The push toward megamergers in Europe is swamping the 15-nation European Union (EU) Commission, whose merger taskforce is staggering under an ever-increasing workload.
"Big-scale mergers, which have to be reviewed by the Commission, have tripled -- from 100 to 300 a year -- but the size of the review staff has not changed," notes Rachel Brandenburger of the Freshfields Deringer law firm in Brussels. "This is a reflection of the success of Europe's economy but also of the handicaps of regulation."
Lawyers complain that highly pressured EU officials are failing to do their own analysis, preferring to gain time by delegating the work to outsiders. "This clearly involves risks in the way merger applications are handled," says Nick Levy, a partner at Cleary Gottlieb, another Brussels law firm. Goetz Drauz, head of the EU merger taskforce, admits his staff can sometimes be "unfocused" in questions put to applicants' lawyers. "But last year the 300 big mergers involved 20 detailed investigations, each lasting four months compared with 12 (investigations) in 1998," says Drauz. Brandenburger commented: "Regulators, practitioners, we are all swamped at present."