Note: The Siemens/Alstom Merger Case: How Should European Merger Policy Respond to Global Competition

Liran Pang, Durham University

The European Commission’s block on the Siemens/Alstom merger triggered an outcry from France and Germany, who jointly proposed the ‘Franco-German Manifesto for a European industrial policy fit for the 21st Century’ as a response. They argued that facing global competition, in particular the rising power of China, the creation of the ‘European Champions’ should be the first priority, which requires the current competition law regime to be relaxed. This proposal triggered criticisms from competition law scholars, yet has gained certain support across Europe. Since then, it has reignited the discussion about the relationship between powerful firms, innovation and competition policy. This note discusses the concerns behind the Siemens/Alstom Merger case and the Franco-German Manifesto, and argues that the idea that a closed market with centralised power being most conducive to innovation is not that convincing with a closer look at that industry, and the long-established principle of promoting innovation via a competitive market is the most reliable path for both the European industries and European consumers.

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