What is the EU merger policy?
What is the EU merger policy?
The legal basis for EU Merger Control is Council Regulation (EC) No 139/2004, the EU Merger Regulation. The regulation prohibits mergers and acquisitions which would significantly reduce competition in the Single Market, for example if they would create dominant companies that are likely to raise prices for consumers.
What is controlled under regulation 139 2004?
139/2004 to regulate changes in market structure by deciding whether two or more firms may merge, combine, or consolidate their businesses into one. These decisions affect various market players, including major EU and non-EU businesses, as well as vast product and geographic markets.
What European institution is responsible for evaluating proposed mergers?
The European Commission (EC)
The law requires that firms proposing to merge apply for prior approval from the Commission. The European Commission (EC) has exclusive competence over concentrations that meet certain thresholds.
What is the basic definition of concentration given in the EU Merger Regulation?
A ‘concentration’ is the legal combination of two or more firms by merger or acquisition. Although such operations may have a positive impact on the market, they may also appreciably restrict competition, if they create or strengthen a dominant market player.
Why can EU block mergers?
The EU General Court ruled that the Commission must demonstrate with a “strong probability” that the effect on competition is “significant” to block a merger that does not create a dominant company.
How and why are mergers regulated worldwide?
Mergers & Acquisition are regulated by competition law. As merger & acquisition results into decrease of competition in the market so there is a need to regulate it. The regulating merger parties are regulated by European Union merger law which is a part of European Union laws.
What is SIEC test?
The SIEC test enables the Commission to also catch mergers which, although not giving rise to dominance, result in unilateral (non-coordinated) effects; allowing the merged entity to determine, by itself, the parameters of competition.
What are coordinated effects?
Coordinated effects are merger-related harms that arise because a subset of postmerger firms modify their conduct to limit competition among themselves, particularly in ways other than explicit collusion.
Does government approve most proposed mergers?
The U.S. government approves most proposed mergers. In a market-oriented economy, firms have the freedom to make their own choices. Private firms generally have the freedom to: expand or reduce production.
What is the purpose of merger control?
Merger control regimes are adopted to prevent anti-competitive consequences of concentrations (as mergers and acquisitions are also known).
What is merger filing?
Find SEC Merger Filings Use SEC filings to find details about a company’s merger or acquisition. Both the target and acquirer will file reports.
How are mergers regulated worldwide?
Mergers & Acquisition are regulated by competition law. As merger & acquisition results into decrease of competition in the market so there is a need to regulate it.