EU 'Ecosystems' Theory of Harm Gets Court Backing
The EU General Court endorsed the European Commission's 'ecosystem' theory of harm by upholding its decision to block Booking's acquisition of Etraveli, creating new hurdles for M&A in the digital sector.
On September 9, 2026, the European Union's General Court upheld the European Commission's 2023 decision to block Booking Holdings' proposed acquisition of Etraveli. The judgment is a significant victory for the Commission, as it validates the regulator's use of the controversial 'ecosystems theory of harm' in merger control.
Sophisticated counsel should note that this theory allows regulators to block deals that could entrench a dominant market position by expanding a company's network of interconnected services, even where the transaction does not involve direct competitors. The court's endorsement creates significant new hurdles and uncertainty for M&A activity, particularly for digital platforms seeking to grow by acquiring complementary services. The decision requires dealmakers to analyze not just traditional horizontal or vertical overlaps, but also how a target might strengthen a buyer's broader 'ecosystem.'
While an appeal to the European Court of Justice may follow, firms planning strategic acquisitions in the EU must now proactively assess and address potential ecosystem-related competition concerns in their merger filings and deal strategy.