Luxemburg, 14/12/2005 (Agence Europe) - The Court of First Instance has upheld the European Commission's decision of 3 July 2001 to prohibit General Electric's acquisition of Honeywell. A press release stated that, “although the Commission made errors (…) in its analysis of conglomerate effects resulting from the concentration, the fact that dominant positions would have been created or strengthened on several specific product markets is sufficient to justify that decision”. The merger of the American companies would have had significant harmful effects on competition in the jet engines for large regional aircraft, the engines for corporate jet aircraft and the small marine gas turbine markets, said the Court, upholding the Commission's argument.
The manifest errors of assessment made by the Commission in its decision and with regard to the effects of the merger on particular markets did nothing to change the validity of the Commission's decision, the Court went on. The Court held that three distinct aspects of the Commission's decision were vitiated by illegalities: vertical overlap between Honeywell's engine starters and GE's engines; conglomerate effects resulting from the merger owing to GE's financial strength and vertical integration; conglomerate effects resulting from bundling (for the Commission's decision, see EUROPE 7998).
General Electric Company, seeking annulment of the Commission's decision, was defended by half a dozen lawyers, including Cherie Blair, who spoke at the hearing.