Fishy business: Multi-jurisdictional treatment of a horizontal merger in salmon farming

In 2006, a merger between two large salmon farmers, Pan Fish ASA and Marine Harvest NV was notified to competition authorities in four jurisdictions (UK, France, Norway and the US). Despite a unique consensus on the basic economic model to employ for the analysis (Cournot) and of basic economic facts (including the market definition), the competition authorities came to different conclusions regarding the long-run effects of the merger and hence in three jurisdictions, the merger was cleared while the clearance in France was conditional on remedies in the form of divestitures of (Scottish) salmon farms. The paper outlines the case, discusses the use of the Cournot model for merger simulation and shows that the difference in assessment stems from disagreement as to the assessment of barriers to entry and expansion in the long run. Finally, implications for the consistent application of competition policy across EU member states are discussed.