The new merger guidelines tighten the analytical framework for horizontal mergers, establish a framework for non-horizontal mergers, and expand the treatment of specific competition law issues.
On April 26, 2026, the Israel Competition Authority (ICA) published draft merger guidelines for public comment. The new guidelines are expected to replace the previous policy document from 2011 (Opinion 1/11), which addressed only the competitive analysis of horizontal mergers (mergers between competitors).
The new guidelines introduce a broad, detailed, and updated framework for reviewing all merger types, designed to reflect developments in Israeli and global competition law, with particular emphasis on “modern” aspects such as digital markets, data acquisition transactions (especially given the growing scale of data and the increasing use of artificial intelligence), nascent competitor acquisitions, and theories of harm including foreclosure, tying, and competitively sensitive information.
The guidelines also address in depth several emerging phenomena that have come to the forefront of enforcement in recent years, including digital platforms, data as an input, buyer market power, and serial acquisitions.
In doing so, the ICA joins a global trend of updating merger policy documents. The FTC and DOJ introduced new guidelines in 2023, and the CMA did so in 2021 for the UK. The new Israeli guidelines draw inspiration from these documents while also building on decisions issued by the ICA over the years. The European Commission similarly published a comprehensive draft guidelines document on April 30, 2026, which is open for public consultation.
The guidelines are open for public comments and consultation until June 14, 2026. Based on past experience, no dramatic changes to the published text are anticipated, and the general framework is expected to remain intact. It is therefore important to familiarize oneself with the new framework now.
The main change is a tightening of the analytical framework applicable to horizontal mergers. The ICA clarifies that the term “competitors” encompasses any party with which another party to the merger has (or may have) a “business rivalry” of any kind. Accordingly, a greater number of transactions will be classified as horizontal mergers and subjected to more rigorous scrutiny.
The ICA continues to rely on established economic measures, foremost among them the HHI index, to assess market concentration, while adopting a stricter approach than is customary globally and introducing structural presumptions intended to block mergers that may harm competition. However, satisfying these presumptions does not guarantee approval – each transaction will be assessed on its own merits. In other words, it does not constitute a “safe harbor”. Unlike the previous guidelines, which afforded a degree of flexibility, the new presumptions are expected to make it significantly harder to obtain approval for horizontal mergers in concentrated markets and to impose a heavier burden on the parties to rebut competition concerns.
The practical implication is that mergers previously approved may not be approved under the new framework.
For the first time, the new guidelines also address vertical mergers – between parties operating at different levels of the supply chain, such as a supplier and a customer – as well as conglomerate mergers, which increase the existing points of contact between the merging companies or involve complementary products.
In line with the approach taken by leading competition authorities globally, the ICA seeks to protect nascent competitors. Mergers between a dominant player and an early-stage competitor may raise particular concern where there is genuine potential for the latter to threaten the dominant player’s position in the future. In such circumstances, the acquisition may serve to entrench the dominant player’s market power or take the form of a “killer acquisition” aimed at preventing product development and foreclosing competition.
The new guidelines consolidate issues that have become part of the ICA’s enforcement practice but had not previously been codified in a single policy document, having been discernible only from ICA decisions and a limited number of publicly available documents – including potential competition, data, platforms, partial or serial acquisitions, and buyer market power.
Accordingly, the review process is expected to be broader and to encompass matters that previously received less public emphasis.
With respect to potential competition, the ICA clarifies that, from a competitive standpoint, independent market entry or organic expansion is preferable to merging with an existing or potential competitor. It further emphasizes that a merger with a potential competitor – particularly involving a dominant player – may serve to entrench that player’s market power. In parallel, the hurdle for approving mergers involving significant data assets is expected to rise, particularly in the context of vertical mergers, where concerns may arise regarding the foreclosure of competitors’ access to essential data.
The guidelines also address platforms, including online platforms. Although these are not a new phenomenon, the ICA – in line with other competition authorities worldwide – considers this area to warrant more in-depth examination.
The ICA also turns its attention to transactions involving the partial acquisition of rights – such as a passive profit interest in a company – and draws a distinction between a “financial interest” and “corporate control,” with each transaction to be evaluated according to its circumstances. The guidelines further address serial acquisitions, which may be used to build market power. For this purpose, the ICA may consider an acquirer’s acquisition history, including in other markets, and examine its internal documents and future plans. This reflects a public acknowledgment that minority investments and incremental acquisitions will also be subject to thorough scrutiny.
The ICA addresses commonly raised defenses, including anticipated future entry by competitors and efficiency claims. Although such arguments were considered under the previous guidelines as well, it appears they will be afforded more limited weight going forward, particularly in horizontal mergers. The practical implication is that it will be harder to rely on general defenses without adequate substantiation.
An argument that entry by new competitors will constrain the merged entity will continue to be assessed against three cumulative conditions: the timeliness, likelihood, and effectiveness of entry. Not only must entry occur quickly enough to preclude the exercise of market power by the merged entity – even for a very brief period – but the probability of such entry must also be close to certain. Finally, it must be effective in its scope, magnitude, and durability over time, thereby preventing the merged entity from exercising market power. In this context, the ICA will examine barriers to entry, including import barriers, as well as past market entry experience. As a general rule, in the absence of regular and material imports prior to the merger, the ICA will tend to presume that import barriers exist.
The new guidelines preserve the principle that efficiencies must be merger-specific, substantial, timely, and capable of being passed on to consumers, but they sharpen the burden on the parties to demonstrate that these conditions are in fact satisfied.
