The Merger Control

Review

Law Business Research

Fourth Edition

Editor

Ilene Knable Gotts

The Merger Control Review

Reproduced with permission from Law Business Research Ltd.

This article was first published in The Merger Control Review, 4th edition

(published in July 2013 – editor Ilene Knable Gotts).

For further information please emailAdam.Sargent@lbresearch.com

The Merger Control Review

Fourth Edition

EditorIlene Knable Gotts

Law Business Research Ltd

ThE MERGERs and acquIsITIons REvIEw

ThE REsTRucTuRInG REvIEw

ThE PRIvaTE coMPETITIon EnFoRcEMEnT REvIEw

ThE dIsPuTE REsoLuTIon REvIEw

ThE EMPLoyMEnT Law REvIEw

ThE PuBLIc coMPETITIon EnFoRcEMEnT REvIEw

ThE BanKInG REGuLaTIon REvIEw

ThE InTERnaTIonaL aRBITRaTIon REvIEw

ThE MERGER conTRoL REvIEw

ThE TEchnoLoGy, MEdIa and TELEcoMMunIcaTIons REvIEw

ThE InwaRd InvEsTMEnT and InTERnaTIonaL TaxaTIon REvIEw

ThE coRPoRaTE GovERnancE REvIEw

ThE coRPoRaTE IMMIGRaTIon REvIEw

ThE InTERnaTIonaL InvEsTIGaTIons REvIEw

ThE PRojEcTs and consTRucTIon REvIEw

ThE InTERnaTIonaL caPITaL MaRKETs REvIEw

The Law Reviews

www.TheLawReviews.co.uk

ThE REaL EsTaTE Law REvIEw

ThE PRIvaTE EquITy REvIEw

ThE EnERGy REGuLaTIon and MaRKETs REvIEw

ThE InTELLEcTuaL PRoPERTy REvIEw

ThE assET ManaGEMEnT REvIEw

ThE PRIvaTE wEaLTh and PRIvaTE cLIEnT REvIEw

ThE MInInG Law REvIEw

ThE ExEcuTIvE REMunERaTIon REvIEw

ThE anTI-BRIBERy and anTI-coRRuPTIon REvIEw

ThE caRTELs and LEnIEncy REvIEw

ThE Tax dIsPuTEs and LITIGaTIon REvIEw

ThE LIFE scIEncEs Law REvIEw

ThE InsuRancE and REInsuRancE Law REvIEw

ThE GovERnMEnT PRocuREMEnT REvIEw

ThE doMInancE and MonoPoLIEs REvIEw

PuBLIshER Gideon Roberton

BusInEss dEvELoPMEnT ManaGERs adam sargent, nick Barette

MaRKETInG ManaGERs Katherine jablonowska, Thomas Lee, james spearing

PuBLIshInG assIsTanT Lucy Brewer

PRoducTIon cooRdInaToR Lydia Gerges

hEad oF EdIToRIaL PRoducTIon adam Myers

PRoducTIon EdIToR anne Borthwick

suBEdIToR Tim Beaver

EdIToR-In-chIEF callum campbell

ManaGInG dIREcToR Richard davey

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The publisher acknowledges and thanks the following law firms for their learned assistance throughout the preparation of this book:

accuRa advoKaTPaRTnERsELsKaB

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aLTIus

andERson MŌRI & ToMoTsunE

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Acknowledgements

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sTRachan PaRTnERs

TavERnIER TschanZ

ToRys LLP

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wIEsnER & asocIados aBoGados

wILMER cuTLER PIcKERInG haLE and doRR LLP

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wonGPaRTnERshIP LLP

yuLchon LLc

iiiiii

ConTenTs

Editor’s Preface ...................................................................................................ix Ilene Knable Gotts

Chapter 1 ausTRaLIa .............................................................................. 1Peter Armitage, Amanda Tesvic and Ross Zaurrini

Chapter 2 BELGIuM ............................................................................... 17Carmen Verdonck and Jenna Auwerx

Chapter 3 BosnIa and hERZEGovIna ........................................... 31Rastko Petaković

Chapter 4 BRaZIL.................................................................................... 40Lauro Celidonio Neto, Amadeu Ribeiro and Marcio Dias Soares

Chapter 5 canada ................................................................................. 51Dany H Assaf and Arezou Farivar

Chapter 6 chIna .................................................................................... 66Susan Ning

Chapter 7 coLoMBIa ............................................................................ 75Dario Cadena Lleras and Eduardo A Wiesner

Chapter 8 cosTa RIca .......................................................................... 83Edgar Odio

Chapter 9 cyPRus .................................................................................. 93Elias Neocleous and Ramona Livera

iv

Contents

Chapter 10 dEnMaRK ........................................................................... 103Christina Heiberg-Grevy and Malene Gry-Jensen

