INSTITUTIONS AND POLICY CHANGE IN THE EUROPEAN COMMUNITIES: THE CASE OF MERGER CONTROL1

Abstract

The supranational regulation of merger and acquisition activity presents valuable evidence for examining the dynamics of policy change within the European Communities. Over the years four merger regimes can be seen to have existed. The first, restricted to the coal and steel industries, originated in the specific postwar wish to control (German) heavy industry and retains its separate character. Other industries were a matter for the later Treaty of Rome, establishing the European Economic Community (ECC). It was not until 1989 that a clear ECC regime was established after two ‘false starts’ arising from rulings by the European Court of Justice on specific mergers. Agreement eventually came once ministers and industrialists realized that clear rules were needed, if the necessary orderly corporate restructuring were to be facilitated in the run‐up to completion of the single market.A ‘new institutionalist’ approach is adopted in analysing the evolution of supranational merger regulation. Accordingly, the article examines how far the capacity of the two treaties, and the capacities of the individual institutions, can explain the resultant pattern of supranational merger regulation.