DP10959 Effective European Antitrust: Does EC Merger Policy Generate Deterrence

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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Citation

Seldeslachts, J, T Duso and J Clougherty (2015), ‘DP10959 Effective European Antitrust: Does EC Merger Policy Generate Deterrence‘, CEPR Discussion Paper No. 10959. CEPR Press, Paris & London. https://cepr.org/publications/dp10959