“Pivotal Capacity”: A New Measure of Market Power in EU Merger Control

“Pivotal Capacity”: A New Measure of Market Power in EU Merger Control

On 30 April 2026, the European Commission published draft merger guidelines that merge two decades-old texts into a single framework. The headline innovation rests on a deceptively simple question:

If one company left the market, could the remaining competitors meet demand on their own?

If the answer is no, that company is “pivotal” — and treated as holding significant market power, regardless of how modest its sales share may look.

A few takeaways for dealmakers:

→ The analysis shifts from sales shares to capacity. Low market share is no longer a safe harbour.

→ “We have spare capacity” is no longer enough — the Commission now probes whether competitors have the incentive to use it.

→ Narrower geographic markets mean imports risk being discounted unless their pressure is shown to be structural, not cyclical.

→ Yet the framework is two-sided: efficiency and benefit arguments now carry real weight, if backed by concrete, deal-specific evidence.

The lesson from Tata Steel / ThyssenKrupp still stands: “strengthening European industry” was not, on its own, enough to clear a deal. In this new era, what makes a transaction possible is often not the transaction itself — but the evidentiary architecture that holds it up.

Our short briefing note unpacks what this means in practice. 👇