The EU has approved Microsoft’s $69bn (£55bn) takeover of Call of Duty publisher Activision Blizzard, brushing aside competition fears that led British regulators to block the deal.

EU Commission officials gave the merger the green light on Monday after concluding that concerns about dominance of the cloud gaming market were not enough to justify blocking it.

Britain’s Competition and Markets Authority (CMA) had stopped the buyout from going ahead on these grounds just weeks earlier.

The CMA was concerned that Microsoft would restrict access to Activision's blockbuster Call of Duty franchise to only its Xbox platform.

However, competition regulators at the EU Commission ruled that Microsoft would have “no incentive” to do so.

A Brussels spokesman said: “As always, the Commission has based its decision on hard evidence and on extensive information and feedback from competitors and customers, including from game developers and distributors as well as cloud game streaming platforms in the EU.”

Senior EU officials waved the merger through after closely examining its probable effects on cloud gaming. One said: “Overall, it's important to realise that cloud game streaming is a limited part of the gaming market… 1 to 2pc”.

The takeover is subject to legally-binding promises by Microsoft to let gamers buy and download Call of Duty, and other Activision titles, from any online gaming store.

Brussels’ decision to clear the merger will put pressure on the CMA. Critics including Microsoft have claimed the decision makes Europe a more attractive destination for tech businesses than Britain.

Microsoft President Brad Smith branded Britain “closed for business” last month, saying the decision threatened Jeremy Hunt’s ambitions of making Britain the next Silicon Valley.

The US Federal Trade Commission is also suing Microsoft to block the deal.

UK competition officials said in April that Microsoft has a 60-70pc share of the cloud gaming market, adding that this number doubled over the past year.

Activision’s share price crashed after the CMA decision was announced. The company has said it is working “aggressively with Microsoft to reverse this on appeal”.

A spokesman said at the time: “The report’s conclusions are a disservice to UK citizens, who face increasingly dire economic prospects.”

Both companies are understood to be taking a legal case against the CMA to Britain’s Competition Appeal Tribunal.