Regulator and Practitioner Perspectives on Challenges and Trends in Cross-Border Mergers

Analysis Group Vice President Markus von Wartburg moderated a ThoughtLeaders4 (TL4) Competition webinar on navigating merger enforcement in cross-border mergers. Panelists included Managing Principal Aditi Mehta (formerly of the Department of Justice Antitrust Division), Competition Expert Pierre Régibeau (former chief economist at the European Commission’s Directorate-General for Competition), Paul Gilbert (Cleary Gottlieb), and John Fedele (Baker McKenzie). The conversation covered challenges with cross-border deals, divergence in remedies across jurisdictions, and efficiencies as a focus in Europe.

The group identified several key challenges in navigating cross-border deals. Panelists noted that variation across jurisdictions in statutory review periods and procedures complicates efforts to estimate merger review timelines. Coordinating the pace of review across multiple agencies is a related challenge, particularly when a deal is likely to require remedies in multiple jurisdictions. Panelists observed that merger control has become less predictable, particularly in Europe, where some jurisdictions have changed their thresholds to allow for the review of mergers that do not meet traditional filing thresholds, sometimes due to emerging theories of harm.

The panelists noted the emergence of behavioral remedies in Europe and discussed the consequences of divergence between jurisdictions in the approach to remedies. Dr. Régibeau suggested such innovative remedies may not have much impact on global mergers because parties may not accept an expensive behavioral remedy if it only results in clearance in a single market. Dr. Mehta observed that, regardless of each jurisdiction’s preferences with regard to remedies, agencies must be aware of what’s happening in other jurisdictions, how that will change the market, and, particularly in the US, how that will impact the litigation of the deal in court.

The group also discussed recent shifts in the enforcement landscape across jurisdictions, with Dr. Mehta and Mr. Fedele identifying the expanding role of state attorneys general in reviewing and litigating mergers as a significant change in the US. In Europe, panelists described an increased focus on efficiencies, including efficiencies from innovation. Looking ahead, Dr. Régibeau suggested that elements of efficiency, such as resiliency and contribution to growth and innovation, may create a tug of war between jurisdictions when it comes to remedies, with each market vying for a localized benefit.