Chapter 11 EcuadoR ............................................................................ 111Diego Pérez-Ordóñez and José Urízar

Chapter 12 EuRoPEan unIon ........................................................... 120Mario Todino, Piero Fattori and Alberto Pera

Chapter 13 FInLand.............................................................................. 136Niko Hukkinen and Sari Rasinkangas

Chapter 14 FRancE ................................................................................ 146Hugues Calvet and Olivier Billard

Chapter 15 GERMany ............................................................................ 165Götz Drauz and Michael Rosenthal

Chapter 16 Ghana ................................................................................. 175Rosa Kudoadzi and Esaa Elorm Adzo Acolatse

Chapter 17 GREEcE ................................................................................ 185Alkiviades C A Psarras

Chapter 18 honG KonG ...................................................................... 195Sharon Henrick, Joshua Cole and Tina Zhuo

Chapter 19 IndIa .................................................................................... 207Rajiv K Luthra and G R Bhatia

Chapter 20 IndonEsIa ......................................................................... 220Theodoor Bakker and Luky I Walalangi

Chapter 21 IRELand .............................................................................. 232Helen Kelly

v

Contents

Chapter 22 ITaLy ..................................................................................... 242Rino Caiazzo and Francesca Costantini

Chapter 23 jaPan .................................................................................... 251Yusuke Nakano, Vassili Moussis and Kiyoko Yagami

Chapter 24 KoREa .................................................................................. 264Sai Ree Yun, Seuk Joon Lee, Cecil Saehoon Chung and Kyoung Yeon Kim

Chapter 25 LIThuanIa ......................................................................... 272Giedrius Kolesnikovas and Emil Radzihovsky

Chapter 26 MaLaysIa ............................................................................ 282Jeff Leong

Chapter 27 nEThERLands .................................................................. 292Gerrit Oosterhuis and Weijer VerLoren van Themaat

Chapter 28 nIGERIa ............................................................................... 304Afoke Igwe

Chapter 29 noRway .............................................................................. 317Thea Susanne Skaug and Janne Riveland

Chapter 30 PaKIsTan ............................................................................. 326Mujtaba Jamal

Chapter 31 PoRTuGaL .......................................................................... 335Gonçalo Anastácio and Alberto Saavedra

Chapter 32 RoManIa ............................................................................ 347Carmen Peli and Manuela Lupeanu

Chapter 33 RussIa .................................................................................. 359Evgeny Khokhlov

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Contents

Chapter 34 sERBIa .................................................................................. 369Rastko Petaković

Chapter 35 sInGaPoRE ......................................................................... 380Ameera Ashraf

Chapter 36 souTh aFRIca .................................................................. 389Lee Mendelsohn and Amy van Buuren

Chapter 37 sPaIn .................................................................................... 401Juan Jiménez-Laiglesia, Alfonso Ois, Jorge Masía, Samuel Rivero, Joaquín Hervada and Rafael Maldonado

Chapter 38 swEdEn .............................................................................. 412Fredrik Lindblom and Amir Mohseni

Chapter 39 swITZERLand ................................................................... 419Pascal G Favre and Silvio Venturi

Chapter 40 TaIwan ................................................................................ 428Victor I Chang, Margaret Huang and Jamie C Yang

Chapter 41 TuRKEy ................................................................................ 439Gönenç Gürkaynak and K Korhan Yıldırım

Chapter 42 uKRaInE .............................................................................. 450Dmitry Taranyk and Predrag Krupez

Chapter 43 unITEd KInGdoM .......................................................... 457Michael Rowe and Paul Walter

Chapter 44 unITEd sTaTEs ................................................................. 469Ilene Knable Gotts

Chapter 45 vEnEZuELa ........................................................................ 478Pedro Ignacio Sosa, Ana Karina Gomes, Nizar El Fakih and Vanessa D’Amelio

vii

Contents

Chapter 46 InTERnaTIonaL MERGER REMEdIEs ......................... 489John Ratliff and Frédéric Louis

Appendix 1 aBouT ThE auThoRs .................................................... 505

Appendix 2 conTRIBuTInG Law FIRMs’ conTacT dETaILs ... 539

ix

Editor’s PrEfacE

Pre-merger competition review has advanced significantly since its creation in 1976 in the United States. As this book evidences, today almost all competition authorities have a notification process in place – with most requiring pre-merger notification for transactions that meet certain prescribed minimum thresholds. This book provides an overview of the process in 45 jurisdictions as well as a discussion of recent decisions, strategic considerations and likely upcoming developments. The intended readership of this book comprises both in-house and outside counsel who may be involved in the competition review of cross-border transactions.

