Merger Control in the European Union: A Comprehensive Guide
Introduction
Merger control is a key aspect of competition law, as it enables competition authorities to regulate changes in market structure by deciding whether two or more undertakings may merge, combine, or consolidate their business into one. This article provides a comprehensive guide to merger control in the European Union (EU), covering the substantive test, theories of harm, market definition, and the role of the European Commission and national competition authorities.
Substantive Test
The substantive test against which concentrations with an EU dimension should be appraised is the ‘significant impediment to effective competition (SIEC)’. This means that a merger may be prohibited even if it does not create or strengthen a dominant position if a SIEC is established.
Theories of Harm
The Commission considers two main theories of harm when assessing horizontal mergers: unilateral (non-coordinated) effects and coordinated effects.
Unilateral Effects
Unilateral effects refer to a situation in which the merger will lead to the elimination of important competitive constraints without resorting to coordination of competition behavior among the market players following the merger.
Coordinated Effects
Coordinated effects will be considered in situations where the merger will lead to a change in the nature of competition which will make it easier for the firms on the market to coordinate their competitive behavior.
Market Definition
Market definition is crucial for assessing dominance in merger cases, as dominance is about market power, which does not exist in the abstract but in relation to a relevant market.
Role of the European Commission and National Competition Authorities
The European Commission has the primary responsibility for enforcing merger control in the EU. However, national competition authorities (NCAs) also play a role, particularly in cases where a concentration does not have an EU dimension but affects trade between member states.
Conclusion
Merger control is a complex and evolving area of law. This guide has provided a comprehensive overview of the key principles and procedures involved in merger control in the EU. For more detailed information, please refer to the relevant EU regulations and guidelines.