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Trends and climate

Trends

How would you describe the current merger control climate, including any trends in particular industry sectors?

The Greek debt crisis and the resulting financial environment have significantly affected M&A activity. Following consolidation in the banking sector, merger control activity during the past year has mainly focused on the retail sector (eg, supermarkets) and privatisation projects, which are also subject to merger control clearance.

Reform

Are there are any proposals to reform or amend the existing merger control regime?

No. However, amendments will likely be proposed following the upcoming reform of the EU merger control rules.

Legislation, triggers and thresholds

Legislation and authority

What legislation applies to the control of mergers?

The Law on the Protection of Competition (3959/2011) came into force in April 2011. It replaced Law 703, which had been introduced in 1977 – long before Greece became a member of the then European Economic Community. Both laws are modelled on EU legislation. As regards merger control, Greek law generally reflects EU law with respect to both substance and the procedures to be followed.

Only major concentrations fall under the jurisdiction of the Hellenic Competition Commission (HCC), which examines whether they significantly impede competition (as analysed below).

The existing law has abolished the HCC post-notification obligation regarding minor concentrations of undertakings whose:

  • share in the Greek market was at least 10%; or
  • aggregate turnover in Greece was at least €15 million.

While the HCC was not required to approve such concentrations, it was required to be notified within one month of their closing. This was intended to enable market mapping (ie, the identification of trends in the market), although this was not the case. The requirement also created unnecessary work for the HCC and was therefore abolished.

What is the relevant authority?

The HCC is an independent authority which enforces Articles 1 and 2 of the Law on the Protection of Competition (3959/2011), as well as Articles 5 to 10 therein, which cover merger control in respect of mergers with a national dimension. In this capacity, the HCC has the decisive power to:

  • verify whether a concentration will have a significant impact on competition;
  • allow or prohibit the concentration; and
  • accept remedies or impose conditions.

The HCC has exclusive authority to apply merger control provisions in all market sectors. However, specific liberalised industries (eg, telecoms and energy) also have separate national regulatory authorities which enforce competition rules, including merger control provisions, in cooperation with the HCC (ie, the National Telecommunications and Post Commission and the Regulatory Authority for Energy). Article 24(2) of the Law on the Protection of Competition (3959/2011) governs this cooperation, given that coordination is required in most cases.

The HCC also has the authority to handle mergers with an EU dimension referred to it by the European Commission, as per the EU Merger Regulation (139/2004).

Under the existing structure, the HCC is a single organ comprising a president, a vice president and six further members, four of whom are full-time exclusive employment executives (rapporteurs). The rapporteurs are assigned cases and must then prepare a statement of objections, which constitutes the basis of the HCC’s examination. In accordance with the latest amendment to the Law on the Protection of Competition (3959/2011), rapporteurs participate in hearings and deliberations, but do not vote.

Transactions caught and thresholds

Under what circumstances is a transaction caught by the legislation?

A concentration will be deemed to arise where a change of control on an ongoing basis results from:

  • the merger of two or more previously independent undertakings or parts thereof; or
  • the acquisition of direct or indirect control of all or part of the undertakings, regardless of how this acquisition is affected. 

Article 5 of the Law on the Protection of Competition (3959/2011) incorporates the definitions of the EU Merger Regulation.

Both stock and asset deals will be deemed to be concentrations where they lead to an acquisition of control. Cases involving a change of control (eg, from joint to full control) also constitute concentrations and must be notified if the above thresholds are met.

Do thresholds apply to determine when a transaction is caught by the legislation?

Merger control is exercised regarding concentrations where:

  • the combined aggregate worldwide turnover of all of the undertakings concerned is at least €150 million; and
  • cumulatively, the aggregate turnover of each of at least two of the undertakings concerned in the Greek market exceeds €15 million.

The above turnover thresholds apply for all market sectors except mass media, where special legislation (Law 3592/2007) defines the respective thresholds.

Informed guidance

Is it possible to seek informal guidance from the authority on a possible merger from either a jurisdictional or a substantive perspective?

Yes – although so-called ‘comfort letters’ are not usually provided.

Foreign-to-foreign

Are foreign-to-foreign mergers caught by the regime? Is a ‘local impact’ test applicable under the legislation?

