EU Merger Control: Concentrations, Market Assessment, and Commission Review

EU Merger Control: Concentrations, Market Assessment, and Commission Review

1. Introduction: Controlling Structural Changes in the Internal Market

Competition law does not only regulate how businesses behave after they have entered a market. It also examines changes in market structure that may fundamentally alter the conditions under which businesses compete.

When two major competitors merge, an established company acquires a potential rival, or a business purchases control over an important supplier or distribution platform, the transaction may change the competitive landscape for years. It may reduce the number of independent market participants, eliminate a source of innovation, increase barriers to entry, or strengthen an undertaking’s ability to influence prices and commercial conditions.

At the same time, mergers and acquisitions can generate substantial economic benefits. They may allow businesses to combine complementary technologies, achieve economies of scale, reduce production costs, enter new markets, improve research capacity, or develop products that neither undertaking could have produced independently.

EU merger control seeks to distinguish transactions that strengthen economic activity without significantly damaging competition from those that are likely to undermine the competitive structure of the internal market.

The principal legal instrument is Council Regulation (EC) No 139/2004, commonly known as the EU Merger Regulation (EUMR). It establishes a system of prior review for concentrations with a European Union dimension and gives the European Commission authority to approve, conditionally approve, or prohibit transactions falling within its jurisdiction.

The central substantive test is whether a concentration would significantly impede effective competition (SIEC) in the internal market or a substantial part of it, particularly as a result of the creation or strengthening of a dominant position.

Merger control therefore differs from the enforcement of Articles 101 and 102 TFEU. Article 101 examines restrictive agreements, while Article 102 addresses the abuse of dominance. Merger control is primarily prospective: it examines the likely competitive consequences of a proposed structural transaction before it is implemented.

The system is designed to protect the competitive process without treating business consolidation as inherently harmful. Its purpose is to preserve effective competition while allowing businesses to grow, innovate, invest, and reorganise their activities.

2. Legal Foundations of EU Merger Control

The legal foundation of EU merger control is Council Regulation (EC) No 139/2004, adopted on 20 January 2004 and applicable since 1 May 2004.

It replaced the earlier merger regulation and introduced the current SIEC test, broadening the Commission’s ability to assess transactions that may substantially weaken competition even where they do not create or strengthen a dominant position in the traditional sense.

The Regulation is supported by Commission Implementing Regulation (EU) 2023/914, which establishes procedural rules, notification requirements, forms, and other administrative arrangements.

The principal sources are:

• Council Regulation (EC) No 139/2004 — EU Merger Regulation.
• Commission Implementing Regulation (EU) 2023/914.
• European Commission — Merger Control Legislation.

The EUMR establishes a centralised review system for transactions with an EU dimension. The Commission normally acts as the principal reviewing authority, while national competition authorities retain responsibility for transactions falling outside the Regulation’s jurisdiction, subject to the applicable referral mechanisms.

This arrangement is commonly described as the one-stop-shop principle. Its purpose is to avoid unnecessary parallel reviews by several national authorities where a transaction has a significant cross-border dimension.

The Regulation applies regardless of where the merging companies are incorporated or headquartered. A transaction between businesses established entirely outside the European Union may still fall within EU merger control if the relevant turnover thresholds and jurisdictional requirements are satisfied.

The relevant consideration is the transaction’s economic connection with the internal market, not simply the nationality or location of the parties.

3. What Constitutes a Concentration?

Merger control applies to concentrations rather than every form of commercial cooperation or corporate restructuring.

Article 3 EUMR identifies the principal circumstances in which a concentration arises. The defining element is a lasting change of control.

3.1 Mergers between independent undertakings

A concentration occurs where two or more previously independent undertakings, or parts of undertakings, merge.

The transaction may involve the creation of a new legal entity or the absorption of one company into another. The legal form is not decisive. The important question is whether previously independent economic activities become subject to common control on a lasting basis.

A merger between two competing manufacturers, for example, may remove one independent source of supply from the market.

3.2 Acquisition of control

A concentration also occurs where one or more persons or undertakings acquire direct or indirect control over another undertaking or parts of it.

Control is the possibility of exercising decisive influence over an undertaking. It may arise through ownership of shares, voting rights, contractual arrangements, or other means.

A majority shareholding will often confer control, but it is not essential. A minority shareholder may acquire control where its rights allow it to determine strategic commercial decisions.

Relevant considerations may include the ability to determine:

• The composition of the management or supervisory bodies.
• The approval of budgets and business plans.
• Major investment decisions.
• Commercial strategy.
• Significant changes to the undertaking’s activities.

Control may be exclusive or joint.

Exclusive control exists where one undertaking alone can exercise decisive influence. Joint control arises where two or more undertakings must agree on important strategic decisions.

The acquisition of control is therefore an economic and legal concept, not merely a question of formal ownership percentages.

3.3 Joint ventures

A joint venture may constitute a concentration where it performs, on a lasting basis, all the functions of an autonomous economic entity.

