Notification and clearance timetable

Filing formalities

What are the deadlines for filing? Are there sanctions for not filing and are they applied in practice?

According to the Act, the Council has to be notified of an intended concentration within 15 days of the signing of the respective agreement, the announcement of a public offer of shares, or an acquisition of control, whichever (of the three) occurs first. However, the undertakings concerned have the option to notify the concentration already once they can demonstrate their intention to undertake the concentration based on, for example, the conclusion of an agreement in principle, a memorandum of understanding, a letter of intent signed by all parties to the concentration or a public announcement of the intention to submit a purchase offer.

Failure to notify the Council of the concentration within due time may result in a fine of up to 1 per cent of the total turnover of the undertakings concerned, realised in the business year preceding the concentration. In addition, a fine of between 5,000 and 15,000 Bosnia and Herzegovina convertible marks may be imposed on the responsible persons within the undertakings concerned. Such fines may be imposed regardless of whether the concentration was implemented or not at the moment when the Council learned of the concentration. Therefore, fines for a failure to notify the Council of a concentration in due time may be substantial (depending on the undertaking’s turnover). In this respect, the Council imposed fines for late filling in several cases (2013) ranging between 19,000 and 310,000 Bosnia and Herzegovina convertible marks. The Council may also impose fines for the implementation of a concentration prior to or without clearance (for details and in particular concerning the fines imposed in a case in 2013 combining fines for late filing and closing before clearance, see question 12).

Which parties are responsible for filing and are filing fees required?

Responsibility for notifying the Council of the acquisition of a majority shareholding or a majority of voting rights or other controlling interests rests with the acquirer. In the case of an acquisition of control based on a public offering of shares, the offeror has the filing responsibility. In the case of joint ventures and in all other cases, responsibility to notify the Council of the transaction lies with all undertakings concerned.

An initial filing fee of 2,000 Bosnia and Herzegovina convertible marks is payable prior to the submission of the notification, and a proof of payment must be submitted to the Council together with the notification. In addition, a fee of 5,000 Bosnia and Herzegovina convertible marks is payable after the Council issues a Phase I clearance decision without performing an in-depth investigation. A fee of 0.03 per cent of the total annual turnover of each of at least two undertakings concerned, generated through the sale of goods or services in the market of Bosnia and Herzegovina (up to 50,000 Bosnia and Herzegovina convertible marks) is payable if the Council adopts its decision after an in-depth (Phase II) investigation. If the Council dismisses the notification because of the requirements for filing not being met, a fee of 1,000 Bosnia and Herzegovina convertible marks is payable. In practice, the Council will not issue its decision unless the fees are paid.

What are the waiting periods and does implementation of the transaction have to be suspended prior to clearance?

The Act provides that the intended concentration must not be implemented until the Council passes a decision authorising the transaction or until the waiting period expires (suspension obligation).

Following the submission of the notification, the authority first assesses the completeness of the filing. The law does not provide a specific time frame for this stage. In practice, it is thus recommended to be in contact with the authority during this stage to ensure that this period is short. Once the filing is accepted as complete, the Council issues a certificate of completeness. If the Council, upon review of the submitted notification, takes the view that the notified concentration does not raise any competition law concerns in Bosnia and Herzegovina, a clearance decision for the concentration is issued within 30 days of the date of issuance of the certificate. If the Council does not take any decision within such 30-day period, the concentration shall be deemed to be approved.

If the Council takes the view that the intended concentration is likely to have a negative effect on competition in the market, it can initiate an in-depth (Phase II) investigation. Such investigation may take up to three months, meaning that the Competition Council is obligated to issue a final decision within three months of the day of adoption of a decision on initiation of proceedings.

An extension of an additional three months is possible if the intended concentration involves a sensitive business sector and in cases in which it is necessary to carry out additional analysis defining the state of facts or an examination of evidence. If the Council initiates a Phase II investigation but fails to issue a decision within the above-mentioned deadline, the concentration shall be deemed to be approved.

