EU telecom merger rules face pressure to balance competition, innovation and scale

As the European Commission reviews its approach to telecom mergers, industry leaders and regulators are argument over balancing competition safeguards with the need for scale and investment, with potential implications for Europe’s digital future.

As the European Commission re-examines its approach to merger control, a debate has intensified over whether consolidation in telecommunications will deliver the scale and investment policymakers seek or instead imperil competition, innovation and consumer choice. According to the original report, MVNO Europe has warned that reducing the number of operators “for the sake of scale” risks higher prices, weaker competition and a fragmentation of the Single Market unless future mergers guarantee fair wholesale access, safeguards for innovation and balanced oversight. [^[1]^](https://insidetelecom.com/european-commission-merger-cases/)

The Commission’s recent moves to modernise merger guidance have widened the analytical lens beyond classic price-and-market-share metrics to include sustainability and innovation considerations. Industry observers point to the conditional approval of ADNOC’s acquisition of Covestro as a formative precedent: the deal was cleared only after commitments ensured “access to key Covestro patents in the field of sustainability,” a requirement framed as necessary to preserve competitive research and downstream innovation. That remedy signals Brussels is prepared to deploy remedies designed to stimulate, not merely preserve, competition. [^[1]^](https://insidetelecom.com/european-commission-merger-cases/)

MVNOs have pressed back against the narrative that consolidation is the principal route to investment. MVNO Europe stresses that its members underwrite almost the entire telecom value chain except the radio network itself, contributing billions in wholesale fees that support national infrastructure, and argues that competition , not fewer network owners , is the engine of Europe’s digital transition. Jacques Bonifay said “consolidation for its own sake does not foster innovation or investment,” and called for policy changes such as fit-for-purpose wholesale access, rejection of sector-specific leniency and protections for emerging connectivity markets where MVNOs often lead. [^[1]^](https://insidetelecom.com/european-commission-merger-cases/)

Brussels officials and national regulators are split on whether merger rules themselves block scale. EU antitrust chief Margrethe Vestager has defended current merger controls, saying competition , not easier consolidation , produces stronger companies and warning against loosening rules in a way that could weaken consumer outcomes. She argues that effective merger control has enabled the emergence of European champions without sacrificing internal competition. At the same time, senior Commission officials have emphasised that merger control targets market power rather than company size, and that acquisitions are permissible so long as they do not create excessive dominance. [^[2]^](https://www.reuters.com/markets/europe/vestager-defends-eu-merger-rules-says-competition-creates-strong-companies-2024-04-18/)[^[6]^](https://www.reuters.com/markets/deals/no-easier-merger-rules-telcos-eus-vestager-says-2024-02-19/)[^[4]^](https://www.reuters.com/sustainability/boards-policy-regulation/eu-rules-not-barrier-telcos-scaling-up-senior-eu-official-says-2025-10-29/)

Telecom industry leaders counter that the EU should take a more flexible view. Vodafone’s chief executive has urged the Commission to learn from the UK Competition and Markets Authority, which approved Vodafone’s merger with Three on the basis that long-term network investment and the presence of MVNOs would protect consumers. Executives have also proposed extending review horizons beyond the current 18 months to better capture investment trajectories and to assess the broader competitive landscape, not merely the headline number of mobile network operators. Those arguments informed a broader industry push for regulatory change, culminating in a high‑profile letter from major telcos urging President von der Leyen to relax merger rules to spur infrastructure investment. [^[3]^](https://www.reuters.com/business/media-telecom/vodafone-ceo-says-eu-could-learn-britains-merger-control-2025-02-04/)[^[7]^](https://www.reuters.com/business/media-telecom/major-telcos-urge-eus-von-der-leyen-ease-merger-rules-boost-investments-2025-10-28/)

The Commission has sought stakeholder input through a public consultation on revamping merger rules that explicitly invites views on competitiveness, innovation, decarbonisation and digitalisation. The exercise reflects a recognition that courts and markets have changed since current rules were last overhauled, but analysts caution that substantive overhaul is unlikely: the core tests have been upheld in successive rulings and national regulators in several member states have warned that fewer network operators could reduce service quality. The consultation therefore looks set to refine how benefits and harms are weighed rather than to overturn the fundamentals of EU merger control. [^[5]^](https://www.reuters.com/sustainability/boards-policy-regulation/eu-seeks-feedback-merger-rules-revamp-amid-pressure-businesses-2025-05-08/)

The contest playing out is substantive and consequential. If Brussels embeds sustainability and innovation into its enforcement toolbox while remaining sceptical of consolidation that risks market power, telecom mergers will face stricter scrutiny and more creative remedies. If, by contrast, the Commission loosens standards or national politics push for scale, consolidation could reshape Europe’s telecom landscape , with uncertain results for prices, choice and cross‑border services. For now, the future of connectivity in Europe will depend as much on how regulators define public‑interest benefits as on how operators justify scale as a path to investment. [^[1]^](https://insidetelecom.com/european-commission-merger-cases/)[^[5]^](https://www.reuters.com/sustainability/boards-policy-regulation/eu-seeks-feedback-merger-rules-revamp-amid-pressure-businesses-2025-05-08/)[^[4]^](https://www.reuters.com/sustainability/boards-policy-regulation/eu-rules-not-barrier-telcos-scaling-up-senior-eu-official-says-2025-10-29/)[^[2]^](https://www.reuters.com/markets/europe/vestager-defends-eu-merger-rules-says-competition-creates-strong-companies-2024-04-18/)

📌 Reference Map:

##Reference Map:

• [^[1]^](https://insidetelecom.com/european-commission-merger-cases/) (Inside Telecom) – Paragraph 1, Paragraph 2, Paragraph 3, Paragraph 7
• [^[2]^](https://www.reuters.com/markets/europe/vestager-defends-eu-merger-rules-says-competition-creates-strong-companies-2024-04-18/) (Reuters: Vestager defends EU merger rules) – Paragraph 4
• [^[3]^](https://www.reuters.com/business/media-telecom/vodafone-ceo-says-eu-could-learn-britains-merger-control-2025-02-04/) (Reuters: Vodafone CEO on CMA) – Paragraph 5
• [^[4]^](https://www.reuters.com/sustainability/boards-policy-regulation/eu-rules-not-barrier-telcos-scaling-up-senior-eu-official-says-2025-10-29/) (Reuters: Senior EU official on merger rules) – Paragraph 4, Paragraph 7
• [^[5]^](https://www.reuters.com/sustainability/boards-policy-regulation/eu-seeks-feedback-merger-rules-revamp-amid-pressure-businesses-2025-05-08/) (Reuters: EU seeks feedback on merger rules) – Paragraph 6, Paragraph 7
• [^[6]^](https://www.reuters.com/markets/deals/no-easier-merger-rules-telcos-eus-vestager-says-2024-02-19/) (Reuters: Vestager not easing telecom rules) – Paragraph 4
• [^[7]^](https://www.reuters.com/business/media-telecom/major-telcos-urge-eus-von-der-leyen-ease-merger-rules-boost-investments-2025-10-28/) (Reuters: Major telcos urge easing rules) – Paragraph 5

Source: Fuse Wire Services