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Alex Chisholm, Nelson Jung, Oct 15, 2014
Developments over the past few months have been described as a “volcanic rise in protectionist sentiments from national governments.” General Electric’s bid for Alstom as well as numerous recent takeover proposals in the pharmaceutical sector, in particular Pfizer’s attempt to acquire AstraZeneca and AbbVie’s proposed takeover of Shire, have reinvigorated the long-running debate about greater state intervention in cross-border deal-making. There have been calls for a widening of public interest tests in merger control, or for the use of other legislative tools designed to protect vital sectors of the economy from certain foreign takeovers.
This article commences by briefly summarizing the evolution of merger control regimes, away from broad public interest tests and towards a competition-based assessment, in the United Kingdom and also internationally. In light of the recent, increasingly vocal demand for new or wider public interest considerations, it is time to take stock and explore what implications a shift or reversal in policy of this type may have. In order to do so, we set out to answer the question whether the U.K. merger control regime is in good health. One of the key tenets of medicine is the injunction that doctors should “first, do no harm;” any treatment required for a merger control regime must thus be based on a thorough diagnosis of…