New Act; New Agency
The Competition and Consumer Protection Act 2014 entered into force on 31 October 2014. Among other things, the 2014 Act merged the Competition Authority and the National Consumer Agency into a single body, the Competition and Consumer Protection Commission (CCPC), which now has responsibility for both consumer protection and competition enforcement (including merger control). The 2014 Act significantly decreased the financial thresholds for notifiable deals, as well as making procedural changes to the Irish merger control regime (in particular, longer review periods and a new regime for media mergers).
CCPC Management Changes
The introduction of the new Act saw significant management changes within the CCPC. Professor Stephen Calkins, who had been in charge of the Mergers Division, has now been appointed as the CCPC Member with responsibility for Advocacy and Market Intelligence and Consumer Enforcement. Gerald FitzGerald has replaced Stephen Calkins as the Member with responsibility for mergers. Commissioner FitzGerald was previously the head of McCann FitzGerald’s Competition Law practice. Cormac Keating, Manager of the Mergers Division in the Competition Authority, has been appointed Director of the CCPC’s Mergers Division.
Increase in Deals Notified
Deal notifications fell for three straight years from 2010 to 2012, but the past two years has seen a modest upturn in the number of deals notified. In total 41 deals were notified in 2014, representing a 10% increase on the 37 notified deals in 2013. This is still some way off the 2006 peak of 98 filings. The introduction of new financial reporting thresholds on 31 October 2014 saw a notable increase in the number of notifications made towards year end. 31 deals were notified from 1 January to 30 October, with 10 deals subsequently notified in the two month period following introduction of the new regime.
First parties-led referral back to the CCPC
Fitzwilliam/Wittington Canada/Arnotts involved the first parties-led referral back of a transaction from the European Commission to the CCPC under Article 4(4) EUMR. The deal was unconditionally cleared following an extended Phase I investigation. The CCPC relied on a large scale, third-party commissioned customer survey (of 500 Arnotts customers) to indicate that Arnotts and Brown Thomas (a subsidiary of Wittington Canada) were not close competitors.
Increased Number of Irish deals notified to Brussels
In 2014, at least four significant Irish-related transactions were notified to the European Commission under the EU Merger Regulation: Hutchinson/Telefonica Ireland, Centrica/Bord Gáis Energy, Apollo/Ulster Bank/Arnotts, and ESB/... ...Vodafone. As the EU Merger Regulation thresholds have remained unchanged for the past 25 years, more Irish-related transactions are becoming notifiable at the EU level. McCann FitzGerald acted in all of the notifications mentioned above.
Further Increase in Notifiable Deals
2015 is likely to see a significant increase in the number of deals notified to the CCPC. The introduction of lower financial reporting thresholds towards the latter part of 2014 gave rise to a year-end spike in deal notifications (with transactions such as the acquisitions of individual hotels and petrol forecourts now giving rise to notifiable deals). This trend is set to continue in 2015.
The Irish media mergers regime was significantly amended by the 2014 Act. Further change is expected by virtue of the introduction of the Intellectual Property (Miscellaneous Provisions) Bill 2014. This bill will amend the 2014 Act to allow the Department of Communications more time to gather information in the context of a deal review. As such, it will lengthen the review timeframe for media mergers.
Phase 2 Investigation outcome
In Ireland, Phase 2 investigations are rare in practice (less than 0.5% of notified deals move to Phase 2). On 18 December 2014, the CCPC launched a Phase 2 investigation into the Valeo/Wardell/Robert Roberts deal. The notifying parties in that instance overlap in the manufacture, sale and distribution of a number of fast moving consumer goods and the outcome of the CCPC’s investigation is eagerly awaited.