Brussels, 13th February 2026

Following the European Commission’s decision on UMG/Downtown, IMPALA underlines its key conclusions from the process, as well as the challenges and opportunities for the future in terms of the market and sector regulation:

IMPALA’s key messages are: 

Our conclusions:

1. IMPALA welcomes the EU taking on the case and executing a detailed merger investigation, ultimately securing concessions in a key economic market which has huge strategic importance for Europe. This is telling as it happens in a tiny fraction of merger cases, the most concerning ones. Only 1% of all mergers notified to the EC in 2025 went to a detailed Phase II investigation. Of the two Phase II decisions that were issued in 2025, and unlike UMG/Downtown, both were cleared without remedies, again underlining the strong stance of the EU on this particular case*.
    
2. The process reaffirms the key role of national competition authorities within merger control in Europe – both the Netherlands and Austria flagged concerns which enabled the EC to exercise authority and bring the case in for inspection. The investigation relied on an essential procedure in European merger control for national authorities (known as Article 22 referrals) and it is positive that this tool has been used to good effect in this case**.
    
3. The outcome demonstrates the clear risks of excessive expansionist policies. When acquisitions raise concerns, they will be subject to thorough and lengthy scrutiny (final decision was 14 months after the deal was announced) and structural remedies (divestments) will be required to address serious problems. Regulators won’t simply accept arguments that businesses can be run separately or that behavioural undertakings suffice. Investors and shareholders will be taking good note. Large-scale companies can benefit industries and markets, and all businesses need good exit options, but there is always a point when big is too big. There is an opportunity here for more independent growth in the market.
    
4. The fact that the market leader UMG has been able to become even bigger and control an even larger part of the sector is nonetheless a problem which will widen the gap between the majors and the independents. IMPALA will need to assess the decision when it is published to see what further action may be needed to correct any errors. IMPALA consistently set out that this case is not just about data. In addition, data concerns of course extend beyond Curve and we will need to examine the Commission’s decision in this regard. IMPALA also raised concerns about key aspects of the proposed sale of Curve to avoid a “hollow divestment” and is pleased to see that these issues appeared to have been addressed by the EC.
    
5. There are certain specificities in this case that clearly led to a rigorous assessment process as well as a particular outcome. All consolidation in the music sector, whether in distribution or other infrastructure, or recorded music, publishing or any other part of the music market such as live, will continue to be subject to heavy duty and lengthy regulatory screening. Similarly, concentration in other culture sectors or the digital market will also face tough hurdles.
    
6. IMPALA looks to UMG to set the example and for Virgin to facilitate an express transition system, free from penalties and exit fees, or obstruction or delays, or incentives to stay, for companies and artists who wish to retain independence in their supply chain. Enabling labels and artists to move to an independent distributor in an efficient way without friction, unreasonable costs or their data being kept is essential. This is a pre-requisite for respecting freedom of choice for labels and artists alike. In addition, IMPALA calls on UMG to follow the best practice guidelines set out in the Digital Distribution Switch Code, which was created by, and widely adopted across, the independent distribution sector to help make the mechanics of switching as smooth as possible.
    
7. There are opportunities if an “optimal ecosystem” can be achieved through sector wide collaboration, as also set out in the report Powering an Independent and Culturally Diverse European Music Ecosystem (full report / infographic) by analyst Dan Fowler earlier this month. Underlining the importance of diversity and independence in the ecosystem for the overall health of the sector, the report calls for targeted scrutiny, investment and industry collaboration. Streaming reform, manipulation, AI challenges as well as opportunities, market share assessments, and the use of the word “independent” in the sector, are all identified as key opportunities for collaboration within the sector.
    
8. Significant government and private investment and fiscal incentivisation are needed to enable interesting exit options for SME businesses and to help competitive independent rightsholders and infrastructure to grow across Europe. This is a key opportunity for the EU, currently deep in budget talks, and the governments of non-EU countries alike. The whole music economy, from artists to labels to distributors, big or small, will all be better off if there are more European champions not fewer.
    
9. At European and national level, decision-makers have powerful tools to ensure that important markets, like music, operate in a fair, competitive and healthy manner. If there is market dysfunction or abuse occurs or if expansionist policies of over-consolidation continue, regulators will be very busy. Alongside competition tools, regulators will need to identify their strategic ambitions for cultural industries and make sure their regulatory frameworks are fit for purpose. Diversity is a huge opportunity for Europe, as underlined in this report referred to above.
    
