Additional information: Jurisdictional Test
Some concentration transactions do not require notification to MOFCOM even though the relevant jurisdictional thresholds have been satisfied.
Business operators may be exempted from notification under the following circumstances, because the concentration are treated as re-organization within a group:
- one of the business operators involved in the concentration holds at least 50% of the voting shares or assets of each of the other business operators; or
- at least 50% of the voting shares or assets of each business operator involved in the concentration are held by one business operator not involved in the concentration.
MOFCOM may investigate a concentration transaction even though the jurisdictional thresholds have not been satisfied.
Pursuant to Article 4 of the Provisions of the State Council on Notification Thresholds for Concentrations of Undertakings, promulgated by the PRC State Council on 3 August 2008, where a concentration transaction does not meet the jurisdictional threshold, but facts and evidence collected in accordance with the prescribed procedures establish that the concentration transaction in question has or may have the effect of eliminating or restricting competition, MOFCOM shall initiate an investigation into the concentration transaction.
Separate measures for the calculation of turnover shall be applied to business operators in the financial industry.
Based on the particularities of the financial industry, MOFCOM and other authorities formulated a regulation entitled Measures for the Calculation of Turnover with respect to the Declaration of Concentrations of Business Operators in the Financial Industry in 2009, setting out the measures for the calculation of turnover of business operators in the financial industry. Business operators in the financial industry, such as banking financial institutions, securities companies, futures companies, fund management companies and insurance companies shall use the calculation measures stipulated in this regulation when calculating their turnovers for merger filing purposes.
The Israeli Antitrust Authority tries to meet the standards of leading jurisdictions like the European Union and the USA. It makes a great effort to meet the tight filing schedules. There is generally open communication with Israeli Antitrust Authority representatives and they are often willing to share doubts or questions they may have with the parties.
Under Japanese merger regulation, a single transaction may trigger multiple filings depending on the structure of the transaction. For example, if a transaction is composed of a share transfer and an asset transfer, the parties have to file two separate notifications for both the share transfer and the asset transfer, respectively, if they meet the thresholds designed for a share acquisition and an asset transfer, respectively. The parties should carefully analyse if multiple filings are necessary by looking into transactions composing the whole transaction. In particular, the establishment of a joint venture often triggers multiple filings.
There are certain other special merger control rules to be considered in respect of a number of specific sectors.
First, similarly to the EU, there are specific rules regarding turnover calculation for specific sectors such as banks, financial institutions, leasing companies, factoring companies, securities agents, insurance companies, etc. See Article 9 of Communiqué No. 2010/4.
Second, there are specific merger control provisions for banks and privatisation tenders.
(i) Banks: Banking Law No. 5411 provides that Articles 7, 10 and 11 of the Competition Law are not applicable if the sectoral share of the total assets of the banks subject to the transaction does not exceed 20%. In practice, the Competition Board distinguishes between: (i) transactions involving foreign acquiring banks with no operations in Turkey, to which the Competition Law is fully applied; and (ii) foreign acquiring banks already operating in Turkey, to which the Competition Law is not applied if the conditions for the application of the Banking Law exception are fulfilled.
(ii) Privatisation tenders: Communiqué No. 2013/2 prescribes an additional pre-notification process. This only applies to privatisations in which the turnover of the undertaking or asset or unit intended for production of goods or services to be privatised exceeds 30 million TL (approximately EUR 10 million). For this calculation, sales to public institutions and organisations including local governments made on the basis of a legislative provision should not be taken into account. If the threshold is met, a pre-notification should be filed with the Competition Authority before the public announcement of the tender specifications. The Competition Board will issue an opinion that will serve as the basis for the preparation of the tender specifications. This opinion does not mean that the transaction is cleared. Following the tender, the winning bidder will still have to make a merger filing and obtain clearance before the Privatisation Administration’s decision on the final acquisition.
Third, there are various sector-specific rules alongside the merger control rules for sectors such as media, telecommunications, energy and petrochemicals. For example:
(i) Energy: regarding electricity and natural gas, approval is required for share transfers of more than 10% (5% in case of publicly traded company shares) following the Electricity Market License Regulation the Natural Gas Market License Regulation.
(ii) Broadcasting: under Law No. 6112, the transfer of the shares of a joint stock company holding a broadcasting licence should be notified to the Turkish Radio and Television Supreme Council.
Please note that the Russian law provides for the general possibility of the applicant to contact the FAS before filing in order to preliminary inform the authority about the deal, check the completeness of the package, discuss provision of additional information and potential remedies (the applicant may propose them to the authority). The FAS is not obliged to accept or officially confirm anything at this stage, but it shall take the provided information into account when considering the deal. Since there is no detailed procedure for such communication, in practice, it depends on the deal in question and arrangements with concrete FAS’ department.
In accordance with the referral system under the EU Merger Regulation, a transaction that is notifiable to the European Commission may, if certain criteria are met, be referred – in whole or in part – for review by the CMA, either at the request of the parties or at the request of the CMA.
In addition, a transaction (or the UK aspects of it) may be referred for review by the European Commission even if the parties do not meet the jurisdictional thresholds for review under the EU Merger Regulation or the UK merger control regime. Again, this can happen at the request of the parties or of the CMA.
Particularly in difficult cases, the official parties are generally open to pre-notification talks. They can also be approached, for example, with questions regarding the above discussed effects doctrine.
In 2015, Cofece released non-binding guidelines for merger control review in Mexico. The Guidelines published by Cofece aim to provide further explanations for analysing specific cases, as well as detailed advice over substantive and procedural rules applicable for these kinds of procedures. Cofece’s guidelines are similar to those published by leading competition enforcers such as the US antitrust authorities (DOJ Antitrust Division and the FTC) and the European Commission.
In addition to obtaining pre-merger clearance, parties are also required under German law to submit a very brief post-completion notice to the FCO, which is to be provided in due course following the closing of a previously notified transaction. This can be done by way of a short letter in which reference is made to all facts as described in the earlier pre-merger notification. In practice, if the FCO has not received such post-merger notice after a certain period of time, it will follow up with the parties to inquire about the status and by reminding them that submitting a post-completion notice is mandatory under German law.
Under Law Decree no. 21 of 15 March 2012, as amended by Italian Law no. 56 of 11 May 2012, the Italian Government has the power (golden shares) to object or impose conditions in case of extraordinary transactions regarding strategic activities or assets in the communications, energy and transport sectors. Such strategic activities and assets have been identified in several Prime Minister Decrees.