On 9 September 2026, the EU’s General Court (Court) delivered its long-awaited judgment in Booking Holdings v Commission, handing the European Commission (EC) a significant victory and lowering the bar for intervention in future merger cases where the EC raises conglomerate concerns – that is, concerns that are grounded in neither a horizontal nor a vertical relationship between the parties. The judgment increases uncertainty regarding EU merger control because:

• The EC is not confined to the theories of harm outlined in its 2008 Non-Horizontal Merger Guidelines when objecting to a proposed transaction on grounds other than horizontal concerns.
• The EC can prohibit a proposed deal when an acquisition in an adjacent market may lead to a marginal share increment in another market in which the acquirer is dominant, if such acquisition strengthens the “ecosystem” of the dominant acquirer and makes future competition in the dominant firm’s market less likely.
• Merger control is increasingly focused on future competitive dynamics and market contestability, not just current market shares.

Background

On 25 September 2023, the EC blocked Booking’s proposed acquisition of eTraveli. This was the EC’s first-ever prohibition based solely on concerns regarding conglomerate effects.

The parties to the proposed EUR 1.6 billion acquisition are in adjacent markets: Booking is a leading online travel agency (OTA) for hotels (hotel OTA) in the European Economic Area (EEA), while eTraveli is one of the main suppliers of OTA services for flights (flight OTA) in the EEA. The EC concluded that the proposed transaction would significantly impede effective competition by strengthening Booking’s already dominant position in the hotel OTA market. Acquiring eTraveli, a flight OTA, would have done this by bolstering Booking’s travel services “ecosystem”, enabling it to significantly increase traffic to its platform and strengthen its already dominant position in the hotel OTA market.

Court’s Judgment

The EC Is Not Confined to the Theories of Harm Outlined in the Non-Horizontal Merger Guidelines

Booking argued that the EC had departed from its Non-Horizontal Merger Guidelines by prohibiting a conglomerate merger without demonstrating traditional anticompetitive foreclosure. According to Booking, the EC had relied on a novel “reverse leveraging” theory under which dominance in one market (hotel OTA) would be strengthened through activities in another market (flight OTA).

The Court disagreed. It held that the Non-Horizontal Merger Guidelines do not exhaustively define all possible theories of harm and observed that the Guidelines expressly state that the Guidelines’ principles can be developed and refined over time. The Court therefore approved the EC’s use of a reverse leveraging theory in Booking/eTraveli in digital markets where ecosystem effects and network effects may generate competitive concerns, even though the EC did not specifically contemplate this theory when it adopted the Guidelines.

Immaterial Errors in the Counterfactual Assessment Would Not Alter the Outcome

Booking also challenged the EC’s approach to the counterfactual, arguing that the EC wrongfully applied a “zero flights” counterfactual and did not account for Booking’s existing commercial agreement with eTraveli. It argued that the EC therefore underestimated the extent to which Booking already benefited from its pre-existing agreements with eTraveli and had overstated the transaction’s merger-specific effects.

The Court found that the EC’s counterfactual did not assume that Booking would abandon its flight OTA altogether but rather envisaged that there would be continued cooperation between Booking and eTraveli for at least some period under renegotiated conditions. More importantly, the Court also ruled that the differences between the proposed counterfactuals would not be decisive when compared with the merger scenario because Booking’s estimated share increment in the hotel OTA market under both counterfactual scenarios would be marginal.

Reverse Leveraging: A “few tenths of a per cent” Market Share Increment Can Be Decisive

The Court largely upheld the EC’s finding that Booking was already dominant in hotel OTA. It specifically rejected Booking’s challenge to the EC’s market share estimates and agreed that Booking benefited from significant customer loyalty and inertia and was not subject to sufficient competitive constraints in the hotel OTA market.