10. A reassessment of how merger control works in cultural industries is needed. In many ways the timing of UMG/Downtown is perfect as the European Commission has a real-world case study to feed into its ongoing review of its merger regulation framework. A sector specific approach is essential, especially in markets where the vast majority of innovation comes from micro, small and medium sized businesses who have a huge gap to the top three global players. The EU should also have the power to call in mergers which are too small to trigger an automatic review but which are nonetheless problematic***.  

Helen Smith, Executive Chair of IMPALA commented: “We thank the European Commission for their determination in taking this case all the way through a detailed Phase II investigation to securing structural concessions, as well as the national competition authorities who raised the alarm in the first place. In 2025, only two Phase II decisions were issued by the EC, neither of them resulting in any remedies*. We appreciate that this level of scrutiny is reserved for a tiny fraction of cases which raise serious concerns. With only 1% of all mergers notified last year going to Phase II and with conclusion arriving fourteen months after the deal was struck, the EC is sending a clear message about the risks of expansionist policies in music. At the same time, the final outcome falls short.” 

Dario Draštata, Chair of IMPALA, President of regional association RUNDA Adria and Executive Director of Dallas Records commented: “Getting this case reviewed is an impressive result for the independent sector and the impact will be felt across the industry for a very long time. The question of independence and neutrality in distribution will remain essential for IMPALA. Labels and artists will now take decisions based on what their priorities are. Some might prefer to work with major businesses, others will decide that independence is more important. What is essential is that independent distributors are able to grow and there is proper competition and real choice for artists and labels. Power in the digital market will remain an issue, as well as the impact on cultural diversity. We expect the EC to continue to monitor UMG and the music market very closely.” 

Francesca Trainini, IMPALA President and Vice President of Italian association PMI added: “It is now incumbent on UMG to set the example and ensure a friction free system without penalties or other charges for labels who want to move away and who are prepared to take on this huge task despite the difficulties and costs involved. If the EC believes labels are able to move, then it has to make sure it is a market reality.”

Martin Mills, Beggars Group Founder and Chair commented: “Once again IMPALA has demonstrated that any entities planning consolidation need to expect full scrutiny and regulator appetite to make full use of what they have in their toolkit. The unprecedented speaking out we have seen in the independent sector sends a clear message that the concerns are real, that they are global as well as European and that they are not going away. A level playing field is in the interests of all.”

Darius Van Arman, Secretly Group Co-CEO commented: “I am so encouraged by how effective IMPALA and the broader independent community was in this fight against further market concentration, forcing a serious review by the European Commission and extracting a meaningful remedy. More importantly, IMPALA’s work here makes market-bending acquisitions like this one harder to pull off in the future.”

Gee Davy, CEO of AIM, The Association of Independent Music continued: “We are grateful to the EC regulator for hearing the global independent community and drawing a line in the sand on excessive expansion. It was the unmissable chorus of concern that brought this investigation about, and it is collective strength that will help the independent music community through the challenges that persist beyond this outcome, to continue to invest in and develop truly diverse music. We will be looking to both the UK competition authority (CMA) and the EC’s monitoring trustee to ensure fair market behaviours moving forward to support that. UMG must now fully respect labels and artists freedom to leave without incentive or penalty and to follow the Digital Distribution Switch Code. There are many opportunities to work together to support and bolster the health of the independent music sector.” 

Birte Wiemann, Project Manager, Cargo Records Germany said: “Only yesterday, at the “informal retreat” in Belgium, European leaders discussed bolstering competitiveness for the European economy in the face of US and Chinese dominance. The UMG/Downtown case fits neatly into this narrative. While it is also about data insights and individual assets, the much larger point is free choice and market access for European independents outside of multinational, major structures. The work of the EU Commission has been impressive, especially in its Phase II thoroughness and scrutiny. While it is re-assuring that these European instruments are firmly in place for all upcoming mergers in the creative sector, the outcome of this particular case must remain an immense disappointment for all independents.”

