Mergers: An integral part of the competition landscape to be closely monitored
Almost all systems of competition law provide for control of mergers, to prevent companies from joining together to eliminate competition between them.
A merger could be a complete union of two or more companies, a more one-sided takeover or the transfer of parts of one firm to another.
Deciding whether a merger will harm competition can require sophisticated economic analysis of markets and the effects of the transaction. Yet this sophisticated analysis must in most jurisdictions be carried out to strict deadlines so as to protect the procedural rights of all affected parties.
Why do competition authorities analyse mergers?
Most mergers are beneficial to competition, or at least do no harm to it, so competition authorities typically conduct a quick screening exercise to identify the exceptions. In, mergers between competitors can result in very large costs to consumers and to the economy more generally, so it is essential that authorities have the power and skills to investigate effectively and to remedy any potential problems they find (including by blocking the merger).
Mergers between companies that do not directly compete (such as a ‘vertical’ merger between a supplier and its customer) rarely raise competition concerns; but when they do, they require very sophisticated economic analysis to assess whether the effects are anti-competitive or efficiency-enhancing.
Debating merger control at the OECD
The OECD provides competition agencies with opportunities to debate the latest developments in merger control between themselves, as well as with international experts and the business community. These debates cover the whole process from the initial notification of a merger, to assessment of the determination of remedies and finally ex post evaluation of the results. The OECD has been closely involved in the development of common principles for the standard of review of mergers. This extends to principles for co-operation between competition authorities when assessing international mergers, an area in which the OECD is currently focusing its efforts.
Documents and links
List of all roundtables on mergers
Remedies in cross-border merger cases, 2013
Provisions in co-operation agreements on competition, 2014
Enhanced Enforcement Co-operation, 2014 (Hearing)
Investigations of Consummated and Non-notifiable Mergers, 2014
Definition of Transaction for the Purpose of Merger Control Review, 2013
Role and Measurement of Quality in Competition Analysis, 2013
The Role of Efficiency Claims in Antitrust Proceedings, 2012
Market Definition, 2012
Impact Evaluation of Merger Decisions, 2011
OECD Recommendation on Merger Review 2005
Country experiences with the OECD Recommendation on Merger Review
For further information on work related to mergers, please contact us at DAFCOMPContact@oecd.org.