Google and Yahoo want to merge. They file as approrpriate with the U.S. Departme
ID: 2720576 • Letter: G
Question
Google and Yahoo want to merge. They file as approrpriate with the U.S. Department of Justice (DOJ). Both companies do business in dozens of countries. Does this mean the companies have a green light, even though they sell services in many countries?
Yes. By international agreement, if the DOJ approves the merger as not having anticompetitive effects, then it is cleared in other countries as well.
Yes. Since the two companies are headquartered in the U.S., the DOJ is the only agency necessary to file with.
No. Various parts of the world have their own laws and procedures for determining whether two companies, foreign or domestic, will gain approval to operate within their borders.
No. Every country in the world has their own equivalent of the DOJ, and approval must be sought country by country, even if the U.S. based companies do not operate within some countries.
a.Yes. By international agreement, if the DOJ approves the merger as not having anticompetitive effects, then it is cleared in other countries as well.
b.Yes. Since the two companies are headquartered in the U.S., the DOJ is the only agency necessary to file with.
c.No. Various parts of the world have their own laws and procedures for determining whether two companies, foreign or domestic, will gain approval to operate within their borders.
d.No. Every country in the world has their own equivalent of the DOJ, and approval must be sought country by country, even if the U.S. based companies do not operate within some countries.
Explanation / Answer
When two major companies in the same industry want to merge it might create a very large entity which might result in competition going down and might not be conducive for the consumers. Thus the companies are required to obtain approval in various parts of the world where they operate. The answer is PART C.
For example two US companies GE and Honeywell could not merge as the European commission had reservations related to competition.
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