The Court of Justice of the European Union (CJEU) annulled a decision made by a lower court to void the European Commission’s (EC) block of a proposed acquisition of O2 UK by CK Hutchison’s local unit in 2016, sending the case back for re-examination.
In its judgement, the CJEU pointed to a number of errors in the General Court of the European Union’s determination in 2020, which had rejected the grounds for the EC scuppering the deal.
Explaining its decision to have the case reassed by the lower court, CJEU pointed to the “breadth, nature and scope of the errors” which “affect the General Court’s reasoning as a whole”. The latest case followed an EC appeal.
An order to the General Court to re-examine the case is despite attempts to combine the two companies being long abandoned, with O2 now united with fixed player Virgin Media and CK Hutchison’s 3 UK in the process of attempting to tie-up with Vodafone’s business in the country.
The latter proposal will come under the jurisdiction of UK authorities following the country’s exit from the European Union in 2020.
However, the decision surrounding the EC’s block of the O2/Hutchison deal may have a knock-on impact on future M&A activity in the European Union, especially where it cuts the number of mobile players in a specific market.
One such case currently being investigated by the EC is a proposed tie-up between the Spanish units of Orange and Masmovil.