CJEU on Merger Control and EU Commission Powers

Sept 27, 2024 Benn-Ibler Rechtsanwälte

In its latest ruling, the European Court of Justice (CJEU) addressed the EU Commission’s powers to control mergers.

The case at hand is about the acquisition of Grail LLC, a US company active in the development of blood tests for the early detection of cancer, which was to be taken over by Illumina Inc, also a US company. The merger did not have a European dimension and was therefore not reported to the Commission, in particular because Grail had no turnover in the EU or anywhere else in the world. In addition, the merger was not reported to any Member Staten nor to anyone within the EEA, as it did not meet relevant national thresholds.

However, an appeal against the merger was lodged with the Commission.

Having received the appeal, the Commission invited Member States to submit requests under the Merger Regulation for the Commission to review the proposed merger, as it might affect trade between Member States and threaten to significantly impede competition in their territory. The Commission then received a request from the French competition authority which was joined by other competition authorities, upon which the Commission started to investigate the proposed transaction. However, Illumina Inc. took legal action against the Commission. The company was unsuccessful before the ECJ. The CJEU has now set aside the original judgment and annulled the Commission decisions for the following reason:

The Commission has no right to propose or accept the referral of merger cases with no European dimension by national competition authorities if they do not have jurisdiction under national law to review such cases.

The CJEU also made it clear that national authorities cannot refer cases to the Commission where (as in the case at hand) the criteria for review by national authorities are not fulfilled.

ECJ C-611/22 (3 September 2024)