Do merger control rules apply to joint ventures (both new joint ventures and acquisitions of joint control over an existing business?
Merger Control (2nd Edition)
New joint ventures and acquisitions of joint control over an existing business, are both subject to merger control whenever the joint undertaking is full-function, and one of the three jurisdictional thresholds is met. Non-full-function joint ventures may be subject to the Competition Act and assessed under the restrictive practices legal regime.
For the purposes of calculating the jurisdictional thresholds, turnover comprises the group-wide revenues. In order to calculate the market share for each undertaking concerned in the concentration, the turnover to be considered, cumulatively, is as follows:
a) Turnover of the undertaking concerned in the concentration;
b) Turnover of the undertaking in which it has, directly or indirectly:
- A majority shareholding;
- More than half of the voting rights;
- The possibility of appointing more than half of the members of the board of directors or the supervisory board;
- The power to manage the undertakings’ affairs;
c) Turnover of the undertakings that have, in the undertaking concerned, alone or jointly, the rights or powers detailed in the previous subparagraph;
d) Turnover of the undertakings in which any of the undertakings referred to in subparagraph c) may have the rights or powers detailed in subparagraph b);
e) Turnover of the undertakings where various undertakings referred to in subparagraphs a) to d) jointly hold, between themselves or with third-party undertakings, the rights and powers listed in subparagraph b) above.
In this area, the PCA also closely follows the rules and criteria set out by the European Commission in its Consolidated Jurisdictional Notice. Non-full-function joint ventures, e.g. the establishment of a cooperative joint venture, are subject to self-assessment by the parties/parent companies to that cooperation agreement, under both Article 101 TFEU and the Portuguese equivalent.
The Competition Act does not provide for separate thresholds for JVs. Where joint control over a to-be-established-JV (newCo) is the case, all undertakings that acquire control over such JV are deemed as participating parties to the concentration; the JV cannot be considered as a participating party to the concentration, since it practically does not yet exist and generates no turnover. As a result, the acquiring undertakings will be taken into account for considering whether the jurisdictional thresholds are satisfied. On the contrary, when two or more undertakings acquire joint control over an existing JV, then all undertakings concerned, i.e. on the one hand the acquiring undertakings and on the other hand the existing JV, will be considered participating parties to the concentration and will be taken into account for considering whether the jurisdictional thresholds are satisfied.
When the full-function JV (as per how it is defined below) acquires control over another undertaking-target, then, in principle, only the JV and the target will be considered participating parties to the concentration, and not the parent companies of the JV. On the contrary, when the JV is used merely as a vehicle for such acquisition of control by the parent companies, then only the latter along with the target will be considered participating parties to the concentration; only such participating parties will be taken into account for determining whether the thresholds are satisfied.
According to art. 3 para. 4 of the Merger Regulation and art. 5 para. 5 of the Law, a concentration will be found in the case of the creation of a JV performing on a lasting basis all the functions of an autonomous economic entity; such JV is deemed a “full-function JV” [see Commission Consolidated Jurisdictional Notice under Council Regulation (EC) No 139/2004 on the control of concentrations between undertakings (2008/C 95/01) para. 91 et seq.]. The criteria taken – on an ad hoc basis- into account for the determination of full functionality or autonomy, among others, are (ibid. para. 94-102) related to (i) whether sufficient resources for independent operation in the market exist, (ii) whether activities beyond one specific function for the parents are carried out, (iii) whether there is strong presence of the parent companies in upstream or downstream markets and whether the JV relies on sales/purchases to/from the parent companies (especially for a period exceeding an initial start-up period, which usually lasts three years). Accordingly the JV must be intended to operate on a lasting basis (ibid. para. 103-105). Should the above characteristics of full-functionality and long lasting operation not be met, then the JV may be reviewed under art. 1 of the Law and/or art. 101 TFEU for prohibited collusions.
