EU competition authorities are increasingly scrutinizing transactions that fall below standard merger-control notification thresholds. This trend reflects a growing concern that traditional turnover-based thresholds fail to capture certain acquisitions, such as those in the life sciences sector involving early-stage innovators, pipeline products, or emerging technologies, whose competitive significance lies in future potential rather than current revenues.

In 2024, the Court of Justice of the European Union, in a case concerning the acquisition of a start-up developing innovative cancer detection technologies at pipeline stage, held that a Member State may refer a transaction under Article 22 EUMR to the European Commission (EC) only where it has jurisdiction to review it under its national merger-control rules. Following this judgment, the EC encouraged Member States to introduce call-in powers into their national legislation to assert jurisdiction over transactions falling below traditional turnover thresholds. In the last few years, several Member States have introduced or expanded such powers within their merger-control regimes.

These reforms address a structural mismatch between turnover-based notification thresholds and the way that competitive value is created in innovation-driven markets. This mismatch is particularly acute in life sciences, where competition takes place between development programs and therapeutic pipelines long before products reach the market, so that acquisitions of early-stage assets can shape future standards of care, even without overlaps in marketed products. Indeed, empirical evidence commissioned by the EC confirms that a significant share of such transactions is followed by the discontinuation of overlapping pipelines.

These below-threshold regimes vary significantly across jurisdictions and can broadly be grouped into three models:

• Threshold-based call-in regimes, under which competition authorities may assert jurisdiction where predefined quantitative indicators are met, such as reduced turnover thresholds.
• Discretion-based call-in regimes, which grant national competition authorities wide discretion to call in transactions on a case-by-case basis, where there is a possible or likely impact on competition.
• Other requirement-specific regimes, which rely on predefined alternative jurisdictional criteria, such as market share thresholds or transaction-value thresholds.

As a result, below-threshold scrutiny has become a structural feature of merger control, particularly in innovation-driven markets. Therefore, life sciences companies should integrate potential call-in risk into early deal assessment and transaction planning. This requires not only traditional merger-control screening, but also an early assessment of whether pipeline overlaps, therapeutic indications and control rights in licensing, option or co-development agreements could trigger a call-in, delay closing, or require remedies in the same way as a notifiable acquisition.