As shown in further detail in the chapters, some common threads in institutional design underlie most of the merger review mandates, although there are some outliers as well as nuances that necessitate careful consideration when advising clients on a particular transaction. Almost all jurisdictions either already vest exclusive authority to transactions in one agency or are moving in that direction (e.g., Brazil, France and the UK). The US and China may end up being the exceptions in this regard. Most jurisdictions provide for objective monetary size thresholds (e.g., the turnover of the parties, the size of the transaction) to determine whether a filing is required. Germany provides for a de minimis exception for transactions occurring in markets with sales of less than €15 million. There are a few jurisdictions, however, that still use ‘market share’ indicia (e.g., Bosnia and Herzegovina, Colombia, Lithuania, Portugal, Spain, Ukraine and the UK). Most jurisdictions require that both parties have some turnover or nexus to their jurisdiction. However, there are some jurisdictions that take a more expansive view. For instance, Turkey recently issued a decision finding that a joint venture (‘JV’) that produced no effect in Turkish markets was reportable because the JV’s products ‘could be’ imported into Turkey. Germany also takes an expansive view, by adopting as one of its thresholds a transaction of ‘competitively significant influence’. Although a few merger notification jurisdictions remain ‘voluntary’ (e.g., Australia, Singapore, the UK and Venezuela), the vast majority impose mandatory notification requirements.

Almost all jurisdictions require that the notification process be concluded prior to completion (e.g., pre-merger, suspensory regimes), rather than permitting the transaction

Editor’s Preface

x

to close as long as notification is made prior to closing. Many jurisdictions can impose a significant fine for failure to notify before closing even where the transaction raises no competition concerns (e.g., Austria, the Netherlands, Romania, Spain and Turkey). Some jurisdictions impose strict time frames within which the parties must file their notification. For instance, Cyprus requires filing within one week of signing of the relevant documents and agreements; and Hungary, Ireland and Romania have a 30-calendar-day time limit from entering into the agreement for filing the notification. Some jurisdictions that mandate filings within specified periods after execution of the agreement also have the authority to impose fines for ‘late’ notifications (e.g., Bosnia and Herzegovina, Serbia) for mandatory pre-merger review by federal antitrust authorities. Most jurisdictions have the ability to impose significant fines for failure to notify or for closing before the end of the waiting period, or both (e.g., United States, Ukraine, Greece, and Portugal).

Most jurisdictions more closely resemble the European Union model than the US model. In these jurisdictions, pre-filing consultations are more common (and even encouraged), parties can offer undertakings during the initial stage to resolve competitive concerns, and there is a set period during the second phase for providing additional information and for the agency to reach a decision. In Japan, however, the Japanese Federal Trade Commission (‘the JFTC’) announced in June 2011 that it would abolish the prior consultation procedure option. When combined with the inability to ‘stop the clock’ on the review periods, counsel may find it more challenging in transactions involving multiple filings to avoid the potential for the entry of conflicting remedies or even a prohibition decision at the end of a JFTC review. Some jurisdictions, such as Croatia, are still aligning their threshold criteria and process with the EU model. There remain some jurisdictions even within the EU that differ procedurally from the EU model. For instance, in Austria the obligation to file can be triggered if only one of the involved undertakings has sales in Austria as long as both parties satisfy a minimum global turnover and have a sizeable combined turnover in Austria.

The role of third parties also varies across jurisdictions. In some jurisdictions (e.g., Japan) there is no explicit right of intervention by third parties, but the authorities can choose to allow it on a case-by-case basis. In contrast, in South Africa, registered trade unions or representatives of employees are even to be provided with a redacted copy of the merger notification and have the right to participate in Tribunal merger hearings, and the Tribunal will typically permit other third parties to participate. Bulgaria has announced a process by which transaction parties even consent to disclosure of their confidential information to third parties. In some jurisdictions (e.g., Australia, the EU and Germany), third parties may file an objection against a clearance.

In almost all jurisdictions, once the authority approves the transaction, it cannot later challenge the transaction’s legality. The US is one significant outlier with no bar for subsequent challenge, even decades following the closing, if the transaction is later believed to have substantially lessened competition. Canada, in contrast, provides a more limited time period for challenging a notified transaction.

As discussed below, it is becoming the norm in large cross-border transactions raising competition concerns for the US, EU and Canadian authorities to work closely with one another during the investigative stages, and even in determining remedies, minimising the potential of arriving at diverging outcomes. Regional cooperation among some of the newer agencies has also become more common; for example, the Argentinian

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authority has worked with Brazil’s CADE, which in turn has worked with Chile and with Portugal. Competition authorities in Bosnia and Herzegovina, Bulgaria, Croatia, Macedonia, Montenegro, Serbia and Slovenia similarly maintain close ties and cooperate on transactions. Taiwan is part of the Asia-Pacific Economic Cooperation Forum, which shares a database. In transactions not requiring filings in multiple EU jurisdictions, Member States often keep each other informed during the course of an investigation. In addition, transactions not meeting the EU threshold can nevertheless be referred to the Commission in appropriate circumstances. In 2009, the US signed a memorandum of understanding with the Russian Competition Authority to facilitate cooperation; China has ‘consulted’ with the US and EU on some mergers and entered into a cooperation agreement with the US authorities in 2011, and the US has also announced plans to enter into a cooperation agreement with India.

