In a notable contestation of EU regulatory authority, Illumina, Inc., the American juggernaut in DNA sequencing, has struck a legal victory with the European Court of Justice (ECJ) decrying the European Commission's jurisdiction over its acquisition of GRAIL. According to Illumina, the ECJ has invalidated the European Commission's ability to impose a fine, previously pegged at 432 million euros, due to Illumina's move to merge with the cancer diagnostics firm without prior approval.

The crux of the dispute hinged on the Commission's use of Article 22, a tool for examining mergers that fall below the EU's revenue thresholds for automatic review. Today's judgment stems from Illumina's appeal challenging this principle, wherein the higher echelon of Europe's judiciary has taken a stand opposing the Commission's actions. The ECJ's decision, as Reuters reports, stipulates that such referrals by national authorities to the Commission are unwarranted if the said authorities lack the power to review them based on their legislative framework.

It's a development reverberating beyond the case at hand, potentially frustrating the EU's aspirations to scrutinize less prominent mergers they fear could be so-called killer acquisitions. These are strategic takeovers where larger entities swallow up nascent startups that could, ostensibly, offer significant market competition in the future, particularly in sectors like technology and pharmaceuticals.

Nevertheless, Illumina has moved to comply with an earlier EU order to divest from GRAIL. After spinning off GRAIL in June 2024 and maintaining a 14.5% stake in the independent company, Illumina remains invested, albeit not as before. "Today's judgment confirms Illumina's longstanding view that the European Commission exceeded its authority by asserting jurisdiction over this merger," Illumina explains, as per its press release, signaling a removal of the impending fine. Illumina's squabble with the EU over its veto of the deal is, as a result, rendered moot.