Tuesday, the Green Paper. Next week the European Commission is to launch the review process regarding the regulation over the control of mergers, ten years after it has been up and running. It will be a fairy lengthy process, the first step of which will be a "Green Paper" drawn up under the responsibility of Mario Monti, that the Commission proposes approving in Strasbourg on Tuesday. A Green Paper, we know, is essentially an instrument for discussion: it is not a proposal. But the intention of carrying through with the reform is explicitly stated: "in order both to take stock of the accumulated experience and to prepare European merger control for the challenges of the coming years, to initiate a reform process", without modifying the principles of the current regulation. Thus, it's the whole competition policy, in its three fundamental chapters, that is the subject of a review: a) the ban on concerted agreements and dominant positions; b) the control of mergers; c) the management and control of State aid, at least in some essential elements like subsidies to companies responsible for providing services of a general interest. There is of course a time-gap between the review relating to concerted agreements and dominant positions - for which the Commission has submitted its formal proposal, Parliament voted on it and is now on the Council's table for final deliberations - and that relating to mergers, that is to begin. But one has not to lose sight of the general context not forget that competition policy cannot change course: the essential goals and principles remain the same. The reviews aim at improving the effectiveness of the policy, enable the Commission to focus on the really important cases, strengthening the legal security of companies, reduce the bureaucratic weight of the procedures.
Two intangible elements. Let's return to the Green Paper on mergers. The starting point of the "mergers" regulation is the observation that the fact itself, for a large company, of swallowing a large rival, may constitute an abuse of a dominant position. Recognition of this principle was essential, as the Treaty does not prohibit the existence of a dominant position, but only abuses of such a position. The Council (which approved the regulation unanimously in 1989) and the European Parliament have shared the Commission's analysis. Over the ten years it has been up and running, the regulation has proven that it is in fact an appropriate instrument to avoid, faced with increased market integration, industrial restructuring harming competition and that it provides sufficient flexibility to take account of new economic, legal as well as political developments. The Commission considers that it will also be so in the future, and that consequently the essential elements of the regulation remain valid, especially two: 1) the Commission's exclusive jurisdiction on mergers of a European dimension (the principle of the "single window" is unanimously appreciated); 2) the setting of absolute deadlines for the different phases of the procedure.
On criterion to change? The Commission nevertheless considers that, for certain aspects, the regulation needs adapting to forthcoming developments, such as the introduction of the euro; the Union's enlargement; acceleration in the globalisation of markets and companies. Acquired experience leads the Commission to consider that the changes to foresee affect both the goals and functioning of the regulation.
Regarding the goals, the essential point is that of the criterion used to assess the effects of a concentration. There is a nuance between the European criterion and the American one. For the EU, the examination must concern whether a merger leads to the "creation or strengthening of a dominant position"; in the United States, the authorities examine whether the merger causes "a significant lessening of competition test". The difference seems slight, but Professor Monti has on several occasions recognised that the European criterion is more rigid and leave less margin for an individual assessment. The Green Paper will thus call for that the European criterion is more rigid and leave less margin for an individual assessment. The Green Paper will thus call for that the European criterion is more rigid and leave less margin for an individual assessment. The Green Paper will thus call for an in-depth debate to begin on the respective merits of the two criteria. These are apparently legal subtleties, but they can have great consequences for individual cases.
As for the functioning, the main changes cod concern: a) the possibility, on request, of extending by one month the period for offering "concessions" for companies involved in a merger; b) the appropriateness of providing for the Commission's exclusive competence to be extended to cases that must be notified to three Member States, or more, even if the threshold of the turnover in the EU is not exceeded.
For now, however, what is important does not lie in the details, but in the fact itself that the debate is to begin and that anyone will be able to express themselves on subjects that have recently led to heady polemics following some of the Commission's resounding decisions. And we shall have the opportunity to return to these aspects, as to the other chapters of the review of competition policy (F.R.).