What procedure applies in the event that remedies are required in order to secure clearance?

Merger Control

China Small Flag China

The Regulations on Imposing Restrictive Conditions on Concentrations of Undertakings (for Trial Implementation) (the “Remedy Regulations”), promulgated by MOFCOM on 4 December 2014, detail rules on the procedure for offering remedies.

Timeline for offering remedies

Business operators to the concentration may negotiate with MOFCOM regarding offering remedies either before or after MOFCOM informs the parties that the concentration will or may have the effect of eliminating or restricting competition. Pursuant to Article 6 of the Remedy Regulations, a final remedy proposal shall be submitted to MOFCOM no later than 20 days before the end of Phase II. Otherwise, MOFCOM will have right to prohibit the concentration transaction.

In practice, the negotiation between MOFCOM and the concerned parties generally occurs in Phase II, and remedies in some cases are accepted and determined in the extended Phase II (or Phase III). Most commonly, the remedies are offered by the acquiring party, but MOFCOM has in the past accepted remedies from both the acquiring party and the selling party (e.g., by both Microsoft and Nokia in the Microsoft/Nokia transaction).

Remedy proposals will be market tested by MOFCOM

MOFCOM will evaluate the remedies offered by the parties. When conducting a market test, MOFCOM may seek opinions of the relevant government authorities, industry associations, business operators and consumers in the relevant market by way of issuing questionnaires, convening hearings, organizing experts to conduct feasibility studies, etc.

MOFCOM may not waive a demand for a formal remedy even though a remedy is agreed in other jurisdictions

Based on our experience, what MOFCOM is most concerned about is whether the concentration transaction will give rise to any competition concerns within the China market. If the answer is yes, a formal remedy may be imposed on the concerned parties before a clearance decision can be made. Since a remedy agreed upon in other jurisdictions may not be able to resolve the competition concerns in the China market, and the implementation of such remedy is beyond the control of MOFCOM, we do not believe that MOFCOM would grant the parties to the concentration a waiver for a formal remedy merely based on the fact that a remedy has been agreed upon in another jurisdiction.

Denmark Small Flag Denmark

If the DCCA finds that a merger gives rise to concerns, the parties may propose remedies in order to obtain an approval. Remedies should preferably be offered as early as possible. Remedies offered late in Phase II will extend the time frame of Phase II in order to grant the DCCA at least 20 business days to assess the remedies. The offered remedies will usually be market tested.

Ireland Small Flag Ireland

The CCPC may enter into discussions with the undertakings involved in a transaction with a view to identifying measures which would ameliorate any effects of the merger or acquisition on competition. The CCPC is concerned with the competitive impact of the transaction in the State; to that extent, it will consider whether a remedy proposal made or agreed in another jurisdiction addresses the competition issues identified in Ireland.

Proposals can be submitted to the CCPC at any stage during Phase I or Phase II, although the CCPC has made clear that early remedies discussions are desirable as the CCPC may have questions on the proposals and the proposal remedy may be market tested. Commitments at Phase I and Phase II must be proposed by the parties. If the remedy proposals are agreed between the parties and the CCPC, they will become binding on the parties as a commitment decision, which is published.

The Competition Act provides for the enforcement of obligations arising from commitments accepted by the CCPC. The High Court can grant an injunction to enforce compliance with the terms of commitments. Any person who contravenes such commitments is guilty of an offence and liable to fines and/or imprisonment (see below).

Israel Small Flag Israel


Japan Small Flag Japan

The parties can begin negotiating remedies with the JFTC at any time during the review. The negotiation is typically triggered by the JFTC’s explanation to the parties of its competitive concerns on the notified transaction. The parties need to take initiative in proposing them. When the parties propose remedies, the JFTC will comment as to whether the proposed remedies are sufficient to resolve the concerns or not.

The JFTC’s merger guidelines provide that remedies in principle should take place before the implementation of the transaction. Even if this is not possible, they should be implemented before the proper deadline which is to be clearly provided in the remedy proposal. In addition, if the remedies include the divestiture of any or all of the overlapping business, for example, the buyer of such business should be identified before the implementation of the transaction, otherwise the parties may have to obtain the JFTC’s approval of the buyer before divesting the business.

