CAUSATION IN EC MERGER CONTROL

"there are ever so many ways that a world might be; and oneof these many ways is the way that this world is" (David Lewis,1986)

This article looks at two areas of merger control under EC Lawwhere the principles of causation are applied and, in our view,misapplied. The article traces the development of the conceptof the "counterfactual" in antitrust law. It then draws on thisanalysis in considering the operation of the "failing firm defense,"and in particular the standard of proof employed by the Commissionwhen analyzing the "counterfactual" in relation to the failingfirm defense. We argue that the Commission employs an excessivelyhigh standard of proof, and that this standard of proof contributesto the drawing of the failing firm defense too narrowly, througha misapplication of the principles of causation. We then proceedto contrast and prefer the approach of the UK Competition Commissionin recent cases. In the final part of the article we considerscenarios where two or more mergers are contemplated in thesame market at the same time, in cases of both parallel andoverlapping mergers. In these complicated scenarios, which requireprospective, multifaceted analysis, we set out in detail how,despite inherent difficulties, a similarly rigorous applicationof the principles of causation produces coherent results.