Roundup

Antitrust in focus - June 2025

Antitrust in focus - June 2025
Published Date
Jul 1 2025

This newsletter is a summary of the antitrust developments we think are most interesting to your business. Djordje Petkoski (partner based in Washington, DC) is our editor this month. He has selected:

U.S. merger remedies see revival as antitrust agencies conditionally clear five cases

Under the Biden administration, the U.S. antitrust agencies, particularly the U.S. Department of Justice Antitrust Division (DOJ or Antitrust Division), were unusually resistant to negotiated merger remedies. Instead, they preferred to challenge deals or see transactions restructured outside the normal consent decree process, expressing skepticism as to whether remedies—even structural divestments—could effectively address antitrust concerns.

In fact, only six U.S. consent decrees were entered into during 2023 and 2024. Our global trends in merger control enforcement report gives more data and commentary. In the report, we predict a return to pre-Biden levels of merger control enforcement under the Trump administration’s pro-business agenda, translating to a greater willingness to accept merger remedies.

This prediction looks set to play out in practice. In the space of just a couple of weeks, the U.S. agencies announced the clearance of five separate transactions subject to remedies.

Four of these involve structural divestments:

  • Synopsys/Ansys: The Federal Trade Commission (FTC) will require Synopsys and Ansys to divest assets to address concerns over the impact of their tie-up on several software tools markets. The agency says these markets are critical for the design of semiconductors and light simulation devices. The remedy package includes the sale of assets from both parties (a so-called “mix-and-match” solution) to Keysight Technologies.
  • Keysight/Spirent: The DOJ will require Keysight to divest Spirent’s high-speed ethernet testing, network security testing and RF channel emulation businesses. Without these remedies, the agency is concerned that the transaction would harm competition in markets for specialized communications test and measurement equipment. Viavi will purchase the divestment businesses.
  • Safran/Collins: Safran must sell its North American actuation business and related assets to address DOJ concerns over its acquisition of Collins’ actuation and flight control business. The deal will recombine assets that were divested as part of a previous conditional clearance and, according to the DOJ, would likely result in higher prices, lower quality, and reduced innovation. Woodward is the remedy-taker. 
  • Alimentation Couche-Tard (ACT)/Giant Eagle: The FTC will require ACT to divest 35 gas stations to settle charges that the acquisition of 270 retail fuel outlets from Giant Eagle would likely lead to higher fuel costs for consumers in certain U.S. states. The gas stations will be sold to Majors Management. The remedies will also require ACT—for ten years—to give prior notice to the FTC before acquiring any stations the authority has deemed “competitively significant” in the affected local areas. 

In addition to requiring structural divestments, these cases have other aspects in common:

  • Each involves an upfront buyer. These are becoming a fairly standard requirement of some antitrust agencies, particularly in the U.S., and are used to minimize the risk that the divestments might not be effective.
  • In three (all except ACT/Giant Eagle), in addition to allegations that the deals would eliminate head-to-head competition and lead to higher prices, the agencies claim a possible reduction in innovation. In recent years, we have seen antitrust authorities across the globe increasingly assess a transaction’s impact on innovation. These cases show that this parameter of competition is now front and center of the U.S. agencies’ merger control assessment.
  • Those same three cases are global transactions that also required merger control approvals in jurisdictions outside the U.S. Many of the authorities coordinated their assessments. In Synopsys/Ansys, for example, the FTC notes that it cooperated closely with authorities in the EU, UK, Japan and South Korea. This can be beneficial to merging parties, enabling agencies to align on a global remedy solution as well as on timing. The UK Competition and Markets Authority (CMA)’s acceptance of remedies in Safran/Collins, for example, came on the same day as the DOJ’s announcement in the case.

The fifth U.S. merger remedy announcement is different to the other four.

While it also concerned a global deal—Omnicom’s acquisition of rival advertising agency IPG—in this case, the remedies are behavioral in nature. They comprise a series of provisions designed to address the FTC’s concerns over potential anticompetitive coordination by Omnicom to “direct advertising away from media publishers based on the publishers’ political or ideological viewpoints.”

