The European Union (EU) regulators are set to launch a formal investigation into Adobe's pending acquisition of Figma, the cloud-based design platform, for $20 billion. The regulators suspect that acquisitions of small innovative businesses by giants like Adobe will lead to the elimination of fair competition in the software market.

Adobe's attempt to acquire Figma has faced multiple challenges, with regulators worldwide expressing concerns about the impact on competition. The EU Commission plans to initiate a phase II investigation, which involves a more extensive analysis, including gathering internal documents from companies involved and collecting economic data. The Commission has 90 days from the start of the investigation to make a decision.

While the EU Commission has not made a formal announcement about the investigation, it is expected that they will proceed with the probe. The US Department of Justice and the UK's Competition and Markets Authority are already investigating the acquisition. The DOJ is reportedly preparing an antitrust lawsuit, and the UK regulator is actively examining the deal, with a decision expected by the end of June.

Adobe, known for its design software such as Photoshop and Illustrator, announced its intention to acquire Figma in September 2022.