The European Union’s antitrust regulator has stated that a deal involving a Luxembourg brewery requires approval from EU authorities. According to regulators, Brasserie Nationale, the largest brewery in Luxembourg, must obtain clearance from the EU to acquire Boissons Heintz, a wholesale drinks distributor in Luxembourg. This requirement follows a request from the competition agency in Luxembourg.
The European Commission has invoked its authority under Article 22 of EU merger regulations, enabling it to scrutinize transactions that fall below revenue thresholds but could impact trade between EU member states or significantly influence competition within the country requesting the examination.
The EU competition authority emphasized the significance of imported beverages in Luxembourg and noted that the proposed deal would merge the two primary wholesale drinks distributors in the Grand Duchy.
This marks the Commission’s fourth assessment under Article 22, a mechanism used to address concerns regarding “killer acquisitions,” where large companies acquire innovative startups with the intent of shutting them down.
Article 22 of the EU Merger Regulation (EUMR) empowers Member States to request the European Commission (Commission) to scrutinize specific acquisitions, even if they fall short of meeting EU merger control thresholds.
Historically, the Commission has discouraged referrals for transactions that aren’t reportable at a national level. However, a shift in this stance occurred with the Commission’s updated Guidance issued in March 2021.
This guidance signaled an intention, under certain circumstances, to support and consider Article 22 referrals, particularly when the referring Member State(s) lack the authority to review the transactions under national regulations.
In two recent rulings, namely EEX/Nasdaq Power and Qualcomm/Autotalks, the Commission acknowledged that the acquisitions in question—although they didn’t trigger EU merger control thresholds and weren’t subject to notification in any Member States—qualified for referral under Article 22 EUMR.
These decisions, following the Commission’s pivotal ruling in Ilumina/Grail, mark only the second and third instances where the Commission, in alignment with its Guidance, has asserted jurisdiction under Article 22 for transactions that weren’t notifiable at both EU and national levels.