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142 Working Paper

The Politics of Antitrust and Merger Review in the European Union: Institutional Change and Decisions from Messina to 2004

2007 – Tim Büthe and Gabriel T. Swank


Antitrust regulation and the related merger review are essential for making a market economy work. Merger review is also among the most prominent powers of the European Commission in the Common Market of the EU. How did this supranational actor come to acquire such power? And what explains the variation in the Commission's decisions in some of the trans-atlantically most controversial merger review cases in recent years? In this paper, we develop a modified neofunctionalist theory as a historical institutionalist theory of institutional change that integrates elements of rational choice and social constructivism. We argue that it provides a superior explanation of (1) the institutional development of the European Commission's competence over antitrust matters and merger review from the 1950s negotiations over the Treaty of Rome through the changes of 2004 and (2) the Commission's decisions in some of the most prominent cases, where a high level of politicization makes a neofunctionalist explanation least likely.