The Channel Islands Competition and Regulatory Authorities (CICRA) have issued new guidance on the process for obtaining their approval of a notifiable merger or acquisition in the Channel Islands.
The guidance formalises the practical approach developed by CICRA over the past few years when dealing with merger control applications. In all cases other than those qualifying for the shorter preliminary review in Guernsey (which does not apply in Jersey), the changes made by the guidance include:
- hardwiring a formal pre-notification requirement into the first phase of the process;
- introducing more flexibility for CICRA to comment on a draft version of the merger application form and associated information before accepting the form for registration;
- bringing forward the time at which a redacted, confidential version of the merger application form must be delivered to CICRA to aid the public consultation process; and
- introducing the concept of a 'state of play' meeting to be held between CICRA and the parties if it appears that the transaction may not be approved or may only be approved subject to conditions.
CICRA previously expected the transaction parties to meet with them before filing a merger application form only if the proposed transaction was likely to give rise to substantive competition concerns.
The new guidelines require formal pre-notification discussions with CICRA for all transactions, with CICRA encouraging the parties to contact them as soon as there is a good-faith intention to proceed.
CICRA expect the following benefits to arise from these pre-notification discussions:
- a chance for the parties to give CICRA advance information on the relevant markets;
- the ability for CICRA to identify any particular areas of difficulty and ask for the information needed upfront, thereby reducing the risk of CICRA 'stopping the clock' later in the review process;
- the ability for CICRA to identify any areas where extensive information is not required from the parties; and
- an opportunity for the parties to raise any questions or concerns before the merger application is made.
The new guidelines also include the following changes to the merger application process:
- CICRA require a draft of the merger application form to be submitted to them for review before the filing is made, with the new guidelines giving them more flexibility in terms of the time within which they will respond to the parties. CICRA now undertakes to review the draft merger application form and revert to the parties "within a reasonable time", with the previous five-working-day deadline now only a "guide".
- The new guidance explicitly allows CICRA to refuse a merger application form for registration unless it contains all of the information necessary for them to carry out the formal review. The information must be clear enough to enable CICRA to conduct their public consultation, and the guidance reserves the right for CICRA to ask the parties to provide more information and resubmit the draft form if it is unclear or incomplete.
- A separate version of the merger application form redacting confidential information must now be submitted at the same time as the form itself, rather than if and when it is requested by a member of the public during the 10-working-day consultation phase. The guidelines also state explicitly that CICRA will apply the principles set out in relevant European Commission guidance when assessing claims for confidentiality in this regard.
A new concept introduced by the revised guidelines is the so-called 'state of play' meeting between CICRA and the transaction parties. This may be held if CICRA believe there is a realistic chance of the transaction either not being approved during the first detailed review stage or being conditionally approved. The meeting will typically take place at the end of the public consultation period in order to:
- advise the parties of the concerns from a competition law perspective;
- provide feedback from CICRA's consultation; and
- clarify the probable timetable for CICRA's analysis.
The new guidance implements some procedural aspects of the recommendations for the islands' merger control regime overhaul which CICRA published in September 2016.
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