A furious boss at Microsoft has the claimed the European Union is better for business than Britain after a UK regulator blocked the purchase of the maker of Call of Duty.

Brad Smith, Microsoft’s vice chair and president, warned the “English Channel has never seemed wider” as the the software company’s £55 billion takeover of gaming firm Activision Blizzard stalled.

He told BBC Radio 4’s Today programme the move was “probably the darkest day” in its 40-year history in the UK and “had shaken confidence” in Britain.

“There’s a clear message here. The European Union is a more attractive place to start a business if you want some day to sell it than the United Kingdom,” he said.

The Competition and Markets Authority (CMA) defended its decision to block Microsoft’s deal for Activision and said the UK was “absolutely open for business”.

The spat comes after the regulator on Wednesday prevented the mammoth buyout over concerns in the cloud gaming sector.

Xbox owner Microsoft struck a deal to buy the maker of Candy Crush and Call Of Duty in January 2022.

The CMA said the tie-up would make Microsoft stronger in cloud gaming – where video games are played using remote servers and have no need for downloads – “stifling competition in this growing market”.

It claimed that Microsoft already accounted for between 60% and 70% of cloud gaming services.

Microsoft submitted a proposal in an effort to address concerns but the watchdog said this contained a “number of significant shortcomings”.

Microsoft and Activision have both said they will appeal the decision.

Smith told the Today programme: “I think the impact on the UK, unfortunately, is to shake the confidence among the business community in the UK, and the CMA as a regulatory agency.”

He added: “This decision, I have to say, is probably the darkest day in our four decades in Britain. It does more than shake our confidence in the future of the opportunity to grow a technology business in Britain than we’ve ever confronted before.”

Downing Street dismissed criticism of the UK’s position as a place for tech firms to invest.

Prime minister Rishi Sunak’s official spokesman said: “Those sorts of claims are not borne out by the facts.”

He added that the UK’s games market had doubled in size to £7 billion over the past decade.

CMA head Sarah Cardell insisted the regulator wanted “to create an environment where a whole host of different companies can compete effectively, can grow and innovate”, claiming this was the “best thing for consumers and businesses”.

She told BBC’s Today programme that after a “long and careful investigation” into the Microsoft deal, “combining those two businesses would really reinforce Microsoft’s strong position in cloud gaming”.