Antitrust team reviews ECJ's Illumina / Grail judgment in EU Law Live

Andrea Pomana, Partner in the Frankfurt office, and Alejandro Guerrero and Jonathan Saké, respectively Partner and Associate in the Brussels office, have co-authored an article titled "European Court of Justice Curbs Commission's Ambition to Review Non-Notifiable Mergers" for a specialised symposium of EU Law Live's Competition Corner. The link to the full article can be found here. The article provides an in-depth review of the Illumina/Grail judgment by the European Court of Justice. The judgment, delivered on 3 September 2024, ruled that the European Commission cannot expand its jurisdiction to review mergers that are not notifiable at the EU or Member State level. This decision was made in the context of the planned takeover of Grail by Illumina, which was prohibited by the Commission in 2022. The judgment emphasizes legal certainty, institutional balance, and alternative tools for merger control. It invalidates all referral decisions and follow-on decisions taken by the Commission after the referral, including the prohibition of the merger and the fining of Illumina and Grail.

The Court of Justice highlighted the importance of legal certainty over regulatory interventionism. The authors note that merger regulation rules and thresholds are crucial for foreseeability and legal certainty for undertakings. The broad interpretation of the Commission's competencies had led to significant legal uncertainty in practice. The judgment is welcomed by practitioners and investors alike. The Court of Justice also emphasized the principle of conferral of powers within the EU legal order, clarifying that the EU merger control system is based on a clear allocation of tasks between the Commission and the Member States.

In the short term, the Commission and national competition authorities will need time to review the judgment and extract appropriate conclusions and necessary regulatory changes. In the medium to long term, legal changes may be made to expand authorities' powers to call in deals. The Court of Justice suggested three alternative tools or mechanisms to capture below-threshold deals that may significantly impede effective competition. These include adjusting revenue thresholds, scrutinizing below-threshold transactions as possible instances of abuse of dominance, and increasing national notification thresholds and competition authorities' powers to call in deals