Due to the declined volume of concentrations that have taken place in Greece during the past few years, as a result of the unprecedented fiscal crisis the country is facing, the Hellenic Competition Commission has not generated rich case law. In a recent merger control decision issued by the HCC, Decision no. 615/2015, the HCC held that there two conditions which shall be met in order to confirm the full functionality of a JV i.e. a) the exercise of joint control by the parent entities (with a citation to footnote 84 of the Jurisdictional Notice) and b) that the JV shall perform on a lasting basis all the functions of an autonomous economic entity, i.e. be operationally and therefore economically autonomous in an operational respect (with citation to paras 92-93 of the Jurisdictional Notice). Another relative decision of the HCC dealing with a shift of control over a joint venture is decision no. 577/2013; the case pertained to the shift in the quality of control over Waste Syclo, a full-function JV. Such was implemented through the acquisition of the 51% of the shareholding in the JV by a new shareholder. Until the time of the concentration the JV had generated zero turnover (since its activity amounted merely to its participation in an international public tender) and had been funded by its parent companies. The HCC, which approved the concentration, subject to certain commitments assumed by the parties, ruled in its decision that a concentration exists in the case of the establishment of a new legal entity in the form of a JV, which can boast performance on a lasting basis and function as an autonomous economic entity, as well as in the case of a shift in the structure of an existing JV. According to the HCC in its ruling, a JV carries out on a lasting basis all the functions of an autonomous undertaking when it is active in the market and carries out all usual functions of an undertaking that is active in the same market, it is independently managed and has sufficient financial funds, personnel and fixed assets so that it can carry out its business activity on a lasting basis.
It is irrelevant whether the transaction relates to an existing JV or the creation of a new one. The full-functionality criterion set forth above delineates the application of the Merger Regulation for the creation of joint ventures by the parent companies, irrespective of whether such a joint venture is created as a “greenfield operation” or whether the parties contribute assets to the joint venture which they previously owned individually. In addition, a transaction involving several undertakings acquiring joint control of another undertaking or parts of another undertaking fulfilling the criteria in the test for control, from third parties does constitute a concentration without it being necessary to consider the full functionality criterion.
In relation to joint ventures, where both/all parents are contributing assets to the new joint venture, turnover of each of the businesses being contributed to the joint venture must be assessed, with the lowest business turnover being deemed the 'target' in this respect.
'Greenfield' joint ventures (i.e. joint ventures that commence a new business activity, rather than combining existing activities of the parent companies) are not notifiable under UK merger control rules, as such ventures have neither turnover nor share of supply.
Italian merger control rules apply to joint ventures, only if they have a “concentrative” nature, namely:
- They are intended to perform on a lasting basis all the functions of an autonomous economic entity (full function nature); and
- Their object or effect is not the coordination of the competitive behavior of the parent companies.
As a result, a full function joint venture could fall outside the scope of the Italian merger control rules if, for example, the parent companies were active in the same relevant product and geographic market as that of the joint venture, or in upstream/downstream markets. Such joint venture would need to be (self-)assessed according to rules governing restrictive agreements (e.g., Art. 101 TFEU).
Joint ventures that do not involve the formation of a new corporate or non-corporate entity (i.e., involve existing entities) are HSR reportable if they meet the relevant size-of-transaction and size-of-person thresholds, one of the parties forming the joint venture is engaged in commerce, and no exemption applies.
When a joint venture involves the formation of a new entity (Newco), each contributing party is considered an acquiring person and the Newco is considered the acquired entity. The rules determining whether a formation triggers a filing vary depending upon whether the Newco being formed is a corporation or an unincorporated entity.
The threshold values listed below are as of February 2017 and are adjusted annually.
Formation of a Corporate Entity
In the formation of a US Newco corporation, each acquiring person must submit an HSR filing if no exemption applies and the value of that acquiring person’s shares of the new corporate entity is either over $323 million or between $80.8 million and $323 million and the size-of-person test is met. The value of an acquiring person’s voting securities of the Newco is based on the acquisition price of the Newco’s voting securities, if determined, or the fair market value (described in response to question 7 above) of the acquiring person’s contributions to the Newco if the acquisition price is not determined. The size-of-person test is met if:
- The acquiring person has annual net sales or total assets of at least $16.2 million and (1) the Newco has assets of $161.5 million and (2) at least one of the other acquiring persons has assets or annual net sales of at least $16.2 million, or
- The acquiring person has annual net sales or total assets of at least $161.5 million and (1) the Newco has assets of $16.2 million and (2) at least one of the other acquiring persons has assets or annual net sales of at least $16.2 million.
