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- Tzanaki, Anna
(author)
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Antitrust’s Increasingly Long Arm: (Minority) Private Equity Investors Beware
- 2022
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In: CPI Antitrust Chronicle. - 2168-1155. ; October 2022
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Journal article (peer-reviewed)abstract
- Where do competition, antitrust and private equity intersect? Once antitrust’s favored child compared to strategic buyers, private equity seems to have fallen from competition enforcers’ grace. Interestingly, this is part of a broader trend: financial investors in general, from BlackRock to Blackstone, have come into the antitrust spotlight. Being a minority financial investor is no longer reason for antitrust immunity. Economic theory and competition policy have been shifting. Common ownership of small stakes in rival firms by institutional investors, even if passive, can create harm. Rollup acquisitions by active private equity investors may also raise concerns under given circumstances. How is the law reacting to economists’ and policymakers’ nods? With interest on both sides of the Atlantic. Competition law enforcement signals no empty threats, but rather an eagerness to cover blind spots. What is particularly intriguing is that the US and the EU, for reasons of path dependence and system design, have chosen different legal paths to achieve the same goal. What about politics? It is also here (to stay). Antitrust’s recent (over)reach into finance suggests a (renewed) balancing act between competition in product markets and in the market for corporate control, with not only legal and economic underpinnings but also political ramifications.
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- Tzanaki, Anna
(author)
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Varieties and Mechanisms of Common Ownership: A Calibration Exercise for Competition Policy
- 2022
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In: Journal of Competition Law & Economics. - : Oxford University Press (OUP). - 1744-6414 .- 1744-6422. ; 18:1, s. 168-254
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Journal article (peer-reviewed)abstract
- Minority shareholdings have been on the regulatory agenda of competition authorities for some time. Recent empirical studies, however, draw attention to a new, thought-provoking theory of harm: common ownership by institutional investors holding small, parallel equity positions in several competing firms within concentrated industries. While critical voices abound, EU and U.S. antitrust agencies closely follow these developments indicating an appetite to act. This article connects the common ownership debate to merger control and explores: i) the aims and scope of legal control as regards partial acquisitions in different jurisdictions; ii) the nature of potential competition effects arising from passive minority shareholding; and iii) the plausibility of common owners' anticompetitive strategies from a corporate governance perspective. Drawing a distinction between "concentrated" and "diffuse" common ownership, it sheds light on the different supporting mechanisms and varying harm potential of each variety. "Passive influence "mechanisms characterizing "diffuse" common ownership may not only generate plausible and material competition concerns in given circumstances but present challenges for the effective jurisdictional and remedial design of merger law frameworks. Competition policy should stay current by explicitly recognizing these novel insights in enforcement practice and developing guidelines on how to treat common ownership cases in the future.
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