Review article
Assessment of vertical mergers by the European Commission after the entry into force of the guidelines on the assessment of non-horizontal mergers - on the example of decisions in cases TomTom/Tele Atlas and Nokia/NAVTEQ
Tea Jagić
; Faculty of economics and business, University of Zagreb, Zagreb, Croatia
Abstract
The author gives an outline of the development of legal rules, milestone decisions of the European Commission, and Court judgments regarding assessment of mergers in the European Union. The focus is on the modernised approach to assessment of mergers introduced in 2004. Further, the author clarifies the division of non-horizontal mergers
into vertical and conglomerate mergers, along with their positive and potential negative effects, paying special attention to the assumption that the positive ones outweigh the negative. Using the examples of decisions reached in merger assessment procedures in the new technologies market between the entrepreneurs TomTom/Tele Atlas and Nokia/NAVTEQ, the author goes on to assess potential negative effects which may appear, according to the European Commission, after the implementation of these vertical mergers, even though the Commission stated in the decision that, ultimately, they could
not significantly impede effective competition. Finally, considering the overall low number of banned mergers, which is largely due to their limited negative impact on competition, and taking into account the undisputed fact that vertical mergers produce significant benefits, particularly in terms of innovations, the author holds it unlikely that, especially in the new technologies market, at the time of merger notification, these mergers will pass the SIEC and three-tier tests (ability/motive/effect) and consequently be banned. Such mergers will produce benefits in terms of innovations and have positive effects on
competition and, ultimately, on consumers.
Keywords
non-horizontal mergers; vertical mergers; European Union; new technologies market; innovations
Hrčak ID:
74551
URI
Publication date:
28.10.2011.
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