Debevoise & Plimpton

Casting a wider net — EU merger control review of minority shareholding acquisitions?

The European Commission is considering amending the EU Merger Regulation (EUMR) to allow it also to review certain acquisitions of non-controlling minority shareholdings. This update briefly summarises the various possible review mechanisms being considered by the Commission as well as the major concerns raised by third parties in a recently completed consultation process.

Under the current EUMR regime, the Commission can only review the acquisition of a minority shareholding and possibly prohibit it ex ante where it confers control. Control is currently defined in the sense of ‘decisive influence’ over the target. There is no set level of shareholding that is considered to give rise to decisive influence. Acquisitions of non-controlling minority shareholdings are not subject to a merger review process.

The Commission may also intervene with respect to certain acquisitions of a minority shareholding ex post under the EU’s antitrust provisions (article 101 or article 102 TFEU), but its ability to do so is limited. The Commission considers the existing legal tools at the EU level do not sufficiently cover all possible anti-competitive effects that may arise from an acquisition of a minority shareholding. It has concluded that the enforcement gap is significant enough at least to consider seriously an extension of its merger control review powers…

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