IMPALA CONTINUES ITS OPPOSITION TO THE UNIVERSAL/EMI MERGER
Brussels, 17th July 2012
At an IMPALA board meeting yesterday, the board voted to continue its opposition to the Universal/EMI merger, underlining its concerns that any remedies would have to be able to deal with the concerns raised by the European regulators regarding the impact of the merger.
IMPALA will comment on any proposed remedies in due course when the EC market tests them. The EC is subject to strict rules and has to ensure any undertakings completely eliminate all problems identified, otherwise it is obliged to reject the proposed remedies.
Helen Smith, Executive Chair of IMPALA commented: “Our board took a clear decision yesterday to continue its opposition to the Universal/EMI merger, rejecting remedies which do not deal with the specific problems set out in the EC’s statement of objections. The issue isn’t just digital, it’s physical and access to media- exposure for new artists, as well as the foreclosure of independents when it comes to signing artists. We all respect Patrick Zelnik’s view, but the FT article is the Naive position, not the Impala position.”
IMPALA agrees that digital companies are giants and need proper regulation, but the problem is that excessive concentration in the music sector would help Universal mould services towards its own interests and obtain more than its fair share of exposure. This result repeats itself all the way from offline to access to media to signing artists. That is the underlying issue which needs to be addressed. From where we are sitting right now with what we know about the EC’s objections, that seems a tall order.
IMPALA has made its position clear to the European Commission. The rules governing the European Commission’s approach to dealing with remedies are set out in a remedies notice, which it is obliged to comply with.
IMPALA normally takes decisions by consensus and its statutes allow decisions to be taken by two thirds majority in the absence of unanimity. IMPALA is a large and diverse community and of of its strengths is its ability to encompass a range of varying personal views. At yesterday’s meeting 25 board members voted and the result was a rejection of remedies not dealing comprehensively with the problems identified above.
IMPALA was established in April 2000 to represent European independent music companies. One of IMPALA’s missions is to keep the music market as open and competitive as possible. IMPALA has an impressive record on competition cases in the music sector. The first EMI/Warner merger was withdrawn in 2001 following objections from the EU after IMPALA intervened, in its first year of existence. It also won a landmark judgment in 2006 in the Sony/BMG case, and when Sony acquired 30% of EMI publishing in 2012, it was at the cost of significant divestments. The biggest set of remedies proportionately ever in a merger case was secured later that year, when UMG was forced to sell two thirds of EMI records and had to accept ten years of scrutiny over the terms of its digital deals. When WMG bought Parlophone in 2013, IMPALA secured a hefty divestments package for its members. On top of mergers, IMPALA has also been involved in other anti-trust cases involving the music sector, such as the abuse complaint against YouTube in 2014 and the call for regulating unfair business practices by large online players. IMPALA has also submitted observations on Apple’s bid to acquire Shazam. See the organisation’s other key achievements in IMPALA’s milestones.
IMPALA – Independent Music Companies Association
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