Frank L. Fine


The wave of mergers and acquisitions experienced during the last several years in the United States is now on its way to Europe. The Commission of the European Communities ('Commission') recently reported that cross-border mergers and stock purchases of majority shareholdings in the European Community ('EC' or 'Community') have surged from 29 in 1983-1984 to 52 in 1985-1986. Acquisitions by non-EC companies, particularly United States and Japanese firms, are also likely to increase dramatically. The Community has become a field ripe for merger activity largely because both European and non-European companies are keen to position themselves in anticipation of '1992,' the target date for the integration of the EC Internal Market. In the absence of a strong, uniform counterweight to this pressure to merge, competition in the Community could suffer or become distorted. Merger mania may mean that stagnant national economies and high unemployment could become the legacy of 1992. In light of these developments, it is likely that the Draft Regulation, in a form approximating that of the April 1988 text, will be adopted by the Council in the coming months.