Brussels approves Paramount-Warner Bros. merger with conditions

The European Commission has granted conditional approval for Paramount Skydance's acquisition of Warner Bros. Discovery, a deal valued at $110 billion. The approval hinges on Paramount implementing specific measures to address competition concerns within the European Economic Area's film distribution market.

European regulators had raised concerns that the merger, as initially proposed, could lead to a significant concentration in film distribution. This was particularly relevant in countries where Paramount partners with Universal Pictures through their joint venture, United International Pictures (UIP). The Commission feared that incorporating Warner Bros.' films into this distribution channel could result in less favorable terms for cinema operators and ultimately harm consumers.

To satisfy these concerns, Paramount has committed to several conditions. Within thirteen months of the deal's closure, Paramount will cease its involvement in UIP within the European Economic Area. Furthermore, for a period of ten years, Paramount is restricted from entering into new joint distribution agreements with Universal in these territories.

Paramount also agreed not to shift Warner Bros.' film distribution from its current partners to distributors that also handle Universal or Disney films in UIP's operational regions. In areas where Paramount and Universal do not share a distributor, Paramount cannot move its films to a distributor also handling Warner Bros., Universal, or Disney films. The Commission views these commitments as sufficient to resolve its competition worries, clearing the path for the merger provided all conditions are met.