Merger of Companies or Selling a Business
Contents:
1. Legislative framework and competent authority: what is the relevant legislation
2. Scope of legislation: what constitutes a concentration?
A concentration of undertakings is deemed to arise where a change of control on a lasting basis results from:
- The merger of two or more previously independent undertakings or parts of undertakings, or
- The acquisition, by one or more persons already controlling at least one undertaking, or by one or more undertakings, whether by purchase of securities or assets, by contract or by any other means, of direct or indirect control of the whole or parts of one or more other undertakings.
The creation of a joint venture performing all the functions of an autonomous economic entity on a lasting basis also constitutes a concentration of undertakings.
The Law does not apply to a concentration of two or more undertakings, each of which is a subsidiary of the same undertaking.
3. Are there any exemptions from the rule and are there any rules on particular sectors?
(Sections 6(4) & 5 of the Law)
4. What is the definition of ‘control’?
(Section 6(2) & (3) of the Law)
Control is constituted by rights, contracts or any other means which either separately or in combination and having regard to any factual or legal considerations, confer the possibility of decisive influence on the activities of an undertaking either by ownership or usufruct of all or part of the assets of an undertaking and/or the rights or contracts which confer decisive influence on the composition, voting or decisions of the executive and management bodies of an undertaking.
Control is acquired by persons or undertakings which are holders of such rights or entitled to rights under said contracts or are otherwise entitled to exercise the rights deriving therefrom.
5. Can a concentration arise from multiple legal acts or in stages?
(Sections 7 & 8 of the Law)
6. What are the statutory thresholds for notification and are there any exceptions?
(Sections 3 & 5 and Schedule II of the Law)
7. Is filing mandatory or voluntary? If mandatory, do any exceptions exist?
(Sections 10 & 13 of the Law)
Filing is mandatory for all concentrations of major importance that fall under the scope of the Law. There are no exceptions to the rule.
Where a concentration that needs to be notified is not so notified but comes to the attention of the Service from a different source, the Service immediately informs those concerned of their obligation to notify and on receipt of such notification proceeds as if the conditions for notification had been duly met from the start, provided that for the purposes of calculating time-limits, the actual date of receipt of the notification will be taken into account.
8. Filing formalities: what are the deadlines for filing?
(Section 10 of the Law)
9. Which parties are under the obligation to file a notification and do any filing fees apply?
(Sections 10 & 12 and Schedule III of the Law)
10. Do foreign-to-foreign concentrations have to be notified?
(Sections 3 & 6 of the Law)
11. Does implementation of the transaction have to be suspended prior to clearance?
(Sections 11, 24(2) & 29 of the Law)
12. What are the waiting periods?
(Sections 23, 24, 27, 29 & 30 of the Law)
13. Documentation: What is the level of detail required in the preparation of a filing?
(Schedule III of the Law)
14. Investigation procedure and timetable: What are the typical steps phases of the investigation?
(Sections 10, 15, 16, 17, 22 & 24 of the Law)
15. Can concentrations be cleared temporarily?
(Sections 31 & 32 of the Law)
16. What are the sanctions for pre-clearance implementation of the concentration or for any other infringment of the Law?
(Section 40 of the Law)
17. Are there any sanctions for supplying wrong or missing information?
(Section 40 of the Law)
18. What is the procedure followed in case of an infringement of the Law?
(Section 34 of the Law)
19. What is the substantive test for clearance and is there a special substantive test for joint ventures?
(Section 19 of the Law)
20. What are the main factors that the Commission investigates during an assessment?
(Schedule I of the Law)
21.Is it possible to remedy competition concerns, by giving divestment undertakings or other remedies?
(Sections 22, 25, 26, 27 & 28 of the Law)
22. What are the basic provisions applicable to a divestment or other remedy?
(Section 25 and Schedule IV of the Law)
23. What publicity is given to the process and how is confidential information protected from disclosure?
(Sections 22, 28 & 48 of the Law)
24. Cross-border regulatory cooperation: does the Commission cooperate with antitrust authorities in other jurisdictions?
(Section 54 of the Law)
25. Available avenues: What are the opportunities for appeal or judicial review?
(Section 146 of the Constitution)