Leveraging as a theory of competitive harm in EU merger control

Summary:

This article addresses the future of exclusionary leveraging as a theory of competitive harm after Tetra Laval. It first identifies leveraging concerns as involving a distinct type of competitive harm. The article then addresses the question of whether leveraging concerns should, as a matter of law and policy, be investigated under the Merger Regulation, in particular given the possibilities of ex post control under Article 82 EC. It then discusses the real-world commercial and legal constraints on successful leveraging strategies after a merger, and the conditions under which the risk of competitor foreclosure could arise. Last, it addresses the issue of whether and how leveraging concerns can be resolved by behavioural commitments.

The article concludes that there are very few cases imaginable in which the Merger Regulation would allow blocking a merger on the basis of leveraging concerns. In the author’s view, the continued pursuit of such concerns by the Commission risks having negative repercussions on its merger policy in general, namely reputational risks and the fostering of an unduly negative attitude towards certain types of efficiencies.