Consolidated Convergence: An Italian Merger Saga

Bocconi Legal Studies Research Paper No. 06-06

Journal of Computer, Media and Telecommunications Law, Vol. 9, No. 2, pp. 37-80, 2004

37 Pages Posted: 13 Sep 2005

See all articles by Maria Lillà Montagnani

Maria Lillà Montagnani

Bocconi University - Department of Law; Ask Research Center; New York University School of Law


The 1998 European telecommunications framework was designed to facilitate the transition from a national state-owned telecoms industry into a competitive telecoms market throughout Europe. Although this ideal has been slow to be realised and confronted by Member State specific legislative and regulatory barriers, it has been deemed to be sufficiently implemented. Thus, having achieved the goal of telecoms sector liberalisation, the 1998 framework has been regarded as impeding the internal market integration in this sector, thereby stifling EU international competitiveness. Consequently, the European Commission (hereafter Commission) adopted a measures set within the new regulatory framework for electronic communications services to be put in place by the 24th of July 2003 in order to realign regulation to the current situation deriving from convergence occurring at technological, industry and services levels and the market structure changes.

The new regulatory framework revamps the 1998 one by focusing upon strengthening electronic communications services sector competitiveness within the global market thereby promoting an open and competitive European market for such services.

In this context, the multi-step mergers of Telecom Italia with Seat Pagine Gialle and of Seat Pagine Gialle with Cecchi Gori Communications are illustrative of how the 1998 framework was not able to deal with the convergence phenomenon in the Italian telecoms market. This is the starting point to show that not even the new framework appears to be appropriate in facing the effects of this process. While the former regulation was not thought to deal with convergence, the new one is driven by it. The 1998 framework's failure is due to the Italian telecoms market partial liberalisation and, on the other hand, to the means it offered to face convergence: competition law. The new framework's hypothetical failure is due to the fact that it does not appear equipped to deal with convergence effects. The same competition regime that addresses converged markets under the new regulation did not effectively do it in the analysed case. As competition law was not able to address convergence under the 1998 framework, it is unlikely that it will do under the new one. Analysis of these concrete and hypothetical failures serve thus as a marker to evaluate the effectiveness of 1998 framework in liberalising the Italian telecoms sector and new framework in facing convergence effects.

In order to assess the new framework's effectiveness in dealing with converged markets in the Italian electric communications services market, section I will provide a brief overview of the new regulatory framework and examine the mechanism to transit from ex-ante to ex-post regulation. In this context the Italian implementation's state of art will be briefly summarised. Section II will then describe the infrastructure of the Italian telecoms market, both from ex-ante and ex-post perspectives under the 1998 and new frameworks; the environment in which the case developed; and provide a description of the analysed merger with regard to entities and proceedings. Finally, both regulations' failure will be concluded as whether the assessment of 1998 and new frameworks' convergence relies on the sole competition law. Although the former's failure is due to the Italian telecoms market's partial liberalisation and the complex allocation of competition competence between national authorities, even a fully realised implementation (so far not the Italian current situation) and a different competition competence allocation would have probably produced the same results that the new framework is likely to produce. New regulation's effectiveness in dealing with convergence effects in the electronic communications services market is thus to be put in doubt.

Keywords: Competition law, telecoms law, new regulatory framework, convergence, multi-step merger

JEL Classification: K21, K23, K39

Suggested Citation

Montagnani, Maria Lillà, Consolidated Convergence: An Italian Merger Saga. Bocconi Legal Studies Research Paper No. 06-06, Journal of Computer, Media and Telecommunications Law, Vol. 9, No. 2, pp. 37-80, 2004 , Available at SSRN:

Maria Lillà Montagnani (Contact Author)

Bocconi University - Department of Law ( email )

Via Roentgen, 1
Milan, Milan 20136

Ask Research Center ( email )

via Roentgen 1
Milan, 20136

New York University School of Law ( email )

40 Washington Square South
New York, NY 10012-1099
United States

Here is the Coronavirus
related research on SSRN

Paper statistics

Abstract Views
PlumX Metrics