Some jurisdictions (e.g., the EU and Ireland currently) have as their threshold test for pre-merger notification whether there is an acquisition of control. Such jurisdictions will often consider relevant joint control (e.g., the EU) or negative (e.g., veto) control rights to the extent that they may give rise to de jure or de facto control (e.g., Turkey). Minority holdings and concern over ‘creeping acquisitions’, in which an industry may consolidate before the agencies become fully aware, seem to be gaining increased attention in many jurisdictions, such as Australia. Some jurisdictions will consider as reviewable acquisitions in which only 10 per cent interest or less is being acquired (e.g., Serbia for certain financial and insurance mergers), although most jurisdictions have somewhat higher thresholds (e.g., Korea sets the threshold at 15 per cent of a public company and otherwise 20 per cent of a target; and Japan and Russia, at any amount exceeding 20 per cent of the target). This past year, several agencies analysed partial ownership acquisitions on a stand-alone basis as well as in connection with joint ventures (e.g., Canada, China, Cyprus, Finland and Switzerland). Vertical mergers were also the subject of review (and even resulted in some enforcement actions) in a number of jurisdictions (e.g., Canada, China, Sweden and Taiwan). Portugal even viewed as an ‘acquisition’ subject to notification the non-binding transfer of a customer base.

Given the ability of most competition agencies with pre-merger notification laws to delay, and even block, a transaction, it is imperative to take each jurisdiction – small or large, new or mature – seriously. China, for instance, in 2009 blocked the Coca-Cola Company’s proposed acquisition of China Huiyuan Juice Group Limited and imposed conditions on four mergers involving non-Chinese domiciled firms. In Phonak/ReSound (a merger between a Swiss undertaking and a Danish undertaking, each with a German subsidiary), the German Federal Cartel Office blocked the merger worldwide even though less than 10 per cent of each of the undertakings was attributable to Germany. Thus, it is critical from the outset for counsel to develop a comprehensive plan to determine how to navigate the jurisdictions requiring notification, even if the companies operate primarily outside some of the jurisdictions.

For transactions that raise competition issues, the need to plan and to coordinate among counsel has become particularly acute. As discussed in the last chapter, it is no longer prudent to focus merely on the larger mature authorities, with the expectation that other jurisdictions will follow their lead or defer to their review. In the current environment, obtaining the approval of jurisdictions such as Brazil and China can be as important as the approval of the EU or US. Moreover, the need to coordinate is

Editor’s Preface

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particularly acute to the extent that multiple agencies decide to impose conditions on the transaction. Although most jurisdictions indicate that ‘structural’ remedies are preferable to ‘behavioural’ conditions, a number of jurisdictions in the past year imposed a variety of such behavioural remedies (e.g., China, EU, Netherlands, Norway, South Africa, Ukraine and the US). This book should provide a useful starting point in navigating cross-border transactions in the current enforcement environment.

Ilene Knable GottsWachtell, Lipton, Rosen & KatzNew YorkJuly 2013

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Chapter 29

NORWAY

Thea Susanne Skaug and Janne Riveland 1

I INTRODUCTION

Mergers and acquisitions (‘concentrations’) are subject to control under Chapter 4 of the Norwegian Competition Act of 5 March 2004 No. 12 (‘the Competition Act’). More detailed provisions on notification requirements are provided in the Regulation on notification of concentration of 28 April 2004 No. 673 (‘Regulation on Notification’) and the Regulation on Partial Exceptions from the Rule on Suspension of Concentrations of 9 March 2009 No. 0292 (‘Regulation on Exceptions’). The Norwegian Competition Authority (‘the NCA’) has also issued best practices for merger control proceedings and guidelines on notifications of a concentration. Relevant legislation and guidelines are available in English on the NCA’s webpage.2

Norway is a party to the Agreement on the European Economic Area 1992 (‘the EEA Agreement’), and has implemented Regulation (EC) 139/2004 on the control of concentrations between undertakings (‘the Merger Regulation’) as part of this Agreement. Therefore, mergers with an EU or EEA dimension are governed exclusively by EU or EEA merger control provisions, and are not subject to national merger control. A one-stop-shop approach applies under the EEA Agreement.

The first instance in respect of merger control in Norway is the NCA, with the Ministry of Government Administration, Reform and Church Affairs (‘the Ministry’) as the appeal body. Furthermore, in cases involving public principles or interests of major significance to society, the government may approve a concentration that the NCA has intervened against.

