A merger that did not come to pass

The EU's competition policy on the example of the prohibited merger of Ryan Air and AerLingus

Essai , 2009 , 13 Pages , Note: A-Grade with distinction

Politique - Sujet: Union européenne

This essay examines the theoretical background and the practical application of the EU's “antitrust policy”. As mergers are one way for firms to gain a “dominant position” in the market, the Commissionapplies the merger regulation to control such developments. The operation of this policy is analysed with the case study of a prohibited merger of “Ryan Air” and “Aer Lingus”. The case also shows the high degree of legislative and executive powers the EU-institutions have gained in the significant economic area of competition policy.
Although seemingly of purely economic purposes, EU competition policy serves “integrative” purposes too. “EU-Integration” can be defined as the EU-Member States voluntarily foregoing their power to formulate only national political and legal measures. Instead they formulate common policies which are determined in a coop-erative process of decision making. Cooperation can either take place in an intergovernmental framework or by transferring national sovereignty to the EU-institutions with the subsequent subjugation of national law under EU Law. Since the Treaty of Rome in 1957 expressed the determination of the European Economic Community’s Member States to build an “ever closer union”, economic integration parented EU-integration. With the new Treaties from the Single European Act onwards other than economic policies were added to the EU’s agenda, e.g. cultural policy, foreign or security policy, but economic integration stayed a top priority. The EU’s success is still believed to depend on its economic success and its ability to let the majority of the EU’s citizens profit from it. Economic failure could undermine people’s acceptance of the renunciation of national political independence. Therefore the Commission strives to ensure the Single Market’s success, among other things by applying a competition policy with merger controls.

Inhaltsverzeichnis (Table of Contents)

• Introduction
• Applying merger control policy - The case of Ryan Air and Aer Lingus
  • Background of the case
  • Reasons for the merger coming under EU jurisdiction
    • Legal framework
    • The definition of a “merger”
    • The “Community Dimension”
  • The Commission's reasons for prohibiting the merger
    • Theoretical background
    • The Commission's decision
      • Definition of the market
      • The merger's effects on competition
      • Barriers to other firms' market entry
      • Added efficiency
    • Possible amendments
  • Special problems of this merger case
• Conclusion

Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)

This essay examines the theoretical background and the practical application of the European Union's (EU) “antitrust policy”. The essay uses the case study of a prohibited merger “Ryan Air” and “Aer Lingus” to analyze how the EU’s merger regulation operates in practice. The case study also reveals the extent of the EU’s competences and responsibilities in the significant economic area of competition policy, highlighting the process of EU integration through economic integration. Here are the key themes explored in this essay:

• EU antitrust policy and its application in merger control
• The role of the European Commission in regulating competition within the EU
• The relationship between EU competition policy and the process of EU integration
• The application of economic theory to the analysis of merger cases
• The practical challenges of applying EU merger control in the context of international airlines

Zusammenfassung der Kapitel (Chapter Summaries)

Introduction

This chapter introduces the essay's topic of examining the theoretical background and practical application of the European Union's (EU) “antitrust policy” through the case study of the prohibited merger of “Ryan Air” and “Aer Lingus.” It emphasizes the significance of the EU's competences and responsibilities in competition policy and highlights the role of EU integration in driving this policy.

Applying merger control policy - The case of Ryan Air and Aer Lingus

This chapter delves into the specific case of the proposed merger between Ryan Air and Aer Lingus. It provides context, outlining the background of the airlines and their operations. It then examines the reasons for the merger coming under EU jurisdiction, exploring the legal framework, the definition of a “merger,” and the concept of “Community Dimension.” The chapter goes on to explore the Commission's reasons for prohibiting the merger, delving into both theoretical background and specific decisions regarding the definition of the market, the merger's effects on competition, barriers to market entry, and the potential for added efficiency. The chapter also touches upon the specific challenges posed by the case, such as the difficulty of allocating turnover for cross-border operating airlines.

Conclusion

This chapter concludes the essay by summarizing the main points discussed and drawing conclusions about the theoretical background and practical application of the EU's “antitrust policy.”

Schlüsselwörter (Keywords)

This essay focuses on the EU's antitrust policy, examining the theoretical background and practical application of merger control. Key terms and concepts include: EU antitrust policy, merger control, European Commission, competition policy, EU integration, economic integration, Single Market, dominant position, market equilibrium price, and case-by-case approach. The essay also examines the specific case of the proposed merger between Ryan Air and Aer Lingus, highlighting the challenges of applying EU merger control in the context of international airlines.

• Université: South Bank University London (Faculty for Art and Human Sciences)
• Cours: Postgraduate Course on European Policy
• Note: A-Grade with distinction
• Auteur: Andrea Daniel (Auteur)
• Année de publication: 2009
• Pages: 13
• N° de catalogue: V131484
• ISBN (ebook): 9783640372508
• ISBN (Livre): 9783640372140
• Langue: anglais
• mots-clé: Ryan, AerLingus, A-Grade