Thought Leadership

The Hutchison Judgment: A Rare Judicial Strike Against the European Commission's Approach to Merger Assessments

External Article
On May 28, 2020, the General Court of the European Union delivered its decision in CK Telecoms UK Investments Ltd v. Commission, annulling the European Commission’s 2016 decision to prohibit the proposed merger of Hutchison 3G UK (Three) and Telefónica UK (O2), two of the UK’s cellular network operators. The case involved the assessment of the competitive effects of a transaction in an oligopolistic market. In its judgment, the Court found wanting the Commission’s interpretation of the standards to be applied in assessing such transactions, as well as the quantitative analysis it used as evidence to support the prohibition of the transaction.

This article examines several of the key findings of the Court in annulling the Commission’s 2016 Decision, and addresses several conclusions: (i) even if it does not prompt any explicit, wholesale shift in practice by the Commission in the near term, the Hutchison judgment could nonetheless introduce important changes to the landscape for merger reviews by the Commission; and (ii) it may be more likely that parties to mergers in oligopolistic markets will see material differences in how their transactions are reviewed in the future.

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