The crusade on killer acquisitions continues: AG Kokott’s Opinion in Towercast
In her most recent Opinion in Towercast v Autorité de la Concurrence Case (C-449/21), Advocate General Kokott has clarified how killer acquisitions can be policed even where a merger falls short of the required national and European notification thresholds, by post-transaction assessment under Art. 102 TFEU. AG Kokott also made it clear that, logically enough, where mergers have already been approved under the EU merger control regime it will not be possible for an acquisition to be targeted under abuse of dominance rules and in this sense, there will be no double assessment of mergers.
In 2017 Towercast S.A.S.U. (Towercast), a company operating in the French terrestrial television broadcasting market, lodged a complaint with the French Competition Authority in relation to the acquisition of Itas by TDF, Towercast’s much larger and market-dominant rival. Since this three-to-two merger fell short of revenue thresholds set out in either the EUMR or the French Commercial Code, Towercast sought to block the merger by relying upon the seminal Continental Can case. Towercast alleged that the acquisition constituted an abuse of a dominant position, hampering competition in the upstream and downstream wholesale markets for digital terrestrial television broadcasting. The French competition authority rejected this argument, and the case proceeded to the Paris Court of Appeal, which sought the ECJ’s guidance on whether a national competition authority can apply Art. 102 TFEU to mergers that were not subject to the standard pre-transaction merger control clearance procedure.
AG Kokott’s Opinion
Ultimately confirming the national authority’s ability to apply Art. 102 TFEU in relation to a merger, AG Kokott took this opportunity to make a number of important points.
Firstly, AG Kokott underlined that Art. 102 TFEU is a provision of primary European law, accordingly, rejecting the entire suggestion that the EUMR may restrict or limit the scope of Art. 102 TFEU. She emphasised that Art. 102 TFEU is “sufficiently clear, precise and unconditional” to have direct effect. Addressing the point raised by the defendants, AG Kokott noted that neither the referral mechanism in Art. 22 EUMR, nor the exclusion in Art. 21 (1) EUMR can therefore, as a matter of principle, preclude an assessment of a merger post-transaction under Art. 102.
Secondly, AG Kokott stressed that, though Continental Can remains relevant, it must be read in the context of its time, since the introduction of the EUMR, and the pre-transaction merger control regime it imposed, meant that Art. 102 TFEU could not be applicable to concentrations in the same way as it once was. The current role of the Art 102 TFEU provision, in the merger context, is as a post-transaction assessment tool which “furthers the objective of the Treaties of maintaining the most effective and complete protection of competition within the common market”. The provision accordingly plays the role of a “safety net”, guarding against acquisitions which have as their aim eliminating competitors, but which are not currently caught by the revenue thresholds inherent to the merger notification procedure.
Lastly, AG Kokott endorsed the comments by the Italian government and the Commission, who spoke of an enforcement gap pertaining to anti-competitive acquisitions of innovative start-ups in the fields of internet services, pharmaceuticals, or medical technology and expressly used the term “killer acquisitions”. Her Opinion marks the first occasion the term has been used in an official CJEU judicial document and stresses the need for a “punitive ex-post control” instrument in the arsenal of national competition authorities in innovative or highly concentrated markets, albeit with the admission that it is a “weaker” instrument than preventive merger control.
Despite the lack of binding effect, this Opinion  is highly significant, as, if followed by the ECJ, it would constitute a decisive response to the problem of acquisitions of small yet promising innovator companies by large established competitors. This type of transaction, which is already problematic because such acquisitions may result in stifled innovation, also tend to fly under the radar of competition authorities as they fall short of the appropriate national or European notification thresholds. When taken together with the recent judgment of the General Court in Illumina , it is clear that killer acquisitions will continue to be a hot topic and an enforcement priority for the European Commission and other National Competition Authorities. This Opinion, when viewed in context, seeks to tackle an existing enforcement gap from another angle, by ensuring that Member States themselves are empowered to tackle killer acquisitions.
 The ECJ has come to the same judgment as AG Kokott advised in the last 29 of 34 cases in which she has delivered a non-binding opinion.
 The Illumina case concerned a below-notification threshold concentration between undertakings in the healthcare sector. In it, the General Court confirmed that the European Commission has jurisdiction to review mergers that are referred to it by national competition authorities under Art. 22 even if the relevant transaction has no European dimension and was never notified to any of the EU Member States.
With special thanks to Ilia Sigarev for his assistance on this piece