Does EU Merger Control Discriminate Against Small Market Companies?

When it comes to merger control regulations in the European Union, many argue that small market companies are at a significant disadvantage. Critics claim that the stringent requirements and burdensome procedures imposed by EU authorities discriminate against smaller businesses, making it difficult for them to compete on equal terms with their larger counterparts.

Understanding EU Merger Control

EU merger control is a regulatory framework that aims to prevent anti-competitive practices and ensure fair competition within the European Union. By scrutinizing the merger and acquisition activities of companies, the EU seeks to maintain a level playing field for businesses and protect consumer welfare.

The European Commission, along with national competition authorities, reviews proposed mergers and acquisitions that meet certain thresholds. These authorities are responsible for assessing whether a proposed transaction would significantly impede competition within the EU's internal market, and may require companies to undertake certain measures to mitigate any adverse effects on competition.

Does EU Merger Control Discriminate against Small Market Companies?: Diagnosing the Argument with Conclusions

by Mika Oinonen(Kindle Edition)

5 out of 5

Language	:	English
File size	:	2920 KB
Text-to-Speech	:	Enabled
Screen Reader	:	Supported
Enhanced typesetting	:	Enabled
Word Wise	:	Enabled
Print length	:	448 pages

FREE

The Impact on Small Market Companies

While the intentions behind EU merger control are noble, critics argue that the regulations disproportionately affect small market companies. This is primarily due to the costly and time-consuming procedures involved in obtaining regulatory approval for a merger or acquisition.

Unlike larger corporations, small market companies often lack the necessary financial resources and legal expertise to navigate through the complex merger control process effectively. As a result, they may be forced to abandon potentially beneficial business opportunities or face significant delays and increased costs.

Furthermore, critics claim that the thresholds for triggering EU merger control are set unreasonably low. Transactions that have a minimal impact on the internal market are subject to scrutiny, creating an undue burden for small market companies. This leads to a disproportionate allocation of resources, diverting the attention of these companies away from their core operations.

The Need for Reform

Recognizing the concerns raised by small market companies, efforts have been made to reform the EU merger control regulations to level the playing field. Proponents argue that the current system stifles innovation and hampers economic growth by discouraging potential mergers and acquisitions that could generate positive market outcomes.

Reform proposals include raising the thresholds for triggering EU merger control, offering assistance programs specifically tailored to small market companies, and streamlining the review process to reduce costs and timelines.

While EU merger control aims to preserve fair competition, it is crucial to address the concerns voiced by small market companies. Reforms that promote a more balanced and inclusive regulatory environment can foster greater innovation, economic growth, and job creation.

By acknowledging the unique challenges faced by smaller businesses and implementing measures to alleviate the burdens they encounter during the merger control process, the European Union can ensure a level playing field for all market participants while safeguarding competition and consumer interests.

Does EU Merger Control Discriminate against Small Market Companies?: Diagnosing the Argument with Conclusions

by Mika Oinonen(Kindle Edition)

5 out of 5

Language	:	English
File size	:	2920 KB
Text-to-Speech	:	Enabled
Screen Reader	:	Supported
Enhanced typesetting	:	Enabled
Word Wise	:	Enabled
Print length	:	448 pages

FREE

Although the question posed by the title of this book has generated considerable debate, the essential issue remains open and largely blurred. While some believe that there is no so-called ‘small market problem’, others discern discrimination against small market companies (i.e., companies with a strong position in their home markets but a modest position in the European and global markets) and a consequent need for changes in competition law. The author of this enormously helpful work here sets the stage for meaningful discussion by analysing the EC Merger Regulation’s objectives, economic foundations, and application practice to present a reasoned view of the issues that can be considered relevant for such a discussion. Considering their effect on the ’small market problem’, the author scrutinizes such factors as the following: the Commission’s methodology for delineating relevant markets in merger assessments; unnecessary prohibition caused by overestimation of the market power of small market mergers; erroneous approval of cases that should actually be prohibited; impact of the so-called ‘Harvard’ and ‘Chicago’ schools of competition theory and their key policy implications; process-related alternative views of competition and new synthesizing approaches; relevant criteria for a proper analysis of market power; concentration measures and market shares; barriers to entry; price and profitability analyses; and product definition v. geographic definition of markets. In a final chapter, the author presents some tentative s, normative in nature, concerning the problem and the relevant issues relating to it. As the first in-depth analysis of the issues that are actually involved – with its particular diagnosis of the assessment of market power in considering the relevant issues for the problem – this study brings into salience the terms of the debate on the ‘problem’, and thus takes a giant step forward towards defining what needs to be done. Competition lawyers, policymakers, and academics in Europe and elsewhere will find the discussion of great value.