Belgium (Brussels Morning Newspaper) European Commissioner Margrethe Vestager, the Union’s antitrust chief, hinted on Friday that she might have more targets in sight for the Merger Regulation Article 22, after the controversial EU law received the backing of the Union’s General Court this week.
Speaking at a news conference on Friday, Vestager said that the Commission might consider further mergers falling under the scope of the now-reinforced Merger Regulation. “We have a few acquisitions within our sights that may be relevant candidates for Article 22. But that is not a given,” said Vestager.
The Article 22 gives the Commission the power to review mergers, even mergers that have already taken place, even if the companies involved have no activities or revenues reported in EU countries at the time, if they assess that the merger could impact the market in the future.
Particularly of note are the so-called “killer mergers”, where a larger corporate entity is taking over an innovative startup, especially in the tech or pharmaceutical sector, where the merger would effectively eliminate “a potentially important competitive force”.
The Article 22 power was tested by the Commission by stopping the US biotech giant Illumina from taking over a smaller US-based life sciences company, the Grail, whose innovations include its flagship Galleri blood test used to diagnose cancers at early stages. While Illumina completed the takeover in 2021, the Commission instructed the company to keep Grail separate and have independent managers continue to run it until it concludes its investigation.
Illumina appealed to the Union’s General Court, which ultimately ruled this Wednesday that the Commission was within its rights to halt the merger. While the US company will appeal to the Court of Justice of the European Union (ECJ), the Union’s highest judicial authority, the Commission appears to have interpreted the lower court ruling as a green light to proceed with using its Article 22 powers.
