Client Alert: All is Not Quiet on the EU Competition Law Front - Key Trends and Predictions for 2025
Sign Up for PublicationsThe past year was an eventful one for competition law enforcement in the European Union (“EU”). The European Commission (“Commission”) published a revised Market Definition Notice,[1] as well as draft Guidelines on exclusionary abuses, currently under public consultation.[2] It issued important antitrust decisions in Apple/Spotify[3] and Teva,[4] and conducted a flurry of investigations under the Digital Markets Act (“DMA”)[5] and the Digital Services Act (“DSA”).[6] The EU Court of Justice (“CJEU”), meanwhile, handed down several landmark rulings, including in Illumina,[7] Google Shopping[8] and Intel RENV.[9] And with a new Commissioner at the helm of the EU’s competition law directorate, the impending changes to U.S. trade policy heralded by the return of President Trump to the White House – the impact of which will be felt worldwide –, significant technological developments, and geopolitical turmoil, the new year is expected to be all but quiet on the EU competition law enforcement front. We provide below our views and predictions for the most pertinent trends and developments in 2025.
I. New Policy Direction under Commissioner Teresa Ribera?
Following the European elections of June 2024 and the appointment on 27 November 2024 of the second Commission presided by Ursula Von der Leyen, the former Spanish Deputy Prime Minister and Minister for Ecological Transition, Teresa Ribera, was appointed Competition Commissioner and Executive Vice-President with a broad new portfolio for “Clean, Just and Competitive Transition.” Ms. Ribera has big shoes to fill: Her predecessor, Margrethe Vestager, was the longest-serving EU Competition Commissioner, and frequently occupied the spotlight for battling Big Tech and leading high-profile antitrust, merger, and State aid investigations.[10]
At the dawn of Ms. Ribera’s mandate as head of the Directorate-General for Competition (“DG COMP”), we do not expect major surprises or deviations from pre-existing policy. With the nomination of a new Director-General, Deputy Director-General, and Deputy Directors for Mergers and for Antitrust still pending, the new Commissioner is likely to take a cautious approach and rely primarily on the incumbent key DG COMP officials to ensure the completion of ongoing investigations in a manner consistent with the policies set by her predecessor.
But Ms. Ribera’s key objective, set forth in her mission letter and public statements, is to “modernise competition policy” in alignment with other policy areas, notably digital technologies, energy, defence, and space.[11] The modernisation of EU competition rules is an ongoing process that begun during Ms. Vestager’s mandate. But this time there seems to be an even greater emphasis on the need to expedite the Commission’s antitrust procedures, avoid unduly long – and often unfair –, investigations, and be more agile in enforcing competition in fast-paced digital industries. We expect Ms. Ribera to start announcing concrete measures to that effect from the second quarter of 2025 onwards. In particular, we expect DG COMP to press ahead with its revamp of the antitrust legal framework currently enshrined in Regulation 1/2003,[12] and to devote more resources to cases that feature innovation theories of harm. Ms. Ribera has also committed to revise the Horizontal Merger Guidelines[13] with the aim of enabling EU companies to remain competitive vis-à-vis non-EU countries. It is also possible that this review will extend to the non-horizontal merger guidelines.[14] Finally, the new Commissioner has promised to enact significant changes to the State aid rules, including devising a new State aid framework to support renewable energy, industrial decarbonisation and clean tech “made in Europe,” as well as expedite approval when “Important Projects of Common European Interest” are at issue.
The recent Draghi Report, which emphasised the need for the EU to increase competitiveness by providing clearer guidance and reducing “red tape” to enable pro-competitive cooperation between businesses, has been viewed as likely to provide inspiration and help shape future EU competition policy.[15] It has been said that it might incentivise the Commission to simplify the legal framework applying to cooperation agreements in the fields of R&D and defence, including the merger control rules through the introduction of a new “innovation defence” that could be raised by merging parties. The Draghi Report suggested that this “innovation defence” would serve as a means to clear agreements between companies that aim to merge or pool resources to cover large fixed costs in certain strategic sectors and achieve the scale required to compete at the global level. For the defence to be accepted, it would require that the companies involved commit to making certain R&D investments, and ex post monitoring by authorities.[16] Given that the EU antitrust enforcer is typically loath to having to monitor deals ex post (as is the case with behavioural remedies), this suggestion may fall on deaf ears, or be very rarely successful if adopted.