The suspension obligation does not prevent the implementation of a takeover bid of which the competent authority has been notified in accordance with the respective public takeover bids regulations as provided in article 18, paragraph 10 of the Act.

Pre-clearance closing

What are the possible sanctions involved in closing or integrating the activities of the merging businesses before clearance and are they applied in practice?

Closing a concentration without obtaining prior clearance by the Council may result in a fine of up to 10 per cent of the parties’ total turnover in the year preceding the closing of the concentration. Individuals responsible within the undertakings may in that case be subject to fines ranging from 15,000 to 50,000 Bosnia and Herzegovina convertible marks. These fines were introduced with the amendments to the Act adopted in October 2009. Previously, there were no sanctions prescribed by the law in the event that the parties implemented the transaction before obtaining clearance, although the suspension obligation did exist.

The statute of limitations for infringing the suspension obligation is five years from the date of the infringement (ie, the day of closing the transaction without clearance).

In addition, if the Council was not notified of a concentration and it later finds that such concentration had negative effects on competition in the market of Bosnia and Herzegovina, the Council may order that the acquired shares and assets be sold. The Council may also restrict the voting rights of the acquiring undertaking or order the cessation of the joint venture or any other form of acquired control that the Council believes restricts competition in the market of Bosnia and Herzegovina.

In March 2010, for the first time after the 2009 amendments to the Act, the Council imposed a fine on an undertaking for closing the concentration before obtaining prior clearance from the Council. The fine amounted to 200,000 Bosnia and Herzegovina convertible marks and was imposed on a local company engaged in the trade of petroleum and petroleum products for failure to notify the Council of the acquisition of 10 petrol stations from another local company, as well as for closing the concentration before obtaining prior clearance from the Council. For procedural reasons, this fine was reimposed by the Council in 2011. Apart from that, the Council imposed in three more cases fines for failure to notify a concentration and breach of the suspension obligation in 2011, although at lower amounts (40,000, 50,000 and 70,000 Bosnia and Herzegovina convertible marks). In 2012, the Council did not impose any sanctions for closing before clearance. In 2013, in one case a fine of in total 656,667 Bosnia and Herzegovina convertible marks was imposed on the undertakings concerned for late filing and closing before clearance. In this case, however, the decision of the Council was in the following challenged by one of the undertakings concerned and, consequently, the fine was substantially lowered. In 2014, the Council imposed in one case a fine of 26,500 Bosnia and Herzegovina convertible marks for failure to notify the concentration and closing before clearance.

In 2015, 2017 and 2018, the Council did not impose any sanctions for closing before clearance or for failure to notify a concentration, while in 2016 fines were imposed in two cases for failure to notify the concentrations and for implementation of the concentrations without decision of the Council. In one case two undertakings with fines of 30,000 and 7,500 Bosnia and Herzegovina convertible marks, respectively, for failure to notify the concentration, and with fines of 60,000 and 15,000 Bosnia and Herzegovina convertible marks, respectively, for implementation of the concentration without decision of the Council. In the second case a fine in an amount of 10,000 Bosnia and Herzegovina convertible marks was imposed to the undertaking concerned for a failure to notify the concentration within the statutory deadline.

Are sanctions applied in cases involving closing before clearance in foreign-to-foreign mergers?

The sanctions for closing before clearance are also applicable in cases involving foreign-to-foreign mergers.

What solutions might be acceptable to permit closing before clearance in a foreign-to-foreign merger?

Foreign-to-foreign mergers are assessed in the same way as local concentrations. The Act and the applicable regulations do not provide for hold-separate (carveout) solutions. Although discussed in practice, such solutions have not yet been tested with the authorities in Bosnia and Herzegovina.

Public takeovers

Are there any special merger control rules applicable to public takeover bids?

