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Independent Music Companies Call For Enquiry Into EC's Approval Of SonyBMG Merger
By Mi2N
(more articles from this author)
2007-10-04
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IMPALA calls for a formal enquiry into the news that the EC has cleared the SonyBMG merger a second time without remedies. The independents take the view that this is indefensible. The Commission has ignored major findings of the European court in favour of IMPALA last summer. The independents will ask the European Ombudsman to investigate potential maladministration. IMPALA will examine the decision in detail when the non-confidential version becomes available. As well as a formal enquiry, there is the option of appealing, and a clear case for claiming damages against the EC.

The EU's first approval was set aside last summer by the European Court. The judges found that the Commission had wrongfully approved the merger without remedies, despite overwhelming evidence that competition would be severely damaged. IMPALA takes the view that the Commission has simply made many of the same mistakes all over again. It ignored the independents' evidence of anti-competitive behaviour across all key markets. Moreover, the Commission did not consider the non-price effects of the merger on consumer choice and diversity, as well as competitive access to retail, radio and online. No cultural diversity impact assessment was carried out, despite an EC Treaty obligation to do so.

The independents also highlight the fact that the EC is sending contradictory messages to Europe's citizens, artists and entrepreneurs. It seeks remedies from UniversalBMG but not SonyBMG. It pushes an "Agenda for Culture" to make sure culture and all creative industries are properly prioritised in other key policy areas, but what about competition? It signs the UNESCO Convention on Cultural Diversity with a fanfare, yet breaches its own Treaty obligations to take cultural diversity into account in all decisions. It acknowledges the vital role of SMES in all creative sectors yet takes decisions which restrict their market access.

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