Moreover, the Commission was, until recently, expected to globally intensify its vigorous enforcement and targeted implementation of sector-specific regulation, in particular, the much-debated DMA, DSA, and FSR[17] in 2025, and to even expand their scope. In fact, the European Parliament’s Working Group on the DMA implementation just urged the Commission to monitor closely artificial intelligence (“AI”) and cloud services and to designate them as “core platform services.”[18] Nevertheless, the Commission’s appetite to use its regulatory powers may now be lower due to external geopolitical pressures discussed in Section IV below.
Finally, it seems unlikely that Ms. Ribera will propose the adoption of additional ex ante regulations. This is because the Commission already enjoys far-reaching regulatory powers, and the prevailing view that seems to be emerging is that the EU is overregulated. Mr Draghi appears to agree, finding that “it is too labour-intensive and unrealistic for the authority to engage in monitoring all markets,” and arguing instead for the introduction of a “new competition tool” in four specific areas.[19] Such tools would include market studies, dialogue with firms, and market investigations. Ms. Ribera should opt for the lighter touch approach.
II. Antitrust Enforcement to Remain Vigorous
Over the past decade, the number of antitrust investigations carried out by the Commission has increased,[20] as has the level of fines imposed.[21] We expect the new Commissioner to keep up the momentum in 2025. The main focus is likely to remain on new and emerging technologies, with conduct in the field of artificial intelligence (“AI”) being seen as a primary target.[22] Anticompetitive practices pertaining to labour markets, such as the use of no-poach and wage-fixing agreements, are also likely to continue to attract the Commission’s scrutiny.[23] The Commission can also be expected to focus on certain key sectors where consumers are most likely to suffer from potential price increases and/or reduction in choice, such as pharma, biotech, energy, and food.
2025 is also expected be the year in which the Commission withdraws its 2009 Guidance Paper on exclusionary abuses[24] and replaces it with a set of Guidelines. The first draft of those Guidelines has sparked heated debate and attracted a flood of comments. Stakeholders will once again have the opportunity to voice their concerns at a workshop organised by the Commission set for 13 February 2025.[25] Final Guidelines are not to be expected before the second half of 2025. Also, in principle, DG COMP will hold its horses until the CJEU hands down judgment in a number of highly relevant cases currently pending before it, including Google Android,[26] Android Auto,[27] and Bulgarian Energy Holding.[28] Other equally important cases pending before the CJEU, such as Qualcomm[29] relating to alleged predatory pricing, and Google AdSense for Search[30] relating to exclusivity clauses, are still at too incipient a stage to be reflected in the upcoming version of the Guidelines. They should be included in a potential future revision.
