No. 68: The Article 7 EUMR Prohibition Implementation and Conduct of Business-Clause as Legal Measure of Risk Minimization


  • Tomislav Jurić
Publish Date:
September 27, 2022
Publication Title:
European Union [EU] Law Working Papers
Stanford Law School
Working Paper
  • Tomislav Jurić, The Article 7 EUMR Prohibition Implementation and Conduct of Business-Clause as Legal Measure of Risk Minimization, EU Law Working Papers No. 68, Stanford-Vienna Transatlantic Technology Law Forum (2022).
Related Organization(s):


This paper examines the EU competition law aspects of the prohibition on the implementation of a merger under Article 7 of the EU Merger Regulation and the Conduct of Business-Clause as a risk mitigation measure. Under the EU Merger Regulation, parties to concentration must notify the European Commission of a proposed transaction that reaches the prescribed Community dimension. The merging parties are initially subject to a standstill obligation, i.e. they may not take any measures to integrate the target company into the seller’s portfolio ahead of time until the Commission has approved the transaction. However, mere preparatory acts for the pending concentration do not constitute a violation of the implementation prohibition within the meaning of Article 7 EUMR and may be carried out by the parties to the merger. The demarcation between preparatory acts and early integration measures has not been conclusively clarified by the EU judicial bodies and represents a “grey area” of the EU Merger Regulation. In a not inconsiderable number of cases, the EU Commission has imposed significantly high fines on the offenders for violations of the implementation prohibition and has thus increasingly become the focus of public attention. In one of its most recent decisions, the EU Commission names concrete preventive measures that serve to protect the parties in the period between notification and approval of the transaction, including Conduct of Business-Clauses that are part of the share purchase agreement. Nevertheless, caution must be exercised in their formulation, as a too far reaching Conduct of Business-Clause constitutes a premature integration of the target company and thus a violation of Article 7 EUMR: The aim of this article is therefore to highlight the legal nature of the Conduct of Business-Clause and its suitability for solving the above-mentioned competition law issue.