefully reviewed to make sure that consumers are protected.

“We have worked closely with the European Commission so far and we will build on the work that has already been carried out to make sure that the case can be investigated as quickly and efficiently as possible.”

O2’s combination with Virgin would be a boost for Spain’s Telefonica, allowing it to substantially pay down its debt pile.

Regulators blocked its previous attempt to offload O2 to mobile network Three in 2016. The deal was blocked by European regulators on the ground it would reduce the UK market from four major mobile providers to three.

However, while the deal fell through, the decision to bar the transaction was ultimately overturned on appeal to the European Court this year. That decision could clear the way for further telecoms consolidation in Europe.

While the O2 and Three deal was blocked because both companies had mobile networks, Virgin is the UK’s second largest broadband provider.

Mobile networks and broadband providers have engaged in multiple mergers across Europe as they aim to “converge” their networks, combining mobile, broadband and media offerings for cost savings.