The Hunt/Murdoch Affair: Why a Secretary of State Should Have No Role in Merger Control

(by Andreas Stephan) This week there is continued pressure on the UK Culture Secretary, Jeremy Hunt, to resign. This follows revelations that his department was communicating with a News Corporation lobbyist at the time of its proposed acquisition of BSkyB,  precisely when he was meant to be acting in an independent and impartial manner.  This follows a media sting that revealed the apparent personal prejudice, this time against NewsCorp, which led to the Business Secretary, Vince Cable, being stripped of the role.  Such incidents highlight why it may be inappropriate to retain even the limited role of the secretary of state in UK merger control in relation to public interest considerations.

Merger Approval of Google-Motorola Mobility and the Failure of FRAND

(by Bruce Lyons) The European Commission and US DoJ have approved a (mainly) vertical acquisition of Motorola Mobility (MM) by Google because the specific transaction would not lessen competition.  They did so with weary resignation that it is part of the patent arms race into which they will be drawn to adjudicate in the coming months and years.  The underlying problem is that ‘fair, reasonable and non-discriminatory’ (FRAND) royalty commitments are not fit for purpose as part of standard setting agreements. 

What the Cunning Fox Really Wants

(by Shaun Hargreaves Heap) News Corporation’s withdrawal of the undertakings, that would have allowed its acquisition of BSkyB before the hackings crisis, looks like a masterstroke. By triggering a referral to the Competition Commission, it takes the heat out of the current ‘fit and proper’ debate and it gives News Corporation a re-match in the dispute over pluralism. Arguably, the outcome on this issue can be no worse than before, and so the only drawback is the delay. Rupert Murdoch’s decision to take full ownership of BSkyB had nothing to do with short term expediency, he is one of the great strategists in the industry.  The current media and political frenzy is missing the key question.  Why is Murdoch so determined to gain 100% control of BShyB?

Who Should Copy Whom in the Design of Merger Control?

(by Bruce Lyons) The UK regime for controlling potentially anticompetitive mergers has a number of idiosyncrasies as compared with most other competition authorities across the globe.  For example:  the two phases of merger inquiries are carried out by separate institutions; merger notification is voluntary;  very small mergers can be caught by the ‘share of supply’ test for jurisdiction; and minority shareholdings can be prohibited on the grounds of ‘material influence’.  Some of these are good idiosyncrasies, and other jurisdictions could learn from the UK, but other idiosyncrasies are a handicap, and the UK system would benefit from reform.  Which fall into each of these two categories?

EU Commission Steers Clear of another Antitrust Disaster in Greek Air Transport, but for how long?

(by Andreas Stephan) This month, the European Commission blocked the proposed merger between Greece’s two main airlines, Olympic Air and Aegean Airlines. What seemed like an insignificant concentration between two minor players in international passenger air transport would have destroyed competition in the market for domestic flights in Greece. Olympic and Aegean make up around 77% of flights out of Athens International Airport. While the decision is beneficial to European air passengers travelling within Greece in the near future, can two Greek airlines survive the economic downturn?