In June 2019, the OECD Competition Committee discussed how competition authorities can effectively use merger control to reduce the risk of competition harm posed by potentially problematic vertical mergers, without compromising the many efficiencies typically associated with vertical integration.Read more
The first panel at the inaugural OECD Competition Open Day in 2019 opened the conversation about vertical restrains in e-commerce to the wider competition community. Watch a video of the session here with panelists Pinar Akman, Paolo Buccirossi and Gunnar Kallfass.Read more
In this video Professor Margaret Slade, Professor Emeritus at the Vancouver School of Economics at the University of British Columbia offers her insights into the empirical evidence on the welfare effects of vertical mergers.Read more
Mergers: An integral part of the competition landscape to be closely monitored
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.
Permanent URL: www.oecd.org/competition/mergers
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