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"There'll be an exchange of views Wednesday (9/27), but the EC has to get the member states to buy into what it's doing. It's not clear where things stand."
—an official at a rival company

EU ASKS FOR HELP IN PENDING MERGER DECISIONS

But Ruling On Mergers May Be Handed Down
As Early As Oct. 4
European Union regulators will consult experts from its 15-member states on Wednesday before offering their final decision on whether to clear America Online's merger with Time Warner, reports out of Brussels said.

At the same time, the EU's Advisory Committee will be asked to give its opinion on the proposed joint venture between TW's Warner Music Group and EMI, EU officials said Monday.

The European Commission will present the committee with a draft decision in each case plus a list of concessions offered by the companies in an attempt to meet advisory concerns.

"There'll be an exchange of views Wednesday (9/27), but the EC has to get the member states to buy into what it's doing," an official at a rival company being consulted on the two deals told Reuters. "It's not clear where things stand."

The commission has until Oct. 24 to rule on AOLTW and until Oct. 18 to reach a decision on WEMI, but is more likely to rule at its meeting on Oct. 4.

Earlier this month, the EC reportedly drafted decisions to block both deals on the grounds they would stifle fair competition in Europe. But that was before the companies offered last-minute concessions.

EU Competition Commissioner Mario Monti is concerned the AOL-TW tie could create a company that would dominate the market for online entertainment. Likewise, Monti feared the creation of WEMI would lead four "majors" to dominate the recorded music market and give the new company too much power over music publishing.

In the last week, all three companies have offered a number of concessions to make the deals more acceptable. These are currently being "market-tested," or distributed to competing companies in the same markets, to gauge their views on whether they solve the problems.

In the mean time, AOL's rivals have urged regulators to block the $142 billion purchase unless the Internet giant offers equal access to Web sites and accepts independent arbitration of competitors' complaints.

"AOL will have access to enormous catalogs for both music and copyrights," said Patrick Zelnik, CEO, Naive Records and president of the French record producers' union. "It's necessary that they treat other music houses in the same way that they treat their own—not only in terms of access to their portals but also offering us the same prices to use AOL."

For more details on proposed concessions and the play-by-play regulatory action from both sides of the Atlantic, log on to hitsdailydouble.com, which has been covering the proceedings extensively and will continue to do so until all outcomes are reached.

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