Illumina/Grail case: new policy for the application of Article 22 of the Merger Regulation to under-the-threshold cases halted

Eight Advisory took part in the first encounter of the “Ping-Pong de la concurrence” conference, organised by Muriel Chagny Law Professor, Director of the UVSQ’s Master’s courses in contracts and competition law (Paris-Saclay).
In the first edition, Étienne Chantrel, Partner at Eight Advisory, and Faustine Viala, Partner at Willkie Farr & Gallagher LLP, were asked to share their expert insights on the European Court of Justice’s judgement of 3 September 2024 in the Illumina/Grail case.

Below are the key takeaways from their discussion:

Decisive clarifications, but some questions remain unanswered: 

• Article 22 referral mechanism is not intended as a ‘corrective measure’ to remedy shortcomings in the merger control system (§192 of the judgement). 

• Legal certainty is a key objective of the Merger Regulation, which precludes the implementation of such a mechanism (§210 of the judgement). 

• The requirement that trade between Member States must be affected remains ambiguous: was the Court of Justice right to find that this condition is only fulfilled if the national thresholds are met?  

“The debates of recent years indicate that it is perfectly possible to influence competition without exceeding national thresholds. Furthermore, such a criterion would imply that if a Member State raises its thresholds, many transactions could be classified as no longer affecting competition, even if the factual circumstances remain unchanged,” emphasises Étienne Chantrel. 

Is the hype surrounding the judgement to be treated with caution? 

• Faustine Viala states: “This judgement is welcome from a practitioner’s point of view, as it enhances legal certainty for companies.” 

• However, while this decision signals the end of the referral of transactions below the thresholds, Étienne Chantrel points out “the development of an even more unpredictable approach, especially in view of the fact that national authorities are introducing call-in powers. Eight European countries already have such powers: Italy, Ireland, Denmark, Hungary, Latvia, Lithuania, Slovenia, and Sweden. Will France be next?” 

Applying antitrust law to under-the-threshold merger cases: a preferred but ineffective solution? 

• Ex post control based on the prohibition of anti-competitive practices is one of the solutions favoured by the Court of Justice, which recently confirmed the possibility of prosecuting abuse of a dominant position (Article 102) as a result of mergers (Towercast case). The French nationalcompetition agency has also shown interest in this approach and is even considering applying it to anticompetitive agreeemnts (Article 101), as shown by the recent decision in the meat-cutting sector. 

• However, the question arises as to the effectiveness and flexibility of this mechanism: the procedures are lengthy and difficult to reconcile with the time-critical nature of transactions. 

Read the full article by Muriel Chagny, Étienne Chantrel and Faustine Viala, published in Concurrences.