CK Telecoms UK Limited v Commission – A Significant Impediment to Effective Protection?

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On 28 May 2020 the General Court of the EU annulled the decision of the European Commission to prohibit the proposed acquisition by Hutchinson 3G UK Investments Limited of Telefónica Europe Plc (which trades as O2 in the UK). The General Court’s decision is noteworthy for a number of reasons, such as elucidating a new test for determining whether a merger would result in a significant impediment to effective competition under the Merger Regulation, establishing the standard of proof to be applied, and for the rigorous nature of the General Court’s review of the Commission’s decision. The Commission has been highly critical of the judgment and lodged an appeal on 7 August 2020. However, the case will continue to have significant implications for merger control rules until the appeal is heard, and its impact will be felt for decades to come if the Commission’s appeal is ultimately unsuccessful. The case note argues that the judgment represents a very troubling precedent from the perspective of European consumers, as it will result in potentially harmful mergers being permitted and ultimately lead to lower competition on already highly concentrated markets. It may also lead to more paltry offers of remedies from merging parties to cure competition concerns. Therefore, the result of the decision may represent a very significant impediment to effective protection of competition on markets for years to come.