Referral (merger)

Community jurisdiction in the field of merger control is defined by the application of the turnover-related criteria contained in Articles 1(2) and 1(3) of the Merger Regulation. When dealing with concentrations, the Commission and Member States do not have concurrent jurisdiction. Rather, the Merger Regulation establishes a clear division of competence. Concentrations with a “Community dimension”, i.e. those above the turnover thresholds in Article 1 of the Merger Regulation, fall within the exclusive jurisdiction of the Commission; Member States are precluded from applying national competition law to such concentrations by virtue of Article 21 of the Merger Regulation. Concentrations falling below the thresholds remain within the competence of the Member States; the Commission has no jurisdiction to deal with them under the Merger Regulation. Determining jurisdiction exclusively by reference to fixed turnover-related criteria provides legal certainty for merging companies. While the financial criteria generally serve as effective proxies for the category of transactions for which the Commission is the more appropriate authority, Regulation (EC) No 139/2004 complements this ‘bright-line’ jurisdictional scheme with a possibility for cases to be re-attributed by the Commission to Member States and vice versa, upon request and provided certain criteria were fulfilled. This case referral system is laid down in Article 4(4) and (5), Article 9 and Article 22 of Council Regulation (EC) No 139/2004 of 20 January 2004 on the control of concentrations between undertakings. The system of merger control established by the Merger Regulation, including the mechanism for re-attributing cases between the Commission and Member States contained therein, is consistent with the principle of subsidiarity enshrined in the EC Treaty. Decisions taken with regard to the referral of cases should accordingly take due account of all aspects of the application of the principle of subsidiarity in this context, in particular which is the authority more appropriate for carrying out the investigation, the benefits inherent in a ‘one-stop-shop’ system, and the importance of legal certainty with regard to jurisdiction. These factors are inter-linked and the respective weight placed upon each of them will depend upon the specificities of a particular case. Above all, in considering whether or not to exercise their discretion to make or accede to a referral, the Commission and Member States should bear in mind the need to ensure effective protection of competition in all markets affected by the transaction. © European Commission

See Regulation (EC) No 139/2004