Yearbook of European Law - Vol. 10

By Francis Geoffrey Jacobs | Go to book overview
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EEC Control Over International Mergers*


I. Introduction

Some time ago David Edward made the point that it seems, if not absurd, at least far-fetched to discuss the 'effects' of the economic activities of undertakings whose turnover exceeds the GNP of most States in terms of bullets shot across frontiers or the negligence of the officer-of-the-watch of 'The Lotus'.1

The EC Commission officials dealing with merger control under the new EEC Regulation on the control of concentrations are not negligent officers- of-the-watch. The Commission is not trigger happily shooting bullets across frontiers when controlling international mergers. Sir Leon Brittan recently described its approach in a nutshell as follows:

a combination of proper respect for international law, politically responsible exercise of self-restraint and regard for others and comprehensive bilateral treaties between the free market world's trading powers is what is needed to provide a framework for the application of competition law in today's environment.2

Sir Leon's reference to proper respect for international law prompts the question as to how the new Regulation deals with the international aspects of merger control and whether international law, as it stands, measures up to the present day situation. The growing interdependence of the economies of industrialized countries has led in the past, and will lead in the future to mergers between undertakings established in different countries. The same interdependence implies that a merger between undertakings established in two countries may very well have consequences in a third country. This development has resulted and will increasingly result in attempts by most, if not all, countries concerned to subject such mergers to their control and is bound to give rise to conflicting claims of jurisdiction and mutually inconsistent decisions.

© Jacques H. J. Bourgeois, 1990, Partner, Baker and Mckenzie ( Brussels) and Professor at the College of Europe ( Bruges).
"'The Practice of the Community Institutions in relation to extraterritorial application of EEC Competition Law'", in R. Bieber & G. Ress, Eds, The Dynamics of EC-Law ( Baden-Baden, 1987) 355 at 356.
Sir Leon Brittan, "'Jurisdictional Issues in EEC Competition Law'", Competition Policy and Merger Control in the Single European Market ( Cambridge, Grotius, 1991).


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Yearbook of European Law - Vol. 10
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