1 Thea Susanne Skaug is a senior lawyer and Janne Riveland is an associate at Arntzen de Besche Advokatfirma AS.

2 www.konkurransetilsynet.no.

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Concentrations are subject to mandatory notification if the undertakings concerned have a combined annual turnover in Norway exceeding 50 million Norwegian kroner and at least two of the undertakings concerned each have an annual turnover in Norway exceeding 20 million Norwegian kroner. There is no deadline for filing. However, concentrations are subject to an automatic standstill obligation pending the outcome of the NCA’s investigation.

In May 2013, the Parliament amended the Competition Act, including merger control. One of the most important amendments is to increase substantially the very low notification thresholds. The amendments are expected to enter into force in January 2014. For more information regarding the pending amendments, please see Section V, infra.

II YEAR IN REVIEW

i Notifications and decisions

In 2012, the NCA received 411 standardised notifications and three voluntary complete notifications. The NCA required the parties to submit a complete notification in 13 cases. Up to May 2013, the NCA has intervened in six cases in total. In three of these cases, the NCA approved the concentrations subject to conditions (remedies), whereas three cases have been entirely prohibited. Additionally, the NCA has imposed administrative fines in four cases for breach of the standstill obligation.

Mekonomen/MecaThe NCA approved Mekonomen’s acquisition of the automotive spare parts chain Meca conditioned on substantial behavioural remedies in order to restore competition in the market for the wholesale of spare parts to independent repairers. The obligations further include the appointment of a trustee to oversee the parties’ compliance with the commitments. To ensure continued competition in the markets, the NCA prohibited Mekonomen from entering into minimum quantity agreements with independent repairers. Further, the NCA limited Mekonomen’s use of tying agreements such as loyalty rebates and long-term agreements. Finally, the NCA limited Mekonomen’s exclusion of repairers and spare part resellers outside Meconomen’s chain structure.

A-Pressen/Edda MediaThe NCA approved media house A-Pressen’s acquisition of Edda Media subject to conditions. The NCA found that the concentration would create significant restrictions on competition in certain parts of the local markets for newspaper advertising. A-Pressen was required to divest two alternative newspapers in order to resolve the competition concerns.

Telenor/LOSIn this transaction, the NCA concluded that the concentration would result in a significant restriction of competition in the local broadband markets for leased lines above 8 Mbit/s, and for internet access in the private sector. To ensure continued competition in these markets, the NCA required Telenor to sell a transport network, to offer to sublease of

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parts of LOS’ capacity and finally to provide business customers with access (through transmission capacity) to LOS’ access network.

Plantasjen/Oddernes GartneriThe decision is a rather exceptional case; the NCA prohibited the national garden chain’s acquisition of a single competing garden centre. The target had turnover just above the thresholds for automatic review (22.3 million Norwegian kroner). The acquired centre was deemed to be the closest competitor to Plantasjen, and the NCA found that the concentration would lead to a substantial reduction of competition in the garden centre market in the area of Kristiansand (a city with 85,000 inhabitants). The NCA found the remedies offered by the companies to alleviate local competition issues were insufficient. The Ministry upheld this decision.

Retriver/InnholdsutviklingThe NCA prohibited Retriever’s acquisition of Innholdsutvikling AS in its entirety. The NCA found that the concentration would significantly limit competition in the market for media monitoring, including monitoring of newspapers (‘digital press clippings’). The parties did not propose any remedies to address the NCA’s concerns.

Sentralvaskeriene/Nor TekstilThe NCA also prohibited a merger in the laundry sector between two of the largest operators in the ‘flat linen’ market in southern and eastern Norway. The NCA stated that the tie-up would give the merged company a very high market share, which would have a negative effect on quality and prices. The parties did not propose any remedies to address the NCA’s concerns.

Referrals to and from the European Commission Norway is part of the EEA, which has similar rules regarding referrals to and from the Commission as those applying to Member States of the EU.

The Belgian Competition Authority referred the merger between Canon and the Belgian electronic scanning company IRIS to the European Commission under Article 22 of the Merger Regulation. The concentration was notified to the NCA. However, the NCA did not join the request for referral, and the transaction was cleared in Norway before the Commission cleared the transaction in November 2012.

The Nordic conglomerate Orkla’s acquisition of the processed food producer Riber was originally filed to the European Commission. The Norwegian part of the transaction was, however, referred to the NCA because: a the NCA grocery market is mainly domestic and the NCA has particular

knowledge about the Norwegian market; andb a few products would be under the sole jurisdiction of the authority since they are

not covered by the EEA Agreement.

After reviewing extensive documentation in the case and conducting several market investigations, the NCA concluded that the concentration would not lead to a significant restriction of competition. The transaction has also been approved by the Commission and the Russian Competition Authorities.

