Universal-BMG Merger Receives Conditional EC Approval

by Ulrika Lomas, for LawAndTax-News.com, Brussels

23 May 2007

The European Commission announced on Tuesday that under EU Merger Regulation rules, it has approved the proposed acquisition of the music publishing business of Bertelsmann Music Group (BMG) of Germany by Universal, a US subsidiary of the French company Vivendi.

Following Universal's notification of the planned merger in November 2006, the EC launched a probe the following month, citing concerns that such a move would create adverse effects for competition in the "already concentrated music publishing market".

In a statement published on Tuesday, the EC explained that:

"The Commission found that the proposed merger, as initially notified, raised serious doubts as regards adverse effects on competition in the market for music publishing rights for online applications. However, the Commission's investigation found that these concerns would be removed by the remedies package proposed by the parties concerning the divestiture of a number of publishing catalogues."

"In the light of these commitments, the Commission has concluded that the proposed operation would not significantly impede effective competition in the European Economic Area (EEA) or any substantial part of it."

Competition Commissioner Neelie Kroes added:

"Digital music has the potential to change the face of the music industry in Europe. I am satisfied that the significant remedies will keep these markets competitive and ensure that consumers will not be harmed by the merger."

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