EU merger control guidelines face revamp

The European Commission is in the process of reviewing the existing EU merger guidelines. It has now opened a consultation that comprises two parts – a general consultation with high-level questions, and an in-depth consultation with technical questions on seven key topics – and is seeking feedback from stakeholders on how to consider different factors relevant to the Commission’s competition assessment of notifiable transactions before they are cleared to complete. Both parts of the consultation run until 3 September, and the Commission will also conduct a separate economic study on the dynamic effects of mergers.

The consultation deals with two separate but related sets of Commission guidelines: one involving “horizonal” mergers between actual or potential competitors on the same market; and another for “non-horizontal” mergers between firms that are active on different levels of the supply chain or in neighbouring markets. The review may also help inform the Commission whether the two separate guidelines should be amalgamated.

The Commission’s review is structured around seven thematic areas, each addressing a critical dimension of merger assessment. These are competitiveness and resilience; market power; innovation; sustainability; digitalisation; efficiencies; and broader public policy considerations such as defence and security, labour markets and media plurality. It has published seven technical papers, one for each focus area, as part of the in-depth consultation and has invited extensive stakeholder responses in relation to each.

The consultation exercise invites feedback from stakeholders across a wide range of topic areas. One of the most prominent themes is the role of scale in enhancing competitiveness. The Commission acknowledges that mergers can help firms – particularly SMEs and mid-sized companies – achieve the scale necessary to compete globally. Economies of scale, access to capital, and the ability to invest in R&D are all potential benefits. However, the Commission is equally mindful of the risks: increased market power can stifle innovation, reduce supply chain resilience, and harm downstream competitors and consumers.

To address these concerns, the Commission is considering whether to introduce stricter structural indicators or rebuttable presumptions to better identify mergers likely to harm competition. While market shares and concentration indices remain important, the Commission is exploring alternative metrics such as diversion ratios, profit margins and pivotality to capture competitive dynamics more accurately, particularly in differentiated or fast-moving markets.

Innovation is another focal point of the consultation. The Commission is particularly concerned about so-called ‘killer acquisitions’ and the elimination of nascent competitors, especially in sectors like pharmaceuticals and digital markets. It is seeking to refine its framework for assessing the impact of mergers on R&D pipelines, innovation incentives, and potential future market entry. The challenge lies in balancing the need to protect innovation with the inherent uncertainty of predicting future market developments.

Sustainability and the green transition are also being brought into sharper focus. The Commission recognises that mergers can either support or hinder the EU’s climate goals. For example, vertical integration may facilitate circular economy practices, while acquisitions of green innovators by incumbents could suppress clean innovation. The revised guidelines may incorporate sustainability as a parameter of competition and explore how “green efficiencies” can be assessed and verified.

Digitalisation presents a particularly complex set of challenges. Markets shaped by digital technologies often exhibit tipping points, network effects, and data-driven competition. Traditional distinctions between horizontal and non-horizontal mergers are increasingly blurred in digital ecosystems. The Commission is also considering how to factor in privacy and data protection as non-price parameters of competition, particularly where consumer choice is at stake.

Efficiencies remain a cornerstone of merger assessment, but the Commission is seeking to clarify how these should be demonstrated and weighed against potential harms. Efficiencies must be merger-specific, verifiable, and likely to benefit consumers. The Commission is also exploring how to assess non-price efficiencies, such as improvements in quality or innovation, and how to balance short-term harms against long-term benefits.

Finally, the consultation addresses broader public policy considerations, including defence and security, media plurality and labour markets. While these areas traditionally fall outside the Commission’s competition mandate, there is growing recognition that mergers can have significant societal impacts. The Commission is seeking views on whether and how to reflect these concerns in the revised guidelines, particularly in relation to ‘monopsony’ power in labour markets and the potential erosion of democratic safeguards through media consolidation.

The Commission is also considering whether the revised EU merger guidelines should include new or expanded guidance on infrastructures that are vital to the EU economy such as telecommunications networks or electricity distribution networks; and what would constitute pro-competitive consolidations in global strategic and technology sectors that would benefit the EU Single Market – such as the ‘Internet of Things’ (IoT), cloud, quantum, telecoms, data, advanced connectivity, cybersecurity and artificial intelligence.

