9 January 2012
NEW BEST PRACTICE FOR COOPERATION IN MERGERS
Introduction
The European Commission and the Directors of the European competition authorities
have recently adopted a "best practice" for cooperation between national competition
authorities (NCAs) in the review of mergers that are declared in more than one Member
State. The new best practice rules may be found at http://ec.europa.eu/competition
/ecn/mergers.html.
The rules shall apply in the EU for mergers that require approval in several Member
States, but which do not qualify for notification to the commission (one-stop-shop).
This best practice is a non-binding document which does not create new rights or obligations for the NCAs.
The purpose of best practice cooperation in merger cases is to create efficiency, transparency and punctuality, as well as to inform, among others, the merging companies of
how NCAs will endeavor to cooperate in cross-border merger cases, when such cooperation is considered appropriate. The cooperation is beneficial to both authorities and
companies, as it contributes to a more flexible review of cross-border mergers, and
helps to ensure a consistant legal position.
Particularly in cases involving difficult analytical problems, cooperation between national
authorities may be valuable.
The NCAs in individual Member States already have the opportunity to cooperate and
exchange non-confidential information in connection with the review of merger cases.
However, a close cooperation between the NCAs is not an aim in itself. In cases which
do not give rise to any concerns, in spite of the merger involving several Member
States, a close cooperation is not necessary. In each case, the NCAs will decide whether
a close cooperation is necessary.
Cases where best practice should be complied with
The Best practice document mentions the following examples where best practice
should be complied with:
1.
Cooperation may assist the NCAs in forming a view as to whether a
transaction qualifies for notification or investigation under merger
control laws in their respective jurisdictions. It is noted that although
jurisdictional rules and practices may differ across jurisdictions, cooperation may assist the NCAs in reaching an informed view of the
merger.
2.
Cooperation may assist the NCAs in relation to mergers, which may
have an impact on competition in more than one Member State,
when markets affected by the transaction cover more than one Member State or when a merger affects national or sub-national markets
in more than one Member State, if such national or subnational markets are the same or similar from a product standpoint.
3.
Cooperation may also be of value in relation to mergers where remedies need to be designed or examined in more than one Member
State, such as in situations where the same remedy is designed to
address competition issues in different Member States or where one
remedy affects the effectiveness of a different remedy in another
Member State.
Contents of the cooperation
The role of the NCAs in best practice cooperation, among other things, consists of continually informing each other about each step performed and completed in a given
transaction. Cooperation only relates to the NCA involved in the transaction, and thus,
information is not given to all NCAs.
Furthermore, NCAs should discuss their respective legal and substantial analysis of a
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given transaction. These discussions may relate to the definition of the relevant market,
assessment of the competitive impact etc.
Additionally, the role of the merging parties is to provide relevant information to the
NCAs with a view to facilitating and improving the efficiency of the work.
In cases where a transaction is expected to be notified in several Member States, the
merging parties should contact the relevant NCAs, unless it is clear that the transaction
does not give rise to any concerns.
The information provided shall include:
1.
The name of each jurisdiction in which they intend to make a filing,
2.
the date of the proposed filing in each jurisdiction,
3.
the names and activities of the merging parties,
4.
the geographic areas in which they conduct business and
5.
the sector or sectors involved.
The delivery of this information is not, in itself, a trigger for cooperation between national competition authorities. Whether cooperation should be established depends on
whether this cooperation is necessary or appropriate. If the merging parties provide the
information to the relevant NCAs, this information contributes, at an early stage, to decide whether there may be a need for cooperation in the relevant case.
Exchange of non-confidential information between the merging parties and NCAs does
not give rise to any problems. However, there may be problems in connection with confidential information.
In such cases, the best practice document recommends that the merging parties as far
as possible give the parties access to confidential information, in return for this information being kept secret. This is also a case of a recommendation, not an obligation.
Opinion
If this recommended best practice is complied with by both the NCAs and the other parties involved, it is assumed that both time and resources may be saved in cross-border
mergers which do not need to be notified, but which still affect several Member States.
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For example, notification of conditions for the implemention of a merger may set right
problems with legislation in one Member State, but simultaneously give rise to problems
in relation to the law of another State. Such problems may be forestalled by the best
practice rules through increased information, and by finding the right solution for the
implementation of the merger at an early stage, in order to ensure that the implementation is carried out as quickly as possible.
If you have any questions or require additional information on the rulings or mergers in
general, please contact partner Claus Molbech Bendtsen ([email protected] or attorney
Christian R.J. Nielsen ([email protected])
The above does not constitute legal counselling and Moalem Weitemeyer Bendtsen does
not warrant the accuracy of the information. With the above text, Moalem Weitemeyer
Bendtsen has not assumed responsibility of any kind as a consequence of a reader’s use
of the above as a basis of decisions or considerations.
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