Helen Smith, Executive Chair of IMPALA concluded: “This case matters because it impacts the resources that independent labels have to take risks with diverse artists and new releases and therefore cultural diversity. We completely agree with Commissioner Dombrovskis who says that ‘the music industry plays an important role in bringing artists’ creations to audiences, and it is essential to uphold the availability of diverse service providers for consumers’. This is why we will review the decision with forensic precision and see what our next steps are as we do not agree with the outcome, as it is difficult to see how this could be good for culture in Europe. We expect regulators to be on the look out for any abuse or dysfunction in terms of streaming revenue, cultural diversity, and the freedom of labels to move if they wish to retain independent distribution. This is also an opportunity for the sector to work together on an “optimal ecosystem” as Dan Fowler’s report highlighted last week.”

During the UMG/ Downtown process, concerns were raised across the music sector in an unprecedented way, with artists, independent businesses and other parts of the sector speaking out publicly: featured artists, authors and composers, managers, independent publishers, letter from +200 independent CEOs & founders, 100 voices website, Martin Mills (UK, Europe, international), Eva Karman Reinhold (Sweden), Kees van Weijen (Netherlands), Ruth Barlow (UK), Birte Wiemann (Germany), Nuno Saraiva (Portugal), Darius Van Arman (USA, Europe, international), Noemí Planas (international), Richard Burgess (US), Helen Smith (Europe), Gee Davy (UK) and Ruth Barlow at AIM’s AGM.

Influential European parliamentarians Aurore Lalucq and Nikola Minchev also spoke up, as well as competition expert Amelia Fletcher – former Chief Economist of the UK competition authority. National competition authorities who examined the case in the Netherlands and Austria raised the alarm. With music an essential part of the economy in most member states, the interest of national competition authorities is clear.

The independent sector opposes concentration for reasons set out in IMPALA’s cultural diversity paper and other expert analyses. Economic modelling carried out on behalf of IMPALA showed that any slip in streaming revenues would lead to a reduction in total market releases, and that smaller genres and countries, including non-English language music, would be most impacted. This is one of the main concerns raised about the impact of consolidation in an ecosystem where power on one side of the market inevitably influences the whole, particularly where the largest market player has demonstrated its ability to impose changes on digital services that disadvantage competitors and lead to the demonetisation of large sections of repertoire. Infrastructure neutrality is essential to a well-functioning music market, which means reinforcing independent distribution.

A new report out earlier this month Powering an Independent and Culturally Diverse European Music Ecosystem (full report / infographic), authored by industry expert Dan Fowler analyses the ability of Europe and the European music sector to sustain a diverse and competitive ecosystem, calling for investment, targeted regulatory oversight and sector collaboration. The report is addressed to European and national decision makers and the industry and calls for “an urgent rethink” to not only address challenges but also take advantage of opportunities. Market concentration, financial and data asymmetries, intentional co-opting of an “independent” identity, as well as other factors, such as the rapid rise of generative AI and streaming manipulation, are cited as “severe tests that need to be overcome to maintain a healthy ecosystem”. The report notes that: “Despite Europe’s world leading position as a source of incredible diversity and talent, most of the power is effectively in the hands of non-European businesses”. Cultural diversity as an opportunity and key indicator of a strong music ecosystem is also assessed, as well as the conditions needed for growth and the role of the independent sector as the engine of Europe’s cultural diversity. 

* More Phase I cases than usual resulted in remedies in 2025, so the overall incidence of intervention in problematic European merger cases remains constant with the previous year.

** This is significant because the acquisition would otherwise have escaped EU scrutiny altogether as UMG and Downtown did not notify it directly to the European regulator, presumably because they considered that the thresholds were not met (only deals above a certain size are subject to automatic review by the European Commission).

*** These powers are increasingly being introduced at national level to allow better scrutiny of strategic cases which would otherwise escape scrutiny because thresholds are not met. They are known as “call-in” powers simply because they allow the relevant authority to call any merger in for review if it carries potential risks for the market.

About IMPALA

IMPALA was established in 2000 and now represents over 6000 independent music companies in Europe. 99% of Europe’s music companies are small, micro and medium businesses and self-releasing artists. Known as the independents, they are world leaders in terms of innovation and discovering new music and artists – they produce more than 80% of all new releases and account for 80% of the sector’s jobs. IMPALA’s mission is to grow the independent music sector sustainably, return more value to artists, promote diversity and entrepreneurship, improve political access, inspire change, and increase access to finance. IMPALA works on a range of key issues for its members and started a new co-funded work programme as an EU cultural network in 2025. IMPALA runs various award schemes and has a programme aimed at businesses who want to develop a strategic relationship with the European independent sector – Friends of IMPALA