EU Takeover rules-(11.06.02)

The European Court of Justice has delivered a ruling that may increase takeovers across Europe, particularly for the Utility industries. The way the European Commission have interpreted the ruling, designed to prevent protection of privatised companies from cross-border takeover bids, is to suggest that a takeover should be allowed if it can be shown to be in the interest of consumers. The interpretation of consumer interest appearsr to be based on cost savings to the firms themselves that could theoretically be passed on to consumers within regulated markets, although this last part is not clear at the moment. It is the definition of this last part, as to how cost savings can be interpreted more or less directly as relating to consumer interest that may determine the success in encouraging more competitive European utility markets.