Legislation and jurisdiction

Relevant legislation and regulators

What is the relevant legislation and who enforces it?

The relevant legislation is the Dutch Competition Act of 22 May 1997 (the Act), which entered into force on 1 January 1998. The general rules on administrative procedure, as laid down in the General Act on Administrative Law, cover enforcement of the Act as well as various procedural aspects.

The body in charge of enforcement is the Authority for Consumers and Markets (ACM), which is competent to take decisions pursuant to the Act. On 1 April 2013, the ACM was created through the merger of the Netherlands Consumer Authority, the Netherlands Independent Post and Telecommunication Authority and the Netherlands Competition Authority (NMa). The ACM is authorised to initiate proceedings, to order parties infringing the Act to cease their behaviour and to take administrative measures. The ACM is an independent agency, as was its predecessor in competition enforcement, the NMa, since 2005. The Minister of Economic Affairs remains responsible for competition policy and may give the ACM general policy instructions but may not give instructions in specific cases. The ACM is headed by a board consisting of three members. In 2018, Chris Fonteijn left the ACM as chairman of the board. He was replaced by Martijn Snoep on 1 September 2018.

Scope of legislation

What kinds of mergers are caught?

The Act applies when any of the following operations occur:

  • two or more previously independent undertakings merge;
  • one or more undertakings acquire direct or indirect control of the whole or parts of one or more other undertakings; or
  • a joint venture (whether concentrative or coordinative) is established that performs, on a lasting basis, all the functions of an autonomous economic entity.

What types of joint ventures are caught?

‘Full-function’ joint ventures (ie, joint ventures that perform, on a lasting basis, all the functions of an autonomous economic entity) are caught by Dutch merger control. Cooperative aspects of joint ventures are not caught by Dutch merger control, but governed by the cartel prohibition contained in article 6 of the Act, which closely resembles article 101 of the Treaty on the Functioning of the European Union.

Is there a definition of ‘control’ and are minority and other interests less than control caught?

‘Control’ is defined as the ability to exercise a decisive influence on the activities of an undertaking on the basis of factual or legal circumstances. The term control does not refer to day-to-day management but to important strategic decisions. Minority shareholdings and other interests that give rise to ‘control’, for example, as a result of contractual veto rights or if a smaller shareholding allows blocking of important strategic decisions because of qualified majority voting requirements, are also caught. If a company is governed by the rules applicable to statutory two-tier entities (ie, with a separate board of directors and supervisory board), the ACM takes the view that this does not mean that the majority shareholders are not able to have decisive influence within the meaning of the Act.

Thresholds, triggers and approvals

What are the jurisdictional thresholds for notification and are there circumstances in which transactions falling below these thresholds may be investigated?

A concentration falls within the scope of the Act if:

  • the aggregate worldwide turnover of the undertakings concerned in the previous calendar year exceeds €150 million; and
  • the individual turnover in the Netherlands of each of at least two of the undertakings concerned was at least €30 million in the previous calendar year.

The interpretation of ‘undertaking concerned’ is similar to that applied under the EU Merger Regulation (EUMR). Where the concentration is implemented through the acquisition of control over parts, whether or not constituted as legal entities, of one or more undertakings, only the turnover relating to the parts that are subject to the transaction will be taken into account in the determination of turnover.

Turnover refers to the net turnover as defined in the Dutch Civil Code. This is the income from the supply of goods and services from the business of the legal person after the deduction of rebates and the like and of tax on turnover. The ACM has indicated that the interpretation of ‘tax on turnover’ is similar to that applied under the EUMR.

For credit and financial institutions, the general thresholds apply, but the calculation of the turnover differs. The turnover is, in general terms, calculated by taking the sum of interest income and similar income, income from securities, commissions receivable, net profit on financial operations and other operating income, after the deduction of VAT and other taxes directly related to these items.

For insurance companies, the €150 million threshold also applies, but it refers to the value of gross premiums that was received from Dutch residents. With respect to pension funds within the meaning of the Dutch Pension Act, alternative thresholds apply: €500 million combined gross written premium of which at least two undertakings concerned received €100 million from Dutch residents.

Separate thresholds apply in relation to the healthcare sector if at least two of the undertakings concerned have achieved a turnover of €5.5 million from the provision of healthcare in the preceding calendar year. If that is the case, the concentration falls within the scope of the Act provided that:

  • the aggregate worldwide turnover of the undertakings concerned in the previous calendar year exceeds €55 million; and
  • the individual turnover in the Netherlands of each of at least two of the undertakings concerned was at least €10 million in the previous calendar year.

