Influence of the European Commission on Innovation Development During the Execution of Merger Control
Authors: Kotenko Andrii , Maryniv Ivanna 
Published: November 2023

Problem setting. The research focuses on examining the nature of European Commission’s evaluation practices, concerning the merger agreements, that are conducted by this body on the basis of the EU Merger Regulation. The modern dimension of informational society has led to revolutionary changes in Commission’s policy regarding mergers. The European dimension criteria and quantitative evaluations of an undertaking are the main but not the only tools, provided by the Regulation 139/2004, that define the scope of measures, available to the Commission during the investigation. The problem is, that the modern startups progression pattern leads to the alteration of the nature of the market, where the nonessential undertakings can become extremely essential in a dramatically short period of time. This factors have become an incentive to the European Commission to conduct research not only by taking the past and the present factors into consideration, but also using various methods to evaluate the future outcome of the merger with a company, that falls under the Commission’s jurisdiction, which leads to appearance of serious concerns about the integrity of the subsidiarity principle. Analysis of recent researches and publications. The role of the Commission’s evaluation procedure in the merger agreements between the innovative subjects has been researched by the following scientists: Oskar Törngren, Joseph Bromfield, Matthew Olczak, Thomas Buettner, Giulio Federico, Szabolcs Lorincz, Kyriakos Fountoukakos, Dafni Katrana, Agathe Célarié, Massimo Motta, Martin Peitz. The issue in question has also been duly revised and studied by the lawyers and responsible staff of the European Commission. Target of the research is to study a multidimensional nature of merger evaluation, conducted by the EU Commission towards the deals between the undertakings, that contain innovation. Article’s main body. The main instrument, possessed by the Commission and designed to evaluate a substantial threat of a merger to trade via the EU remains the significant impediment of effective competition (SIEC) test, which outlines, that the merger agreement must maintain the balance between competition hindrance and possible benefits and positive commercial outcomes of the deal. In order to make a distinction between lawful and unlawful agreements, the Commission uses a set of criterions and techniques to make sure that the current and the future position of the parties on a relative market will not become object to abuse of the parties. The criterions are not excessive and may encompass both legal and non-legal approaches. The Commission investigates how the position of the parties, their market share, the innovative nature of their product or the difficulty of access to the relevant market can affect the trade within the Internal Market. One of the most recent techniques, which is being used by the Commission as a response to the emerging power of innovative international corporate structures is the loss of innovation criteria. The European Commission insists on the position, that so-called «acquisition killing» is illegal within the EU competition law framework and has conducted a number of landmark investigations, where the conclusion has been made, that the innovative nature of some companies does not allow them to be a subject of merger because of the objective misgiving about the loss of the innovative product as a result of the merger, which may lead to the stoppage of a valuable research. The fact that most of the «acquisition killings» do not fit neither into the national nor the supranational jurisdiction is continuing to be a huge challenge for the Commission to tackle. Nevertheless, the recent practice alterations, concerning the use of the referral procedure, set in art.22 of the EU Merger Regulation allows the Commission to create at least a temporary decision of the problem by giving the Member States an incentive of voluntary application submission in case when the national competition authorities can’t cope with the issue newly set. Conclusions and prospects for the development. It’s worth noting, that the referral procedure use is neither a complete, nor a permanent decision of the problem. However, these steps from the Commission allow us to think that the new wave of integration concerning competition is still awaiting the EU and its Members. The Commission’s practice is a step forward to entering the new era of information economics, where the cooperative activities and mutual strategies of the national governments and the EU institutions are crucial for maintaining the sustainable development principle without hindering subsidiarity.