This is commonly described as a full-function joint venture.

A full-function joint venture must have sufficient operational resources, management, and access to markets to operate independently as a business rather than merely carry out a limited task for its parent companies.

A joint venture established to operate a manufacturing facility, provide services to independent customers, or conduct an autonomous commercial business may satisfy this requirement.

By contrast, an arrangement created solely to coordinate a limited activity between parent companies may not constitute a concentration under Article 3. It may instead require assessment under Article 101 TFEU.

Article 2(4) EUMR specifically addresses certain joint ventures that have as their object or effect the coordination of competitive behaviour between independent undertakings that remain active in the same or related markets.

This distinction matters because a transaction may have both a structural and a coordination dimension. Merger control examines the acquisition of lasting control, while Article 101 may apply to restrictive coordination between the parent companies.

3.4 Temporary acquisitions and restructuring

Not every acquisition of shares or assets creates a concentration.

Certain temporary acquisitions by financial institutions, insolvency practitioners, or other entities may fall within specific exceptions where the relevant conditions are satisfied.

For example, Article 3(5) EUMR provides exceptions for certain acquisitions by credit institutions or financial institutions made temporarily for resale, provided that voting rights are not exercised to determine the competitive behaviour of the undertaking except where necessary to prepare the disposal.

Internal reorganisations within the same economic group may also fall outside the concept of concentration where ultimate control does not change.

The analysis must therefore focus on whether a lasting change in control occurs, rather than simply whether shares or assets have been transferred.

4. The Jurisdictional Thresholds: When Must a Merger Be Notified?

The Commission does not examine every merger or acquisition taking place within the European Union. The EUMR applies primarily to concentrations that satisfy the turnover thresholds establishing a European Union dimension.

Article 1 provides two alternative sets of thresholds.

4.1 The primary turnover threshold

A concentration has an EU dimension where:

1. The combined aggregate worldwide turnover of all undertakings concerned exceeds €5 billion; and
2. The aggregate EU-wide turnover of each of at least two undertakings concerned exceeds €250 million.

The thresholds are intended to identify transactions with a substantial economic presence in the Union.

4.2 The alternative turnover threshold

A concentration may also have an EU dimension where the following conditions are satisfied:

1. The combined aggregate worldwide turnover of all undertakings concerned exceeds €2.5 billion.
2. In each of at least three Member States, the combined aggregate turnover of all undertakings concerned exceeds €100 million.
3. In each of those three Member States, the aggregate turnover of each of at least two undertakings concerned exceeds €25 million.
4. The aggregate EU-wide turnover of each of at least two undertakings concerned exceeds €100 million.

These alternative thresholds capture transactions with significant activity across several Member States even where the primary worldwide turnover threshold is not met.

4.3 The two-thirds rule

Under both alternatives, the concentration does not have an EU dimension where each of the undertakings concerned achieves more than two-thirds of its aggregate EU-wide turnover within one and the same Member State.

The rule recognises that a transaction may have substantial turnover but remain predominantly national in economic significance.

Where the two-thirds exception applies, the transaction will generally fall within the jurisdiction of the relevant national competition authority, subject to national law and any applicable referral arrangements.

4.4 Calculating turnover

Turnover is calculated under Article 5 EUMR.

The calculation generally reflects the preceding financial year and takes account of the economic activities of the undertakings concerned, including relevant subsidiaries and controlled entities.

The purpose is to measure the actual economic scale of the businesses involved rather than simply the turnover of the legal entities directly signing the transaction documents.

Special rules apply to particular sectors, including banking, financial services, and insurance, because conventional turnover measures may not adequately reflect their economic activity.

The turnover calculation is therefore a technical jurisdictional exercise. Incorrect calculations may lead to a failure to notify a transaction that should have been submitted to the Commission.

5. The Relationship Between EU and National Merger Control

The EUMR establishes a division of responsibilities between the European Commission and national competition authorities.

Where a concentration has an EU dimension, the Commission normally has exclusive jurisdiction under the Regulation. National competition authorities generally cannot apply their national merger control rules to the same transaction, subject to the referral mechanisms provided by the EUMR.

Where a transaction does not have an EU dimension, it may nevertheless be subject to national merger control rules.

A large cross-border transaction may therefore require notification to the Commission, while a smaller acquisition may be examined by one or more national authorities.

5.1 The one-stop-shop principle

The one-stop-shop system reduces the administrative burden of multiple national reviews.

Instead of requiring a transaction to be examined independently by several national authorities, the Commission conducts a centralised assessment where the EUMR applies.

This does not mean that national competition authorities lose their general responsibility for competition enforcement. They continue to apply Articles 101 and 102 TFEU and their national competition laws within the applicable framework.

5.2 Referral from the Commission to a Member State

Article 9 EUMR allows the Commission to refer certain concentrations to a Member State where the relevant conditions are satisfied.

