The current Guidelines set out certain “safe harbours", according to which mergers falling below specified structural thresholds (based on the parties’ combined market shares and post-merger levels of market concentration) are unlikely to raise competition concerns. But the inverse does not apply where those indicators are exceeded; the Commission must establish likely harm on a case-by-case basis.

As a counterbalance to the safe harbours, the Commission is considering introducing “stricter indicators” or even rebuttable presumptions of harm – similar to those in the US – that would apply when certain market share or concentration thresholds are exceeded. While it is already common in practice to apply rule-of-thumb thresholds when filtering overlaps for in-depth scrutiny, a move to codify rebuttable presumptions in the guidelines – with it falling on the merging parties to show that the transaction will not harm competition – would raise important legal questions, most notably around who ultimately bears the burden of proof under EU law. 

As noted above, the Commission is having to respond to growing calls for merger policy to support the key objectives of: (i) helping EU companies scale up, so they can invest more in innovation (including in green technologies) and compete more effectively at the global level; and (ii) ensuring the EU’s critical industries are resilient, including in their finances and supply chains. 

Behind those calls lie concerns that European businesses are increasingly being left behind by their rivals on the global stage, and that reliance on overseas suppliers of critical inputs has left the EU economy excessively vulnerable to external shocks. 

For some, addressing those concerns necessarily entails allowing firms in strategic sectors to consolidate, even if an orthodox approach to merger enforcement would see the concentration prohibited. What emerges from the technical papers, however, is a relatively balanced assessment of these issues. 

On the one hand, the Commission invites suggestions as to how and when it should factor such concerns into its merger reviews and weigh them against likely impacts on competition within the single market. At the same time, however, it appears to be approaching these issues from a position of economic orthodoxy, noting, for example: that resilience can only be taken into consideration where it is a relevant factor for competition in the affected markets; that preserving a diversified supply base actually enhances resilience; and that the productivity and innovativeness of the EU economy may be hindered if market power is acquired or increased. The Commission also appears sceptical of suggestions that many markets should now be seen as global or EEA-wide in scope (thus permitting further consolidation in some cases), citing the continued presence of regulatory and other barriers.

Just as environmental harm is being taken more seriously, so too are environmental efficiencies. 

The Commission is already open to the idea that mergers could accelerate green innovation or support more sustainable production, but only if the benefits are concrete, merger-specific, and passed on to customers. In Aurubis/Metallo, for example, while claims regarding improved copper recycling weren’t ultimately accepted, the case signalled a willingness to consider environmental benefits. 

The technical papers flag in multiple places that mergers may give rise to concrete environmental efficiencies, and that this is one way in which merger policy can contribute to the EU’s sustainability objectives. However, they reveal little on how the Commission intends to assess such claims going forward (beyond the traditional framework applied to efficiencies claims in general), and merely seek stakeholder input. Certainly, there is scope for the revised guidelines to offer more guidance on how to quantify and validate such efficiencies, in particular so-called “out of market benefits”.

One of the more novel elements of the consultation is a proposal to assess mergers' impact on labour markets. The logic is borrowed from assessments of mergers’ effects on buyer power (itself a nascent concept in EU merger enforcement), but applied to employers – looking in particular at whether a merger could lead to wage suppression, reduced mobility, or poorer working conditions.

One issue the Commission intends to explore is whether monopsony power in labour markets should constitute a standalone theory of harm, or must be linked to a negative effect on competition in downstream markets. If the former, this has the potential significantly to increase the complexity of many merger reviews.

Either way, the inclusion of this issue reflects a growing interest in the intersection between competition policy and social outcomes.

Finally, in view of the changed geopolitical environment, the Commission is seeking feedback on whether the revised guidelines should address the potential for interaction between its competitive assessment and Member States’ national security and defence interests. 

The Commission’s ultimate objectives here are not entirely clear. As the relevant technical paper notes, such considerations are generally the privilege of the Member States, who can intervene to block mergers on such grounds under Article 21(4) EUMR. But at the same time, there have been calls for further consolidation in the EU defence sector, following the Russia-Ukraine war. Whilst the Commission has never blocked a merger between defence companies, it may be that it foresees the possibility of there being pressure to clear an otherwise anticompetitive merger on defence and security grounds (Article 21(4) does not permit Member States to override the Commission’s competitive assessment). 

One area the Commission is likely to expand upon in its revised guidelines is its approach to “gap” cases – those where a merger is expected to result in a significant impediment to effective competition (SIEC) through non-coordinated effects, without creating or strengthening a dominant position. 

