The European Commission has resumed its review of Boeing’s proposed acquisition of 80 percent of Embraer’s commercial aircraft division, two months after halting work on the in-depth probe. “The clock has been restarted in the Commission investigation into the joint ventures proposed by Boeing and Embraer on January 6, 2020,” a Commission spokesperson told AIN. “The new decision deadline is April 30, 2020.”
In November last year, the European Union’s antitrust regulator “stopped the clock” on the probe. That procedure in EU merger investigations activates if the parties fail to provide, in a timely fashion, an important piece of information that the commission has requested from them. Once the parties supply the missing information, the clock restarts and the deadline for the commission’s decision gets adjusted accordingly.
In an emailed statement to AIN, Boeing and Embraer stressed they “have been engaged with the European Commission and other global regulatory authorities since late 2018,” adding they have received unconditional clearance to close the transaction from “almost all jurisdictions,” including the U.S., China, and Japan. “We continue to cooperate with the European Commission as it assesses our transaction and look forward to a positive resolution,” they said.
The deal needs approval by competition authorities in nine countries. Seven jurisdictions—the U.S., China, Japan, South Africa, Kenya, Colombia, and Montenegro—have approved the tie-up, without demanding changes to the deal. Only the EU and Brazil have not yet cleared the proposed transaction.
Boeing and Embraer pre-notified the EU of their plan to combine their commercial aviation activities in April 2018 and formally notified it of the deal in August 2019. The sides initially had expected to close the transaction by the end of 2019 but needed to revise the timeline in October after the EU informed the airframers it would conduct an in-depth investigation into the deal. Brussels launched the Phase II probe because its initial investigation raised concern that the tie-up might remove Embraer as “a small but important competitive force in the concentrated overall single-aisle market.”
To eliminate its concerns, the commission’s competition division has requested more than 1.5 million pages of documentation and data on some 1,200 sales campaigns over the past 20 years, sources familiar with the case told AIN, describing the information request as “very voluminous” and representing a multitude of the documentation requested and analyzed by the other regulators that scrutinized the proposed transaction.