|Author (Person)||Chapman, Peter, Frost, Laurence|
|Series Title||European Voice|
|Series Details||Vol.7, No.45, 6.12.01, p22|
THE EU's competition watchdog is to consider bringing itself into line with counterparts in other countries, notably the US, according to leaked excerpts of an eagerly-awaited European Commission 'green paper' on merger reform seen by European Voice.
The paper by Mario Monti will raise the question of replacing the dominance test at the core of the Union's merger regulation with another principle, 'substantial lessening of competition', which is used in the US, Canada, Japan and Australia.
The Commission is anxious to be seen responding to transatlantic tensions over mergers, highlighted by the recent GE-Honeywell deal, which was approved in the US but blocked by Monti, the EU competition chief. "We're even open to examine the European standard of merger control," said Monti's top official, Alexander Schaub. "But we have not yet finalised our thinking on the green paper."
Johan Ysewyn, a partner at law firm Linklaters & Alliance, said mooting a change in the dominance test "looks more like a political move" by the Commission than a reflection of "true concern".
But EU sources say the paper will also suggest that the Commission could begin weighing the efficiencies generated by deals - and passed on as lower prices - against their anti-competitive effects. This would represent another step towards much-hyped 'convergence' with US merger philosophy, which places a greater emphasis on consumers. Some business groups worry that the drive for international coordination could be undermined by plans to increase the number of decisions taken by national authorities, allowing the Commission to vet more deals with pan-European implications.
Under current rules, a member state can request referral only where the anti-competitive effects of a deal would be felt on its own markets. But in future, national agencies could win a referral when the facts of a case relate to that member state when. for example, one or more of the merging companies operates there.
"This could lead to different application of the rules by the different authorities," said Erik Berggren of EU employers' organisation UNICE, "in other words divergence".
The Confederation of British Industry (CBI) believes the move could mirror recently proposed modernisation of the competition rules governing distribution agreements and other kinds of deals.
CBI legal adviser Jonathan Dykes said the modernisation proposals threatened to hand far-reaching enforcement powers to national authorities, with no guarantee that they would stick to EU rules. "If extensive decentralisation of European merger control is proposed, we would also view that with concern," said Dykes.
Schaub defended a larger role for national anti-trust regulators. At a recent conference held by the Canada-Europe Round Table, he said: "We firmly believe it will lead to more convergence. It will free competition authorities to work together in a way they've never done."
The EU's competition watchdog is to consider bringing itself into line with counterparts in other countries, notably the US, according to leaked excerpts of a European Commission 'green paper' on merger reform.
|Subject Categories||Internal Markets|