456 14 Excursion: Merger Control
concerned and, possibly, attach to its decision conditions and obligations;^58 or (3)
declare that the concentration is incompatible with the common market.^59
Conditions and commitments. It is normal to modify a notified concentration by
offering commitments with a view to rendering the concentration compatible with
the common market. The Commission may attach to its decision conditions and
obligations intended to ensure that the undertakings comply with the commit-
ments.^60 Such commitments should be proportionate to the competition problem
and entirely eliminate it.^61
In the Boeing/McDonnel Douglas case, for example, the Commission had several concerns
such as the potential spillover of benefits from the McDonnell Douglas defense business to
the Boeing commercial airplane business, the market share of Boeing, and the existence of
exclusive supplier agreements with commercial aircraft purchasers. Because of the Com-
mission’s concerns, Boeing agreed, among other things: to license patents obtained under
US government-funded contracts to commercial aircraft manufacturers on a non-exclusive,
reasonable-royalty basis; not to leverage customer support provided for existing McDonnell
Douglas commercial aircraft to obtain any advantage in sales of new commercial aircraft;
not to enter into any new “exclusive” supplier agreements with commercial aircraft pur-
chasers until 1 August 2007, except where another aircraft manufacturer has offered such
an agreement; and not to enforce the exclusivity provisions in its existing agreements with
certain US airlines.
Another example of the use of conditions is the takeover of BOC by Linde. In July 2006,
the European Commission approved the acquisition of BOC, a British company, by Linde,
a German company. Both companies were active in the market for industrial and specialty
gases. The clearance was conditional upon the following commitments: (i) the divestiture
of Linde’s industrial gas business in Britain; (ii) the divestiture of BOC’s industrial and
specialty gas business in Poland; (iii) cutting BOC’s structural links with French Air Liq-
uide in a number of Asian joint ventures; and (iv) divesting several helium wholesale sup-
ply contracts of both Linde and BOC.
Some conditions are core conditions without which the concentration would be
deemed to significantly impede effective competition or without which the criteria
for derogating from Article 81(1) of the EC Treaty would not be possible. Breach
of such conditions can carry heavier sanctions.^62 If the concentration is imple-
mented, it is treated in the same way as a non-notified concentration implemented
without authorisation. Where the Commission has already found that, in the ab-
sence of the condition, the concentration would be incompatible with the common
market, it can directly order the dissolution of the concentration, so as to restore
the situation prevailing prior to the implementation of the concentration.^63
Sanctions for non-compliance. The EC Merger Regulation provides for sanc-
tions for non-compliance. Some of them apply to breach of a condition. Others
(^58) Article 8(2) of Regulation 139/2004 (EC Merger Regulation).
(^59) Article 8(3) of Regulation 139/2004 (EC Merger Regulation).
(^60) Article 6(2) of Regulation 139/2004 (EC Merger Regulation).
(^61) Recital 30 of Regulation 139/2004 (EC Merger Regulation).
(^62) Article 8(4) of Regulation 139/2004 (EC Merger Regulation).
(^63) Article 8(4) of Regulation 139/2004 (EC Merger Regulation). See also recital 31.