The European Commission today endorsed Universal Music Group’s £1.2bn takeover of British record company EMI, and demanded that both companies sell a third of their assets in an attempt to cut their monopoly on the music market.
The Commission said that EMI must dispose of the Chrysalis, Mute, Classics and Parlophone labels, while Universal must sell the Sanctuary and Co-op Music Limited labels.
Additionally, the Commission said that Universal must refuse new digital music contracts in Europe for the next 10 years in a bid to mediate its dominance in the music industry. EU Competition Commissioner, Joaquin Alumnia, said that the commitments “will ensure that competition in the music industry is preserved”.
Martin Mills, chairman of music label Beggars Group, today agreed with the Commission. He said: “It’s good to see that the Commission has seen this deal as such a threat to the market that it has demanded and received truly swingeing commitments to divestments.”
Rival music labels raised concerns that this transaction will provide Universal with “excessive market power” with music label Impala adding that “artists and consumers will ultimately pay the price”.
City A.M. Reporter