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 was the purpose of the Merger Treaty?

The Merger Treaty or Treaty of Brussels came into effect in 1967. The objective was to merge the existing institutions because at the time, the EEC, EURATOM and ECSC had an independent Commission, Council and Assembly.

Can the 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.

What reform was brought by the Merger Treaty 1965?

While keeping the 3 communities legally independent, the Merger Treaty rationalised their institutions by merging their then still independent executive bodies — thus bringing to 5 the number of common European institutions — and amended the 3 community treaties accordingly.

Why are mergers regulated worldwide?

Mergers and acquisitions are regulated by competition laws because they may concentrate economic power in the hands of a smaller number of parties. Merger regulation thus involves predicting potential market conditions which would pertain after the merger.

Which law regulates mergers in the EU?

The competition law
Introduction. The competition law regulates the merger and acquisitions. As Merger and Acquisitions (“M&A”) leads to the concentration of economic power in a smaller number of parties which can lead to distortion of competition in the market there is a need to regulate it.

What did the ECSC Treaty 1951 create?

The Treaty of Paris (formally the Treaty establishing the European Coal and Steel Community) was signed on 18 April 1951 between France, Italy, West Germany, and the three Benelux countries (Belgium, Luxembourg, and the Netherlands), establishing the European Coal and Steel Community (ECSC), which subsequently became …

Which Treaty created the European Union?

European Union – Maastricht Treaty
Treaty on European Union – Maastricht Treaty.

Why does the government block mergers?

Section 7 of the Clayton Act prohibits mergers and acquisitions when the effect “may be substantially to lessen competition, or to tend to create a monopoly.” The key question the agency asks is whether the proposed merger is likely to create or enhance market power or facilitate its exercise.

How are mergers assessed?

When assessing mergers, the CMA considers whether a transaction has resulted or may be expected to result in a “substantial lessening of competition” (or “SLC”), which is the test set out in the relevant legislation (with different legal thresholds for this assessment for “Phase 1” and more in-depth “Phase 2” reviews).

Why did the European Defense Community fail?

Defence arm of a European Political Community The European Political Community project failed in 1954 when it became clear that the European Defence Community would not be ratified by the French national assembly, which feared that the project entailed an unacceptable loss of national sovereignty.

How does a merger work in the EU?

The merger must be checked for legality in each EU country involved before it can enter into force. This is normally done by a notary or court. After checking if everything is in order,​ they will issue a pre-merger certificate.

Can a joint venture be subject to EU Merger Regulation?

Joint ventures which are full function but which do not satisfy the EU Merger Regulation turnover thresholds and which have as their object or effect the co-ordination of the competitive behaviour of undertakings which remain independent will also be subject to Articles 101 and 102 and possibly also to national merger and competition laws.

When are cross border mergers exempt from EU rules?

Cross-border mergers involving companies investing capital provided by private or public investors are exempt from EU merger rules. EU rules must be applied to mergers when: If you are the purchasing company, the assets and liabilities of the companies you buy will be transferred to you.

How is EU Merger regulation related to EFTA?

The EU Merger Regulation requires that turnover of all companies related to the undertakings concerned, i.e. “group” companies, is included in the calculation of aggregate turnover and thus the assessment of its Community/EFTA dimension. Related undertakings cover the following: the undertaking concerned;