Deals cleared with behavioral commitments such as these are likely to be the exception rather than the norm. FTC head Andrew Ferguson notes that this is a “rare instance where the imposition of a behavioral remedy is appropriate” due to the characteristics of the market in question. Nevertheless, the case adds to the tally of remedy cases under Trump 2.0, which looks set to soon grow further with an unusual DOJ settlement during litigation.

Separately, Ferguson released a statement in which he sets out the case for merger remedies more generally.

He argues that a negotiated settlement that successfully prevents the merger’s anticompetitive features can also permit the procompetitive aspects to proceed. He notes that settlement is cheaper—an important factor given the agencies’ limited resources. And he says it avoids complicated litigation where parties may seek to present a remedy to the court (known as “litigating the fix”).

But Ferguson also warns of the dangers of “inadequate or unworkable settlements.” He believes that behavioral remedies should be treated with “substantial caution” and that the FTC’s standards for evaluating remedies “should be exacting.” The FTC plans to release a full policy statement on merger remedies in due course, which should tell us more.

Merger remedies may now be back on the table in the U.S. This is good news for parties to deals that may raise antitrust concerns. To take advantage of this shift in agency approach, parties should be prepared to offer robust solutions, at an early stage of the proceedings, that will comprehensively address antitrust concerns as fully as possible. Any procompetitive features of the deal should be clearly stated and evidenced, particularly where improvements to innovation, growth and investment are expected.

Read more about this trend, and how merging parties should respond, in our alert.

U.S. agencies file statement on the anticompetitive use of common shareholdings

The DOJ and FTC have filed a statement of interest setting out their position that antitrust safe harbors for passive investment do not protect the use of commonly managed stock in competitors to encourage market-wide reductions in output.

The agencies filed the statement in a lawsuit brought last year by a coalition of U.S. states—led by the Texas Attorney General—alleging that institutional asset managers used their management of stock in competing coal companies to induce reductions in output, leading to higher consumer energy prices.

It is the first formal statement by the agencies in federal court on the antitrust implications of common shareholdings.

In it, the agencies explain that antitrust laws allow most index fund investing as well as shareholder advocacy for better corporate governance. 

However, they distinguish such “ordinary activity” from the alleged “coordinated use of the power of horizontal shareholdings to distort output and prices in energy markets.” 

Discussing the statement, the head of the Antitrust Division also argues that “social justifications” (such as climate and carbon reduction goals) are not a defense to anticompetitive conduct. She warns that the DOJ will “not hesitate to stand up against powerful financial firms that use Americans’ retirement savings to harm competition under the guise of ESG.” 

While the lawsuit is playing out in the context of a declared national energy emergency, it has broader implications for investment in other industries as well as industry actions premised on “social justifications.” We will keep you updated.

UK merger control to see faster reviews, clarified jurisdictional tests and less intervention in global deals

The CMA has launched a consultation on proposed changes to its mergers guidance on jurisdiction and procedure and its mergers notice template. The consultation is the CMA’s latest move to implement the UK government’s “strategic steer”, and embed the “4Ps” (pace, predictability, proportionality and improved process) into practice.

There are four key takeaways.

First, to speed up reviews, the following key performance indicators (KPIs) apply to all cases where the draft initial merger notice has been submitted after June 20, 2025:

  • Pre-notification will typically be no longer than 40 working days—provided the merger parties have submitted a minimum level of information, they do not request a longer period, and the CMA does not disapply the KPI.
  • For “straightforward cases,”, the CMA aims to issue clearance decisions by working day 25 (down from 35 working days).

Second, the CMA is proposing additional engagement at the start of pre-notification:

  • A “teach-in” session for the case team and senior staff followed by informal update calls.
  • Publication of a case webpage, including an invitation for market feedback, in all but exceptional cases.

Third, ahead of the government’s imminent consultation on legislative revisions to the material influence and share of supply tests, the CMA provides welcome clarity on its current approach to these notoriously expansive jurisdictional tests. For example:

  • It sets out the main factors that are likely, individually or collectively, to give rise to material influence (including the level of shareholding held, the right to appoint members to the board, and the existence of financial, commercial and/or consultancy agreements). 
  • It confirms the metrics that the authority will typically focus on when determining whether the 25% share of supply threshold is met, and the goods and services it will consider.