Formation of a Non-Corporate Entity
In the formation of a US Newco non-corporate entity, the transaction is reportable if that acquiring person acquires control of the Newco. An acquiring person that acquires control of the Newco must submit an HSR filing if the value of that acquiring person’s shares of the non-corporate entity is either over $323 million or between $80.8 million and $323 million, the size-of-person test is met, and no exemption applies. The value of an acquiring person’s controlling interest in the Newco is based on the acquisition price of the controlling interest in the Newco, if determined, or the fair market value of the controlling interests. The size-of-person test is met if:
- The acquiring person has annual net sales or total assets of at least $16.2 million and the Newco has total assets of $161.5 million, or
- The acquiring person has annual net sales or total assets of at least $161.5 million and the Newco has total assets of $16.2 million.
The rules for merger control apply to joint ventures as well. Forming new joint ventures is covered as well as any significant transfer of assets to an existing JV. The same merger control regime applies to JV and other transactions alike.
When assessing a transaction involving a joint venture, any company holding 25% of shares or more needs to be taken into account.
In the framework laid out by the ARC, merger control, prohibition of abuse of dominant position and prohibition of cartels work alongside each other. Therefore, the fact that one applies to a JV does not mean that the other could or would not.
It does not make a difference if a transaction relates to an existing JV or the creation of a new JV. Neither does German merger control treat full-function and non-full-function JVs different. As long as parent companies and/or the JV exceed the relevant thresholds and the transaction is considered a concentration, the transaction is subject to merger control.
No special thresholds for transactions establishing joint ventures exist. This means that parties have to analyse whether the transaction structure includes any qualifying transactions, such as share acquisitions, mergers, and business/asset transfers, and if it includes any, then apply the thresholds designed for each category.
The creation of a joint venture – that is an undertaking being jointly controlled by at least two other undertakings – performing on a lasting basis all the functions of an autonomous economic entity qualifies as a concentration under Austrian law. Such joint ventures are also referred to as so-called full-function joint ventures. Similar as under the EUMR, a full-function joint venture has to be economically autonomous, permanent and must not fulfil only auxiliary functions. The joint venture must have sufficient resources to operate independently on a market in order to conduct its business activities on a lasting basis. Moreover, it must be involved in activities beyond one specific function for the parent companies.
If two undertakings gain joint control over an already operating target company, this can as well qualify as concentration (see the above elaboration on what transactions are concentrations under Austrian law). The full-function test is in such cases not a requirement to have a concentration.
The Act exempts the formation of an unincorporated combination (e.g., a joint venture established through the formation of a partnership) from the merger control provisions if: (i) all the persons who propose to form the combination are parties to an agreement in writing or intended to be put in writing that imposes on one or more of them an obligation to contribute assets and governs a continuing relationship between those parties; (ii) no change in control over any party to the combination would result from the combination; and (iii) the agreement restricts the range of activities that may be carried on pursuant to the combination, and contains provisions that would allow for its orderly termination.
The formation of a joint venture that does not qualify for the exemption above (e.g., a joint venture carried on through a corporation), as well as the acquisition of an interest in an existing joint venture, may be subject to merger control if the transaction exceeds the relevant financial thresholds that are generally applicable to all transactions. There are no separate thresholds for joint ventures, and the same general rules apply regarding entities that must be included for the purpose of determining whether the thresholds are met.
For example, the “size of transaction” threshold for a joint venture established through the contribution of assets to a new corporation would be met where: (i) at least one of the persons contributes assets from an operating business, and (ii) the aggregate value of the assets in Canada or the gross revenues from sales in or from Canada generated from those assets exceeds CAD $88 million (for 2017).
The “size of transaction” threshold for the acquisition of an interest in a combination (e.g., acquiring voting interests in a partnership) would be met where: (i) the combination carries on an operating business other than through a corporation; (ii) the aggregate value of the assets in Canada that are the subject matter of the combination or the gross revenues from sales in or from Canada generated from those assets exceeds CAD $88 million (for 2017); and (iii) as a result of the acquisition, the person acquiring the interest will be entitled to over 35% of the profits of the combination or of its assets on dissolution, or where the person acquiring the interest is already so entitled, the acquiring person will be entitled to over 50% of such profits or assets.
From a substantive perspective, joint ventures may be reviewed under the Act’s prohibition on anticompetitive agreements among competitors regardless of whether they are subject to merger control. If they constitute the acquisition of a significant interest in a person (i.e., a merger), joint ventures also could be reviewed under the substantive merger provisions, even if they are not notifiable.