Notably, although eTraveli was not active in hotel OTA services, the EC nevertheless assessed the transaction’s impact on Booking’s share of the hotel OTA market. The EC viewed eTraveli’s flight OTA business as a valuable customer acquisition channel and concluded that ownership of eTraveli would allow Booking to convert additional flight customers into hotel bookings on Booking.com, thereby incrementally increasing its share in the hotel OTA market, where it already held a dominant position. Booking argued that the potential incremental increase in its hotel OTA market share resulting from the transaction would be minimal and could not strengthen network effects.

The Court rejected this argument: while a strengthening of dominance does not automatically amount to a significant impediment to effective competition, the EC is not required to demonstrate a dramatic increase in market share or immediate price effects. The EC may instead rely on a sufficiently cogent body of qualitative and quantitative evidence to demonstrate that a transaction would entrench an already dominant position and reduce market contestability.
The Court accepted that the EC’s quantitative assessment of the precise market share increment contained errors and that the increment may ultimately have been limited to only “a few tenths of a per cent”. Nevertheless, it held that in a market such as hotel OTA, characterised by strong network effects and a large gap between the dominant firm and its rivals, even a relatively small increase in the dominant firm’s market share due to an acquisition in an adjacent market could strengthen existing network effects and further reduce the market’s contestability.

The Court pointed out that the EC’s theory did not turn on market share increment alone. The Court emphasised that the EC’s theory was grounded in concerns that the transaction would reinforce Booking’s dominant position in hotel OTA by acquiring one of the few remaining customer-acquisition channels available to hotel OTAs, strengthen existing network effects, and make it more difficult for rivals to expand their customer bases and challenge Booking’s dominance in hotel OTA.

The Standard for Prevailing Based on Efficiency Arguments Remains High

Finally, the Court upheld the EC’s rejection of Booking’s claims that the transaction would generate substantial procompetitive efficiencies that would outweigh any anticompetitive effects. This determination reaffirms that the bar remains high for successfully invoking efficiencies to avoid a prohibition, even in conglomerate cases. The Court found that many alleged efficiencies were either inadmissible or insufficiently substantiated. As to efficiencies in the flight OTA market, the Court upheld the EC’s determination that Booking had failed to demonstrate that any cost savings would be passed on to consumers. It held that the evidence did not show that Booking intended to lower prices or that any purported cost savings were verifiable and merger specific.

The Court also accepted the EC’s conclusion that benefits accruing primarily to flight OTA customers could not offset competitive harm in the hotel OTA market. The Court upheld the EC’s reasoning: customers who might benefit from cost savings in the flight OTA market were not substantially identical to the customers who might suffer from the proposed transaction in the hotel OTA market – although there was some overlap between the two customer groups.

Looking Ahead

The judgment is particularly significant since the EC is currently finalising its revised Merger Guidelines. The judgment endorses several themes that feature prominently in draft versions of the new Merger Guidelines. Most notably, the Court approved entrenchment as a standalone theory of harm. The Court also endorsed the EC’s intention to shift focus from predominantly share-based assessments to a focus on broader competitive dynamics – including ecosystems, data advantages, customer acquisition channels and network effects – especially in digital and platform markets.

The judgment also underscores the importance of identifying and substantiating efficiencies at an early stage, including in conglomerate transactions. Parties should be prepared to demonstrate, with robust evidence, how efficiencies from combining firms that participate in adjacent markets, e.g. convenience of a “one-stop shop” offering for consumers, may offset any potential adverse effects in one or more relevant markets.

Last, the judgment confirms that the EC can rely on theories of harm that are not explicitly detailed in its guidelines.

The judgment likely has significance beyond digital markets. It confirms that a merger may substantially impede effective competition where it reinforces an already dominant position by strengthening barriers to expansion and making the market less contestable. As a result, dominant firms acquiring complementary assets that enhance customer access, distribution, network advantages or other strategic capabilities may face increased scrutiny, especially in markets characterised by limited competition and high barriers to entry or expansion.

The judgment is not necessarily the final word: Booking may appeal to the Court of Justice, the highest EU court.

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For more information on this or other antitrust matters, contact one of the authors. The authors would like to thank Oisín Ó Síocháin for his assistance in preparing this alert.