COMPETITION • FRENCH LAW • MERGERS
According to the Merger Control Guidelines, a concentration may significantly impair competition in markets affected by non-coordinated effects, i.e. effects resulting from the behavior of market operators acting independently of each other. Non-coordinated effects are in contrast to coordinated effects, which imply an interdependence of the actions of market players.
A horizontal merger produces non-coordinated effects when it allows the merged entity to build or strengthen its market power. Unilateral effects can lead to the creation or strengthening of a dominant position, allowing the undertaking to behave to an appreciable extent independently of any competitive pressure.
A vertical or conglomerate merger produces non-coordinated effects when it allows the merged undertaking to restrict or prevent access to one or more markets.
To assess whether a transaction significantly impedes competition through its non-coordinated effects (horizontal, vertical or conglomerate), the Competition Authority analyzes the ability of customers to switch to alternative products or services from competing undertakings. To do so, it conducts a prospective supply and demand analysis and examines the likely behavior of customers and competitors in the short term following the transaction. In particular, it assesses the ability of existing competitors to respond to the post-merger situation and their incentive to do so.
