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What are the potential outcomes of a merger control investigation in the European Union?
At the conclusion of its review, the European Commission must:
- clear the deal unconditionally;
- clear it subject to remedies; or
- prohibit the transaction.
Parties can submit remedies as early as the start of Phase I (but will generally wait until a state of play meeting with the case team has taken place at around working day 15 in Phase I to hear the European Commission’s views). Any submission of Phase I remedies will extend the initial review deadline from 25 to 35 working days. In Phase II, the parties can submit remedies until working day 65. The submission of remedies after working day 55 will automatically extend the review deadline by 15 working days.
The commitments must be set out at length based on a standard form and must be described in the Form RM template, explaining the content and their suitability to ease the European Commission’s competition concerns. Parties must provide a non-confidential version of the commitments for market testing. In certain cases, officials may ask the parties to present or suggest qualified buyer(s) for any divestment.
The remedy should be proportionate to the competition concerns it addresses while entirely removing the concerns.
The European Commission generally prefers structural remedies (ie, divestments), but will also consider behavioural remedies (eg, to continue providing certain services or supplying certain goods) on a case-by-case basis. Generally, remedies are market tested with relevant third parties unless the European Commission finds the commitments to beprima facie inadequate. Depending on when remedies are first offered, the parties may have one or more opportunities to upgrade their proposal in response to comments from the case team and the market.
The European Commission’s remedy notice guidance and model commitments are available on its website.
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