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ii Fines for breach of the standstill obligation

Breach of the standstill obligation may be subject to administrative fines or criminal sanctions (see Section III, infra). The NCA actively enforces breach of the standstill obligation. The maximum administrative fine is 10 per cent of the worldwide annual turnover of the company. In 2012, the NCA fined four companies in the auditing, power, construction and retail markets between 250,000 Norwegian kroner and 350,000 Norwegian kroner each for completing mergers before notifying the NCA.

On 23 April 2013, the NCA issued a statement of objection to a fine of 25 million Norwegian kroner to NorgesGruppen, the largest grocery chain in Norway, for breach of the standstill obligation. After 13 lease contracts had been transferred from Lagopus to NorgesGruppen, the NCA required a complete notification of the transaction. After the NCA had considered the notification, it closed the part of the case regarding the material merger control. However, the NCA issued a statement of objection of the fine due to NorgesGruppen’s breach of the standstill obligation. The NCA’s final decision in this case is still pending.

III THE MERGER CONTROL REGIME

i Mandatory filing

The mandatory filing system applies to ‘concentrations’. The definition corresponds to the definition of concentration in the Merger Regulation3 and comprises mergers, acquisitions of control (de facto and de jure) and the creation of a full-function joint venture.

There are no turnover thresholds for the NCA’s power to intervene as such. However, pursuant to the Regulation on Notification, concentrations are subject to mandatory notification if:a the undertakings concerned have a combined annual turnover in Norway

exceeding 50 million Norwegian kroner; and b at least two of the undertakings concerned each have an annual turnover in

Norway exceeding 20 million Norwegian kroner.

In relation to foreign companies, only the turnover allocated to Norway is relevant when estimating the jurisdictional thresholds.

As mentioned above, the thresholds for filing have been amended with effect from 1 January 2014. Further details on the amendments are provided in Section V, infra.

ii Procedure and timetables

There is no deadline for filing in Norway. Thus, the notification may be filed at any stage in the transaction period, provided that the transaction can be described accurately enough to fulfil the content requirements of a standardised notification. If the conditions

3 Council Regulation (EC) No. 139/2004 of 20 January 2004 on the control of concentrations between undertakings.

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for a concentration change after the submission of the notification, and such changes are material to the NCA’s assessment, a new notification must be submitted. The NCA publishes a brief notice of all received notifications on its webpage. Further, all third parties may ask for access to the notification and the NCA is obliged to give such access, except access to information regarding trade secrets. Thus, in practice, the parties should delay the filing until they are ready to publish information about the proposed transaction.

The parties to a concentration must determine whether the relevant notification thresholds are met and whether EU or Norwegian law applies. Once notified, certain procedures and timetables apply. If a standardised notification is submitted, the NCA can order the submission of a complete notification no later than 15 working days after its receipt of a standardised notification. If no action is taken within 15 working days, the transaction is automatically cleared.

If a compulsory or voluntary complete notification is submitted, the NCA conducts a first-phase investigation. Within 25 working days, it must either clear the transaction (automatically if no action is taken within 25 business days or a clearance letter is sent to the parties) or conduct a second phase investigation.

If the NCA conducts a second phase investigation, it has 70 working days from receiving a complete notification to present a reasoned preliminary decision on intervention to the parties. If a preliminary decision is not issued within the 70-day period, the transaction is automatically cleared. The parties must reply to the NCA’s preliminary decision within 15 working days of the issue date. After the 15-day period, the NCA must decide whether to intervene. The time limits are either 15 working days after the date of receiving the parties’ reply, or 25 working days after the date of receiving the parties’ reply if the parties offer remedies to modify the concentration.

If no decision is made within the applicable deadline, the transaction is automatically cleared. A clearance letter is normally sent to the parties to confirm the clearance. If the NCA decides to intervene, it can either prohibit the transaction or approve the transaction subject to conditions. The deadlines set out above are suspended if the notification fails to fulfil the information requirements and if any of the undertakings concerned fail to comply with written requests to provide information by a specific date. The parties are to be notified of any suspension of deadlines. The deadline continues to run once the NCA or the Ministry has received the requested information.

iii Pre-notification contacts and meetings under the process

Informal contact with the NCA pre-filing is possible. However, the NCA will not give any legally binding decisions at this stage. After submission of a complete notification it may, according to the best practice guidance, be appropriate to hold meetings with the Competition Authority and the notifying party at the following stages:a approximately 10 working days after receipt of the complete notification;b approximately 10 working days before the reasoned preliminary decision on

intervention; and c approximately five working days after receipt of the notifying party’s reply to the

reasoned preliminary decision on intervention.

