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Title: Effective European Antitrust: Does EC Merger Policy Generate Deterrence

Author(s): Joseph A. Clougherty, Tomaso Duso, Miyu Lee and Jo Seldeslachts

Publication Date: November 2015

Keyword(s): competition policy, deterrence, European Commission and merger policy

Programme Area(s): Industrial Organization

Abstract: We estimate the deterrence effects of European Commission (EC) merger policy instruments over the 1990-2009 period. Our empirical results suggest that phase-1 remedies uniquely generate robust deterrence as ? unlike phase-1 withdrawals, phase-2 remedies, and preventions ? phase-1 remedies lead to fewer merger notifications in subsequent years. Furthermore, the deterrence effects of phase-1 remedies work best in high-concentration industries; i.e., industries where the HHI is above the 0.2 cut-off level employed by the EC. Additionally, we find that phase-1 remedies do not deter clearly pro-competitive mergers, but do deter potentially anti-competitive mergers in high-concentration industries.

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Bibliographic Reference

Clougherty, J, Duso, T, Lee, M and Seldeslachts, J. 2015. 'Effective European Antitrust: Does EC Merger Policy Generate Deterrence'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=10959