EU Signals Tighter Scrutiny on Big Tech “Acquihire” Deals to Preserve Competition

The European Commission is ramping up scrutiny on Big Tech’s “acquihire” practices where companies hire start-ups’ key staff instead of buying the entire business to prevent these deals from bypassing antitrust merger rules. Olivier Guersent, outgoing head of the EU’s competition unit, emphasized that these hires can be viewed as mergers since employees are valuable assets of a company.

To strengthen enforcement, the Commission is encouraging national regulators in member states with “call-in” powers—such as Denmark, Ireland, and Italy to refer deals below EU thresholds to the European Commission for review. Guersent stressed the importance of patience and coordinated efforts within the European Competition Network to address these transactions effectively.

Examples of recent high-profile acquihires include Microsoft’s $650 million deal to hire most of AI start-up Inflection’s team, Google’s recruitment from chatbot startup Character.AI and AI code generation startup Windsurf, as well as Amazon and Meta’s strategic hiring from AI and data firms. These moves illustrate Big Tech’s ongoing strategy to acquire talent without triggering full merger scrutiny.

Guersent also reflected on the progress made under the EU’s Digital Markets Act, which he helped champion to limit Big Tech’s dominance. While acknowledging some positive shifts, he admitted that results have been mixed and enforcement challenges remain, citing Apple’s ecosystem as resistant but noting Meta’s pushback as an example of ongoing industry tensions.

Source: Reuters