The European Union may allow startups to claim innovation benefits in M&A if they are not involved in the process. This move comes after telecoms operators called for looser merger rules to allow them to compete with U.S. and Chinese rivals. The proposed 'innovation shield' does not cover deals where the acquirer is the largest player in the relevant market or where the company is labelled a gatekeeper under the Digital Markets Act. The proposal is currently being reviewed by the European Commission and will be open to feedback from companies and other participants before it is adopted.