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Kyriakos Fountoukakos, Nov 03, 2006
On July 13, 2006, the Court of First Instance (CFI) annulled the European Commission’s 2004 decision authorizing the creation of SonyBMG, a joint venture between Bertelsmann and Sony, merging their global recorded music activities. In general, the CFI was very critical of the Commission’s analysis and use of evidence. The court was particularly critical of the Commission’s inability to explain the U-turn in its position between the Statement of Objections and the final decision. While the CFI accepted that the Commission was entitled to change its view in the final decision, it clearly stated that the Commission should be able to explain, if not in the decision at least in the proceedings before the court, the reasons for changing its view. Three aspects of the CFI’s judgment merit further attention:
- (i) the CFI’s clarification and application of the test for collective dominance;
- (ii) the CFI’s approach on the Commission’s investigation, treatment of the evidence and reasoning; and,
- (iii) the CFI’s application of a heightened standard of review.