Malta Small Flag Malta

Remedies may be provided to the OFC during both phases. Remedies during Phase I shall not preclude the DG from proceeding with Phase II, although if the remedies sufficiently eliminate serious doubts, then the DG shall not proceed to Phase II.

Since is no clear cut precedent as to remedies which are acceptable to the DG, the OFC generally adopts the views of the European Commission in this regard. The determining criterion remains the removal of any serious doubt regarding the lessening of competition.

Turkey Small Flag Turkey

The parties may submit to the Board proposals for possible remedies either together with the notification form, during the preliminary review or the investigation period. If the parties decide to submit the commitment during the preliminary review period, the notification is deemed filed only on the date of the submission of the commitment. In any case, a signed version of the commitment text that contains detailed information on the context of the commitment and a separate summary should be submitted to the Authority.

As per the Remedy Guideline, it is at the parties’ own discretion whether to submit a remedy. The Board will neither impose any remedies nor ex parte change the submitted remedy. In the event the Board considers the submitted remedies insufficient, the Board may enable the parties to make further changes to the remedies. If the remedy is still insufficient to resolve the competition problems, the Board may not grant clearance.

There have been several cases where the Competition Board has accepted the remedies or commitments (such as divestments) proposed to, or imposed by, the European Commission as long as these remedies or commitments ease competition law concerns in Turkey (see, for example, Cookson/Foseco decision No. 08-25/254-83 of 20 March 2008).

The Board conditions its clearance decision on the application of the remedies. Whether or not the parties may complete the merger before the remedies have been complied with depends on the nature of the remedies. Remedies may either be a condition precedent for the closing or may be designed as an obligation post-closing of the merger. The parties may complete the merger if the remedies are not designed as a condition precedent for the closing.

Ukraine Small Flag Ukraine

If the AMC informs the parties to the concentration that they may not be granted an approval, they have 30 calendar days (extendable at the parties’ request) to offer the AMC remedies they are willing to undertake, in order to eliminate negative effects on the competition. As a rule, the AMC informs the parties that remedies are required within the framework of Phase II.

United States Small Flag United States

Remedy discussions generally happen during the course of a Second Request. Ideally, the parties to the transaction and the agency staff will have an ongoing dialogue about the status of the investigation, the competitive concerns raised by the agency, and whether a divestiture would be sufficient to address those concerns. There is no “deadline” for the parties to offer a remedy, but if the agency believes a transaction is anticompetitive and the parties are unwilling or unable to offer a divestiture, the alternative will be an injunction proceeding in federal court. Any proposed divestiture will be carefully evaluated by the agency to ensure it would be sufficient to remedy the competition concerns raised by the transaction. Even if the parties to a transaction with competitive issues offer a remedy at the very beginning of the HSR process, the likelihood of a Second Request is very high to allow the reviewing agency time to develop the scope of the competitive issues presented by the transaction, and to evaluate the proposed divestiture and whether it will address the agency’s concerns.

Russia Small Flag Russia

The decision whether or not to issue a remedy and on its content is made by the FAS. Such a decision may be made any time within the review period. The FAS is not obliged to consult with (or even to inform) the parties or any third parties when making a decision to use a remedy and such a decision is not market tested. Yet the parties may send the FAS their own proposals in relation to potential remedies and, in practice, the FAS is ready to discuss the approach to the remedies with the parties. Please note that, in general, remedies issued by the FAS do not depend on and are not connected with remedies in another jurisdictions (excluding the situation when they contradict each other).

United Kingdom Small Flag United Kingdom

During the first-phase investigation, remedies can be offered at any time up to five working days after the CMA has informed the parties of a decision that the merger risks giving rise to a substantial lessening of competition, and will therefore be subject to a second-phase investigation unless suitable remedies are agreed and implemented. This means that the parties are not required to offer remedies without having been informed of the substance of the CMA's concerns and the markets to which they relate. In practice, it is possible to commence a dialogue on remedies at any stage in the process, or even before the CMA begins its investigation.