A referral may be appropriate where a concentration threatens to affect competition significantly in a distinct market within a Member State that presents the characteristics of a separate market.

The purpose is to ensure that a transaction is examined by the authority best placed to assess its competitive effects.

5.3 Referral from Member States to the Commission

Article 22 allows one or more Member States to request that the Commission examine a concentration that does not have an EU dimension, provided the statutory conditions are met.

The concentration must affect trade between Member States and threaten to significantly affect competition within the territory of the requesting Member State or States.

This mechanism is particularly relevant where a transaction may have competitive significance despite falling below the ordinary EU turnover thresholds.

However, its application is subject to an important limitation clarified by the Court of Justice in 2024.

In Illumina and GRAIL v Commission, Joined Cases C-611/22 P and C-625/22 P, the Court held that a national competition authority cannot refer a concentration to the Commission under Article 22 where it lacks competence under its own national merger control rules to examine the transaction.

The judgment restricted the Commission’s earlier interpretation of Article 22, which had sought to facilitate referrals of certain transactions not notifiable under national law.

The decision is particularly significant for acquisitions involving companies with low turnover but potentially important competitive or innovative assets. It confirms that referral powers must remain within the legal limits established by the Regulation.

5.4 Voluntary referral requests by the parties

Article 4(5) provides another route through which transactions may be referred to the Commission.

Where a concentration does not have an EU dimension but is capable of being reviewed under the national competition laws of at least three Member States, the parties may submit a reasoned request for referral to the Commission before notifying national authorities.

If the statutory conditions are satisfied and the Member States do not object within the applicable period, the transaction may be examined under the EU Merger Regulation.

This mechanism can reduce the burden of multiple national notifications.

6. The Substantive Test: Significant Impediment to Effective Competition

The central substantive test under Article 2 EUMR is whether a concentration would significantly impede effective competition in the internal market or a substantial part of it.

This is commonly known as the SIEC test.

The test applies particularly where a transaction creates or strengthens a dominant position, but it is not limited to those circumstances.

The change introduced by the 2004 Regulation was important because the previous legal framework focused more heavily on the creation or strengthening of dominance.

The SIEC test allows the Commission to examine transactions that may substantially weaken competition even where the resulting undertaking does not become dominant in the traditional sense.

For example, a merger between two of the strongest competitors in an oligopolistic market may reduce competitive pressure substantially without creating a single dominant undertaking.

The assessment is prospective. The Commission examines the likely competitive conditions after the transaction and compares them with the conditions that would probably exist without it.

The analysis considers price, output, quality, innovation, choice, investment, and other relevant dimensions of competition.

A transaction may be problematic even if its immediate effects on prices are uncertain. The elimination of an important innovator, for example, may weaken future competition by reducing the likelihood that new products or technologies will reach the market.

7. Horizontal Mergers: Combining Actual or Potential Competitors

A horizontal merger occurs when undertakings operating at the same level of the supply chain combine.

For example, two manufacturers producing competing products may merge, or two retail businesses serving the same customers may come under common control.

Horizontal mergers can generate efficiencies, but they may also remove direct competitive constraints.

7.1 Unilateral effects

Unilateral effects arise where the merged undertaking gains the ability or incentive to act less competitively without requiring coordination with remaining competitors.

The merger may eliminate a close competitor, increase market concentration, or make it easier for the merged business to raise prices, reduce output, lower quality, or slow innovation.

The concern is particularly strong where the merging parties are close competitors and customers have few realistic alternatives.

For example, a merger between two of only three significant suppliers in a market may substantially weaken competitive pressure even if several smaller businesses remain active.

7.2 Coordinated effects

A merger may also make coordination between the remaining market participants more likely.

Where a market is highly concentrated, transparent, and relatively stable, businesses may find it easier to coordinate their behaviour, either expressly or tacitly.

Merger control does not require proof that the parties have entered into an unlawful cartel. It examines whether the structural change is likely to make coordination more sustainable or effective.

Relevant factors include:

• The number and size of remaining competitors.
• Market transparency.
• The ability to monitor competitors’ behaviour.
• The existence of stable market conditions.
• The possibility of retaliation against businesses that deviate.
• The presence of competitive constraints from outside the market.

The assessment must be based on the specific structure of the market rather than a general assumption that fewer competitors automatically means unlawful coordination.

8. Non-Horizontal Mergers: Vertical and Conglomerate Transactions

Not all mergers involve direct competitors.

Non-horizontal mergers occur between undertakings operating at different levels of the supply chain or in neighbouring markets.

They are commonly divided into vertical and conglomerate mergers.

8.1 Vertical mergers

A vertical merger occurs where businesses operating at different stages of production or distribution combine.

For example, a manufacturer may acquire a distributor, or a supplier of an essential input may acquire a company that uses that input to produce finished goods.

Vertical integration may improve efficiency by reducing transaction costs, improving coordination, and securing reliable supplies.

