The European Commission has approved Paramount Skydance Corporation’s acquisition of Warner Bros. Discovery, clearing the deal under the EU Merger Regulation after the companies agreed to a series of commitments aimed at preserving competition in film distribution across the European Economic Area.
The European Commission has approved Paramount Skydance Corporation’s proposed acquisition of Warner Bros. Discovery, subject to a series of commitments designed to preserve competition in the European Economic Area (EEA). The deal was cleared under the EU Merger Regulation after the Commission concluded that the proposed remedies adequately addressed its competition concerns.
Both Paramount and Warner are major producers and distributors of films and audiovisual content, including television series and streaming services. The companies argued that the merger would strengthen Paramount’s ability to compete in an entertainment industry that is increasingly shifting toward streaming platforms.
During its investigation, the Commission assessed the impact of the transaction across several markets, including film production and distribution, audiovisual content licensing, television channels, and streaming services. It found that competition in film production would remain strong, with major studios such as Disney, Universal, Sony, Amazon MGM, A24, Lionsgate, and several European producers continuing to compete in the market.
However, regulators raised concerns about film distribution in countries where Paramount and Universal currently cooperate through their joint venture, United International Pictures (UIP). The Commission concluded that adding Warner’s film catalogue to that partnership could reduce competition, potentially leading to less favorable distribution terms for cinema operators and, ultimately, consumers.
To resolve these concerns, Paramount agreed to divest its stake in UIP within 13 months of completing the transaction and accepted a series of 10-year commitments preventing joint film distribution arrangements with Universal in the EEA. The company also agreed not to move Warner’s or Paramount’s film distribution to distributors that also handle Universal’s or Disney’s films in specified EEA markets.
Following a market test, the Commission concluded that these commitments fully addressed the identified competition issues and approved the acquisition. The decision remains conditional on Paramount’s full compliance with the agreed remedies, which will be monitored by an independent trustee under the Commission’s supervision.
The European Commission’s approval comes as the transaction continues to face scrutiny in the United States. The deal has been temporarily paused while U.S. authorities and the courts review legal challenges related to the merger.
