Mike Sax, founder and chairperson of ACT | The App Association, issued a statement on September 3, 2024, regarding the Court of Justice of the European Union (CJEU) ruling in the Illumina/GRAIL appeal case.

“We welcome the ruling by the Court of Justice of the European Union (CJEU) in the Illumina/GRAIL appeal case. This decision is a win for small businesses across Europe, especially for those driving innovation and growth in rapidly evolving sectors that the app economy is transforming.”

Sax emphasized the importance of small businesses to the digital economy: “Small businesses are the driving force of the digital economy, bringing fresh ideas and disruptive technologies to the market. However, the European Commission’s (EC) expanded interpretation of Article 22 of the EU Merger Regulation, which expanded its threshold for merger reviews, had created an environment of uncertainty for SMEs. The prospect of mergers and acquisitions being subject to unpredictable regulatory reviews, even when well below established thresholds, created a real risk to innovation and SME growth.”

He further elaborated on how these uncertainties impact entrepreneurs: “A barrier to exit is a barrier to entry. When entrepreneurs face heightened uncertainties and undue difficulties in getting acquired, it becomes much harder for them to secure necessary funding from the outset. Excessive government scrutiny of mergers stifles growth potential of innovative businesses and diminishes opportunities available to our members.”

Sax concluded by noting that “The CJEU’s ruling restores much-needed legal certainty, reaffirming that only mergers meeting clear and established thresholds will be subject to review, protecting small businesses and startups represented by The App Association from improper exposure to EC’s complex and burdensome regulatory processes. It is a positive step forward in supporting growth and competitiveness of SMEs in the European Union.”