III. Merger Control post-Illumina
In its landmark Illumina ruling, delivered last year, the CJEU thwarted the Commission’s attempt to rely on Article 22 EUMR[31] to review transactions over which neither the Commission nor the EU Member States have jurisdiction. The CJEU made clear that deals over which national competition authorities do not have jurisdiction cannot be referred to the Commission for review.[32] But it appears that the Commission remains determined to ensure that so-called “killer acquisitions,” i.e., the acquisition of a company with limited or no turnover but with a high competitive and innovative potential, do not escape scrutiny.[33]
To that end, a review of the EUMR is not completely off the table, but if and until that happens the Commission can be expected to seek to rely on other means to claim jurisdiction over such deals. One way to do so will be to use the “call-in” powers of national competition authorities to acquire jurisdiction over deals that do not meet e national thresholds, and the subsequent referral of those deals to the Commission. This mechanism was recently used by the Italian Competition Authority initially to review, and subsequently to refer to the Commission, Nvidia’s proposed acquisition of Run:ai.[34] We expect other Member States that already possess “call-in” powers (i.e. Denmark, Hungary, Ireland, Italy, Latvia, Lithuania, Slovenia and Sweden) or intend to acquire such powers in future (i.e. Belgium, Czech Republic, Finland, France, Greece and the Netherlands) to employ them more frequently. Such an approach may, however, run counter to the CJEU’s finding that revenue-based thresholds are an important guarantee of foreseeability and legal certainty,[35] and it is now being challenged by Nvidia before the General Court.[36] Another alternative being currently market tested by the French Competition Authority[37] would consist in introducing a mandatory notification obligation for companies that possess a certain degree of market power. Finally, we expect that national competition authorities will review non-reportable deals by relying on the CJEU’s Towercast[38] ruling, which confirmed the power to examine deals ex post under the abuse of dominance rules. Such a mechanism has, for instance, been used by the Belgian Competition Authority to impose structural remedies on Proximus,[39] and by the French Competition Authority to investigate transactions in the meat cutting sector.[40]
IV. The Trump Effect and Strategic Geopolitical Issues
Perhaps the most burning question of 2025 is what effect President Trump’s election will have on EU competition law and digital policy, in particular, the enforcement of the DMA and DSA. Despite the Commission’s stated intention to actively enforce those regulations, it cannot be excluded that President Von der Leyen will choose to adopt a conciliatory attitude toward the Trump administration[41] rather than face the prospect of retaliation, such as the levy of export tariffs, were U.S. companies to complain of being “harassed” by the EU. Notably, US Vice-President, J.D. Vance, stated recently that U.S. support for NATO could be revisited were the Commission to take action under the DSA to limit freedom of speech on X.[42] Similarly, President Trump has expressed concerns about Apple’s treatment in the EU.[43]
Last but not least, the ongoing geopolitical turmoil resulting from the protracted war in Ukraine has triggered the strategic relocation of production facilities for key products necessary for the resilience of European economies. This has led to significant changes in industrial policy and the grant of subsidies in strategic economic areas, such as defence and energy. Moreover, with Mr. Trump announcing deregulation, tax cuts, and trade tariffs galore, we anticipate an increase in M&A activity, the relocation of production facilities to countries other than China with relatively low production and labour costs, especially in the semiconductors industry, a rise in the price of materials and products of strategic importance. This will result in a wave of merger notifications in the U.S., EU and worldwide, likely with numerous inconsistent outcomes.
What is certain is that not all will be quiet on the EU competition law front in 2025.
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Miguel Rato
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Endnotes:
[1] Communication from the Commission – Commission Notice on the definition of the relevant market for the purposes of Union competition law, C/2024/1645.
[2] Draft Communication from the Commission – Guidelines on the application of Article 102 of the Treaty on the Functioning of the European Union to abusive exclusionary conduct by dominant undertakings.
[3] Commission Decision of 4 March 2024 in Case AT.40437 – Apple – App Store Practices (music streaming), C(2024) 1307 final.
[4] Commission Decision of 31 October 2024 in Case AT.40588 – Teva Copaxone.
[5] Regulation (EU) 2022/1925 of the European Parliament and of the Council of 14 September 2022 on contestable and far markets in the digital sector and amending Directives (EU) 2019/1937 and (EU) 2020/1828 (Digital Markets Act) (“DMA”). See also https://www.quinnemanuel.com/the-firm/publications/client-alert-shaping-the-future-of-tech-latest-updates-on-the-digital-markets-act/..
[6] Regulation (EU) 2022/2065 of the European Parliament and of the Council of 19 October 2022 on a Single Market For Digital Services and amending Directive 2000/31/EC (Digital Services Act) (“DSA”).
[7] Joined Cases C-611/2 P and C-625/22 P, Illumina v Commission, EU:C:2024:677.
[8] Case C-48/22 P, Google and Alphabet v Commission (Google Shopping), EU:C:2024:726.; and Case C-240/22 P, Commission v Intel Corporation, EU:C:2024:915.
