The Regulatory Gap in Merger Control Vis-à-Vis the New-Economy

Sammanfattning: The new-economy encompasses a variety of industries, particularly pharmaceuticals and online-based companies. These may hold strong market positions, or be strong future competitors, despite having low turnover. Where foreclosure techniques to curtail competition are employed, the concentration may result in a long-lasting anti-competitive impact on the market. However, due to low or insufficient turnover, these transactions may avoid merger control where notification thresholds are turnover-based. The purpose of this thesis is to investigate if a regulatory gap exists in merger control legislation, and if so to what extent. This is assessed through analysing new-economy transactions within the framework of the thresholds in Article 1 EUMR, thus examining if the thresholds in the EUMR creates a regulatory gap on an EU level. The thesis further analyses the potential need for reform on a Member State level as this is relevant from an internal market perspective, the importance of national legislation where the EUMR does not apply and the active role of NCAs. The effect of alternative thresholds is also examined should reform prove necessary. This allows for a holistic discussion and considers potential future legal development. The thesis contends that a regulatory gap does exists within the EUMR but that it is not isolated to the EUMR as it can also be observed on a national level. The regulatory gap is of particular importance due to the new-economy sectors' importance within the modern economy and the risk of long-term anti-competitive effects on the market. It is argued that this results in an overarching need for reform, but the need for reform must be balanced against the additional costs and burdens on authorities and companies. Within the EU, reform may follow the Commission's public consultation into the need for additional merger control thresholds in the EUMR. On a national level, reform may come through the influence of other jurisdictions within the EU or through spontaneous harmonisation. This is a process where Member States incrementally align their laws with EU law and, to an extent, other Member States’ laws. If national reform does occur, new-economy concentrations would be best captured through utilising a voluntary notification system. However, it is argued that such a system must be combined with a residual jurisdiction for NCAs as well as an effective monitoring system over M&A activity to ensure its functionality. None of the models examined are flawless and all may strongly influence how M&A transactions are structured as well as how NCAs and the Commission operate. However, the importance of effective merger review over new-economy concentrations implies that measures must be taken.