An amalgamation or joining of two or more firms into an existing firm or to form a new firm. A merger is a method by which firms can increase their size and expand into existing or new economic activities and markets. A variety of motives may exist for mergers: to increase economic efficiency, to acquire market power, to diversify, to expand into different geographic markets, to pursue financial and R&D synergies, etc. Mergers are classified into three types:
Horizontal Merger: Merger between firms that produce and sell the same products, i.e., between competing firms. Horizontal mergers, if significant in size, can reduce competition in a market and are often reviewed by competition authorities. Horizontal mergers can be viewed as horizontal integration of firms in a market or across markets.
Vertical Merger: Merger between firms operating at different stages of production, e.g., from raw materials to finished products to distribution. An example would be a steel manufacturer merging with an iron ore producer.
Vertical mergers usually increase economic efficiency, although they may sometimes have an anticompetitive effect.
Conglomerate Merger: Merger between firms in unrelated business, e.g., between an automobile manufacturer and a food processing firm.
Source: OECD
Introduction In October 2015, following a phase II investigation, the European Commission published its decision to approve a JV between three of the largest collective management organisations (CMOs) in Europe, PRSfM (UK), GEMA (Germany) and STIM (Sweden).[1]M.6800-PRSfM/ STIM/ GEMA/ JV. As in other recent music industry mergers, the Commission investigated whether the combination of the…
On March 29, 2016, the Canadian Commissioner of Competition and Parkland Fuel Corp. entered into a consent agreement to resolve the Commissioner’s challenge to Parkland’s acquisition of Pioneer Energy. This marks the first time in a Canadian Competition Tribunal proceeding that a consent agreement has been negotiated through mediation. The consent agreement includes not only…
On March 18, 2016 the new law increasing notification thresholds (former draft law 2168a) was officially published. The law is expected to become effective on May 18, 2016. The current financial thresholds test has been substituted by the two new alternative ones (either A or B): Current financial thresholds to be met cumulatively (1+2+3) Expected…
Following over 20 years of deliberations and finally the entry into force of the first cross-sector competition law in the Philippines last summer, the newly established Philippine Competition Commission (“Commission”) has published an interim arrangement to accept simplified merger notifications. Notifications are mandatory for transactions which satisfy the transaction value threshold during the interim period….
The merger control regime in India has been in existence since 2011. The provisions of the Competition Act are to be read together with the notifications issued by the Ministry of Corporate Affairs, Government of India and the Combination Regulations. In line with the vision of India on promoting investments into India, the Ministry of…
79th Lunch Talk of the Global Competition Law Center Monday, March 14, 2016 from 12:00 PM to 2:00 PM Assessing unilateral effects in horizontal mergers: closeness of competition and the role of bidding data with Daniel Coublucq, DG COMP Sascha Schubert, Freshfields David Spector, MAPP Economics Moderator: Damien Gerard, GCLC Programme: 12:00 – 12:30: Sandwich…
DG COMP has published a study by the University of East Anglia analysing the European Commission’s approach to geographic market definition in recent cases. It has reviewed ten cases from 2008-2014 where geographic market definition was a key issue. The study looked at the Commission’s geographic market analysis in terms of the methodology used and…
Timur Bondaryev and Lana Sinichkina, Arzinger On January 26, 2016 Ukrainian Parliament adopted the law amending Ukrainian merger control rules. The law increased notification thresholds which have been effective for over 14 years after they were introduced in 2002. The current financial thresholds test is substituted by the two new alternative ones (either A or…
A seller that failed to provide requested information to the Belgian Competition Authority (‘BCA’) on time in a merger control investigation has been fined €50,000 for obstruction. Beyond the particulars of the case the decision provides more general guidance on the different types of procedural infringements which can give rise to fines under the Belgian…
Introduction The Competition Act, R.S.C. 1985, c. C-34 (“Competition Act”) requires that mergers, acquisitions and other business combinations that meet certain prescribed thresholds be notified to the Commissioner of Competition (“Commissioner”), the head of the federal Competition Bureau (“Bureau”), before they can be completed. A notification must be filed by each party to a notifiable…
