An Emerging Consensus on Minority Shareholdings?

Oct 24, 2013

CPI Europe Column edited by Anna Tzanaki (Competition Policy International) presents:

An Emerging Consensus on Minority Shareholdings? by Alec Burnside (Partner, Cadwalader, Wickersham & Taft LLP) and Nandu Machiraju (Associate, Cadwalader, Wickersham & Taft LLP)*

Intro by Anna Tzanaki (Competition Policy International)

With the Commission closing the period of public consultation and reflecting on a legislative proposal to reform the EUMR, Alec Burnside and Nandu Machiraju (Cadwalader) revisit the thorny issue of minority share acquisitions. They provide a brief account of the Ryanair/Aer Lingus case, which has come to epitomize the inability of the existing EU competition law framework to challenge non-controlling minority shareholdings. Currently EU merger control limits scrutiny of minority share acquisitions only to those conferring “decisive influence” over the target. Further, the Commission lacks the power to unwind a minority shareholding left over after a failed takeover bid, because the stake is not, in isolation, a “concentration” within the meaning of the EUMR (which again leaves non-controlling minority shareholdings unregulated). Against this backdrop, certain EU Member States (e.g., UK or Germany) have jurisdiction to review cases of anticompetitive shareholdings in competitors under lower national thresholds of influence. Law and practice from across the Atlantic point in the same direction. The authors provide a concise ov