The Role of the maverick firm concept in European Commission merger decisions

Abstract

The maverick firm concept recognizes the fact that certain firms may be inherently different from their rivals. This paper provides evidence on the use of this concept in European Commission merger decisions. We find that it has been relatively rarely used. However, where it has, maverick behaviour has been considered in a diverse range of industries and the candidate firms have been both insiders and outsiders to the merger. We then examine in detail the few cases where the existence of a maverick was eventually established by the Commission. All of these cases occurred after the 2004 change in the Merger Regulation and predominantly when analyzing the likelihood that unilateral effects would result from the merger. We suggest that this may be reconciled with economic theory by a more general need to take into account post-merger product repositioning.