The Commission’s ultimate goal is to ensure that the revised guidelines are up-to-date and flexible enough to allow the Commission to protect competition under the merger regulation as the modern market continues to evolve. However, the revised guidelines will not amend the underlying law – the EU Merger Regulation – and instead they will set out how the Commission intends to interpret and apply the merger regulation in light of developments in case law before EU courts, the Commission’s decisional practice and developments in wider EU competition policy.

London-based competition law expert Tadeusz Gielas of Pinsent Masons said: “This is a pivotal development that marks the first comprehensive review of EU merger guidelines since the current regime came into force some 20 years ago. The review recognises that markets and business models have changed substantially over the years, new parameters of competition are emerging, and the distinction between horizontal and non-horizontal mergers is blurring in some cases. The EU's guidelines need to reflect this to provide an adequate legal framework, provide legal certainty, and foster investment and growth in the EU.”

“The detailed consultation seeks to further explore issues around the interplay between European competitiveness, industrial strategy and merger control that were identified in last year’s landmark Draghi report and led the Commission to announce in early 2025 that it would review its merger guidelines as part of the EU ‘competitiveness compass’ initiative. The guidelines review also occurs against the backdrop of significant changes in geopolitics and international trade, which have implications in areas such as supply chain resilience, investment and innovation, and defence and security,” he said.

Pinsent Masons competition law expert Paul Williams, also based in London, added: “In the UK, broadly similar considerations are in play, with the Competition and Markets Authority (CMA) recently consulting on proposed changes to its guidance on merger remedies, as well as issuing its ‘mergers charter’ to help support the UK government’s strong focus on driving economic growth and attracting investment as reiterated in the finalised ‘Strategic Steer’ to the CMA.”

In his report last year, former European Central Bank president Mario Draghi warned of the “existential threat” facing the EU unless it cannot arrest the stagnation it has seen in economic growth. He said a range of factors are harming EU competitiveness, including over its approach to enabling the commercialisation of technological innovation. That report has spurred the Commission, under the presidency of Ursula von der Leyen, to outline a range of initiatives aimed at reducing regulatory burdens and catalysing private investment. The reform of the EU merger guidelines forms part of this broad programme of initiatives.

In the context of the current merger guidelines review, the Commission said: “there have been several transformational changes in the economy, ranging from digitalisation and globalisation to decarbonisation” since the EU horizontal mergers guidelines in 2004 and non-horizontal merger guidelines in 2008 were published. It said these changes “can impact competitive dynamics in many markets” and in many cases have already “surfaced in the enforcement practice of the Commission”.

“After about 20 years, the current review of these guidelines will serve to update the assessment framework for mergers in light of these changes and new market realities, and also enable us to reflect the case practice and the case law of the Court of Justice of the European Union,” the Commission said.

“The aim is to provide a comprehensive, predictable, and lasting framework. The revised guidance should offer a refreshed yet legally and economically sound, predictable, and evidence-based analytical framework, for all types of mergers and all economic sectors. The primary mission of EU merger control will remain the same: preserving a vibrant and competitive internal market which drives companies to offer to their customers and consumers innovative, affordable, and high-quality products,” it added.

“This comprehensive and ambitious review of the EU merger guidelines is a unique opportunity to modernise the Commission’s framework for assessing the impact of mergers on competition,” said Teresa Ribera, Commission executive vice-president for clean, just and competitive transition. “It will allow us to account for disruptive changes in our societies and our economies over the past 20 years, such as digitalisation, and enable us to ensure that innovation, resilience, and the investment intensity of competition are given adequate weight in light of the European economy’s acute needs.”

“This is a pivotal moment for Europe, and it is only by evolving that we can ensure that our merger control policy continues to serve people, drive innovation, and strengthen Europe's resilience and leadership. We count on your help. We stand ready to hear the views of consumers and businesses all across Europe on how our merger review framework can be made fit for the future,” she said.

Businesses have until 3 September to respond to the Commission’s consultation. Responses obtained during this initial consultation will help the Commission develop the draft text of the revised merger guidelines which will be published for further consultation at a later stage, likely in 2026. The Commission will also convene a workshop for stakeholders to provide their views on the draft.  The Commission currently expects to be able to finalise and adopt the revised merger guidelines in late 2027.