Not just ITA: all Italian dossiers “hostage” by the EU Commission
In the analysis of the practices the number M11079 “Ita Airways-Lufthansa” emerges, hopefully it will not be overlooked. When the European Antitrust decides to move to Phase 2, i.e. an in-depth investigation, the timetable becomes less relevant compared to the priority of preserving competition, reports Mf. In Brussels it is emphasized that few cases are subjected to these prolonged and sometimes complicated processes, because the majority of notified mergers do not raise problems and are approved after a routine assessment.
However, yesIt is recognized that the rules for defining the market and competition have remained unchanged for 27 years, making them obsolete. The vice-president of the European Commission, Margrethe Vestager, admitted this when announcing the revision of the guidelines to adapt them to new realities, such as innovation, digital markets, geographical indications and accessibility. It is the first time since 1997 that action has been taken to update the regulations, reflecting the evolution of markets, corporate business models and consumer habits.
While waiting for the application of the new rules, DG Competition does not discount cases requiring Phase 2, with a rigorous procedure that sometimes appears detailed. For example, Lufthansa was even asked the question about meals served on board after the acquisition of 41% of Ita Airways. This approach is not aimed only at Italy, as demonstrated by the prolonged practice in approving the airline born in 2020 to replace Alitalia.
Other companies, Spanish, Korean, etc., are also involved. Of the most recent investigations, five are in Phase 2, three of which involve airlines. The investigation into Lufthansa-Ita Airways started on January 23, 2024, with the Commission expressing serious doubts about the compatibility of the concentration with the common market.
Also other large airlines, such as IAG (International Consolidated Airlines Group), with its plan to acquire Air Europa, I’m under the magnifying glass. IAG, also owner of Iberia, announced in February 2023 that it wanted to acquire the remaining 80% of Air Europa for around 400 million euros, but the Commission opened Phase 2 fearing a possible reduction of competition in the air transport market in Spain.
The timing of Phase 2 assessments varies and often exceeds the expected 90 working days. The Commission may grant extensions during the investigation, making the outcome uncertain. This was seen in the case of Amazon’s acquisition of iRobot and the joint venture between Orange and MasMovil, where numerous postponements were needed before a decision was reached. Furthermore, it was highlighted that, although the majority of cases are resolved in Phase 1, a good part of Phase 2 investigations require corrections or are rejected.