Only where the above turnover thresholds are met.

Joint ventures

What types of joint venture are caught by the legislation?

The creation of a joint venture constitutes a concentration only if the new entity performs all of the functions of an autonomous economic entity on an ongoing basis. If this is not the case, the concentration will constitute a cooperative joint venture, falling under the scope of Article 1 of the Law on the Protection of Competition (3959/2011) (Article 101 of the Treaty on the Functioning of the European Union) and may qualify for exemption.

Notification

Process and timing

Is the notification process voluntary or mandatory?Greece

Concentrations which fall under the definition provided in Article 6 of the Law on the Protection of Competition (3959/2011) and which meet the following thresholds are subject to mandatory pre-merger notification:

  • the combined aggregate worldwide turnover of all of the undertakings concerned is at least €150 million; and
  • cumulatively, the aggregate turnover of each of at least two of the undertakings concerned in the Greek market exceeds €15 million.

The above turnover thresholds apply for all market sectors except mass media, where special legislation (Law 3592/2007) defines the respective thresholds.

What timing requirements apply when filing a notification?

Although the EU Merger Regulation (139/2004) does not provide a notification deadline, it is in parties’ interest to act quickly in order to obtain clearance and implement a merger.

In Greece, notification must be made within 30 days from: 

  • the entry into an agreement;
  • the publication of an offer or exchange; or
  • an undertaking becoming obliged to acquire participation, which secures the control of another undertaking.

What form should the notification take? What content is required?

The HCC, which determines the form and content of the notification, has issued a draft notification form (Decision 558/VII/2013) and a separate form for submitting remedies. These templates generally follow the European Commission’s guidelines in format and aim to make clear to notifying parties the minimum information that must be provided as part of a notification. The notification form must be submitted in Greek, together with all of the supporting documents.

Is there a pre-notification process before formal notification, and if so, what does this involve?

No – the HCC has no formal or standard pre-notification process.

Pre-clearance implementation

Can a merger be implemented before clearance is obtained?

No – if a merger is implemented before clearance is obtained from the Hellenic Competition Commission (HCC), or is implemented contrary to a prohibition issued by the HCC, the undertakings concerned will be subject to serious penalties (eg, a fine and the concentration being declared invalid).

However, if the HCC prohibits a merger’s implementation before issuing clearance, this does not prevent a concentration in the following exceptional cases:

  • where an acquisition of control follows a public offer or other stock exchange transaction, provided that:
    • the relevant actions are notified in time (ie, within 30 days from the date of the transactions); and
    • the buyer does not exercise its voting rights relating to the acquired titles (unless it does so after receiving a special permit from the HCC in order to maintain the value of its investment); and
  • where the HCC has granted special permission (derogation) in order to avoid serious damages to one or more of the undertakings participating in the concentration or a third party.

Guidance from authorities

What guidance is available from the authorities?

If the notification is incorrect or misleading and the HCC cannot evaluate the notified concentration, the HCC will advise the notifying parties accordingly within seven days from receiving the notification. Further, if the undertakings do not meet their obligation to supply information, the HCC will communicate with the notifying parties accordingly. In such cases, the deadlines will be suspended and will restart on the date on which the requested information is submitted.

Fees

What fees are payable to the authority for filing a notification?

At present, there is a €1,100 filing fee.

Publicity and confidentiality

What provisions apply regarding publicity and confidentiality?

A summary of the notification must be published in a daily financial newspaper and on the HCC’s website, so that third parties (eg, competitors, suppliers, customers and customer associations) can learn of the transaction and comment on it to the HCC. The contents of the notification and its supporting material may be treated as confidential, if so claimed and justified by the notifying party.

Penalties

Are there any penalties for failing to notify a merger?

A penalty will be imposed for late notification, even if the parties have not yet implemented the concentration or the concentration has already been finally approved.

Procedure and test

Procedure and timetable

What procedures are followed by the authority? What is the timetable for the merger investigation?

Within one month from receipt of a complete notification, the Hellenic Competition Commission (HCC) president must issue an act to certify that the concentration concerned does not fall within the scope of the Law on the Protection of Competition (3959/2011). If the concentration falls within the scope of the law, the concentration may be examined in one or two phases, in line with the practice defined by the EU Merger Regulation (139/2004).

