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EU Warns That Universal Music Group’s Downtown Acquisition May Harm Competition

By  |  November 24, 2025

The European Commission has issued a formal warning to Universal Music Group (UMG), signaling early concerns that the company’s planned acquisition of Downtown could weaken competition in the wholesale distribution of recorded music across the European Economic Area.

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    According to a statement from the Commission, investigators fear the purchase would give UMG access to commercially sensitive information belonging to rival labels. Downtown, a U.S.-based music services company, operates the FUGA distribution platform and the Curve royalty accounting system, both of which handle large volumes of data for independent labels and artists. The Commission noted that this data infrastructure plays a significant role in the broader market for artist and label services.

    The Commission opened an in-depth review on July 22, 2025, to determine whether the deal might allow UMG to obtain privileged insights into competitors’ business activities, potentially undermining fair competition. Per a statement outlining the Commission’s concerns, such an information advantage could discourage rival labels from competing as effectively, particularly in the distribution and analytics services that are central to A&L operations.

    UMG, headquartered in the Netherlands, is one of the world’s largest music companies, spanning recorded music, publishing, merchandising and audiovisual content. Downtown provides artists and labels with distribution, rights management, and royalty services globally, including support for independent musicians and record companies.

    Read more: Music Streaming: Is It a Level Playing Field?

    As part of its inquiry, the Commission examined internal company documents and gathered feedback from industry stakeholders. Based on that evidence, regulators expressed concerns that the merger could remove a key competitive force in the market for A&L services while giving UMG new leverage in wholesale distribution.

    The notification triggers a Statement of Objections, a procedural step that outlines the Commission’s concerns but does not predetermine the final ruling. UMG will now have an opportunity to respond, review the investigation file, and request a hearing.

    The deal was first notified on June 16, 2025. Under EU merger rules, the Commission has until February 6, 2026, to reach a final decision. Most mergers move through the process without difficulty, typically receiving clearance within 25 working days unless a deeper review is deemed necessary.

    The probe into UMG’s proposed acquisition of Downtown is one of three Phase II investigations currently underway, alongside reviews of Mars’ planned purchase of Kellanova and MMG’s proposal to acquire Anglo American’s nickel business.

    Source: EC Europa