The establishment of a new structural joint venture that will perform activities on a permanent basis is qualified in the Competition Act as an operation of concentration. From the FNE’s Guidelines on Jurisdiction it is moreover clear that non-structural joint ventures are not caught by the provisions of Section IV of DL 211, and may be assessed under the general provision prohibiting anticompetitive facts, acts or agreements.
The Guidelines stipulate furthermore that the joint venture doesn’t necessarily require joint control by the parent companies. The important features are that a new entity is established and that has operational autonomy on a structural basis. Therefore, the joint venture shall be analyzed under a “full functionality” criterion. Such functional autonomy has a normative and an economic dimension: (i) normatively in the sense that the joint venture must act as a sovereign legal economic agent; and (ii) economically in the sense that the joint venture has sufficient resources to operate in the market.
In relation to the analysis whether the turnover thresholds are met, the turnover of the parties establishing the joint venture and their respective company group’s turnover are relevant
The acquisitions of control in an existing joint venture or the acquisition of joint control in an existing company are also qualified as a concentration operation. However, for the analysis whether the turnover thresholds are satisfied, the turnover of the party or parties acquiring control (and their respective company group) and that of the target company are to be taken into account.
A joint venture that is genuinely fully functional must be able to operate independently of its parents on an identifiable market. In order to do so the joint venture must have a management dedicated to its day-to-day operations and access to sufficient resources including finance, staff, and assets (tangible and intangible) in order to conduct its business activities on a lasting basis.
The strong presence of the parent companies in upstream / downstream plays a crucial role in assessing the full functionality of a joint venture, where this presence results in substantial sales or purchases between the parents and the joint venture. Given that the basic function of an outsourcing joint venture is normally to supply the outsourcing parent, the essential question is whether, regardless of these sales, the joint venture is able to play an active role on the market.
The joint venture's full functionality will not normally be affected by an initial period of sales exclusively to its parents. Indeed, such a start-up period may be necessary in order to establish the joint venture on a market. The joint venture should inevitably have sufficient resources to build up such market presence within a reasonable time frame.
Where sales from a joint venture to the parent companies are intended to be made on a lasting basis, the essential question is whether, regardless of these sales, the joint venture is geared to play an active role on the market and can be considered economically autonomous from an operational viewpoint. In this respect the relative proportion of sales made to its parents compared with the total production of the joint venture is an important factor.
Danish merger rules apply to transactions whereby a full-function joint venture is created on a permanent basis, or whereby a permanent change of control over an existing business creates a full-function joint venture.
According to a recent judgment of the ECJ (C-248/16), the creation of a joint venture shall, in either way, be subject to merger control only if it performs on a lasting basis all the functions of an autonomous economic entity. This involves that the joint venture must act independently of its parent companies and thus have its own access to or presence on the market.
Previous to this ruling, the DCCA – as similar to the European Commission - held that a change from a sole control to joint control of an existing undertaking was subject to merger control regardless of whether the full-function joint venture would perform on a lasting basis all the function of an autonomous economic entity. It has yet to be settled in Danish case law, whether ECJ’s judgment will affect the Danish merger regime.
The EUMR provides that so-called “full function joint ventures” which meet the jurisdictional thresholds should be notified. A full-function joint venture exists if there is (a) joint control; (b) sufficient resources, assets, and financial resources to operate the joint venture business autonomously; and (c) the joint venture business will exist for a sufficiently long duration as to bring about a lasting change in the structure of the market concerned.
In the case of joint ventures, the whole turnover of the parents (and their groups) intending to share joint control of the venture is taken into account.
Yes, both types of transactions are caught by French merger control rules. In the case for example of a newly created joint venture with no existing turnover, the parties to the concentration (for the purpose of turnover thresholds calculation) will be the parent companies which will exercise control.
The Regulations stipulate that the creation of a ‘full functioning joint venture’, that is a joint venture performing on a lasting basis all the functions of an autonomous economic entity, shall be considered a concentration for the purposes of the Regulations. In such situations the turnover threshold test does not apply, as the determining criterion is the creation of the joint venture itself.
With regard to that the acquisition of joint control of an entity, whether direct or indirect, such transaction would form a concentration only if the turnover thresholds as discussed in Point 1.1 above are met. Moreover, where there is an acquisition of joint control by two or more undertakings and the turnover of the joint venture and/or the turnover of the contributed activities arising in Malta is less than €698,812.02, and the total value of assets transferred to the joint venture in Malta is less than €698,812.02, a short form notification and simplified procedure in terms of the Regulations is allowed.
