The European Commission’s latest consultation
on further simplifying merger control also highlights its
intention to catch high value technology mergers.
Its October 7 consultation
questionnaire seeks comment on a range of changes to the
existing regime, including the possible introduction of block
exemptions from the filing obligation for certain types of
transaction. But the suggestion of targeting mergers based on
transaction value could stifle the market dominance of the new
breed of data-rich but revenue poor tech companies. The
so-called high value acquisitions in question are those that
currently fall under the Commission’s jurisdiction
due to not meeting its revenue-based threshold.
These typically take place in the tech sector where revenues
can initially be poor, and where even an asset test would fail
due to majority of companies being headquartered outside the EU
in the Silicon Valley. The much-cited Facebook/WhatsApp
transaction is thought to be the behind the...