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The complexity of the relevant case will determine whether fewer or more meetings should be held. The form of the meetings (e.g., in attendance, by telephone or videoconference) will depend on what the NCA considers to be appropriate in the individual case.

iv Third-party access to the file and rights to challenge mergers

Third parties are regularly involved in merger procedures before the NCA, primarily as sources of information. As mentioned above, the NCA is required to publish a brief notice of all concentrations being notified on its webpage. The notice shall contain information concerning the identity of the undertakings concerned, the transaction and the affected markets, in addition to the date of submission and the date of the expiry of the 15 working day deadline. The purpose of this notice is to hear third party comments. Third parties may also ask for access to a non-confidential version of all notifications filed with the NCA. Third parties are not entitled to access trade secrets in such documents or other documents prepared for the NCA’s internal use. Consequently, the parties have to enclose a proposal for a public version of the notification when submitting a notification. The NCA will also normally discuss the information identified as confidential with the parties before giving third parties access to the information.

Additionally, the NCA may order third parties to provide information and comments to the notification. The NCA may carry out an informal market test by telephone or e-mail to third parties in cases of standardised notification. In cases where a complete notification is submitted, the NCA may send a formal request to selected third parties in order to obtain relevant information. A decision by the NCA regarding the right to access the notification (e.g. refusal of access) may be appealed to the Ministry. The appeal must be addressed to the Ministry, but sent to the NCA. If the NCA does not reverse its decision, it must then forward the appeal to the Ministry. Both the NCA and the Ministry must consider independently what type of information constitutes trade secrets. According to former practice and preparatory works to the suggested amendments in the Competition Act, very little information is regarded as trade secrets.

v Resolution of authorities’ competition concerns, appeals and judicial review

After the NCA has considered the standardised or complete notification, further third party information and market inspection, it will decide whether to clear the concentration or to intervene. The NCA or the Ministry may intervene by way of a reasoned administrative decision. Such decisions may include prohibitions, orders or conditional approvals, including:a prohibiting a concentration or an acquisition, and providing detailed terms and

conditions that must be fulfilled to achieve the purpose of the prohibition; b ordering a disposition of shares or holdings acquired as part of a concentration or

an acquisition; or c requiring the parties in question to meet terms and conditions essential to ease

restrictions to competition.

The parties may propose and negotiate all kinds of remedies, both structural and behavioural, with the NCA. It is possible to propose remedies at any stage of the regulatory process. This will, however, normally occur after the NCA has investigated

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the case for a period and has made a preliminary statement on its serious objections against a transaction. The NCA will normally examine the market effect of the proposed remedies (e.g., by consulting third parties). According to the recent amendments of the Competition Act, the notifying parties must suggest relevant remedies themselves. The NCA tends to accept behavioural remedies in quite a lot of cases. Failure to comply with the remedies will constitute failure to observe a decision of the NCA and will be subject to administrative fines of up to 10 per cent of the turnover of the parties or criminal fines or imprisonment.

The NCA may appoint a trustee to oversee the parties’ compliance with the structural and behavioural remedies.

vi Standstill obligation

A concentration cannot be implemented during the first 15 working days after the submission of a standardised notification or during the first 25 working days after the submission of a compulsory or voluntary complete notification (also referred to as the ‘standstill obligation’). The standstill obligation may apply for compulsory and voluntary complete notifications. If no notification is made but the transaction could be subject to intervention, the NCA can order complete notification and the standstill obligation will then apply.

There is no automatic standstill obligation for a second phase investigation. The NCA may issue an interim order prohibiting implementation of the concentration or order alternative measures if: a there are reasonable grounds for assuming that the concentration may create or

strengthen a significant restriction of competition; and b a temporary prohibition is necessary to ensure the effectiveness of any potential

intervention contemplated by the NCA.

Failure to notify (breach of standstill obligation) may result in administrative fines of up to 10 per cent of the annual worldwide turnover of the liable undertakings. Failure to comply with the NCA’s decision or submission of incomplete or false information may be subject to administrative fines or criminal sanctions.

vii Effect of regulatory review

Some merger cases, such as A-Pressen/Edda Medier, are subject to supervision of both the NCA and the Norwegian Media Authority (‘the NMA’). The NMA is a supervisory and administrative body at the state level, and is in charge of enforcing the Act on Broadcasting, the Regulation on Broadcasting and the Media Ownership Act in Norway. The NMA and the NCA evaluate different legal aspects of the concentrations in merger cases. However, in some cases their assessments overlap, and they will normally cooperate and share relevant information for an efficient evaluation. A concentration in a merger case may be prohibited or approved on conditions by either the NMA and the NCA, or by both.

