Earthquake in merger law

In a ruling handed down on 3 September 2024 Illumina & Grail the Court of Justice of the European Union annulled the ruling of the Court of First Instance (CFI) of 13 July 2022 upholding the decisions of the European Commission.

The CFIUE’s ruling – upholding the Commission’s decisions – allowed the European Commission to control, on the basis of the referral provided for in Article 22 of Regulation 139/2004 on the control of concentrations, transactions that did not meet the national control thresholds when they were likely to affect trade between Member States and threaten to significantly affect competition on the territory.  The Court of Justice of the European Union annulled the CFI’s judgment and the Commission’s decisions which had held that the referral mechanism could be implemented by the Member States on condition that the transaction fell outside their supervisory jurisdiction because it did not meet the applicable national thresholds. It considers that this interpretation is likely to upset the balance between the various objectives pursued by the Merger Control Regulation. The setting of thresholds by a Member State to determine the obligation to notify a merger at national level is ‘an important guarantee of predictability and legal certainty for the undertakings concerned’.

This ruling has far-reaching consequences, not only in theory but also in practice, as the Illumina group was heavily sanctioned.