The European Commission has approved Finnish telecom equipment group Nokia's planned purchase of Alcatel-Lucent.
Announcing its conclusion on Friday, the Commission said that although both companies are global providers of telecommunications equipment and services, the transaction would not raise competition concerns because they are not close competitors and would still face strong global competition.
"The Commission found that, despite the merged entity having combined market shares around or above 30 per cent for several specific types of equipment, the overlaps between the two companies' activities are effectively limited," it said in a statement.
Specifically, it assessed the effects of the transaction on competition in mobile network equipment, including Radio Access Network equipment (for connecting mobile devices to networks) and Core Network Systems (that for example route telephone calls and data traffic).
It added that Nokia has a strong presence in Europe, where Alcatel-Lucent is a small player, with the positions reversed in North America.
Nokia announced in April an all-share deal then worth 15.6 billion euros to buys its smaller French rival, building up its telecom equipment business to compete with market leader Ericsson.
The combined group would rank behind Ericsson, but ahead of Chinese rival Huawei. China's ZTE and Korea's Samsung are other competitors, with Samsung expected to play a more significant role in 4G and subsequent 5G mobile networks.
The transaction remains subject to approval by Nokia shareholders, and is expected to close in the first half of 2016.