Brussels, 1st March 2007
The transaction comprises the creation of the recorded music joint venture Sony-BMG, into which Bertelsmann contributed the worldwide recorded music business of its wholly-owned subsidiary Bertelsmann Media Group (“BMG”) with its labels Arista, Jive, Zomba and RCA. Sony contributed its worldwide -with the exception of Japan- recorded music business which had been operated by Sony Music Entertainment and whose labels include Columbia, Epic and Sony Classical.
The Commission initially authorised the creation of the joint venture Sony-BMG (see IP/04/959), combining the recorded music divisions of Sony and Bertelsmann, finding that the merger did not create or reinforce collective market power (i.e. enhance the ability to impose higher prices) on the part of the music majors (Universal, Sony-BMG, Warner and EMI). However, in its 13th July 2006 ruling on case T-464/04, the Court of First Instance considered the evidence relied on by the Commission insufficient to explain the decision and annulled it. The Commission is therefore re-assessing the transaction.
The assessment is carried out under the previous Merger Regulation (4064/89),
applicable to merger agreements signed before 1 May 2004, applying the test of
whether the merger strengthens or creates a dominant or collective dominant
market position in the territory of the European Union as it stood before 1 May
2004 (i.e. 15 countries) or a substantial part thereof. The Commission will
evaluate the transaction in the light of current market conditions, taking into
account developments since 2004, including the growing sales of online music.
The 2004 investigation focused in particular on whether the merger would create
or strengthen a collective dominant position among the major music recording
companies. This will also be an important element of the current extensive
Further information on the case will be available at: