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procedure against Poland for misuse of art. 21 of the EC merger regulation. The conflict ended in April 2006 with an agreement between Poland and Unicredito. According to this, Unicredito was allowed to merge Pekao and BPH under the condition that it would sell 200 of the 480 branches of BPH and the brand BPH itself, and that it would preserve employment at both Pekao and BPH for two years.

A different example of cross border merger was represented recently by the tripartite takeover of ABN AMRO by the consortium formed by RBS, Santander and Fortis. The Commission imposed remedies consisting in the upfront divestiture of ABN AMRO’s Dutch factoring subsidiary and part of its commercial banking business in the Netherlands because of overlap with Fortis (which was perceived to be an aggressive competitor in those markets). In this case it is notable that the Dutch supervisor did not put obstacles to a cross-border acquisition that has as objective to partition the local bank and integration by pieces in the three acquirers.

The cases described above show how Member States can abuse the provision of art. 21(3) so to protect and strengthen national interests. This is further worsened by the potential discretion embedded in the supervisory control. Until recently, the national supervisory regulations for the prudential assessment of mergers and acquisitions lacked specificities in terms of the evaluation criteria, procedural rules and –in most cases–transparency; and, according to a survey conducted by the Commission in April 2005, the “misuse of supervisory powers” represented one of the main obstacles to cross-border consolidation. Competition policy can therefore play a crucial role not only in watching and preventing excessive market power, but also in limiting the discretion and power of national supervisors. This claim is also supported by the empirical results in Carletti et al. (2007) that the opaqueness of the supervisory control of M&As leads to inefficiencies in the supervisory process that can be at least partly removed by strengthening merger control. The need to ensure more transparency and legal certainty in the supervisory control led recently to the adoption of Directive 2007/44/EC of the European Parliament and of the Council of 5 September 2007 (the “Qualifying Holdings Directive”). The new Directive, which must be implemented by March 2009 and is based on the approach of maximum


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