The European Commission has adopted interim measures to restore and maintain the conditions of effective competition following Illumina's early acquisition of GRAIL, which is in breach of the standstill obligation under the EU Merger Regulation.
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Executive Vice President Margrethe Vestager, in charge of competition policy, said: “By implementing their merger while the Commission's in depth investigation into this transaction is still ongoing, Illumina and GRAIL have put at risk the effectiveness of our ex ante merger control enforcement.
"This is why we are adopting today measures aiming to prevent harm to competition in the interim period until our final decision on the substance of the case is taken. In designing the interim measures, we made sure GRAIL and other companies can continue developing their innovative cancer detection technology so that it can reach patients as quickly as possible, thus saving many lives.â€
On 22 July 2021 the Commission had opened an in depth investigation into the effects of the proposed combination of Illumina and GRAIL. Shortly thereafter, on 18 August 2021, while the Commission's review was ongoing Illumina publicly announced that it had completed its acquisition of GRAIL.
On 20 September 2021, the Commission sent a Statement of Objections to the two companies informing them of the interim measures it intended to adopt in response to their alleged breach of the standstill obligation under the EU Merger Regulation.
In particular, the interim measures provide that:
• GRAIL shall be kept separate from Illumina and be run by (an) independent Hold Separate Manager(s), exclusively in the interest of GRAIL (and not of Illumina).
• Illumina and GRAIL are prohibited from sharing confidential business information, except where the disclosure is required to comply with the law or in line with the ordinary course of their supplier-customer relationship.
• Illumina has the obligation to finance additional funds necessary for the operation and development of GRAIL.
• The business interactions between the parties shall be undertaken at arm's length, in line with industry practice, hence without unduly favouring GRAIL to the detriment of its competitors.
• GRAIL shall actively work on alternative options to the transaction to prepare for the possible scenario in which the deal would have to be undone in case the Commission were to declare the transaction incompatible with the internal market.
In parallel, and as communicated on 20 August 2021, the Commission will continue to investigate whether Illumina's and GRAIL's decision to implement their transaction pending the Commission's in depth investigation constitutes an infringement of the EU Merger rules that may trigger the imposition of fines under Article 14 of the EU Merger Regulation. If the Commission were to conclude that Illumina and GRAIL are liable, it could impose a fine of up to 10% of the companies' annual worldwide turnover. ■