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At a Crossroads in EU Merger Control:

Can a Rethink on Foreign Takeovers Address the Imbalances of Globalisation?

David Reader


In the face of momentous change in global politics – which has already begun to usher in a new age of nationalism, populism and protectionism – the European Commission continues to afford primacy to its competition-based approach to merger assessment. However, the Commission is facing increasing pressure from some EU Member States to respond to the emerging challenges of globalisation by adopting a more protectionist industrial strategy that would shelter strategic industries from ‘unwanted’ foreign takeovers. Not since the global financial crisis has the ‘pressure to protect’ been so palpable, and this renewed scrutiny will test the Commission’s resolve to continue enforcing its strict competition-based approach. This article reflects on the recent developments that have left EU merger control at a crossroads in terms of how it proceeds to react to anti-globalisation sentiment. It also examines a radical proposal to task the Commission with the role of analysing foreign takeovers that arise in the EU’s strategic sectors. It finds compelling evidence to suggest that the existing regime provides a legal basis for the Commission to afford greater consideration to public interest factors in merger cases, which would allow it to undertake this task in lieu of legislative reform.

Dr David Reader, Senior Research Associate at the Centre for Competition Policy, University of East Anglia, United Kingdom. The author wishes to thank Prof Michael Harker, Prof Morten Hviid, Dr Jonathan Galloway, Prof Philip Marsden, Dr Scott Summers and two anonymous reviewers for their valuable feedback on an earlier draft of this article. Any errors are the author’s own. For correspondence: <>.DOI: 10.21552/core/2017/2/6


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