1. During a webinar organized on 11 September 2020 on the occasion of the twenty-fourth Competition Conference of the International Bar Association (IBA), Ms. Margrethe Vestager, European Commissioner for Competition, released a change in the doctrine of the European Commission (hereafter the “Commission”). This change would enable it to review concentrations involving high-value and innovative undertakings having a low turnover, including the so-called “killer acquisitions”, without modifying the legislation establishing and governing the European Union concentration control scheme.
2. Regulation (EC) No 139/2004 of 20 January 2004  empowers the Commission to prohibit concentrations when these operations would significantly impede effective competition in the common market or a substantial part of it and authorize them when they would not . This power can only be exercised against mergers notified to it . Only operations having “Community dimension”, namely meeting the thresholds established by Regulation (EC) No 139/2004 , must be notified to the Commission prior to their implementation . The implementation cannot occur before the adoption of the Decision authorizing them, unless a special derogation is supplied by the Commission .
3. The thresholds imposing the obligation to notify a concentration to the Commission before its implementation and to suspend the implementation of the concentration up to the Decision of this institution allowing it are exclusively expressed in global, European and national turnover generated by the undertakings concerned by the operation. At least two of these undertakings must met these thresholds for the transaction to be deemed to have a Community dimension and thus to be subject to these notification and suspension obligations . If these thresholds are not met, the concentration would fall under the national merger control mechanisms of one or more Member States of the European Union, provided that it meets the conditions for the application of these national control mechanisms. Otherwise, it could be carried out without any prior examination under European Union or national concentration law.
4. As a result, a concentration consisting in the acquisition by one of the major players in an industry, such as a giant in the pharmaceutical or digital industry (e.g. the so-called “GAFAM”), of a start-up developing a promising innovation but achieving no turnover or a low turnover at the time of the transaction may perfectly well escape any merger review at European Union or Member States levels. However, such an operation could result in serious negative outcomes on competition since it may consist of a “killer acquisition”, namely a transaction which object is for the purchaser to eliminate a future competitor by getting hold of one or more innovative products or services intended for to compete with its own products or services before the target has gained power and is able to compete effectively.
5. Various options intended to enable the Commission to be review the transactions described in paragraph 4 above are currently debated. Three were more specifically put forward:
- adding to the thresholds expressed in turnover a market share threshold according to which a concentration must be notified to a competition authority if the undertakings concerned holds a share of one or more relevant markets equaling or exceeding a specific percentage: this option is currently applied in Spain  and Portugal , and is deemed unsatisfactory due to the complexity of implementing it since it requires the notifying party or parties to define and analyze the relevant markets to determine the market share of the undertakings concerned, whereas this definition and analysis are the main part of the work necessary to prepare the notification;
- adding to the thresholds expressed in turnover a threshold in value of the transaction according to which a concentration must be notified if its value equals or is superior to a certain amount mentioned in a monetary unit: this option is historically practiced by the United States , and has recently been adopted by Germany with some adaptations , but is criticized because of the complexity in defining the concept of transaction value, particularly for operations which do not consist of an acquisition such as the establishment of joint venture; or
- adding to the ex ante control procedure,e. before the concentration is carried out, an ex post review procedure, i.e. after its completion, that the Commission could implement to review an operation which did not have a Community dimension: inspired by the merger control procedures in force in Sweden  and the United States , this option is criticized because of the uncertainty it imposes on economic players since their concentrations could be called into question once implemented, whereas the cost of a divestment or a de-concentration increases with the time elapsing since their realization.
6. Applying one of these three options requires the adoption of a Regulation amending Regulation (EC) No 139/2004. The passing of a legislation implementing competition provisions of the Treaty on the Functioning of the European Union is governed by a special legislative procedure under which the Council of the European Union solely exercises the legislative competence, the European Parliament providing a mere advisory and non-binding opinion. Although a special legislative procedure applies, securing the adoption of such legislation is a long and uncertain undertaking. It requires a qualified majority in the Council, which imposes on the Commission to find a compromise with the powerful Member States, the chief among them being Germany and France . However, it would be urgent to allow the European Union competition regulator to control “killer acquisitions” which neither have Community dimension nor fall within the scope of national merger control schemes.
7. This is undoubtedly the reason why the Commission wished to proceed differently by relying on Article 22 of Regulation (EC) No 139/2004. During her speech on 11 September 2020 before the International Bar Association, Ms. Vestager rejected the idea of an amendment to this Regulation to introduce a threshold expressed in value of the transaction similar to what Germany has just done and preferred a change in the doctrine of implementation of this provision.
