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Competition

Conglomerate effects of mergers

 

 10 June 2020  Paris  

Conglomerate effects arise when a merger has an effect on competition, but the merging firms’ products are not in the same product market, nor are they inputs or outputs of one another.

Mergers exhibiting conglomerate effects have taken on a new prominence in the digital era, as the largest technology companies use acquisitions as a key part of their product development, expansion and recruitment strategies. These transactions are generally considered to be procompetitive: they can allow the combination of complementary skills and assets, improve interoperability, and facilitate innovation. However, there can also be some potential competition concerns associated with these mergers. They include the potential for bundling and tying, reduced innovation incentives, and co-ordinated effects.

Investigating conglomerate effects can be particularly difficult, as it is not straightforward to identify when they are likely to arise. Information gathering, addressing uncertainty in the development of the market, and assessing remedies for conglomerate effects are some of the key challenges faced by competition authorities in these cases.

In June 2020, the OECD will discuss questions such as:

  • When are conglomerate effects harmful to competition?
  • How should conglomerate effects be assessed?
  • Are new theories of harm specific to digital companies needed?
  • How can authorities overcome the practical challenges associated with investigating conglomerate theories of harm?

All related documentation will be made available on this page.

» See full list of best practice roundtables on competition

 

INVITED SPEAKERS

Marc Bourreau Bio    

Professor of Economics at Telecom Paris, Institut polytechnique de Paris

Eliana Garcés Bio    

Director of Economic Policy, Facebook 

James Langenfeld Bio   

Senior Managing Director, Ankura

 

DOCUMENTS

» OECD Background note • Note de réflexion de l'OCDE 

» Paper by Marc Bourreau and Alexandre de Streel 

 

Forthcoming contributions

Belgium

Brazil

European Union

Hungary

Japan

Lithuania

Mexico

Russian Federation

South Africa

Spain

Chinese Taipei

Turkey

United States

BEUC

BIAC

TUAC

 

 

PRESENTATIONS  
 

RELATED BEST PRACTICE ROUNDTABLES

Portfolio effects in conglomerate mergers (2001)

Vertical mergers in the technology, media and telecom sector (2019)

SEE ALSO

OECD best practice roundtables on competition

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