Reforming European Merger Review: Targeting Problem Areas in Policy Outcomes

Abstract

This paper is an attempt to derive priorities for the reform of European merger policy from observed problems with decision making in merger cases. We identify problems in the application of theory and empirical method as well as the impact of resource constraints and the potential for systematic decision bias. In contrast to the intense debate about the merits of a switch from a dominance criterion to a significant lessening of competition test, we find that such a switch would not effectively address any of the problems in Commission decision making on mergers. Similarly, the lack of an efficiency defense does not seem to explain any of the weaknesses of European merger policy. In contrast, we find that most of the problem areas identified in current merger control practice can be effectively addressed by reforming the merger procedure, the internal organization of merger control in the Commission, as well as addressing resource issues. Together with carefully crafted merger guidelines these should have strong priority for the reform of merger policy in Europe.