However, it may also create incentives or opportunities to restrict competitors’ access to important inputs or customers.

The principal competition concerns include:

• Input foreclosure: restricting competitors’ access to an important input.
• Customer foreclosure: restricting rival suppliers’ access to a sufficient customer base.
• Access discrimination: providing less favourable conditions to competing businesses.
• Increased barriers to entry: making it more difficult for independent businesses to compete.

The Commission examines whether the merged undertaking would have the ability and incentive to engage in foreclosure and whether such conduct would have a significant effect on competition.

8.2 Conglomerate mergers

Conglomerate mergers involve businesses operating in complementary or neighbouring markets rather than directly competing or occupying successive stages of the same supply chain.

A merger between a software provider and a manufacturer of related hardware may be an example.

Such transactions may allow businesses to offer integrated products, improve compatibility, or provide customers with more convenient services.

However, they may also create opportunities for tying, bundling, or the use of market power in one product to strengthen a position in another.

The Commission must examine whether the merged undertaking could use its position in one market to restrict effective competition in another.

The fact that two products can be sold together does not itself establish a competition problem. The assessment must demonstrate a credible mechanism through which the merger could materially weaken competition.

9. Market Assessment and Economic Evidence

Merger review requires a detailed examination of the markets in which the parties operate and the competitive consequences of the proposed transaction.

The Commission uses economic evidence, commercial documents, customer information, market data, and the views of competitors and other interested parties.

9.1 Market concentration

Market concentration is an important indicator of competitive structure.

One commonly used measure is the Herfindahl-Hirschman Index (HHI), calculated by adding the squares of the market shares of all undertakings in the relevant market.

A market with several similarly sized competitors will generally have a different concentration profile from one dominated by a small number of large businesses.

The change in HHI resulting from a merger can help identify transactions that warrant closer examination.

However, concentration indicators are not conclusive. The Commission considers them alongside market conditions, barriers to entry, competitive relationships, and other evidence.

9.2 Closeness of competition

The Commission may examine how closely the merging businesses compete with one another.

Customer switching data, internal business documents, pricing records, and evidence concerning lost sales may help establish whether the parties are particularly important competitive constraints on one another.

Two businesses may have relatively modest market shares but compete closely in a specialised segment. Their merger may therefore create concerns that are not immediately apparent from aggregate market shares.

9.3 Barriers to entry and expansion

The ability of competitors to enter or expand may constrain the merged undertaking’s market power.

Barriers may include high capital requirements, intellectual property rights, access to essential infrastructure, regulatory approvals, network effects, specialised technology, or established customer relationships.

The Commission examines whether entry is likely, timely, and sufficient to prevent the merged business from exercising market power.

The theoretical possibility of new entry is not enough. It must be commercially realistic.

9.4 Innovation and dynamic competition

Merger assessment is not limited to immediate price effects.

A transaction may affect innovation by eliminating an important research competitor, reducing incentives to develop new products, or preventing the emergence of future alternatives.

This is particularly important in pharmaceutical markets, digital technologies, artificial intelligence, clean technologies, and other sectors where competition may depend on innovation pipelines rather than current sales alone.

The Commission may examine research projects, development plans, patent portfolios, technical capabilities, and evidence that one party represents a significant potential competitive threat.

10. Acquisitions of Start-Ups and Emerging Competitors

One of the more difficult issues in modern merger control concerns acquisitions of businesses with limited turnover but potentially important future competitive significance.

A start-up may have few customers, little revenue, or substantial operating losses while possessing valuable technology, data, intellectual property, or research capabilities.

Traditional turnover thresholds may therefore fail to capture some acquisitions that could affect future competition.

The expression “killer acquisition” is often used to describe transactions in which an established business acquires an emerging competitor and subsequently discontinues or absorbs its competitive project.

The expression does not establish that every acquisition of a start-up is harmful. Many acquisitions provide financing, infrastructure, expertise, or commercial opportunities that allow innovative businesses to expand.

The legal difficulty is identifying transactions in which the acquisition removes a significant potential competitive constraint.

10.1 The role of transaction value

Some national merger control systems use transaction-value thresholds or other jurisdictional criteria in addition to turnover thresholds.

These mechanisms may capture acquisitions where the target has limited turnover but a high transaction value reflecting its technological or strategic importance.

The EU Merger Regulation itself continues to rely principally on turnover-based jurisdictional thresholds, together with its referral mechanisms.

Article 22 referrals may be relevant in some cases, but the limits clarified by the Court of Justice in Illumina and GRAIL must be respected.

10.2 The relationship with Article 102

In Towercast, Case C-449/21, the Court of Justice confirmed that a national competition authority may, in appropriate circumstances, examine an acquisition under Article 102 TFEU even after completion where the transaction falls outside the EU Merger Regulation and the applicable national merger control framework.

The case concerned an acquisition that had not been subject to prior merger review. The Court recognised that the acquisition could still be examined as a possible abuse of dominance under Article 102.

