Below-threshold digital and pharmaceuticals transactions—especially so-called “killer acquisitions”—are seen as most likely to raise antitrust concerns and, unsurprisingly, remain top of most authorities’ hitlists.
But the focus is not exclusively on these sectors. In 2024, antitrust authorities also pursued assessments of non-notifiable deals relating to ports, cement, food and pallets, including serial acquisitions in these markets. PE-backed roll-up strategies have also raised concerns (as discussed in Private equity and serial acquisitions continue to feel the antitrust heat).
Rethink for the European Commission after court loss
In its groundbreaking Illumina/GRAIL ruling, the European Court of Justice (ECJ) held that member states cannot refer a transaction to the EC for review under Article 22 of the Merger Regulation where they have no competence to review the deal under national merger control rules.
The judgment severely limits the EC’s powers to assess below-threshold mergers. It eliminates the uncertainty created by the EC’s approach to Article 22 (following its policy change in 2021), which included the possibility of a post-closing review.
The EC now faces a dilemma: how to ensure that potentially problematic deals escaping the EC’s turnover-based merger control jurisdictional thresholds are effectively scrutinized. Options include lowering the filing thresholds, introducing a deal value test and/or granting the EC the power to call in transactions it considers may raise antitrust concerns. But these would require legislative change, which would take time and are by no means certain to receive approval.
The more likely route—at least in the short term—is for the EC to rely on member states to use their powers to assess transactions falling below turnover-based thresholds and then refer any potentially problematic mergers to the EC.
For the EC, this alternative course has already started to prove fruitful. In October, Italy used its call-in powers (obtained in 2022) to require Nvidia to notify its purchase of Run:ai Labs. It then referred to deal to the EC, which reviewed and cleared it in late 2024.
For merging parties, this reintroduces unpredictability. It is not surprising that Nvidia has challenged the EC’s jurisdiction over the Run:ai deal. Whether the EC’s approach will stand up in court remains to be seen, especially given the importance placed on the principle of legal certainty by the ECJ in Illumina/GRAIL.
We expect the new competition commissioner to consider the EC’s position on below-threshold deals early in her term. Before taking office, she pledged to “swiftly find the best way” to ensure that killer acquisitions do not escape EC scrutiny and has committed to looking into all options “without creating any unnecessary additional administrative burden or legal uncertainty for companies.” Balancing these objectives will not be easy.
EU member states seek to expand their toolkits
The antitrust authorities in eight member states can already call in/review deals that do not meet national merger control thresholds.
In addition to Nvidia/Run:ai, Italy made use of its powers several times during 2024. This led to in-depth investigations and conditional clearances. The Irish CCPC has asked for information about below-threshold deals although has not yet called one in.
Other member states are pushing for similar powers (or thinking about it). This includes Belgium, the Czech Republic, France, the Netherlands and Slovakia.
The Netherlands is even creatively using its existing merger control framework to review non-notifiable serial acquisitions. It took an in-depth look into Foresco's acquisition of rival pallet producers, assessing Foresco's past and future acquisition strategy, but ultimately cleared the deal. In Belgium, we saw a case where the remedy package included an obligation to inform the authority of future non-notifiable transactions for a period of ten years.
Assessing below-threshold acquisitions under the abuse of dominance rules (and, by analogy, the rules prohibiting anticompetitive agreements) is also a possibility following the ECJ’s 2023 Towercast ruling. Since then, only Belgium (in two cases) and France (in one) have relied on the Towercast case law. But if member states fail to obtain the call-in powers they seek, it may become a more attractive option.
Not all member states agree with a call-in power expansion. The head of the German Federal Cartel Office is concerned it would undermine predictability and certainty. He is convinced that deal value thresholds are the best way to catch transactions that might otherwise escape scrutiny and is considering lowering Germany’s existing deal value test. This divergence of views only adds to the regulatory complexity faced by dealmakers.
Non-EU authorities have below-threshold M&A in their sights
China’s State Administration for Market Regulation (SAMR) requested the notification of semiconductor deal Synopsys/Ansys, despite it not meeting Chinese merger control thresholds. This follows SAMR’s first imposition of remedies on a below-threshold pharmaceutical transaction in 2023. All eyes are on whether SAMR will step up the use of its call-in power in sensitive or strategic sectors.
In Canada, important changes to the merger control rules have extended the period in which the Competition Bureau can challenge non-notifiable deals from one to three years post-closing.
Under the new Australian merger control system (applying from January 1, 2026), ministerial directions will target certain sectors (such as supermarkets) and require incumbents to notify all transactions. Plus the current prohibition against mergers that substantially lessen competition in a market will continue to apply to below-threshold or non-notified deals. This will likely mean that small deals that materially consolidate local markets will need to be self-assessed and voluntarily notified.
An M&A portal established by the U.S. Federal Trade Commission encourages the public to provide comments on proposed mergers. It could prove a useful source of information about deals that do not trigger the HSR reporting obligation. Whether the U.S. agencies take any action as a result will depend on the priorities of the new administration.
The future looks…unpredictable
Antitrust authorities’ increasing powers, evolving policies and creative approaches mean that non-notifiable deals—especially in sensitive sectors—are increasingly likely to face merger control scrutiny. This will usually be pre-closing, but post-completion assessments cannot be ruled out.
Assessing the possibility of a review early in the process is vital. As is negotiating appropriate deal conditions and protections to deal with potential filing obligations. Parties to digital and pharma transactions should be particularly alive to the risks.