Where the HCC finds that the notified concentration does not raise serious doubts as to its compatibility with the competition requirements of the relevant national markets, the HCC will issue a decision approving the concentration within one month from the date of notification (ie, within the same period granted for the verification that the concentration is within or outside the scope of the law).

Where the HCC finds that the concentration raises serious doubts, the HCC’s president will issue a decision initiating Phase II proceedings, which will be notified to the interested parties. This decision must be issued within one month of notification. Following this decision, the rapporteur will prepare his or her recommendation within 45 days from the initiation of Phase II proceedings. The HCC must decide within 90 days whether to approve or prohibit the concentration. If the HCC fails to issue a decision within 90 days, the concentration will be deemed to have been approved. Both the 45 and 90-day deadlines start when Phase II proceedings are initiated (and not on the notification date, as under the previous law).

In addition to the general rules of administrative law regulating the revocation of legal or illegal administrative acts, the Law on the Protection of Competition (3959/2011) maintains special rules concerning HCC decisions to approve the implementation of a concentration, including a provision allowing revocation of a decision based on inaccurate or misleading data. In cases where the undertakings participating in the concentration violate conditions or accepted remedies, the HCC can:

  • dissolve the concentration;
  • restore prior conditions or split the merged enterprises; or
  • order the sale of the acquired shares or assets.

The above arrangement also applies where concentrations are implemented without approval.

What obligations are imposed on the parties during the process?

The deadlines will be suspended if undertakings do not meet their obligation to supply information, provided that they received notice within two days from the expiration of the deadline advising them to supply the information. The deadline period restarts on the date on which the requested information is submitted. The HCC may:

  • impose remedies to remove any serious doubts as to the concentration’s compatibility with competition in the relevant market; or
  • approve the notified concentration and attach to its decision conditions and provisions to ensure that the participating undertakings comply with their commitments, with a view of rendering the concentration compatible with the law.

What role can third parties play in the process?

Third parties can intervene before or during the process or appeal the HCC’s decision before the Athens Appellate Administrative Court.

Substantive test

What is the substantive test applied by the authority?

Greek law follows the EU significant impediment to effective competition substantive test and prohibits concentrations if they may lead to a significant impediment of competition in all or a substantial part of the Greek market, particularly by creating or strengthening a dominant position.

Market share will thus be examined, although it is not the only decisive criterion. The Law on the Protection of Competition (3959/2011) specifies the basic criteria to be considered in the test – namely:

  • the structure of the relevant markets;
  • actual or potential competition;
  • barriers to market entry;
  • the market position of the participating undertakings;
  • available sources of supply and demand; and
  • consumers’ interest and efficiencies.

Carve-outs

Does the legislation allow carve-out agreements in order to avoid delaying the global closing?

A derogation for the implementation of a merger before its clearance is exceptionally and conditionally available only in the event of:

  • an acquisition of control following a public offer (eg, a stock exchange procedure); or
  • threatened serious damage to one or more of the undertakings participating in the concentration or a third party.

The law provides for certain qualifications and restrictions which apply in both cases.

Test for joint ventures

Is a special substantive test applied for joint ventures?

 Please see above.

Remedies

Potential outcomes

What are the potential outcomes of the merger investigation? Please include reference to potential remedies, conditions and undertakings.

Notifying parties have the right to propose remedies to remove serious doubts as to a merger’s compatibility with competition in the relevant market, which may be structural or behavioural. The Hellenic Competition Commission may approve the notified concentration, attaching to its decision conditions and provisions to ensure that the participating undertakings comply with their commitments, with a view of rendering the concentration compatible with the law.

Appeals

Right of appeal

Is there a right of appeal?

Enforceable decisions of the Hellenic Competition Commission are subject to appeal (via an application for annulment) directly before the Athens Appellate Administrative Court. Appellate court decisions are subject to appeal (ie, cassation) before the Supreme Administrative Court only with regard to points of law.

Do third parties have a right of appeal?

Yes – for example, competitors, suppliers, customers and customer associations.

Time limit

What is the time limit for any appeal?

The time limit for an appeal is 60 days.