[9] Case C-240/22 P, Commission v Intel Corporation, EU:C:2024:915.
[10] Margrethe Vestager was EU Commissioner for competition for over a decade, during which there were around 90 antitrust investigations, 3800 merger investigations, and 4500 State aid decisions.
[11] See Mission Letter of Ursula von der Leyen to Teresa Ribera Rodríguez, 17 September 2024, available at https://commission.europa.eu/about/commission-2024-2029/commissioners-designate-2024-2029_en.; and Questionnaire to the Commissioner-Designate Teresa Ribera, Executive Vice-President for the Clean, Just and Competitive Transition, pp 4-5, available at https://elections.europa.eu/european-commission/en/ribera/. See also Speech by Executive Vice-President Teresa Ribera in the Annual CRA Brussels Conference 2024 on competition policy adapted to the new global realities, 10 December 2024, available at https://ec.europa.eu/commission/presscorner/detail/en/SPEECH_24_6341.
[12] Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty.
[13] Guidelines on the assessment of horizontal mergers under the Council Regulation on the control of concentrations between undertakings (2004/C 21/03).
[14] Guidelines on the assessment of non-horizontal mergers under the Council Regulation on the control of concentrations between undertakings (2008/C 265/07).
[15] The future of European competitiveness, Part B, In-depth analysis and recommendations, September 2024, pp 299-300, available at https://commission.europa.eu/topics/strengthening-european-competitiveness/eu-competitiveness-looking-ahead_en (the “Draghi Report”).
[16] Draghi Report, pp 299-300.
[17] Regulation (EU) 2022/2560 of the European Parliament and of the Council of 14 December 2022 on foreign subsidies distorting the internal market. See also Draghi Report, pp 301-302.
[18] MLex, “AI, cloud competition risks must face DMA scrutiny, EU lawmakers say,” 23 January 2025, available at: https://content.mlex.com/#/content/1626113/ai-cloud-competition-risks-must-face-dma-scrutiny-eu-lawmakers-say?referrer=email_instantcontentset&paddleid=202&paddleaois=2000.
[19] Draghi Report, pp 303-304. These four areas are: (i) tacit collusion; (ii) markets where the need for consumer protection is more likely to be needed, for instance due to consumers belonging to sensitive categories or having behavioural biases; (iii) markets where economic resilience is weak, one cause of which could be market structure (e.g. reliance on a single source of raw material) leading to frequent shortages or other harmful outcomes; (iv) past enforcement actions where the information/data received by the authority indicate that the commitments or remedies adopted are not delivering competition.
[20] Based on statistics and data published by the Commission, see https://competition-cases.ec.europa.eu/search?caseInstrument=AT&caseLastDecisionDate=from-2014-11-01-to-2024-12-01&pageSize=50&sortField=caseLastDecisionDate&sortOrder=DESC.
[21] For instance, Apple was fined over EUR 1.8 billion in March 2024. This is the third highest fine ever imposed by the Commission after Google Android (EUR 4.3 billion) and Google Shopping (EUR 2.4 billion).
[22] As regards AI, see, e.g., Competition Policy Brief, Competition in Generative AI and Virtual Worlds, September 2024; or G7 competition Authorities, Digital Competition Communiqué, 4 October 2024, available at https://en.agcm.it/dotcmsdoc/pressrelease/G7%202024%20-%20Digital%20Competition%20Communiqu%C3%A9.pdf.
[23] As regards labour markets issues, see, e.g., Competition Policy Brief, Antitrust in Labour Markets, May 2024, available at https://competition-policy.ec.europa.eu/document/download/adb27d8b-3dd8-4202-958d-198cf0740ce3_en; Press Release, Commission carries out unannounced inspections in the data centre construction sector, 18 November 2024, available at https://ec.europa.eu/commission/presscorner/detail/en/ip_24_5926; or Press Release, Antitrust: Commission carries out unannounced inspections in the online food delivery sector, 21 November 2023, available at https://ec.europa.eu/commission/presscorner/detail/en/ip_23_5944.