8. Article 22 of Regulation (EC) No 139/2004 establishes what is chronologically the first mechanism to refer a concentration between the Member States and the Commission. Under this provision, one or more Member States may request the Commission to review an operation without a Community dimension but affecting trade between Member States and threatening to impact significantly competition on the territory of the Member State(s) making the referral request . The Commission is free to accept the referral or not, but can only comply with the request if the referred concentration affects interstate trade and may significantly rrestrict competition in the territory of the requesting Member State(s) . If accepted, the Commission considers the referred operation as if it has Community dimension . The European Union institution has also the power to inform the Member States concerned that they could refer an operation to it on the basis of Article 22 and invite them to submit such request to it .
9. Article 22 of Regulation (EC) No 139/2004 is known as the “Dutch clause” since it was proposed by the Netherlands. At the time, the Member State did not have a national merger control mechanism. In the absence of such a mechanism, it intended to be able to request the Commission to ensure that an operation having no Community dimension but which could affect the Dutch market would not significantly impede competition on that market. Originally, the “Dutch clause” was intended to allow a Member State to refer a concentration to the Commission when the latter was not competent to examine it because it had failed to establish a national merger control scheme.
10. Since the adoption of the “Dutch clause”, all Member States but Luxembourg adopted a national merger control system. For this reason, the Commission established what has just become the previous doctrine regarding the implementation of this clause. According to this now previous doctrine, a Member State could request the referral of a transaction under the “Dutch clause” only when it was competent to review it under its own national merger law. It should be noted that the letter of Article 22 does not provide such condition for its application and that said doctrine resulted from a political construction of this text made by the Commission, which was clearly contrary to the historical reason for which this clause was adopted, as set out in paragraph 9 above.
11. However, on 11 September 2020 before the International Bar Association, the Commission released that it had adopted a new doctrine relating to the “Dutch clause”. From mid-2021, the European Union institution will accept referrals made under Article 22 of Regulation (EC) No. 139/2004 by Member States that are not competent under their national merger control rules to review the referred concentrations. By a simple public statement made by its Commissioner for Competition, the Commission returned to the historic raison d’être of the “Dutch clause” and found an instrument allowing the review and, if justified, the prohibition of “killer acquisitions” without Community dimension and not falling under any of the national merger control mechanisms of the Member States.
12. One may appreciate the plasticity of European Union merger law, which found a simple response to “killer acquisitions” which up to date could escape merger review at European Union and national merger levels. However, this response can be improved since the competence of the Commission is neither automatic nor independent from the Member States, but conditional on the action of one of them, namely the forwarding of a request for referral. Although one may hope that with twenty-seven Member States, there will always be one to make use of the “Dutch clause”, one may not exclude that the powerful States could gang up to pressure the other so that none of them would refer to the Commission a “killer acquisition” initiated by one of their national champions, such as Sanofi or Orange for France or Bayer or Siemens for Germany or Philips for the Netherlands.
13. It seems unlikely that this new doctrine of application of Article 22 of Regulation (EC) No 139/2004 could be called into question by the Court of Justice of the European Union in the light of Kesko v. Commission of the General Court of the European Union (hereafter the “General Court“) . In this case, the Commission had been referred and had agreed to review a merger between two Finnish undertakings on the basis of the “Dutch clause” by the Finnish Office for Free Competition (Ilmainen Kilpailutoimisto), which was then the national competition authority of Finland. The competence of the Commission was challenged before the General Court on the ground that, according to the claimant, it fell to the Council of State (Valtioneuvosto) of the Republic of Finland, namely the Government of that Member State, and not to the Finish Office for Free Competition to proceed with the disputed referral request by virtue of the Finnish Constitution then in force, and that since the concentration had been referred to by an incompetent authority of a Member State, the Commission was itself incompetent to accept the referral and review the operation .
14. The General Court did not agree with this reasoning. According to it, the European Union case law established that the Commission does not have to rule on the division of competences between bodies and authorities of a Member State under the national institutional rules of the latter and the European Union courts do not have jurisdiction to rule on the lawfulness of measures adopted by a national body or authority. Based on this, the General Court found that it was not for the Commission to rule on the competence of the Finnish Office for Free Competition to make use of the “Dutch clause” under Finnish law but only to verify whether, at first sight, the referral request was that of a Member State within the meaning of this clause . It could be deduced from this ruling that with regard to Article 22 of Regulation (EC) No 139/2004, the Commission is not required to verify whether the Member State requesting the referral of a concentration under this provision is fully competent to control it pursuant to its national competition rules.
