Recent Developments and Prospects Regarding the Decisional Practice of the Italian Competition Authority in Banking Mergers

The IUP Journal of Banking & Insurance Law, Vol. 8, Nos. 1 & 2, pp. 8-26, January & April 2010

Posted: 6 Apr 2010

Multiple version iconThere are 2 versions of this paper

Date Written: April 1, 2010

Abstract

This paper deals with the decisional practice on banking mergers developed by the Italian Competition Authority, Autorita Garante della Concorrenza e del Mercato (AGCM) from 2006 when it was given full jurisdiction over banking. More precisely, the paper focuses on the noteworthy aspects of the AGCM practice that are believed to be the narrow definition of retail banking markets, a 30% market share threshold to identify the mergers presumed to lead to dominance and a pro-active regulation of anticompetitive interlocking directorates. From these aspects, it can be inferred that the AGCM has taken a strict approach in vetting banking mergers. The paper also dwells on the appraisal of rescue banking mergers. Arguably, these mergers fall within Article 20(5bis) of the Italian Competition Act that codifies a failing firm defence, by giving the Bank of Italy the power to clear an anticompetitive merger on stability grounds. The banking regulator should invoke Article 20(5bis) only in exceptional cases meeting a systemic standard, which occurs when a merger is necessary to preserve financial stability. This position is consistent with the thinking of the European Commission (EC), which opposes to relax competition law enforcement during harsh economic times.

Suggested Citation

Giannino, Michele, Recent Developments and Prospects Regarding the Decisional Practice of the Italian Competition Authority in Banking Mergers (April 1, 2010). The IUP Journal of Banking & Insurance Law, Vol. 8, Nos. 1 & 2, pp. 8-26, January & April 2010, Available at SSRN: https://ssrn.com/abstract=1582808

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