How efficient is the EC Merger Regime ?

Lévêque, François

The European Commission recently issued an in-depth study on merger remedies. The study conducted an ex post evaluation of the design and implementation of 96 remedies accepted in merger cases notified between 1996 and 2000. At first glance, remedies seem very effective since 94 % of divested business is still on the market three to five years after divestiture and 81 % of total analysed remedies are assessed as totally or partially effective. In fact, these impressive figures are trees hiding the forest. The study shows numerous difficulties to make remedies successful, especially because of strategic behaviour of merging firms and the poor job made by trustees.

*This article is an automatic translation of the original article, provided here for your convenience. Read the original article. 1. The European Commission published in October 2005 the results of its study on merger control remedies. This is an ex-post evaluation of almost half of the conditional decisions taken in the period 1996-2000. The study has gone unnoticed despite the fact that this key topic is being addressed for the first time in Europe. Authorisations with remedies are about 10 times more frequent than prohibition decisions. Their evaluation is therefore very useful. In the United States, the Federal Trade Commission (FTC) conducted a similar, though much less thorough, investigation in 1999. The study carried out by the Commission is of first-rate quality. It contains a

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