Annulment of EU veto of Hutchison’s bid for O2 UK should be dismissed

A ruling by Europe’s second-highest court that annulled an antitrust veto of CK Hutchison Holdings Ltd’s bid for O2 UK should be dismissed and the case should be re-heard again, an adviser to Europe’s top court said.

Hutchison, owned by billionaire Li Ka-shing, in 2020 successfully challenged the European Commission’s veto of its planned 10.3 billion pound ($11.5 billion) purchase of O2 UK from Spain’s Telefonica TEF.MC at the General Court. The European Commission appealed.

The case is being closely watched by telecoms companies, which have long urged the EU competition enforcer to ease merger rules for the sector, especially for deals which reduce the number of players from four to three.

Advocate-General Juliane Kokott at the Court of the Justice of the European Union (CJEU) said in a non-binding recommendation on Thursday the lower tribunal’s ruling should be dismissed.

She recommended that “the General Court’s judgment be set aside and that the case be referred back to the General Court for it to provide a fresh ruling on the dispute”.

In 2020, the Court ruled that the EU watchdog had failed to prove that the merged company would harm competition or raise prices. Judges raised the bar for the Commission to block mergers that hinder competition, a ruling that regulators said imposes an extremely high burden of proof on them.

But on Thursday, Kolkott said: “There is no justification for requiring a higher standard of proof in the case of concentrations giving rise to non-coordinated effects on oligopolistic markets than in the case of concentrations giving rise to ‘conglomerate’ or ‘collective’ type dominant positions.”

Judges, which usually follow most of such non-binding opinions, will decide on whether to dismiss the General Court ruling in the coming months. Nasdaq