EC considers inquiry into Andersen break-up
The European Commission will this month decide whether to launch inquiries into the piecemeal dismantling of Andersen.
Competition spokeswoman Amelia Torres told Accountancy Age Brussels had been officially informed of the proposed acquisition by Deloitte Touche Tohmatsu of Andersen UK and had until 1 July to say whether the deal should be cleared or; whether we need to take a closer look at it’.
None of the other worldwide deals involving Andersen has yet been officially notified to Brussels though many clearly exceed the financial thresholds beyond which the Commission has a legal right to intervene. The EU can block mergers when combined global turnovers exceed £3.2bn, of which more than £250m is generated in the EU itself.
Torres said the Commission was expecting notification of other deals involving Andersen ‘at some stage’, and smaller deals, which did not cross the turnover thresholds, would have to be examined by the national competition authorities in the country concerned.
In the UK, Deloitte chief executive John Connolly has expressed confidence that the deal between his firm and partners at Andersen, which the firm refuses to call a merger or an acquisition, will not meet any regulatory obstacles.
Indeed Connolly has publicly said he expects the two firms to be integrated by the 1 July deadline.
The Commission indicated earlier this year that an Andersen/ KPMG merger proposal would have been subject to a formal investigation by Brussels.
The Commission ‘remains concerned’ about any reduction in the number of worldwide accountancy firms, though officials refuse to speculate about the implications if the number is cut from five to four through the dispersal of Andersen practices one-by-one.
Most of Andersen’s 84 practices outside the US have announced their intention to merge with former rivals.