“Pivotal Capacity”: A New Measure of Market Power in EU Merger Control

On 30 April 2026, the European Commission published draft merger guidelines that merge two decades-old texts into a single framework. The headline innovation rests on a deceptively simple question:

If one company left the market, could the remaining competitors meet demand on their own?

If the answer is no, that company is “pivotal” — and treated as holding significant market power, regardless of how modest its sales share may look.

A few takeaways for dealmakers:

The analysis shifts from sales shares to capacity. Low market share is no longer a safe harbour.

“We have spare capacity” is no longer enough — the Commission now probes whether competitors have the incentive to use it.

Narrower geographic markets mean imports risk being discounted unless their pressure is shown to be structural, not cyclical.

Yet the framework is two-sided: efficiency and benefit arguments now carry real weight, if backed by concrete, deal-specific evidence.

The lesson from Tata Steel / ThyssenKrupp still stands: “strengthening European industry” was not, on its own, enough to clear a deal. In this new era, what makes a transaction possible is often not the transaction itself — but the evidentiary architecture that holds it up.

Our short briefing note unpacks what this means in practice.