The General Court of the European Union Annuls the European Commission’s Prohibition of a Four-to-Three Merger in the UK Telecoms Sector, in the First Judgment to Directly Deal With the Legal Test for ‘Gap Cases’

Abstract

In May 2020, the General Court rendered its long-awaited judgment in the UK mobile merger case (Case T-399/16). At issue in this case was whether the Commission lawfully prohibited the acquisition by Hutchison of O2 (Telefónica UK) back in 2016. That deal would have reduced the number of mobile network operators in the UK from four to three.

Hutchison appealed the Commission's prohibition decision to the General Court and won, as the General Court annulled the Commission decision.The judgment contains a wealth of interesting holdings, among others on the standard of proof in merger cases, the legal test to prohibit mergers, the role of market shares and concentration levels, the notion of "important competitive force", the meaning of "close competitors" and on the probative value of a quantitative analysis of the effects of a merger.

This note summarizes and comments on the key parts of the Court’s judgment.

Keywords: antitrust law, competition law, concentrations, mergers

JEL Classification: K21