The judgment does not create a general power to reopen every completed merger. Its application depends on the legal conditions of Article 102, including the existence of dominance and abusive conduct.

It nevertheless demonstrates that merger control and antitrust enforcement are not entirely isolated systems.

11. Efficiencies and the Economic Benefits of Mergers

A merger may restrict competition in some respects while generating genuine efficiencies.

Article 2(1)(b) EUMR requires the Commission to take account of technical and economic progress, provided that it is to consumers’ advantage and does not constitute an obstacle to competition.

The Commission’s assessment therefore includes both potential competitive harm and claimed economic benefits.

Efficiencies may arise through:

• Economies of scale.
• Economies of scope.
• Reduced production or distribution costs.
• Improved logistics and supply chains.
• Integration of complementary technologies.
• Increased research and development capacity.
• Improved product quality.
• Greater investment capacity.

However, efficiencies are not accepted automatically.

The Commission generally examines whether the claimed efficiencies are:

Verifiable: The parties must provide evidence supporting the claimed benefits. General statements about improved efficiency or commercial growth are insufficient.

Merger-specific: The efficiencies must result from the transaction and not be realistically achievable through less restrictive alternatives.

Likely to benefit consumers: The efficiencies must be capable of counteracting the likely harm to customers, for example through lower prices, improved quality, greater choice, or innovation.

The timing and distribution of benefits are also relevant. Efficiencies that may arise only in the distant future or benefit only the merged undertaking may be insufficient to offset immediate competitive harm.

The assessment is evidence-based and depends on the circumstances of the particular transaction.

12. The Failing Firm Defence

A special situation arises where one of the merging businesses is financially failing or likely to leave the market.

The parties may argue that the merger will not materially reduce competition because the target would have exited the market even without the transaction.

This is commonly known as the failing firm defence.

The defence is subject to demanding conditions. The Commission generally examines whether:

1. The allegedly failing undertaking would, in the near future, be forced out of the market because of financial difficulties.
2. There is no less anti-competitive alternative acquisition or realistic restructuring option.
3. The assets of the failing undertaking would inevitably leave the market if the merger did not take place.

The defence does not apply merely because a business is unprofitable or experiencing financial difficulties.

The relevant question is what would realistically happen in the absence of the transaction. If another purchaser could preserve the business and maintain competition, the argument that the merger is competitively neutral becomes more difficult to establish.

The analysis is particularly important in periods of economic crisis, industry restructuring, and insolvency proceedings.

13. The Commission’s Merger Review Procedure

The Commission’s review normally proceeds through two principal stages: Phase I and Phase II.

The procedure is governed by the EUMR and Commission Implementing Regulation (EU) 2023/914.

13.1 Pre-notification contacts

Before submitting a formal notification, the parties may engage in discussions with the Commission.

Pre-notification contacts allow the Commission and the notifying parties to identify relevant issues, discuss the information required, and determine whether the transaction may qualify for a simplified procedure.

The process is particularly useful in complex transactions involving several affected markets or substantial economic evidence.

The parties should not assume that informal discussions amount to legal clearance. The formal review begins with notification and follows the statutory timetable.

13.2 Formal notification

A concentration with an EU dimension must generally be notified to the Commission before implementation.

The notification is normally submitted using Form CO, unless the transaction qualifies for the simplified notification procedure.

The parties must provide information about:

• The transaction structure.
• The undertakings concerned.
• Their ownership and control arrangements.
• Their turnover.
• Relevant product and geographic markets.
• Market shares and competitors.
• Customers and suppliers.
• The likely competitive effects of the transaction.

The notification must be sufficiently complete for the Commission to begin its substantive review.

13.3 The standstill obligation

Article 7 EUMR establishes the standstill obligation.

A concentration with an EU dimension must not be implemented before notification or before the Commission has declared it compatible with the internal market, subject to the specific exceptions and derogations provided by the Regulation.

This prevents the parties from changing the competitive structure of the market before the Commission has completed its assessment.

The prohibition on premature implementation is commonly called the standstill obligation. Its infringement is often referred to as gun-jumping.

The obligation may apply even where the transaction has not yet been formally completed, if the parties have already taken steps that effectively transfer control or implement the concentration.

13.4 Phase I investigation

Following a complete notification, the Commission generally has 25 working days to conduct its preliminary examination.

During Phase I, the Commission assesses whether the transaction falls within the EUMR and whether it raises serious doubts about its compatibility with the internal market.

The Commission may consult customers, suppliers, competitors, and other interested parties.

There are two principal outcomes:

• The transaction is cleared, either unconditionally or subject to accepted commitments.
• The Commission concludes that serious doubts remain and opens an in-depth Phase II investigation.

The simplified procedure may be available for transactions that are unlikely to raise significant competition concerns. The 2023 Merger Simplification Package expanded the categories of cases eligible for simplified treatment and reduced information requirements in qualifying notifications.

