A suggested modernized framework can facilitate growth and broader benefits for consumers in many European sectors.
Brussels, February 5, 2026: According to a new report, European merger guidelines must go beyond their narrow focus on short-term static effects and encompass longer-term considerations such as innovation, investment and capacity development.
A dynamic framework for evaluating horizontal mergersprepared by BRG and commissioned by the GSMA with support from Connect Europe, proposes a conceptual framework to support the European Commission's review of its Guidelines on horizontal and non-horizontal mergers.
This comes as the European Commission recognized in last year's Competitiveness Compass that the existing policy framework must evolve to reflect modern dynamics and enable businesses to grow in global markets, while maintaining a level playing field in the Single Market. The 2024 Draghi report also recommended that greater weight should be given to innovation, resilience and investment intensity in merger policy.
Incorporation of dynamic effects.
The report identifies several underlying flaws in the current Horizontal Merger Guidelines.
These include: a highly risk-averse approach that discounts longer-term dynamic effects; the central assumption that mergers are more likely to harm competition than improve it; the asymmetric treatment of pro- and anti-competitive effects; and the drawback of the current sequence of analysis, in which efficiencies are treated as trade-offs to an already formed theory of damage.
To address these concerns, the framework proposed in the report introduces a symmetrical approach to assessing adverse and positive effects together in the core competitive assessment.
Ultimately, a three-step approach is proposed: the identification of relevant dimensions of competition that drive consumer well-being in a given industry; the development of a theory of competitive effects (and not only damage) for each competitive dimension; and integrating efficiencies into core competitive assessment.
The proposed framework consists of the following key recommendations on how to update the Commission's approach to assessing horizontal mergers:
- Consider all effects from the beginning: Mergers should be evaluated by looking at both the potential benefits and potential harms together, rather than treating them separately or at different stages of the process.
- Balance benefits and risks consistently: Positive and negative effects should be measured using the same clear standard of “more likely than not,” avoiding an unrealistically high standard for recognizing benefits.
- Take a broader view of consumer well-being: Evaluations should consider the general well-being of the consumer, including not only prices but also quality, choice and innovation. They should also reflect the broader impact on society, rather than narrowly focusing on particular groups of consumers.
- Be clear about the counterfactual/baseline scenario: The assessment should explicitly describe what the market would be like without the merger and use it consistently when assessing both potential harms and benefits.
- Use market indicators wisely: Measures such as market share are useful as a first check, but should not automatically determine the outcome of a case.
- Focus on holistic evidence: Decisions should be based on detailed mechanism-based evidence showing how mergers will affect prices, quality, investment and innovation; no single metric should be used as a shortcut.
- Avoid automatic assumptions: Indicators should guide the analysis, but should never be treated as evidence of the effects of a merger on their own.
- Scale the analysis to the case.: The framework should be flexible and increase in depth and complexity only as necessary to decide whether a full competitive review is necessary.
This approach would ensure that merger control is forward-looking, balanced, evidence-based and focused on what really matters to consumers, including price, quality, innovation and long-term investment, while avoiding one-size-fits-all assumptions.
The report includes case study examples of how this new framework would be applied in various sectors, including retail, life sciences and telecommunications.
Vivek Badrinath, CEO of GSMA, comments: “Optimizing consumer well-being is the most important objective of merger analysis.
“The current approach to merger assessments does not give adequate weight to the dynamic elements that can lead to merger assessment results that have a detrimental long-term impact on innovation, growth, investment and, ultimately, consumer well-being.
“As the Commission moves forward with its review of the Merger Guidelines, it is imperative that a modernized and broader-based consumer welfare approach is included in the core merger assessment analysis to empower European industries and enable them to grow in global markets.”
Alessandro Gropelli, CEO of Connect Europe, comments: “Europe cannot afford to stand still. In an era of intense economic and geopolitical competition, fragmentation has become a strategic liability. Lack of scale is holding back investment, innovation and technological sovereignty in all industries. In connectivity, the warning signs are clear: despite having more operators.
“Europe is underinvesting and lagging behind global peers in advanced 5G. Merger policy must urgently evolve, adopting a more dynamic and forward-thinking approach that enables scale, unlocks long-term investment and strengthens Europe's resilience, while continuing to meet consumer requirements.”
To read the full report, see here.
ENDS
About the GSMA
The GSMA is a global organization that unifies the mobile ecosystem to discover, develop and deliver critical innovation for positive business environments and social change. Our vision is to unlock the full power of connectivity so that people, industry and society thrive. Representing mobile operators and organizations across the mobile ecosystem and adjacent industries, the GSMA offers its members three broad pillars: connectivity for good, industry services and solutions, and outreach. This activity includes advancing policy, addressing today's biggest societal challenges, supporting the technology and interoperability that make mobile devices work, and providing the world's largest platform to convene the mobile ecosystem at the MWC and M360 series of events.
We invite you to learn more at gsma.com
Media contact
GSMA Press Office
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About Connect Europe
Connect Europe is the voice of Europe's leading network and connectivity service providers. Our members are at the forefront of innovation in the telecommunications and technology ecosystems, connecting more than 270 million Europeans with next-generation mobile and fixed networks, such as fiber and 5G. They also provide advanced services, ranging from world-class IT, artificial intelligence and cybersecurity solutions to entertainment and content. As leading industry investors, our members drive the continent's digital transformation and represent more than 70% of total investment in the telecommunications sector in Europe. Formerly known as ETNO, we advocate for an improved policy and regulatory environment that enables citizens and businesses to benefit from digital connectivity and services. www.connecteurope.org
Media contact
Oscar Berardi
[email protected]
About BRG
BRG combines world-leading academic credentials with proven business expertise around the world, specifically designed to deliver agility and connectivity, which sets us apart and moves our clients forward.
Our world-class experts include seasoned industry leaders, renowned academics, and cutting-edge data scientists. Together, they bring a diversity of proven real-world experiences to economics, disputes and research; corporate finance; and performance improvement services that address the most complex challenges for organizations around the world.
Our unique structure fosters the interdisciplinary relationships that give us the advantage, laying the foundation for more informed insights and more original, incisive thinking from diverse perspectives that, when combined with our global reach and resources, make us uniquely capable of addressing our clients' challenges.
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