Finally, the CMA clarifies that it is less likely to prioritize for investigation deals that concern exclusively global (or broader-than-national) markets. Instead, it may “wait and see” if action taken by other international authorities can resolve UK concerns so as to reduce the potential burden of duplicative investigations.

Read our alert for more detail on the CMA’s proposed amendments as well as the impact the changes will likely have in practice.

We will keep you updated on how the CMA’s approach to merger control enforcement evolves.

We will also report as and when legislative and regulatory proposals set out in the UK government’s Modern Industrial Strategy materialize. In addition to the consultation on potential reforms to the merger control jurisdictional tests mentioned above, the government plans to explore possible updates to the UK’s investment screening framework. It will consult on amendments to the 17 sensitive areas of the economy subject to mandatory notification, introduce new exemptions, and clarify guidance, all with the aim of providing certainty to investors.

Further progress towards a revised EU FDI Regulation as the European Council sets out its position

In last month’s Antitrust in focus, we reported that the European Parliament had reached its negotiating position on revisions to the EU Foreign Direct Investment (FDI) Regulation.

As a reminder, the revised regulation looks set to require all member states to adopt a national FDI screening regime—as of this month, 25 already have such a mechanism, with Greece being the latest adopter (see our article below). The new rules will require mandatory screening of foreign investments in certain specified sectors and ensure national rules are more harmonized. Expanding the scope of the regime to cover indirect investments is also likely, and we may see the European Commission (EC) gain more powers of intervention.

Ultimately, the impact of these revisions will depend on the detail of the updated regulation. 

The latest step in the process is the adoption by the European Council (Council) of its own position on the proposed amendments. Significantly, this differs from the European Parliament’s stance in some key areas, with the Council focusing on more limited harmonization and greater discretion for member states (favoring a more limited role for the EC). 

The Council also has its sights on a narrower list of sectors in which investment must be screened, restricting these to dual-use items subject to export controls and goods and technology listed in the EU Common Military List. 

The EC had proposed a much longer list, and the Parliament’s proposals added significantly to this. However, while the Council proposes that member states should consider the availability of technologies contained in this longer list when determining whether a foreign investment is likely to negatively affect security or public order, it does not propose that investment in these sectors should be subject to mandatory screening. In this longer list, the Council is on board with some of the additions put forward by the Parliament but has not, for example, accepted the Parliament’s proposal to add areas such as media services or types of transport industries.

These divergences will make for some interesting, and no-doubt animated, debates between the two institutions and the EC as they negotiate to reach a final revised text. The discussions kicked off in mid-June. 

We will update you as we learn more.

Greece adopts its first foreign investment screening mechanism

A new Greek foreign investment law has established a mandatory, suspensory regime. Acquisitions of, or increases in, shareholdings or voting rights in Greek undertakings operating in “sensitive” or “highly sensitive” sectors must obtain prior approval if sector-specific thresholds are met:

Investments in “sensitive” sectors—including energy, transport, digital infrastructure, and healthcare—are subject to screening (solely) when a non-EU investor acquires at least 25% of the shares, voting rights, or equivalent participation.

Investments in “highly sensitive” sectors—including defense, dual-use items, cybersecurity, artificial intelligence, and certain tourism infrastructure in border areas—are subject to screening when a non-EU investor (or an EU investor in which a non-EU person holds, directly or indirectly, at least 10% of share capital or voting rights) acquires at least 10% of the shares, voting rights, or equivalent participation. Subsequent add-on acquisitions trigger a new screening if 20%, 25%, 30%, 40%, 50%, and/or 75% ownership is reached or exceeded.

There is a carve-out for portfolio investments, but it is limited to natural persons who acquire shares solely as a financial investment (i.e., without any intention or ability to influence the management or control of the target). Institutional investors and legal entities are expressly excluded from the exemption, regardless of whether their investment is passive in nature.

Read our alert to find out more about the Greek regime—the notification obligation, review period and sanctions for non-compliance—and how it aligns with planned revisions to the EU FDI Regulation (discussed above). Notably, this latest development has left Cyprus and Croatia as the sole EU member states without foreign investment screening laws.

