The European Commission has informed Universal Music Group ('UMG') of its preliminary view that its proposed acquisition of Downtown may restrict competition in the market for the wholesale distribution of recorded music.
UMG is globally active in music recording, music publishing, merchandising, and audiovisual content. Downtown is a global music company providing artist and label ('A&L') services both to independent record companies as well as to artists, notably through its FUGA music distribution platform. Downtown also provides royalty accounting services through its Curve platform, which offers amongst others processing, accounting, payment and related services in relation to royalties as well as rights management.
The Statement of Objections
On 22 July 2025 , the Commission opened an in-depth investigation to assess if the transaction may allow UMG to reduce competition in the market for (i) the wholesale distribution of recorded music in the European Economic Area ('EEA') by acquiring commercially sensitive data of its rival record labels; and (ii) the supply of A&L services in the EEA by removing an important competitive force. A&L services consist mainly of distribution services to third-party labels and artists, including monetisation, marketing and promotion as well as data analytics and management.
The Commission conducted a wide-ranging investigation to understand the affected markets and the potential impact of the transaction. This investigation has included, among others, analysing internal documents provided by the parties and gathering views and data from competitors and customers.
As a result of this in-depth investigation, the Commission is concerned that UMG may have the ability and incentive to gain access to commercially sensitive data that is stored and processed by Downtown's Curve and that such information advantage for UMG would hamper rival labels' ability and incentive to compete with UMG.
A Statement of Objections is a formal step in an investigation, where the Commission informs the companies concerned in writing of the objections raised against them. The sending of a Statement of Objections does not prejudge the outcome of the investigation. UMG now has the opportunity to reply to the Commission's Statement of Objections, to consult the Commission's case file and to request an oral hearing.
Companies and products
UMG, headquartered in the Netherlands, is a global company which owns and operates businesses engaged in wholesale recorded music, music publishing, merchandising, and audio-visual content.
Downtown, headquartered in the US, is a global independent rights management and music services company. It is active in the provision of A&L services to third-party record artists and labels, music publishing services to third-party authors and songwriters, as well as royalty administration and other ancillary services to third-party artists and labels.
Background
The transaction was notified to the Commission on 16 June 2025. The Commission opened an in-depth investigation on 22 July 2025 and now has until 6 February 2026 to take a final decision.
The Commission has the duty to assess mergers and acquisitions involving companies with a turnover above certain thresholds (see Article 1 of the EU Merger Regulation ) and to prevent concentrations that would significantly impede effective competition in the European Economic Area or any substantial part of it.
The vast majority of notified mergers do not pose competition problems and are cleared after a routine review. From the moment a transaction is notified, the Commission generally has 25 working days to decide whether to grant approval (Phase I) or to start an in-depth investigation (Phase II).
In addition to the current transaction, there are currently two other ongoing Phase II merger investigations: (i) the proposed acquisition of Kellanova by Mars ; and (ii) the proposed acquisition of Anglo American's nickel business by MMG .