The undertakings to be taken into account for considering the thresholds shall be the same as those identified above, that is the entities participating directly in the transaction and any group entities which are related under the conditions outlined above.
The turnover thresholds can be satisfied by any undertaking involved in the transaction, including either of the participating parent companies. This applies even where the joint venture is not in itself active in Malta. The consequences of not filing a notification in such instances shall be the same as those identified in the Penalties section discussed below.
A newly created joint venture is automatically considered a concentration if it performs on a lasting basis all the functions of an autonomous economic entity. The default rule in such cases is that it is subject to the notification requirements established in the Regulations.
By exception to the above, where the joint venture has as its object or effect the coordination of the competitive behaviour of undertakings that remain independent, such concentration shall be appraised in terms of the prohibited agreements and concerted practices provisions that are found in the Act, so as to establish whether the operation is lawful. In making this appraisal, the DG shall take into account:
- whether two or more parent companies retain to a significant extent activities in the same market as the joint venture or in a market which is downstream or upstream from that of the joint venture or in a neighbouring market closely related to this market; and
- whether the coordination which is the direct consequence of the creation of the joint venture affords the undertakings concerned the possibility of eliminating competition in respect of a substantial part of the products or services in question.
As discussed, the acquisition of control by one or more undertakings of the whole or part of another undertaking (i.e. an existing business) would only qualify as a concentration if the turnover thresholds are met by any involved entity. Where a new JV is created, this is automatically a concentration and would need to be assessed in terms of the above to establish if it is notifiable and if it should be assessed in terms of the prohibited agreements and concerted practices provisions of the Act.
The merger control rules apply to joint ventures and there are no separate thresholds. The jurisdictional thresholds apply to joint ventures in the same way as under the EU Merger Regulation and the assessment of full functionality is also similar to that under the EUMR.
There is a simplified procedure (short-form notification) for certain transactions relating to joint ventures. This applies in particular to: i) creation of joint ventures where the value of and the turnover related to assets transferred to the joint venture is less than NOK 100 million; and, ii) changes in control over joint ventures where one owner assumes full control over an undertaking previously controlled jointly with others.
The Romanian merger control rules (including the jurisdictional thresholds) apply to the creation of a new full-function joint venture (i.e. performing on a lasting basis all the functions of an autonomous economic entity) as well as to the acquisition of joint control over an existing business.
For the purposes of the jurisdictional thresholds, the turnovers to be taken into account are: the turnover achieved by each undertaking which will exercise joint control (including their respective groups) and the turnover achieved by the joint venture itself (including its subsidiaries), if applicable. Therefore, a joint venture may need to be notified to the Competition Council even if it has no actual or foreseen activities in Romania. Failure to notify the economic concentration to the Competition Council may entail the application of a sanction according to the Competition Law no. 21/1996.
To the extent that the creation of a joint venture has as object or effect the coordination of the competitive behaviour of the undertakings remaining independent, such coordination shall be assessed under the prohibition of anticompetitive agreements. For such review, the Competition Council shall particularly take into account the following criteria:
(i) if two or several parent companies retain, to a significant extent, the activities in the same market as the joint venture or in a market which is upstream or downstream to the joint venture’s market or in a neighbouring market in close connection with this market;
(ii) if through the coordination which constitutes the direct consequence of the creation of the joint venture, the concerned parties have the possibility to eliminate competition for a significant part of the products or services in question.
KN: There are no specific thresholds for joint ventures, the same jurisdictional thresholds apply to them. However, only joint ventures where “a new undertaking acting on a fully independent and long-term basis and having an access to market” is a joint venture subject to merger control. Purely cooperative joint ventures (i.e. where the joint venture is used by the parent companies to coordinate their behaviour on the market) to which merger control rules do not apply may be reviewed under the prohibition on anticompetitive agreements. Therefore, only full-function joint ventures are notifiable under the merger control rules and given the lack of local practice and guidelines the full-functionality is interpreted in line with the EU approach. The Competition Commission is not, however, obliged to apply or follow EC guidelines and precedents therefore it is possible that it adopts wider or narrower approach in respect of full functionality.