EC to take account of the need for “defence readiness” in its merger control and antitrust enforcement

In the context of escalating geopolitical tensions and a growing emphasis on the EU’s strategic autonomy, the EC has unveiled its “Defence Readiness Omnibus”—a package of measures aimed at reducing regulatory friction and mandating a shift to an EU defense-readiness mindset to facilitate up to EUR800 billion in defense investments over the next four years.

The measures cover a broad range of areas, including defense procurement, license permitting, access to financing, and environmental and chemical legislation. There is an acknowledgement that ensuring competitive defense markets is critical to delivery of innovative technology solutions as well as agile supply chains and value for money for defense budgets. However, the EC is seeking to clarify certain areas of antitrust law where it creates “disproportionate or unintended constraints on defence activities.” 

First, as part of the EC’s ongoing review of its merger guidelines, there is a suggestion that consolidation in the industry could be positive and that the authority plans to introduce guidance specific to mergers relating to security or defense. 

While security and defense considerations are generally the privilege of EU member states, the authority does retain jurisdiction over cases involving competition related to dual-use goods and is competent to review mergers in the defense sector more generally. It therefore calls for feedback on whether guidance on the interaction between member states’ security and defense interests and the EC’s competition assessment could be useful. It also asks how a potential balancing of interests between defense and competition objections could be undertaken.

In the omnibus, the EC confirms that it will give “adequate weight” to the changed security and defense environment. In particular, when conducting merger reviews, the EC will assess “the overall benefits from enhanced defence and security” within the EU “leading to efficiencies.” The EC’s commissioner for defence and space reportedly stated that the EC’s rules “will not be an obstacle” for companies wishing to “unite their forces.”

Second, the EC “stands ready” to provide antitrust guidance on cooperation projects in the defense sector. It anticipates that this could arise where collaboration is necessary to scale up production, where individual companies would otherwise be unable to develop or manufacture a product on their own or where defense companies wish to jointly procure raw materials.

Notably, the EC will consider any efficiencies generated such as the positive effects of defense readiness and resilience of defense supply chains.

We will keep you updated on the defense-related aspects of the EC’s merger guidelines review as well as on any guidance published that clarifies how defense collaborations can stay on the right side of the law. 

EC’s merger control assessment of basic industries M&A focuses on capacity and “pivotality”

Many companies active in chemicals, steel and other basic industries are no strangers to the need to factor in merger control risk when assessing the feasibility of a strategic transaction. In recent years, however, the EC’s approach to merger control enforcement in these sectors has evolved, with new analytical metrics coming to the fore.  

In summary, when assessing the competitive impact of M&A in an industrial context, the EC now focuses on the share of capacity of the parties and their rivals (placing less weight on market shares based on sales to third parties). A more sophisticated approach to geographic market definition has also been adopted in recent years, using catchment areas determined by measurable distance or time rather than national- or EEA-wide markets. 

And, significantly, the EC now refers to a concept of “pivotality”. A merged firm may be considered pivotal when all other competitors are unable, together, to cover the entire demand in the market. Deals between pivotal companies are more likely to raise antitrust concerns.   

Overall, this focus on physical structural metrics has important implications for deal planning and the role of imports in the assessment. It could give rise to hurdles in markets even where there is spare capacity. 

Our recent alert examines these issues in more detail. Based on analysis by EC officials, alongside our observations of the authority’s enforcement practice, we give insights on the EC’s current approach to merger control assessment in basic industries. We look at the challenges that may arise, especially in the context of today’s uncertain geopolitical environment. We also set out key practical considerations for parties considering industrial and manufacturing deals, including useful factors for assessing deal feasibility and how any antitrust concerns may be addressed. 

Need-to-Know: updates on U.S. antitrust litigation

Our Need-to-Know Litigation Weekly publication analyzes notable U.S. litigation decisions, orders, and developments. From an antitrust perspective, we have featured the following cases over the past month:

See the full Need-to-Know Weekly for more commentary. If you would like to be added to the distribution list, contact us at litigation_weekly@aoshearman.com.   

A&O Shearman Antitrust team in publication

Recent publications by members of the team include:

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