EU opens door to bigger corporate mergers

{"text":[[{"start":6.46,"text":"The European Commission is signalling greater willingness to consider large corporate mergers that could boost investment, innovation or security of supply and help them compete with the US and China."}],[{"start":17.86,"text":"Anthony Whelan, who leads the bloc’s powerful competition directorate, said companies should make the case for the benefits of such corporate tie-ups."}],[{"start":25.58,"text":"“The opening to the importance of pro-competitive scale can enable the creation of champions, including European champions,” Whelan said."}],[{"start":33.28,"text":"The shift will allow “companies to scale up . . . to deliver better products, services, innovation, security of supply to their customers and ultimately to consumers,” he added."}],[{"start":43.66,"text":"His comments are among the clearest signals yet that the Commission is reassessing its approach to consolidation to help European companies scale up against American and Chinese rivals, after former European Central Bank president Mario Draghi warned that the region needed to step up its competitiveness."}],[{"start":60.74,"text":"In revised merger guidelines published earlier this year, the Commission took on board calls for more openness towards mergers and acquisitions as a way to deliver on the Draghi agenda."}],[{"start":69.84,"text":"Whelan, a former aide of Commission president Ursula von der Leyen, was appointed in April. His start comes at a time when Europe’s consumer-first principles in merger decisions and deep institutional scepticism towards governments attempting to engineer corporate “European champions” are being challenged."}],[{"start":null,"text":"

"}],[{"start":87.48,"text":"The shift could revive mergers once seen as unlikely to clear EU scrutiny. Whelan said he did not know how many potential transactions were “being dusted off from a filing cabinet” because they might now fit the new policy direction, but said Brussels was “consciously making some explicit and hopefully clear signals . . . that we will seriously consider such arguments”."}],[{"start":107.54,"text":"Whelan stressed that the shift did not amount to preferential treatment for European companies. “We are colour blind when the cases come,” he said."}],[{"start":115.48,"text":"But the Commission will increasingly examine how markets are likely to evolve over a longer period, Whelan said, as it seeks to adapt merger control to the current economic environment."}],[{"start":124.64,"text":"“Would the merger have made them better able to access certain inputs” constrained by geopolitics or raw supply, Whelan said. “Would they be better able in pooling their resources to innovate . . . where the capital needs of such innovation are extremely high? . . . Would they be better able to invest in some sort of infrastructure or networks?”"}],[{"start":145.4,"text":"AI is one sector where Brussels is keeping a close eye, as policymakers fear the huge cost of developing cutting-edge models and securing computing power could leave the industry dominated by a small number of US companies."}],[{"start":159.84,"text":"Whelan said the sector has some characteristics of an oligopoly and that the Commission is determined to bring down barriers to entering the market."}],[{"start":167.28,"text":"“Our focus is very much on making sure that the competition to develop and commercialise those models is not distorted by practices in areas surrounding AI,” adding that “the whole ecosystem is one that we need to monitor”."}],[{"start":180.88,"text":"Brussels has been trying to find a delicate balance between enforcing its existing rule book while avoiding a clash with Washington, whose support it needs to defend Ukraine in its war with Russia. US President Donald Trump has repeatedly accused the EU of singling out US companies and threatened tariffs in response to enforcement actions."}],[{"start":200.6,"text":"Whelan described the disagreement with Washington over its digital rule book as “disappointing”, particularly because US and European regulators often share similar concerns."}],[{"start":210.32,"text":"But he rejected suggestions that geopolitical pressure was causing Brussels to hold back from opening cases against American companies. There is no “filing cabinet full of buried cases”, he said."}],[{"start":222.2,"text":"The Irish official said the predictability and neutrality of European enforcement have become even more valuable when political intervention in economies elsewhere was less predictable."}],[{"start":231.44,"text":"“The seriousness and neutrality with which we apply the rules and guidance in all these areas is a very precious asset,” he said, adding that it is important towards “companies in a world where arbitrariness is no longer just in obscure corners, that they can rely on that in the EU”."}],[{"start":248.52,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1788867734_4212.mp3"}