After the CMA has issued its SLC decision, the parties have five working days within which to offer remedies, and the CMA will have up to 10 working days from the SLC decision within which to decide whether the offered remedies merit further negotiation (if it considers that they do not, it will open the second-phase investigation).

The CMA will then have up to 50 working days from the date of the SLC decision within which to negotiate, consult on, and finalise the remedies. This period can be extended to 90 working days if there are 'special reasons' (e.g. if an up-front buyer is required – see paragraph 7.1 above).

During the second-phase investigation, the question of remedies will not normally be raised until the CMA has issued its provisional findings. The basic outline of any remedies will be finalised before the CMA takes its final second-phase decision on the merger. The detailed terms and conditions of the undertakings are negotiated after the final decision has been announced, and must be finalised within 12 weeks (which can be extended by six weeks, if there are special reasons). Where parties do not cooperate in the negotiation of second-phase remedies, the CMA can impose the required remedy in the form of an order on the parties.

Belgium Small Flag Belgium

The parties may offer remedies during either Phase One or Phase Two. The Authority will not propose remedies to the parties of its own initiative, but may suggest amendments to remedies once they have been submitted.

In Phase One, the parties must submit remedies (if they wish to do so) within five working days of receiving the Authority’s draft decision indicating that the concentration gives rise to significant concerns, which is issued within the first 25 working days. In Phase Two, the parties must submit remedies within the first 20 working days of the decision to open Phase Two.

Austria Small Flag Austria

Remedies can be offered both in Phase I and Phase II. They may be given by notifying parties’ offer or upon official parties’ request. The notifying parties may offer remedies in order to convince the official parties not to refer a case to Phase II or to withdraw their Phase II request(s). Another possibility is that the notifying parties negotiate commitments with the official parties and present them to the Cartel Court, which will then issue a decision including the commitments.

In Phase II, the notifying parties may also offer remedies directly to the Cartel Court. However, in practice, remedy negotiations with the BWB and the FCP are much more common.

In the last years, the number of cases, in which parties have entered into commitments in order to get clearance, has increased substantially.

There is no specific procedural regime for remedies discussions, nor are there any strict deadlines. However, if the parties consider offering remedies in Phase I, these should be offered relatively early in the proceedings, given the short time available (maximum of six weeks). In Phase II, more time is available for remedy discussions.

South Africa Small Flag South Africa

The procedure for negotiating remedies is informal. They may be proposed at any time by the Commission or the parties as the case may be. The Commission may test a remedies package with other stakeholders.

If parties are unhappy with any remedies imposed by the Commission, they can be contested before the Tribunal and ultimately, the Competition Appeal Court.

France Small Flag France

Remedies can be offered by the parties either in Phase 1 or Phase 2. In Phase 1, the parties may submit remedies at any time within the 25 working days (Article L.430-5, II of the FCC). In Phase 2, the parties may submit remedies at any time within the 65 working days (Article L.430-7, II of the FCC). Once the commitments have been submitted, the FCA analyses whether they are sufficient to remedy the competition issue(s) identified – it can either reject or accept the parties’ offer. During its investigation, the FCA may decide to market test the remedies offered by the parties by interrogating third parties, such as customers, competitors, trade associations and consumer organisations.

Remedies may also be imposed by the FCA in its clearance decision: the FCA may enjoin the parties to take measures to maintain competition on the market (Article L.430-7, III of the FCC).

There are no precedents of the FCA accepting to waive a demand for a formal remedy when a remedy had already been agreed in another jurisdiction.

Mexico Small Flag Mexico

Considering the current dispositions of the new FECL and how it had worked in the past, commissioners and the staff of the enforcers would normally share their concerns during the review process. The process under the new FLEC requires that the enforcers notify to the parties the concerns they might have on the specific transaction. This communication must be made at least 10 business days prior to the date on which the matter is to be listed for discussion by the commissioners, to allow the parties to propose remedies. As exposed, the proposal of remedies interrupts the 60-day term for the authorities to resolve.

Remedies are commonly negotiated with the authority. The enforcer would normally advise the parties on concerns related with the transaction, and the parties would address those concerns by either clarifying information, or proposing remedies. Third parties, on the other hand, are not allowed to challenge remedies, as they are not part of the filing process.