13.5 Phase II investigation

Phase II is a more detailed examination of transactions that raise serious competition concerns.

The Commission generally has 90 working days from the opening of Phase II to reach a final decision, subject to statutory extensions and suspensions.

The investigation may involve:

• Detailed economic analysis.
• Extensive requests for information.
• Interviews with customers and competitors.
• Examination of internal business documents.
• Analysis of pricing and switching data.
• Assessment of potential entry and innovation.
• Evaluation of proposed remedies.

The Commission may issue a Statement of Objections setting out its preliminary concerns. The parties are entitled to respond and exercise their procedural rights.

The Commission may also appoint a Hearing Officer to safeguard the parties’ procedural rights during the investigation.

13.6 Final decisions

At the end of the procedure, the Commission may:

• Declare the concentration compatible with the internal market without conditions.
• Declare it compatible subject to commitments.
• Prohibit the concentration where the competitive concerns cannot be adequately resolved.

The Commission’s official merger procedures page provides further information about notification, review periods, and possible outcomes.

14. Remedies: Addressing Competition Concerns

A merger that raises competition concerns does not necessarily have to be prohibited.

The parties may offer remedies designed to remove the identified competitive problems and allow the transaction to proceed.

Remedies are commonly divided into structural and behavioural measures.

14.1 Structural remedies

Structural remedies involve changes to the ownership or control of assets or businesses.

The most common form is divestiture, under which the parties agree to sell a business, production facility, intellectual property rights, or another asset to an independent purchaser.

The purpose is to preserve or restore an effective competitive constraint in the relevant market.

A divestiture must generally be capable of creating a viable and competitive business. Selling isolated assets without the personnel, technology, customer relationships, or other resources necessary for effective operation may not adequately resolve the Commission’s concerns.

Structural remedies are often preferred where they provide a clear and lasting solution.

14.2 Behavioural remedies

Behavioural remedies require the merged undertaking to modify its future conduct.

They may include:

• Providing access to infrastructure.
• Maintaining interoperability.
• Offering supplies on non-discriminatory terms.
• Removing restrictive contractual conditions.
• Granting licences to intellectual property.
• Maintaining separate commercial arrangements.

Behavioural remedies may be appropriate where the competition concern can be addressed through clearly defined and enforceable obligations.

However, they may require continuing monitoring and may be less effective where the merged undertaking has strong incentives to avoid or circumvent the obligations.

14.3 Commitments in Phase I and Phase II

The parties may offer commitments during either phase of the review.

Phase I commitments must be capable of resolving the Commission’s concerns sufficiently quickly and without requiring an unnecessarily complex investigation.

More extensive remedies may be considered during Phase II, where the Commission has conducted a detailed examination of the transaction.

The Commission assesses whether the commitments are effective, proportionate, and capable of being implemented.

The parties may be required to appoint a monitoring trustee or divestiture trustee to supervise compliance.

15. Prohibition of a Merger and the Consequences of Non-Compliance

Where the Commission concludes that a concentration would significantly impede effective competition and the parties have not proposed adequate remedies, it may prohibit the transaction under Article 8 EUMR.

A prohibition prevents the parties from implementing the proposed concentration.

If a transaction has already been implemented unlawfully, the Commission may require the undertakings concerned to dissolve the concentration or restore the situation that existed before implementation.

The Commission also has powers to impose fines.

Under Article 14 EUMR, the Commission may impose fines of up to 10% of the aggregate turnover of the undertakings concerned for certain infringements, including:

• Implementing a concentration in breach of the standstill obligation.
• Implementing a concentration declared incompatible with the internal market.
• Failing to comply with specified obligations or conditions attached to a decision.

It may also impose fines for intentionally or negligently supplying incorrect or misleading information or failing to provide information required by the Regulation.

The financial consequences can be substantial, particularly where a business completes a transaction before obtaining the necessary clearance.

The parties should therefore treat merger notification and the standstill obligation as substantive legal requirements rather than administrative formalities.

16. The 2023 Merger Simplification Package

The Commission adopted a new Merger Simplification Package on 20 April 2023, which entered into force on 1 September 2023.

The package revised the implementing rules and expanded the simplified procedure for transactions that are unlikely to raise significant competition concerns.

The changes included:

• Additional categories of transactions eligible for simplified treatment.
• Reduced information requirements for qualifying notifications.
• A revised Short Form CO.
• More flexible treatment of certain horizontal and vertical relationships.
• The introduction of super-simplified treatment for specified cases.
• Electronic notification as the default approach.

The purpose was to reduce administrative burdens for businesses and the Commission while preserving effective scrutiny of transactions that may harm competition.

Simplified treatment does not mean that the Commission has no jurisdiction or that the transaction is exempt from merger control. It remains a formal review procedure, but one designed to be proportionate to the competitive risks involved.

The Commission provides further information through its Merger Control Simplification page.