The suspension obligation does not prevent the implementation of a takeover bid of which the competent authority has been notified in accordance with the respective public takeover bid regulations as provided in article 18, paragraph 10 of the Act.

Documentation

What is the level of detail required in the preparation of a filing, and are there sanctions for supplying wrong or missing information?

The information and documentation required for the notification of an intended concentration is set out in the Regulation on the Notification of Concentrations and the Criteria for the Assessment of Concentrations. The following information, inter alia, is to be provided to the Council when filing a notification:

  • names, seats and business activities of the undertakings concerned;
  • names and contact details of persons authorised to represent the undertakings concerned before the Council;
  • description of the intended concentration;
  • legal basis of the concentration;
  • information regarding the financial status and total turnover of the undertakings concerned (on both a worldwide and national level) for the business year preceding the concentration;
  • information about the relevant market and the market shares of the undertakings concerned;
  • list of the main competitors and estimates of their market shares;
  • information on the ownership structure of the undertakings concerned;
  • information about related parties;
  • description of distribution and retail networks used by the undertakings concerned;
  • description of planned research projects and investments regarding the undertakings concerned; and
  • reasons for the intended concentration and detailed description of the expected benefits for customers.

Documents that have to be enclosed in a notification are, inter alia:

  • excerpts from the commercial registry or other equivalent documents showing the relevant details regarding the undertakings concerned;
  • powers of attorney for the persons authorised to represent the undertakings concerned before the Council;
  • an original or a certified copy of the legal basis of the intended concentration;
  • financial statements of the undertakings concerned for the business year preceding the concentration; and
  • organisational charts of the undertakings concerned.

The Council may request additional information and documentation that it deems necessary or useful when considering a concentration. If the notifying party cannot submit certain information or a requested document despite all reasonable efforts, it may provide the Council with the brief reasonable explanation as to why that information or a particular document is not available.

The notification and all enclosures thereto have to be provided in one of the official languages of Bosnia and Herzegovina. Furthermore, all documents submitted to the Council have to be in the form of an original or a certified copy and apostilled (depending on the jurisdiction of origin of a particular document).

Provision of incorrect or incomplete information to the Council or refusal of a party to comply with an information request may result in a fine of up to 1 per cent of the total turnover of the undertakings concerned, realised in the business year preceding the concentration. In addition, a fine of between 5,000 and 15,000 Bosnia and Herzegovina convertible marks may be imposed on the responsible persons within the undertakings concerned.

Investigation phases and timetable

What are the typical steps and different phases of the investigation?

See question 11.

What is the statutory timetable for clearance? Can it be speeded up?

Once the Council issues a certificate of completeness, it has to decide within 30 days whether the proposed concentration raises competition law concerns in Bosnia and Herzegovina. If the Council believes that the proposed concentration will not have any negative effect on competition, it will issue a (Phase I) clearance decision. If the Council does not issue a decision within the 30-day period, the concentration shall be deemed to be approved.

If the Council takes the view that the intended concentration could have a negative effect on competition, it may initiate a Phase II investigation. A Phase II investigation may take up to three months, meaning that the Competition Council is obligated to issue a final decision within three months following the date on which the resolution authorising the institution to conduct Phase II proceedings is adopted. The Phase II investigation may be extended for an additional three months if the intended concentration involves a sensitive business sector and in cases in which it is necessary to carry out additional analysis defining the state of facts and examination of evidence. If the Council initiates a Phase II investigation but does not issue a decision within the defined deadline, the concentration shall be deemed to be approved.

In practice, after submission of the filing, it usually takes a rather long time until the Council considers the filing complete and issues the certificate of completeness. Therefore, the start of the review period is usually delayed. Against that background and according to our experience it takes about three to five months from initial submission of the filing until clearance in cases in which the Council does not initiate a Phase II investigation. If a Phase II investigation is launched, the overall proceedings until clearance may take up to eight months (and even longer).

The law does not provide for a formal way of speeding up the procedure.