15. Finally, allowing requests under Article 22 of Regulation (EC) No 139/2004 from Member States which are not competent to examine the transactions subject to these demands by virtue of their national merger law will necessarily create new uncertainties on economic players. From mid-2021, a concentration which escaped merger review because it lacked Community dimension and did not meet the conditions for the application of national merger control schemes could possibly be controlled by the Commission under the “Dutch clause”. As this clause provides the Commission with a discretionary power to accept or refuse a referral request, the parties to the concerned operations cannot reasonably anticipate its decision in the matter because they do not know in advance its selection criteria. In order to comply with the principle of legal certainty, it is more than necessary that the Commission set out the criteria under which it will grant or reject a request for referral under Article 22 of Regulation (EC) No 139/2004 in a communication, since the communication notice on case referral in respect of concentrations does not mention with this issue .
 Council Regulation (EC) No. 139/2004 of 20 January 2004 on the control of concentrations between undertakings (“the EC merger regulation”), OJ No. L. 24, 29 January 2004, p.1
 Ibid., Art. 2(2)-(3).
 Ibid., Art. 1, (1).
 Ibid., Art. 1(2)-(3).
 Ibid., Art. 4(1).
 Ibid., Art. 7(1)-(3).
 Ibid., Art. 1(2)-(3).
 Law 15/2007 of 3 July for the defense of competition (Ley 15/2007, de 3 de julio, de Defensa de la Competencia), Art. 8(1)(a) . The market share threshold is set at thirty percent by this legislation.
 Law No. 19/2012 of 8 May approving the new legal regime for competition, repealing Laws No. 18/2003 of 11 June and 39/2006 of 25 August, and twice amending Law No. 2 / 99 of 13 January (Lei n.º 19/2012, de 8 de maio aprova o novo regime jurídico da concorrência, revogando as Leis n.os 18/2003, de 11 de junho, e 39/2006, de 25 de agosto , e procede à segunda alteração to Lei n.º 2/99, de 13 de janeiro), Art. 37(1)(a) The market share threshold is set at fifty percent by this legislation.
 Hart-Scott-Rodino Antitrust Improvements Act of 1976, Sec.201 codified in the United States Code, 15U.S.C.18a.(a)(1)(A)  Law prohibiting restrictions of competition (Gesetz gegen Wettbewerbsbeschränkungen), §35(1a)(3)
 Competition Law 2008: 579 (konkurrenslag 2008: 579), Chap. 4, §§6 and 7
 Clayton Antitrust Act of 1914, Sec.3 codified in the United States Code, 15U.S.C18
 Treaty on European Union, Art. 16(3) ; and Treaty on the Functioning of the European Union, Art. 103(1)  Regulation (EC) No. 139/2004, Art. 22(1).
 Ibid., Art. 22(3).
 Ibid., Art. 22(4).
 Ibid., Art. 22(5).
 CFI, Kesko v. Commission, Case T-22/97 [15 December 1999], Report p.II-3779
 Ibid., §§67 to 71.
 Ibid., §§82 to 84.
 Commission notice on case referral in respect of concentrations, OJ No. C.56, 5 March 2005, p.2
- Adoption of the French Decree extending by one year the application of the French special COVID-19 foreign investment control provisions - January 11, 2021
- French veto to the acquisition of Photonis par Teledyne - December 23, 2020
- One-year extension of the French special COVID-19 foreign investment control provisions - December 21, 2020
- Strengthening the control of the European Commission on “killer acquisitions” - October 2, 2020
- The European Court of Justice upheld the support schemes of the Member States of the European Union for cogeneration units being or not high-efficiency facilities - September 24, 2020
- #COVID-19 : Confirmation by the Court of Appeals of Paris of the orders imposing on EDF to suspend the performance of the contracts for the sale of ARENH power due to force majeure - August 24, 2020
- #COVID-19 : Adoption of the temporary reduction from 25% to 10% of the capital holding threshold, triggering the control of foreign investments - July 29, 2020
- Draft Guidelines on agreements allowing to achieving sustainable objectives of the Dutch competition authority - July 15, 2020
- #COVID-19 : Regulated Access to Historic Nuclear Electricity and Force Majeure - May 26, 2020
- War of courts at the top of the European Union: The ruling of the German Federal Constitutional Court in Karlsruhe - May 12, 2020