17. The Review of the EU Merger Guidelines in 2026

An important development in EU merger control is the Commission’s comprehensive review of its Horizontal and Non-Horizontal Merger Guidelines.

The existing Horizontal Merger Guidelines date from 2004, while the Non-Horizontal Merger Guidelines were adopted in 2008.

The Commission published draft replacement Guidelines on 30 April 2026. The public consultation closed on 26 June 2026, and the Commission’s published timetable indicated that the review was intended to be finalised in the fourth quarter of 2026.

The review responds to significant changes in the economy, including digitalisation, artificial intelligence, globalisation, decarbonisation, and the increasing importance of innovation and investment.

The draft Guidelines address matters including:

• The assessment of market power through structural and other indicators.
• Innovation and dynamic competition.
• Digital markets and data-related advantages.
• Sustainability and clean technologies.
• Investment and resilience.
• Efficiencies.
• Public policy, security, and labour-market considerations.

The Commission has also published an economic study examining the dynamic effects of mergers, including their influence on innovation, investment, market entry, and future product competition.

The review is significant because merger control increasingly requires an assessment of future competitive conditions rather than a narrow examination of existing market shares and prices.

However, it is important to distinguish the draft Guidelines from the existing legal framework. Until the revised Guidelines are formally adopted, the draft should not be presented as the final applicable Commission guidance.

The review and the consultation materials are available through the Commission’s Review of the Merger Guidelines page.

18. Judicial Review of Commission Merger Decisions

Commission merger decisions are subject to judicial review by the EU Courts.

Under Article 263 TFEU, undertakings may bring an action before the General Court seeking annulment of a Commission decision.

The review may concern the Commission’s interpretation of the Merger Regulation, its assessment of the evidence, the economic analysis, procedural fairness, or the adequacy of its reasoning.

The Court of Justice may subsequently hear appeals on points of law.

Merger control decisions frequently involve complex economic assessments. The Commission has a degree of discretion in evaluating economic matters, but that discretion does not remove the obligation to examine the relevant evidence carefully and provide a legally sufficient explanation for its conclusions.

The EU Courts have repeatedly emphasised that merger decisions must be based on sufficiently convincing evidence and a coherent assessment of the likely competitive effects.

The possibility of judicial review is important for both the merging parties and the wider market. It ensures that the Commission’s powers are exercised within the legal framework established by the Treaties and the EUMR.

19. Key Takeaways

• EU merger control is principally governed by Council Regulation (EC) No 139/2004.
• A concentration generally arises where a merger, acquisition, or qualifying joint venture produces a lasting change of control.
• Control may be exclusive or joint and can arise through ownership, contractual rights, or other forms of decisive influence.
• The Commission’s jurisdiction is primarily determined by the turnover thresholds in Article 1 EUMR.
• Transactions with an EU dimension are generally subject to centralised review under the one-stop-shop principle.
• National authorities review transactions falling outside the EU Merger Regulation, subject to referral mechanisms.
• The SIEC test examines whether a transaction would significantly impede effective competition in the internal market or a substantial part of it.
• Horizontal mergers may produce unilateral or coordinated effects, while vertical and conglomerate mergers may raise foreclosure or leveraging concerns.
• Merger assessment considers prices, output, quality, innovation, investment, market entry, and other competitive factors.
• Efficiencies may justify a transaction where they are verifiable, merger-specific, and likely to benefit consumers.
• The Commission generally conducts its review through Phase I and, where necessary, Phase II proceedings.
• The standstill obligation prevents parties from implementing a notifiable concentration before clearance.
• Remedies may be structural or behavioural and can allow a transaction to proceed where competition concerns are adequately resolved.
• The 2026 review of the Merger Guidelines reflects the growing importance of digital markets, innovation, sustainability, and dynamic competition.

20. Frequently Asked Questions

1. What is EU merger control?

EU merger control is the system through which the European Commission examines certain mergers, acquisitions, and joint ventures to determine whether they are compatible with the internal market. Its purpose is to prevent structural transactions that would significantly impede effective competition.

2. Which legislation governs EU merger control?

The principal legislation is Council Regulation (EC) No 139/2004, known as the EU Merger Regulation. Commission Implementing Regulation (EU) 2023/914 establishes important procedural requirements.

3. What is a concentration under the EU Merger Regulation?

A concentration generally arises where a merger, acquisition, or qualifying full-function joint venture produces a lasting change of control over an undertaking or part of an undertaking.

4. What are the turnover thresholds for EU merger control?

The principal threshold requires combined worldwide turnover exceeding €5 billion and EU-wide turnover exceeding €250 million for each of at least two undertakings concerned. An alternative set of thresholds applies to transactions with substantial turnover across at least three Member States.

5. What is the SIEC test?

The SIEC test asks whether a concentration would significantly impede effective competition in the internal market or a substantial part of it, particularly through the creation or strengthening of a dominant position.