The EUMR itself recognises that the creation or strengthening of a dominant position is not a pre-requisite to a finding of an SIEC (and, therefore, a prohibition decision). However, the legal standard applying in such cases was up for debate until the Court of Justice’s 2023 ruling in CK Telecoms, which confirmed the standard of proof in such cases and clarified the requirements for a merging party to constitute an “important competitive force”, the elimination of which would lead to an SIEC.

Whilst these issues are briefly touched upon in the current horizontal Guidelines, which CK Telecoms broadly endorsed, they would benefit from a clearer explanation of the types and level of evidence the Commission is likely to rely on in such cases.

Recent mergers in the pharma and tech sectors, amongst others, have prompted concerns regarding such transactions’ potential to reduce market players’ incentives to innovate – not only through the elimination of direct rivals, but also through “killer acquisitions” of nascent companies or technologies, which can stifle future competition and lock in dominance.

These concerns were central to the Commission’s high-profile review (and its ultimately thwarted prohibition) of Illumina’s acquisition of Grail, which focused on the risk of Illumina  foreclosing emerging competitors in early cancer detection. Similarly, the Commission was concerned that Adobe’s (ultimately abandoned) acquisition of Figma constituted a “reverse killer acquisition”, with Adobe choosing to cancel the internal development of new product design software and purchase the market leader instead, whilst also eliminating a potential competitor that could have threatened Adobe’s market leadership in image editing software.

These cases also reflect a broader effort to protect dynamic competition (i.e. competition stemming from a perceived threat of entry or expansion by rival firms), particularly from smaller players that, despite not yet having achieved a significant market presence, enjoy strong R&D capabilities or a track record of innovation. 

Whilst the current horizontal Guidelines include a cursory reference to mergers’ potential to impact innovation (both positively and negatively), the consultation recognises a need to codify the Commission’s developing framework for assessing such effects, including overlaps in both marketed and pipeline products, disruption of early-stage R&D, and structural reductions in innovation intensity. Particular challenges arise from the forward-looking and uncertain nature of innovation harms, and the need to assess asymmetries – balancing short-term price effects with long-term increases in innovation incentives and output.

The Commission has indicated that its traditional framework, based on input and customer foreclosure, may not always capture the strategic implications of acquisitions involving platform ecosystems. And in cases where input foreclosure concerns have arisen, the Commission has been required to examine how control over data and/or limitations on interoperability could be used to reinforce market power in subtle but effective ways. 

Most notably, in Booking/eTraveli, the Commission was concerned that by capturing eTraveli’s web traffic and integrating its flights travel agency offering into the Booking.com ecosystem, Booking would increase user lock-in and “entrench” its dominant position in accommodation travel agency. Similarly, in Google/Fitbit, Google was required to commit not to use Fitbit’s health and wellness data in its adtech business, to avoid raising barriers to entry/expansion in digital advertising markets, as well as to maintain APIs allowing digital healthcare providers to access that data, and not to degrade the interoperability of rival Android-based wearables. And in Amazon/iRobot, the potential for self-preferencing through Amazon’s marketplace, combined with data advantages from smart devices, highlighted how ecosystem strategies can be exclusionary in the absence classical input foreclosure.

Whilst the current Guidelines recognise that input foreclosure can take subtle forms, including limiting interoperability and degrading the quality of inputs, the revised guidelines will likely tackle the above issues head-on – as well as addressing the concepts of entrenchment and ecosystem competition for the first time. 

Sustainability is increasingly being treated as a dimension of competition, not just a political or regulatory goal. As companies look to differentiate themselves based on their environmental credentials, the Commission is responding by analysing how mergers might affect innovation in green products, access to clean technologies, or incentives to decarbonise.

Whilst the case centred on the merger’s potential to harm innovation, Dow/DuPont demonstrated how such concerns can come into play, with the Commission imposing remedies to address concerns that the combination would reduce R&D in environmentally safer crop protection products. More recently, in Norsk Hydro/Alumetal, the Commission looked at how the merger would affect the supply of low-carbon aluminium, even introducing a novel metric – shares of saved CO₂ emissions – to assess differentiation amongst suppliers. 

These cases illustrate how the clean transition is being baked into merger analysis, not just through possible efficiencies, but as part of the competitive assessment. The new guidelines will allow the Commission to formalise its approach to such assessments, in cases where environmental and sustainability concerns are linked to the competitive dynamics under consideration.