On 5 December 2013, the European Commission ("Commission") reformed its merger procedures. The new rules will apply as of 1 January 2014. The reforms will impact the standard procedure (Form CO), the simplified procedure (Short Form CO) and the referral procedure (Form RS). Three helpful changes are introduced. First, the Commission has increased the market share thresholds for the simplified procedure: mergers resulting in horizontal market shares below 20% (instead of 15% at present) and vertical shares below 30% (instead of 25% at present) can be notified via a Short Form CO, as can mergers where the increment in market share is small. Second, the Commission has committed to reduce the length of pre-notification discussions in all cases and to allow further categories of information to be eligible for waiver requests. Finally, the Commission has introduced a "super-simplified procedure" for two types of deals: transactions which do not result in any horizontal or vertical overlaps and "extraterritorial" joint ventures which will be active entirely outside the EEA. While these three changes are welcome, the Commission has introduced additional information requirements in each of the new EU filing forms.
Broader scope for the simplified procedure
Under the reform package, the Commission has increased the market share thresholds below which the parties can use a Short Form CO, which itself requires less information and market data: (1) In the case of horizontal overlaps, where the parties' combined market share in the relevant market is less than 20% (instead of 15% at present); (2) In the case of vertical overlaps, where the parties’ individual or combined market shares in a market upstream or downstream to the market in which another party to the transaction is engaged are less than 30% (instead of 25% at present); and (3) Where the parties' combined market shares are between 20% and 50%, the increase in the parties’ market shares is very small, i.e. the increment of the HHI Index is below 150 (this criterion is new).
As a result of these changes, the Commission estimates that an additional 10% of cases may be dealt with under the simplified procedure, so that, in total, 60-70% of all notified mergers will qualify for a simplified merger review.
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