Two companies with material market share in the field of genetic screening merged into a single entity. The EU Concentration Commission received a complaint from a third party that the merger is hindering EU Competition law and sought to cancel the merger.
The Court held that the merger should not be cancelled although both companies hold a significant share of the entire European market, as there is no market concentration issue. Market concentration in the EU is considered a significant issue, hence a specific regulation was promulgated to that effect. The regulation dictates that there is a need to assess each merger and to take into account the following criteria: the concentration does not hinder the freedom of development of other companies, there is a need to notify about the merger in advance, and cancelation of the merger shall only happen in cases of a dire hindrance of EU Competition law. In this case, although both companies possess a significant market share, the merger does not hinder the competition and development for other companies in the market, the two companies notified in advance about the merger to the regulators and the merger was published in many publications prior to the actual merger. Furthermore, the point of the merger was to form a joint venture for a new product. The product does not hinder the competition rules, because the market share of the specific product is quite minor. Thus, cancelling the merger serves as a significant breach of competition within the Union and due to the fact that the merger does not hinder the Concentration Regulation, the merger should not be cancelled.