[24] Communication from the Commission - Guidance on the Commission’s enforcement priorities in applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings (2009/C 45/02). EU Courts have repeatedly referenced the Article 102 Guidance Paper and have acknowledged that it establishes the legal standard according to which the Commission must assess exclusionary conduct. See, e.g., Case T-325/18, Qualcomm v Commission, ¶612. See also Case T-612/17 - Google and Alphabet v Commission (Google Shopping).
[25] See https://competition-policy.ec.europa.eu/about/reaching-out/draft-article-102-tfeu-guidelines-exclusionary-abuses_en.
[26] Case C-738/22 P, Google and Alphabet v Commission.
[27] Case C-233/23, Alphabet and Others.
[28] Case C-14/24 P, Commission v Bulgarian Energy Holding and Others.
[29] Case C-819/24 P, Qualcomm v Commission.
[30] Case C-826/24 P, Commission v Google and Alphabet.
[31] Communication from the Commission – Guidance on the application of the referral mechanism set out in Article 22 of the Merger Regulation to certain categories of cases (2021/C 113/01). See also Practical information on implementation of the “Guidance on the application of the referral mechanism set out in Article 22 of the Merger Regulation to certain categories of cases”, Frequently Asked Question and Answers (Q&A), available at https://competition-policy.ec.europa.eu/system/files/2022-12/article22_recalibrated_approach_QandA.pdf.
[32] See, e.g., Microsoft’s acquisition of certain assets of Inflection for which a referral had originally been requested by 7 Member States and then withdrew following Illumina.’s ruling (see Press Release, Commission takes note of the withdrawal of referral requests by Member States concerning the acquisition of certain assets of Inflection by Microsoft, 18 September 2024, available at https://ec.europa.eu/commission/presscorner/detail/en/ip_24_4727).
[33] Questionnaire to the Commissioner-Designate Teresa Ribera, Executive Vice-President for the Clean, Just and Competitive Transition, p. 5, available at https://elections.europa.eu/european-commission/en/ribera/.
[34] See Case M.11766, Nvidia/Run:ai.
[35] Joined Cases C-611/2 P and C-625/22 P, Illumina v Commission, EU:C:2024:677, paras 208-209.
[36] MLex, “Nvidia goes to court over EU regulator’s move to review Run:ai deal,” 15 January 2025, available at https://content.mlex.com/#/content/1623899/nvidia-goes-to-court-over-eu-regulator-s-move-to-review-run-ai-deal?referrer=search_linkclick.
[37] Autorité de la concurrence, Public consultation on the introduction of a merger control framework for addressing below-thresholds mergers, 14 January 2025, available at https://www.autoritedelaconcurrence.fr/en/press-release/public-consultation-introduction-merger-control-framework-addressing-below-threshold.
[38] Case C-449/21, Towercast, EU:C:2023:207.
[39] Belgian Competition Authority, Decision ABC-2023-RPR-17, Proximus/EDPnet, 21 June 2023.
[40] Autorité de la concurrence, Decision 24-D-05 of 2 May 2024.
[41] See MLex, “EU ready to engage with Trump on ‘common interests,’ Von der Leyen says”, 21 January 2025, available at https://content.mlex.com/#/content/1625486/eu-ready-to-engage-with-trump-on-common-interests-von-der-leyen-says?referrer=search_linkclick. See also MLex, “To fine or not to fine Big Tech? New EU commissioners face tricky calls early on,” 3 December 2024, available at https://content.mlex.com/#/content/1614556/to-fine-or-not-to-fine-big-tech-new-eu-commissioners-face-tricky-calls-early-on?referrer=search_linkclick.
[42] See, e.g., https://www.independent.co.uk/news/world/americas/us-politics/jd-vance-elon-musk-x-twitter-donald-trump-b2614525.html.
[43] See, e.g., https://www.bbc.com/news/articles/cj4d75zl212o.