Common Ownership from a Transatlantic Perspective

Common Ownership from a Transatlantic Perspective is a thoroughly researched work that sheds light on the phenomenon of ‘common ownership’ – a situation in which two or more companies have one or more shareholders in common. The focus has been on parallel non-controlling minority shareholdings held by institutional investors in competing companies. The rise of institutional investors has indeed transformed the landscape of global capital markets, making investment increasingly intermediary-driven and diversified. Consequently, corporate ownership structures have become more intertwined. Over the past decade, common ownership has sparked one of the most dynamic and contentious debates at the intersection of finance, corporate governance, and competition law. Do common owners dampen competition among rival firms? Are institutional investors exerting hidden influence across markets? Or are these concerns overstated and based on fragile theoretical and empirical foundations?

What’s in this book:

Using a doctrinal, primarily comparative approach, enriched by interdisciplinary insights, the author organises her work around the following elements:

• how the ‘financialisation’ of the economy has contributed to the creation of structural links between competing companies, or even across value chains, due to diversified institutional investment;
• how these structural links may affect the competitive incentives of common owners’ portfolio companies;
• economic models, empirical evidence, and main criticisms of common ownership theory;
• the extent to which the corporate governance frameworks in the US and the EU enable (or limit) the ability of institutional investors to influence firm behaviour;
• how US and EU competition laws are effective ‘tools for discovery’ yet remain limited in their capacity to address ‘unorthodox’ competition issues; and
• a framework for analysing alternative policies.

  Set in a broad socio-economic context, the book evaluates the effectiveness of current US and EU merger and antitrust/competition legislation in addressing the competitive risks of common ownership. Drawing on statutes, legal instruments, case law, and academic literature, the analysis presents the advantages and disadvantages of the main policy proposals presented by academics and puts forward a framework for policy evaluation.

How this will help you:

The intersection of corporate governance and competition law has long been under-researched, and the relationship between finance and competition issues has received even less attention. This book addresses this gap by identifying the practical and doctrinal limits of corporate governance mechanisms in influencing competitive outcomes, integrating theoretical and empirical insights from finance and industrial organisation economics. As a thorough and systematic contribution to a significant legal and economic debate, it will be welcomed by practitioners, policymakers, and academics seeking to understand these complex and consequential developments in contemporary corporate capitalism.