In addition, remedies proposal have not been subject of market testing in the past and in regard to international transactions, in some cases, the authority aim to find consistency with other remedies obligations imposed in relevant obligations if they apply to Mexican circumstances.

Germany Small Flag Germany

It is usually within the parties’ prerogative to offer sufficient remedies that will allow the FCO to clear the transaction subject to appropriate conditions and obligations. Thus, the FCO will need to rely on the merging parties to offer acceptable remedies and cannot self-impose perceived solutions in its final clearance decision, although it may suggest solutions that it would deem satisfactory to avoid a negative outcome. Within the context of global transactions that present issues in Germany, the FCO will not simply be prepared to rely on remedies entered into with other agencies and give unconditional clearance on the back of those. However, depending on the facts it may decide that the transaction does not result in similar concerns in Germany and be prepared to give clearance to a transaction well ahead of other key agencies reviewing the transaction in parallel.

Different from European merger control principles, there is no option for the parties to offer commitments in Phase I and equally no formal deadline for them to propose commitments in Phase II. Of course, if the parties offer remedies very late in Phase II, they are likely to be requested by the FCO to agree to an extension of the Phase II decision deadline in order to avoid a negative decision, in addition to the automatic one-month extension once remedies are formally submitted. Remedies offered by the notifying parties will be invariably market tested by the FCO in a way similar as is customary under European merger control practice. The FCO has published on its website model texts for offering remedies and a trustee mandate, which also are similar to the European Commission’s templates, albeit considerably shorter.

Italy Small Flag Italy

If the ICA indicates that the notified transaction is likely to distort competition on the relevant market, the parties may offer remedies in order to mitigate such competition concerns. There is no deadline for the proposal and submission of remedies. However, in practice, the negotiations of the remedies begin often during the phase I of the proceeding or even before the notification.

Australia Small Flag Australia

The CCA does not prescribe any formal timing requirements regarding the offering of remedies.

Court enforceable undertakings can be offered by the parties upfront (for example where material competition issues are evident) or during a review once particular competition concerns have been clearly identified by the ACCC (for example, after a 'Statement of Issues' has been published).

The ACCC is likely to take into consideration remedies agreed in other jurisdictions where they are relevant in assessing competition issues in Australia. It will ultimately need to be satisfied that the competition issues affecting Australian markets have been adequately addressed. Sometimes it will still require that court enforceable undertakings are offered by the parties with respect to Australia.

Court enforceable undertakings are (typically) market tested before acceptance by the ACCC, formally documented and executed by the parties giving the undertaking. Undertakings must be published (subject to confidentiality exemptions) on the ACCC's public register (available online).

Canada Small Flag Canada

Remedy negotiations and decisions can be done at any point in the merger review process and are negotiated between the parties and the Bureau. There is no formal deadline for offering remedies.

The Bureau typically market tests proposed remedies, including by seeking feedback from industry stakeholders such as customers and suppliers. The Bureau will often collaborate with foreign agencies to make remedy decisions and sometimes will waive a demand for a formal remedy in Canada if an appropriate remedy has been agreed to in another jurisdiction.

Cyprus Small Flag Cyprus

Where the CPC ascertains that the notified concentration falls within the scope of the Law and raises doubts as to its compatibility with the competitive market, it will inform the Service of the need to conduct a full investigation. In such an event, the Service will request further information from the participants as well as other entities involved in the specific sector for the purpose of completing its investigation. Moreover, the Service notifies the participants that they suggest remedies that will remove the CPC doubts as to the compatibility of the transaction within the time-limit defined by the Service.

Appendix IV of the Law provides the form that the undertakings concerned will be asked to submit when they are willing to undertake any remedies. The CPC accepts both divestiture and behaviour remedies. If, following its review of the additional information provided to it, the CPC’s doubts as to compatibility have not been removed, the Service if it finds any differentiations or modifications in the circumstances under which the concentration has been established which may result in the removal of the doubts, will commence negotiations with the participating undertakings.

Updated: July 6, 2017