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EU Commission clears Bayer-Monsanto merger

by Editor (comments: 2)

Protesters against glyphosate and Monsanto Bayer merger.

The European Commission has approved under the EU Merger Regulation the acquisition of Monsanto by Bayer. The merger is conditional on the divestiture of an extensive remedy package, which addresses the parties' overlaps in seeds, pesticides and digital agriculture, announced the EU authorities.

Commissioner Margrethe Vestager, in charge of competition policy, said: "We have approved Bayer's plans to take over Monsanto because the parties' remedies, worth well over €6 billion, meet our competition concerns in full. Our decision ensures that there will be effective competition and innovation in seeds, pesticides and digital agriculture markets also after this merger. In particular, we have made sure that the number of global players actively competing in these markets stays the same. That is important because we need competition to ensure farmers have a choice of different seed varieties and pesticides at affordable prices."

The transaction creates the largest global integrated seed and pesticide player

Many NGOs, farmers associations aswell as consumers are very critical against the merger and many protests wanted to prevent the Bayer Monsanto deal. Greens/EFA food safety spokesperson Bart Staes reacts: "This merger is bad news for farmers, our environment and food security. The agriculture industry is already far too concentrated, giving a handful of massive firms a stranglehold on food production. Merging two of the biggest players only makes a bad situation worse."

Instead of making the corporations bigger and bigger "the Commission needs to take action to strengthen the hand of the smaller players in our agriculture industry. The upcoming CAP reform is a chance to empower small farmers and support the rapid transition away from the chemical dependent approach of the likes of Monsanto and towards genuinely sustainable farming", Staes emphasised.

The Commission had concerns that it would have strengthened Monsanto's dominant position

According to an official press release of the European Commission today's decision follows an in-depth review of Bayer's proposed acquisition of Monsanto. Monsanto is the world's largest supplier of seeds, which generates most of its sales in the US and Latin America. Monsanto also sells glyphosate, which is the most used pesticide worldwide to control weeds. Bayer is the second largest supplier of pesticides worldwide, with a stronger focus in Europe. It is also an important globally active seeds supplier for a number of crops, the Commission noted.

As part of its in-depth investigation, the Commission has assessed more than 2,000 different product markets and reviewed 2.7 million internal documents. It concluded that the transaction as notified would have significantly reduced competition on price and innovation in Europe and globally on a number of different markets. The Commission also had concerns that it would have strengthened Monsanto's dominant position on certain markets, where Bayer is an important challenger of Monsanto. But anyhow the Commision agreed to the merger because Bayer made some concessions.

These are the commitments submitted by Bayer. "They address the competition concerns in full", says the Commission:

  • They remove all of the parties' existing overlaps in seed and pesticide markets, where concerns were raised, by divesting the relevant Bayer businesses and assets.
  • They cover Bayer's global R&D organisation for seeds and traits as well as Bayer's research activities to develop a challenger product to Monsanto's glyphosate. They also cover certain Monsanto assets, which in future would have competed with a Bayer seed treatment against nematode worms.
  • Finally, Bayer has committed to grant a licence to its entire global digital agriculture product portfolio and pipeline products to ensure continued competition on this emerging market.

On this basis, the Commission concluded that the divestment package enables a suitable buyer to sustainably replace Bayer's competitive effect in these markets and continue to innovate, for the benefit of European farmers and consumers. Bayer has proposed BASF as purchaser for the remedy package. The transaction can only be implemented when the Commission has completed its review of the proposed buyer.

The Bayer/Monsanto transaction is the third in a row in the seeds and pesticides sector. In line with its case practice, the Commission assesses transactions taking place in the same industry according to the so-called "priority rule" - first come, first served. The assessment of the merger between Bayer and Monsanto has been based on the market situation following the Dow/DuPont merger and the ChemChina/Syngenta merger, taking the remedies in both cases into account.

When it comes to seeds and pesticides there are of course other vital concerns that go beyond competition policy, including consumer protection, food safety and ensuring the highest standards for the environment and the climate. The strict national and European regulatory standards on these matters will remain just as strict after this merger as before it and continue to apply, explains the Commission.

Detailled informations from the EU Commission you can find here.



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Comment by Gerd Schnepel |

Monsanto being soon a German company will experiment a lot more war and resistance than in the US with their picketing lines. Laws, consumers, the eco movement including green guerilla actions will cause them more problems and make life not easier for them. And it is more honest anyway: it was a strange situation to be called to sign and act in favor of "real" capitalist competition, whilst Marx already showed us the inevitable course to monopoly capitalism that this nowadays outdated system has to take.

Welcome in Germany and Europe! The people is waiting for you, Monsanto delinquents, false scientists, corrupt politicians and lying public relation officers.

Comment by GrannySue |

People realize that Syngenta is a wholly-owned subsidiary of Monsanto, right? Meaning that Monsanto will remain the largest seed, pesticide and GMO seller on the globe. Has anyone considered the research done on GMO and also on glyphosate as it impacts both health and agriculture? So Bayer comes in with remedies that will now be offered by BASF???? Who is kidding who?? And we do realize that both BASF and Bayer were founded by people sentenced at Nuremberg? REALLY?!?!?! Why not bring in IG Farben, Baxter and Pfizer too - then they could all be one big happy family once again. This time the trials should be in Geneva.