The Economics of European Merger Control
London, England
5 May 2009
Hosted By: NERA Economic Consulting
Since the revised 2004 Merger Regulation, the role of economic analysis in European merger control has increased significantly. The Chief Economist Team takes an active interest in cases, which has led not just to greater focus on coherent economic theories of harm and the required empirical data to test these theories, but to economic analysis featuring throughout the timeline of the case, from pre-notification to Phase 2.
In this seminar, of interest to competition lawyers, corporate counsel, and M&A advisers, NERA Director Dr. Mark Williams presented an overview of the evolving role of economic analysis in European merger control.
In a critical survey of ECMR Phase 2 cases under the new merger regulation, Dr. Williams documented the rise of non-coordinated effects as the primary and natural lens of analysis for the majority of mergers, replacing traditional dominance analysis, and the changing perspectives on coordinated effects analysis from the Airtours appeals through the various Sony/BMG investigations (before the Commission and the Courts), to newer cases such as Travelport/Worldspan and ABF/GBI.
Dr. Williams also outlined the increasing role of econometrics and other quantitative methods, which have made a significant contribution in a number of cases, such as Friesland/Campina and Ryanair/Aer Lingus; and highlighted the relevant considerations when analyzing markets characterized by bidding processes, such as those in Syniverse/BSG or AEE Lentjes/Telelogic.
In addition, Dr. Williams discussed theories of foreclosure and exclusionary conduct in the context of the Commission's non-horizontal merger guidelines, which were followed by a number of cases cleared unconditionally following a careful in-depth analysis, such as Itema/Barcovision, Nokia/NAVTEQ, and TomTom/TeleAtlas.
Finally, Dr. Williams provided an overview of some of the novel and more complex theories of harm such as diagonal mergers and the effect of minority stakes, which have emerged as themes in cases such as Universal/BMG and Norddeutsche Affinerie/Cumerio.
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