6. Does every merger involving competitors create competition concerns?

No. A merger between competitors may generate efficiencies, improve production, or strengthen innovation. The Commission examines whether the transaction is likely to weaken effective competition rather than assuming that every reduction in the number of competitors is unlawful.

7. What is the difference between horizontal and vertical mergers?

A horizontal merger combines businesses operating at the same level of the supply chain, usually competitors. A vertical merger combines businesses operating at different levels, such as a manufacturer and a distributor.

8. What is the standstill obligation?

Under Article 7 EUMR, parties to a concentration with an EU dimension must generally refrain from implementing the transaction before notification and clearance. Premature implementation may constitute gun-jumping and lead to substantial fines.

9. How long does the Commission’s merger review take?

The ordinary Phase I review generally takes 25 working days after a complete notification. If the Commission opens Phase II, it generally has 90 working days to adopt a final decision, subject to statutory extensions and suspensions.

10. Can the Commission approve a merger subject to conditions?

Yes. The parties may offer commitments, including divestitures or access obligations, to address competition concerns. If the commitments are sufficient, the Commission may approve the concentration subject to those conditions.

11. Can the Commission prohibit a merger?

Yes. Where a concentration would significantly impede effective competition and adequate remedies are not available, the Commission may prohibit it under Article 8 EUMR.

12. Can a merger involving companies outside the EU fall within EU merger control?

Yes. The EUMR may apply to transactions between companies established outside the Union where the relevant turnover thresholds and jurisdictional requirements are satisfied.

13. Can the Commission review an acquisition of a start-up with little turnover?

Potentially, but the ordinary EU jurisdictional thresholds are principally turnover-based. Referral mechanisms may be relevant in qualifying cases, subject to the legal limits clarified by the Court of Justice in Illumina and GRAIL. National merger control systems may also use additional jurisdictional criteria.

14. What happens if a company completes a merger before obtaining clearance?

Where the transaction is subject to the standstill obligation, premature implementation may constitute an infringement. The Commission may impose fines of up to 10% of aggregate turnover under Article 14 EUMR and may require measures to restore the previous competitive situation.

15. What is the purpose of the 2026 review of the Merger Guidelines?

The review seeks to modernise the Commission’s analytical framework in light of developments in digitalisation, artificial intelligence, innovation, sustainability, investment, and global competition. The draft Guidelines were published on 30 April 2026, with the consultation closing on 26 June 2026.

21. Conclusion: Preserving Competition Through Structural Review

EU merger control recognises that the structure of a market can be just as important as the conduct of the businesses operating within it.

A transaction may transform competitive conditions before customers experience any immediate change in prices or services. By examining concentrations before implementation, the European Union seeks to prevent structural changes that could remove important competitive constraints, strengthen market power, or undermine future innovation.

The SIEC test provides the central legal standard. It allows the Commission to assess a broad range of competitive effects, including unilateral and coordinated effects, foreclosure, reduced innovation, and the elimination of potential competition.

At the same time, merger control must recognise the economic value of legitimate consolidation. Businesses may need to combine resources, acquire technology, enter new markets, or achieve economies of scale to remain competitive. The legal assessment therefore considers efficiencies and consumer benefits alongside potential harm.

The system also depends on procedural safeguards. Turnover thresholds establish jurisdiction, notification and standstill obligations preserve the possibility of effective review, and judicial oversight ensures that the Commission exercises its powers within the limits of EU law.

The evolution of merger control, particularly in digital and innovation-driven markets, demonstrates that competition cannot be assessed solely by looking at existing market shares. Future innovation, potential entry, access to technology, and the ability of emerging businesses to challenge established undertakings are increasingly important elements of the analysis.

Ultimately, the objective of EU merger control is not to prevent businesses from becoming larger. It is to ensure that economic consolidation does not deprive the internal market of the effective competition that supports innovation, consumer choice, productivity, and sustainable economic development.

22. Primary Legal Sources and Further Reading

EU legislation

• Council Regulation (EC) No 139/2004 — EU Merger Regulation
• Commission Implementing Regulation (EU) 2023/914
• Article 101 TFEU — Anti-competitive agreements
• Article 102 TFEU — Abuse of a dominant position

European Commission guidance and resources

• European Commission — Merger Control Overview
• European Commission — Merger Procedures
• European Commission — Merger Control Legislation
• European Commission — Simplification of Merger Control Procedures
• European Commission — Review of the Merger Guidelines
• Commission Notice on the Simplified Procedure (2023)

Selected Court of Justice authorities

• United Brands v Commission, Case 27/76.
• Illumina and GRAIL v Commission, Joined Cases C-611/22 P and C-625/22 P.
• Towercast, Case C-449/21.
• Airtours v Commission, Case T-342/99.
• Tetra Laval v Commission, Case C-12/03 P.
• Commission v Tetra Laval, Case C-12/03 P.
• CK Telecoms UK Investments v Commission, Case C-376/20 P.