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IV OTHER STRATEGIC CONSIDERATIONS

i Coordination with other jurisdictions

When an acquisition is considered by the European Commission, the NCA will initially not consider the concentration. However, the NCA may assist the Commission in their inquiry, or ask the Commission to have the case transferred to the NCA if it primarily affects Norwegian interests. Further, the NCA may transfer a case from Norwegian jurisdiction to the Commission’s jurisdiction.

ii Special situations

Notification of a minority acquisition of an undertakingThe acquisition of a part of an undertaking that does not lead to control of the undertaking (minority acquisition) is not subject to mandatory notification. However, the NCA shall, under the same conditions as those for an acquisition of control, intervene against such transaction if it finds that the acquisition will ‘create or strengthen a significant restriction of competition’. The NCA may order a complete notification of an acquisition of an undertaking within three months after the agreement is final. The undertaking may also choose to voluntarily submit a notification.

iii Exemption from the standstill obligation

The standstill obligation may be suspended on a case-by-case basis due to a regulation on partial exemption from the standstill obligation. The partial exemption applies to public bids or series of transactions in a regulated market. The parties are only entitled to transfer the securities in question, and the acquirer is not entitled to exercise any voting rights. Thus, the acquirer is still prohibited from exercising any kind of control over the target company. The standstill obligation may also be completely or partially suspended if the concentration is necessary for a party’s further operating (e.g., by preventing insolvency). Suspension is applied at the NCA’s own discretion, in urgent cases where the standstill obligation will lead to serious negative effects for the parties in the concentration.

V OUTLOOK AND CONCLUSIONS

i Legislative changes to the regulatory framework

In May 2013, the Parliament amended the Competition Act. This Act includes substantial amendments regarding merger control, particularly regarding procedural rules. The amendments will enter into force on 1 January 2014.

One important amendment is that the undertakings concerned must have a combined annual turnover in Norway exceeding 1 billion Norwegian kroner, and at least two of the undertakings concerned must each have an annual turnover in Norway exceeding 100 million Norwegian kroner. The legislators estimate that the number of notifications to the NCA will decrease by around 70 per cent to 80 per cent. The purpose of this amendment is to increase the efficiency of the NCA’s executive work.

The distinction between a complete and standardised notification has been abolished. According to the amendments, the parties are only obliged to submit one notification, equivalent to the current complete notification. Additionally, the

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amendments introduce an alternative simplified notification for concentrations exceeding the thresholds but presumed to be unproblematic. As a result, the timetable for the NCA’s case administration will be reduced to 15 working days. The NCA remains in charge of prohibiting concentrations below the thresholds.

Currently, the NCA has no obligation to issue a formal clearance letter, but in second phase cases the NCA will normally send a brief letter informing the parties that it will not intervene in the concentration. However, according to the amendments, the NCA shall be obliged to notify the parties in writing that the concentration has been cleared. Thus, the Norwegian legislation will be in accordance with EU legislation in this matter.

Under the amendments, the NCA may only approve concentrations subject to conditions (remedies) if the parties propose the conditions. If the parties have not suggested some conditions, the NCA may only decide whether to approve the transaction or to prohibit the concentration in its entirety.

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Appendix 1

about the authors

TheA SuSAnne SkAug Arntzen de Besche Advokatfirma ASThea Susanne Skaug is a senior lawyer at Arntzen de Besche. She works with the firm’s European and competition law practice group. With a strong background gained from two periods of working for the Norwegian Competition Authority, latterly as legal director, she has gained comprehensive experience within competition law and assists clients from all industries. Ms Skaug represents Norwegian and foreign clients in matters involving domestic and foreign competition authorities.

She has special expertise in all fields of European and Norwegian competition law, including mergers and joint ventures, and anti-competitive practices and abuse of dominant position. Ms Skaug has represented a number of foreign and domestic companies in mergers and acquisitions investigated by the Norwegian Competition Authority, including successful appeals to the Ministry and filings to the Commission. In addition, she has considerable experience in compliance audits and in-house competition law training for clients, as well as assisting at dawn raids by the Competition Authority.

She also works within public procurement law, marketing practices law and particularly within food law.

Ms Skaug acquired international work experience from her work at a law firm in Brussels and the European Commission. She was a member of the State Food Chain Law Committee, which in 2013 proposed a new act to prohibit unfair practices in negotiations in the food supply chain. She was also a leader of the secretariat of the Norwegian Competition Law Reform Commission responsible for drafting the 2004 Norwegian Competition Act.

JAnne RivelAndArntzen de Besche Advokatfirma ASJanne Riveland is an associate at Arntzen de Besche. She works with the firm’s European and competition law practice group. She specialises in European and Norwegian

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competition law, and works on cases regarding state aid, public procurement and the free movement of goods, services, capital and persons.

ARnTzen de BeSche AdvokATfiRmA ASPostbox 2734 Solli0204 OsloNorwayTel: +47 23 89 40 00Fax: +47 23 89 40 01oslo@adeb.nowww.adeb.no