Merger Review in Emerging High Innovation Markets

In many high innovation markets competition will tend to be more “for the market” than “in the market”. A special analytical framework is neither necessary nor desirable for merger review in innovation intensive markets. Market definition and assigning market shares are particularly challenging tasks in rapidly changing sectors. The ability and incentive to exclude or restrict rivals deserves prime attention in reviewing mergers in high innovation markets. In dealing with anticompetitive mergers in high innovation markets, there is good reason to question the traditional preference for a structural as opposed to a behavioural remedy. Instead, a highly customised use of behavioural remedies, sometimes accompanied with a required divestment, may be the best way to address potential competition problems in such markets. The complexity of mergers in high innovation sectors may require rethinking the merger review process (i.e. strict time limits), increasing sector specific expertise in competition authorities, and taking pro-active steps to prepare for mergers in high innovation markets. This document comprises proceedings in the original languages of a Roundtable on Merger Review in Emerging High Innovation Markets, which was held by the Competition Committee in June 2002.