The European Commission has cleared UniCredit S.p.A.’s proposed acquisition of Banco BPM S.p.A. under the EU Merger Regulation, subject to full implementation of remedies intended to address competition concerns in the Italian banking sector. In parallel, it rejected the Italian competition authority’s request to have the merger assessed under Italian competition law. The review found competition concerns at local level for deposits and loans for retail consumers and small and medium-sized enterprises, driven by strong horizontal overlap between the parties’ activities and branch networks across 181 local areas. The Commission did not identify concerns at regional level for banking services to large corporate clients, and it also found no material risk of coordination in the Italian banking market given market fragmentation, low consumer price transparency and limited scope for competitors to monitor each other’s behaviour. To remedy the local overlaps, UniCredit committed to divest 209 physical branches in affected areas across Italy, with an independent trustee to monitor implementation under Commission supervision; following a positive market test, the Commission concluded the divestment would leave moderate combined shares and remove the identified competition issues.