Both changes of control over an existing joint venture and creation of a new joint venture may amount to a concentration. If a new joint venture is being formed, the turnover of parent companies is taken into account when assessing whether the merger control thresholds have been met. If controlled is being acquired or changed over an existing joint venture, in addition to joint venture parents, the joint venture itself is assessed for the purpose of merger control thresholds and in such situations double-counting of joint venture’s turnover should be avoided.
Considering that local nexus is not required for merger control to apply in Serbia, the same goes for joint ventures. Even if the joint venture will have no actual or foreseen activities in Sebria provided the merger filing thresholds have been met by either of the joint venture partners, the filing would still be mandatory. The assessment of risk should be based on the likelihood of the Competition Commission ever finding out about the joint venture (e.g. regional transaction might be under a greater risk of enforcement than more distant transactions). However, each transaction should be assessed on a case-by-case basis by a local counsel.
The Act does not specifically refer to joint ventures. To the extent that the effect of a joint venture constitutes a ‘merger’ as defined, the merger control provisions of the Act will apply. Generally ‘greenfield’ joint ventures will not be caught by the Act, but a combination of existing operations may be. The Commission has published a non-binding practitioners’ note to help determine whether a joint venture is caught. To the extent that a joint venture is not a ‘merger’, the prohibited practices provisions of the Act may nevertheless apply.
The Turkish merger control rules applicable to joint ventures are akin to-if not the same as-the EU rules. Article 5 of the Communiqué 2010/4 on Mergers and Acquisitions Requiring the Approval of the Competition Board (“Communiqué No. 2010/4”) provides a definition of joint venture, which does not fall far from the definition used in the EU law.
To qualify as a concentration subject to merger control, a joint venture must be of a full-function character and satisfy two criteria: (i) existence of joint control in the joint venture and (ii) the joint venture being an independent economic entity established on a lasting basis (i.e. having adequate capital, labour and an indefinite duration). Additionally, regardless of whether the joint venture is full function, the joint venture should not have as its object or effect the restriction of competition among the parties or between the parties and the joint venture itself within the meaning of Article 4 of Law No. 4054, which prohibits restrictive agreements. If the parent undertakings of a joint venture operate in the same market or the downstream or upstream or neighbouring market as the joint venture, it could lead to coordination between independent undertakings that restrict competition within the meaning of Article 4 of the Law.
If the turnover thresholds are triggered by the parents, the JV transaction would be notifiable as long as it has a full-function nature. The fact that the JV’s products/services are or will not be offered in Turkey would not change the analysis. There has been a legal debate in Turkey that transactions which do not trigger any (potential) effects in Turkey would fall outside the scope of the Law No.4054. However, this debate seems now settled. The Competition Board has adopted several clearance decisions regarding JVs that do not involve sales in Turkey, and has considered that they are notifiable as long as the characteristics of the goods and services in question allow for a theoretical possibility that there "could" one day be sales by the JV into Turkey.
As a side note, in case the nature of the JV turns out to be non-full-functional, while the non-full function JVs are not under a mandatory merger control filing, non-full function JVs may fall under Article 4 of Law No 4054, which prohibits restrictive agreements. The parties have the ability to do a self-assessment individual exemption test, which is set out under Article 5 of Law No. 4054, on whether the JV meets the conditions of individual exemption (which are also very similar to, if not the same as EU regime). Notifying the transaction for individual exemption is not a positive duty of the parties, but it is an option granted to them.
The Ukrainian merger control rules apply to JVs on a common basis. There are no separate thresholds for JVs.
Yes, article 90, IV, of the Brazilian Antitrust Act states the following:
Art. 90. For the purposes of Article 88 of this Law, a concentration act shall be carried out when:
IV - two (2) or more companies enter into an associative contract, consortium or joint venture.
Sole paragraph. What is described in item IV of the caput, when used for bids promoted by direct and indirect public administration and for contracts arising there from, shall not be considered concentration acts.
The test for assessing joint ventures in Australia is the same as for any other type of merger: if the joint venture involves the acquisition of shares or assets, it will be subject to the merger prohibitions under the CCA. If it does not, the joint venture will still need to be assessed under the general prohibition on anti-competitive agreements.
New joint ventures will usually fall outside the scope of the merger control regulation. However, acquisition of existing joint ventures are subject to merger control rules.