Universal Music Group has submitted what it calls a “robust remedy” to the European Commission, following receipt of a Statement of Objections last month regarding its proposed $775 million acquisition of Downtown Music Holdings.
A UMG spokesperson told MBW on Friday (December 12) that the company’s response to the regulator “comprehensively addresses” the Commission’s outstanding issue with the transaction.
“Following constructive conversations with the European Commission, we have submitted a robust remedy that comprehensively addresses the Commission’s only remaining concern,” the spokesperson said.
“We are confident that the Commission will recognize the benefits of the transaction for artists, labels, independent music, and fans in Europe, and clear the transaction swiftly.”
UMG spokesperson
They added: “This deal is about offering independent music entrepreneurs access to world-class tools and support to help them succeed.
“We are confident that the Commission will recognize the benefits of the transaction for artists, labels, independent music, and fans in Europe, and clear the transaction swiftly.”
UMG’s submission to the EC represents a critical juncture in the Commission’s investigation into the proposed deal. The EC opened its in-depth Phase II investigation into the proposed acquisition in July, following a 25-day initial Phase I review.
The Commission said that its aim was to assess two specific concerns: “if the transaction may allow UMG to reduce competition in the market for (i) the wholesale distribution of recorded music in the European Economic Area (‘EEA’) by acquiring commercially sensitive data of its rival record labels; and (ii) the supply of A&L services in the EEA by removing an important competitive force”.
Downtown provides artist and label services through its FUGA music distribution platform, and offers royalty accounting services through its Curve platform, which handles processing, accounting, payment and related services for royalties as well as rights management.
The European Commission issued a Statement of Objections to UMG in November, formally setting out its preliminary concerns about the proposed acquisition.
In describing the results of its investigation, the press release issued last month focused only on UMG’s potential access to data “stored and processed” by Downtown’s Curve platform.
The Commission said in a press release in November that “such information advantage for UMG would hamper rival labels’ ability and incentive to compete with UMG.”
UMG’s Virgin Music Group announced the Downtown acquisition in December 2024. The proposed transaction would see UMG acquire Downtown and its subsidiaries, including FUGA (music distribution), Curve (royalty accounting), CD Baby, and Songtrust (publishing administration).
The European Commission has until February 6, 2026, to reach a final decision on the proposed acquisition.
At the conclusion of its investigation, the Commission can clear the merger with or without conditions, or prohibit it entirely if competition concerns cannot be adequately addressed.
As previously reported by MBW, the UMG-Downtown deal did not meet the EU’s standard turnover thresholds that would typically require notification to Brussels.
The EC decided to look into the deal because the Netherlands triggered a legal mechanism in EU competition law called Article 22. Austria subsequently joined the referral.
The deal has attracted opposition from independent music organizations. In July, over 200 people signed a letter objecting to the acquisition, including 20 employees from Beggars Group and Secretly Group companies, while a “100 Voices” campaign launched in October featuring testimonies from indie reps urged the EC to block the deal.
Last month, responding to reports that the EC was expected to issue a statement of objections over the deal, IMPALA said in a statement that it “welcome[s] this news and look[s] forward to official confirmation and details of the objections.”
In October, Music Business Worldwide published a collection of views from leaders in the global independent music distribution space on the topic of Universal‘s proposed $775 million takeover of Downtown.
In September, Downtown Music CEO Pieter van Rijn issued an open letter commenting on UMG’s proposed acquisition of his company. Van Rijn addressed what he calls “whispering campaigns of misinformation that we have seen pervade the public debate” about the deal.
In July, Virgin Music Group’s bosses slammed what they called “juvenile and offensive falsehoods” spread by opponents of VMG’s planned Downtown acquisition.
On July 2, the European Composer & Songwriter Alliance (ECSA) issued an open letter to the European Commission urging it to block the planned acquisition.Music Business Worldwide