Merger review

Powers of competition authority

Does the competition authority have the same authority with respect to reviewing mergers involving IP rights as it does with respect to any other merger?

There are no specific merger control thresholds for the notification of transactions involving transfer of IP rights. Therefore, general merger control rules apply, according to which transactions must be notified to the Authority, when both the following thresholds (under article 16 of Law No. 287/90, as amended by Law No. 124 of 4 August 2017, entered into force on 29 August 2017) are met (provided that the transaction does not have a Community dimension under the EU merger control rules set out in Regulation (EC) No. 139/2004 on the control of concentrations between the following undertakings):

  • the aggregate turnover in Italy of all undertakings involved above €492 million; and
  • the individual aggregate turnover in Italy of at least two of the parties of the transaction above €30 million.

In principle, the Authority’s powers with respect to reviewing mergers involving IP rights do not differ from those exercised while reviewing any other mergers. That said, as further detailed in questions 20-22, the Authority’s assessment may vary significantly when a notified transaction involves the transfer of IP rights.

Analysis of the competitive impact of a merger involving IP rights

Does the competition authority’s analysis of the competitive impact of a merger involving IP rights differ from a traditional analysis in which IP rights are not involved? If so, how?

The Authority’s analysis of the competitive impact of a transaction involving the transfer or concentration of IP rights may differ from a traditional analysis in which IP rights are not involved, insofar as the transfer or concentration of IP rights may result or contribute to the creation or strengthening of a dominant position in the market.

Challenge of a merger

In what circumstances might the competition authority challenge a merger involving the transfer or concentration of IP rights? Does this differ from the circumstances in which the competition authority might challenge a merger in which IP rights were not a focus?

The Authority may challenge transactions involving the transfer or concentration of IP rights when they may cause market distortion, impede effective competition creation or strengthen a dominant market position (eg, where the transaction would deprive remaining competitors from accessing essential IP rights, in the absence of alternative technologies).

Remedies to address the competitive effects of mergers involving IP

What remedies are available to address competitive effects generated by a merger when those effects revolve around the transfer of IP rights?

Under article 18 of Law No. 287/90, the parties may offer commitments to meet the Authority’s concerns with regard to a notified transaction. In principle, the Authority can require either structural or behavioural remedies to resolve potential competition issues raised by a notified transaction. In the Authority’s past experience, structural remedies appear to be preferable to behavioural ones, as they allow the potential competition issues to be resolved from the outset and require more limited monitoring activities.

Commitments available to address potential competition issues related to the transfer or concentration of IP rights include the mandatory licensing of IP rights or their divestment.

In case C6941 - Koninklijke Numico v Mellin of 15 June 2005 - the Authority found that, inter alia, the divestment of Nutricia’s milk-branded products was an adequate means to reduce Numico’s presence and resolve the potential issues raised by the transaction. In case C1179 - Bolton Alimentari v Simmenthal of 2012 - Bolton committed instead to divest the Manzotin business, which included the Manzotin brand and related business information. In case C12023 - Arnoldo Mondadori Editore v RCS Libri of 23 March 2016 - Arnoldo Mondadori Editore offered to divest its publishers Marsilio and Bompiani to allow the entry into the market of a new player. In addition, Arnoldo Mondadori Editore waived the rights of option and preferential rights regarding future narrative and non-fiction works contained in the authors’ contracts.