{"text":[[{"start":6.25,"text":"Where is Europe’s Google or Tesla, its Alibaba or BYD? Amid the angst over the continent’s failure in recent decades to give birth to corporate world-beaters, a finger is often pointed at the EU’s rigorous merger rules. In his 2024 report on reviving competitiveness, former European Central Bank president Mario Draghi argued — among many other ideas — that EU competition policy should take more account of the need to stimulate innovation and create businesses able to compete globally. As the FT has reported, Brussels is now planning its biggest shake-up of its merger code for decades. But competition policy can only do so much."}],[{"start":46.3,"text":"The last big reform in 2004 put protecting consumers from soaring prices at the heart of merger policy. Vigorous intra-EU competition was prioritised as the best way to ensure dynamism. But the global context has been transformed. An overriding focus on price is less appropriate in the new world of powerful tech platforms and AI “hyperscalers”, which puts a premium on scale and huge investment in research and infrastructure. As proponents of reform warn, EU companies risk being structurally disadvantaged against US and Chinese rivals. Geopolitical risk also makes it more vital to secure supply chains, energy and materials."}],[{"start":89.55,"text":"There is a danger, though, of excessively loosening merger guidelines that were long seen as among the most successful parts of the EU’s regulatory regime. Size and consolidation should not become an end in themselves; bigger companies do not automatically invest more — having achieved market dominance, there can be a temptation to exploit their position. But draft guidelines drawn up by the European Commission, though subject to change through wrangling by member states, appear to strike a sensible balance."}],[{"start":118.9,"text":"They maintain the core objective of preserving effective competition. They call on merger enforcers, however, to give “adequate weight to scale, innovation, investment and resilience as pro-competitive factors that can benefit from a degree of consolidation”. They concede that “growth and scaling-up of firms . . . to reach the necessary size to compete globally can be pro-competitive” and benefit the EU economy. "}],[{"start":144.20000000000002,"text":"The draft makes clear companies must be able to show sufficient evidence or probability of mergers delivering the benefits they promise. Properly assessing and policing those promises will be essential to making the reforms work."}],[{"start":156.75000000000003,"text":"Yet allowing more consolidation cannot on its own solve Europe’s dearth of world-beaters. EU-level blocks on mergers are relatively few; many high-profile examples in recent decades involved non-European companies. The most-cited all-EU case was a thwarted train megamerger between France’s Alstom and Germany’s Siemens. But that was seven years ago, and there have been few similar examples since — though some potential EU takeovers were perhaps not attempted on the assumption they would fail. "}],[{"start":187.00000000000003,"text":"More European tie-ups, notably in banking or telecoms, have foundered in recent years due to opposition from national governments or regulators. The biggest barriers to corporate growth are access to capital, national borders and EU and national red tape. "}],[{"start":202.95000000000002,"text":"The priorities remain completing the EU’s patchy single market, a capital markets union that can more effectively channel funds to promising businesses, and pushing into law the “28th regime”, now more catchily renamed “EU Inc” — or a single set of EU-wide corporate rules that companies could opt into. Tweaking merger rules, if done wisely, may help. But when it comes to ensuring European businesses can scale up, these are the potential game-changers. "}],[{"start":237.55,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1776749661_4935.mp3"}