Publications

On July 13, 2006, in IMPALA v. Commission, the European Court of First Instance (CFI) surprised nearly all observers by reversing the European Commission’s 2004 decision that had approved the creation of the joint venture between Sony and Bertelsmann combining their recorded music businesses (SonyBMG). In a decision with implications well beyond the specific facts of this joint venture, this is the first time the CFI has reversed a Commission decision that had unconditionally authorized a transaction. The CFI’s IMPALA decision (i) broke new ground by potentially dismantling a joint venture that has been operating for two years; (ii) asserts closer control by the European Courts over the Commission’s decision-making; (iii) further empowers third-party competitors in the EC merger review process, including now the judicial review of merger decisions; and (iv) portends another GE/Honeywell-style debate between the European regime and the U.S. antitrust authorities, which had approved the SonyBMG joint venture in 2004 without the issuance of a Second Request. This memorandum addresses this recent decision of the European Court of First Instance.