Case Referrals under the European Union (EU) Merger Regime

Abstract

The case referral system under the EU Merger regime is an exception to the general rule that, mergers that meet the EU community dimension test should exclusively be handled by the EU Commission and those that do not should be handled by the national competition agencies (NCAs) of the Member States. Under the EU merger regime, the NCAs and the Commission do not have concurrent jurisdiction. The introduction of the case referrals sought to ensure that the most appropriate institution would review the merger, and in the end ensure legal certainty and efficiency. Yet, in practice this is not the case and the Commission has to take into consideration additional factors in deciding whether to accept or refuse a case referral request from the NCAs or the merging parties. This paper seeks to examine the application of the case referrals of mergers at the Commission and how it works in practice to achieve the objectives that informed its adoption. At the core of this paper, is the principle that, the Commission has the sole discretion to determine whether case referral is appropriate or not. In some instances, as it will be seen in this paper, the Commission may seek to retain the decision-making power in key policy areas such as telecommunications even when the criterion for case referral from the Commission to the NCAs is met on the argument that it is the most appropriate agency to review the merger. This paper will show that, the Commission has relied on the principal of the ‘most appropriate authority’ as provided for under Sections 9 and 10 of the Commission Notice on Case Referral in Respect of Concentrations (Referral Notice) in refusing to refer certain mergers from the Commission to the NCAs.