Geographical allocation of turnover in aviation mergers: What the European Commission recently hold
The European Merger Control Regulation (ECMR) stipulates that only concentrations with a European dimension fall within the regulatory jurisdiction of the European Commission to review. A concentration is presumed to have such a dimension when it meets the financial threshold in Article 1 of the ECMR. To this end, it is necessary to calculate the turnover generated by the merging parties within the Community or in one or more member states. However, the geographical allocation of the turnover required by Article 1 for the purpose to establish the Commission’s jurisdiction can be a tricky issue in case of mergers between undertakings with a cross-border activity such airliners. In fact, the activities of airlines span several countries as they typically operate flights and sell tickets in many national markets. Recently, the Commission has dealt with the issue at length in the Ryanair/Aer Lingus case. It identified three possible methodologies for geographical allocation of turnover: -