Concentrations that fall below these thresholds can in principle not be reviewed by the ACM unless the companies infringe other parts of the Act. The Minister of Economic Affairs can, however, temporarily reduce the thresholds for certain categories of undertakings, although this measure does not apply retrospectively. The reduction lasts five years, but can be prolonged.

If there is any doubt about the necessity of a notification, the ACM encourages ‘pre-notification’ meetings to discuss such jurisdictional difficulties.

Transactions that fall within the scope of the EUMR do not (with limited exceptions provided for in the EUMR, as set out in the European Union chapter) fall under the Act.

New legislation has been introduced, with effect from 1 January 2014, prescribing prior mandatory notification to the Dutch Healthcare Authority (NZa), if a merger involves a healthcare provider that employs 50 or more persons. The NZa will apply primarily a procedural test, to see whether the parties have taken due account of the interests and opinions of stakeholders. If an NZa notification is required, the transaction cannot be implemented until the NZa has provided clearance (and cannot be implemented until the ACM has also provided clearance if a subsequent ACM notification is needed). In 2017, the NZa, for the first time, imposed a fine of €70,000, for the failure to notify a healthcare merger. The ACM will only accept a notification if the NZa has provided prior clearance. These rules are expected to change. The additional test applied by the NZa will be performed by the ACM after legislative changes have been implemented.

Is the filing mandatory or voluntary? If mandatory, do any exceptions exist?

Filing is mandatory. The Act prohibits the implementation of concentrations that fall within the scope of the Act before they have been notified to the ACM and a period of four weeks has passed. With regard to the acquisition of shares, the ACM is of the opinion that concentrations are implemented when the shares in question are transferred. The ACM may, at the request of the notifying party, grant a (conditional) exemption to the prohibition to implement the transaction before clearance (see question 36).

Do foreign-to-foreign mergers have to be notified and is there a local effects or nexus test?

With respect to the geographical allocation of turnover, the ACM follows the guidance as provided by the European Commission’s Consolidated Jurisdictional Notice in attributing turnover to the Netherlands.

If the turnover thresholds are met, foreign-to-foreign mergers must be notified, even if the companies concerned do not have a physical presence in the Netherlands. Joint ventures may also need to be notified, if the parent companies meet the notification thresholds, even if the joint venture is not active in the Netherlands. The substantive test only applies to impediments to competition on the Dutch market or parts thereof.

Are there also rules on foreign investment, special sectors or other relevant approvals?

Specific rules pertaining to special sectors govern a few Dutch markets. Concentrations involving companies in the banking and insurance sectors are subject to the merger control provisions of the Act. A protocol has been drawn up between the ACM and the Dutch Central Bank, setting out rules for the exercise of supervisory powers in these sectors in cases requiring urgent action. It describes the cooperation between the ACM and the Dutch Central Bank in concentrations involving the financial sector in which there is extreme urgency (such as a possible insolvency) to ensure that emergency situations are dealt with quickly. This protocol was applied for the first time to the acquisition of Friesland Bank by Rabobank. Friesland Bank was in financial difficulty and could not continue independently. The competition authority and the Dutch Central Bank granted Rabobank permission to acquire Friesland Bank without going through the normal notification process.

The ACM agreed a protocol for cooperation in mergers with the NZa. The protocol specifies how the ACM and the NZa will keep each other informed in merger cases, how information is exchanged between them and how they can consult each other on, for example, market definition issues. The ACM has entered into a number of cooperation agreements with other authorities and government departments, including for example the financial markets supervisor, the authority for personal data and the Dutch gambling authority.

Notification and clearance timetable

Filing formalities

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

Like the EU rules, the Act provides for a two-phase filing procedure: the notification (first stage) and the licence (second stage). The Act does not require that an agreement be signed or that a controlling interest be acquired before notification is possible. A concrete intention to engage in a transaction is sufficient. The ACM has to decide whether a licence authorising the transaction is required within four weeks starting the day after the receipt of the notification. If a licence is required, a second-phase examination will be necessary. To initiate the second phase, the parties (or party) concerned must submit a separate application. The ACM must decide on the licence application within 13 weeks.

The implementation of a concentration before the ACM has provided clearance can lead to administrative penalties (see questions 11 and 12). If the parties provide incorrect or incomplete information in their notification, the ACM can impose a fine of €900,000 or 1 per cent of the annual worldwide turnover of the company (whichever is higher).

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

In case of a merger, the acquiring companies have to notify the transaction. Where a company acquires control of another company, the obligation to notify applies to the acquiring company. With regard to public bids, the bidder has to notify the transaction. The filing fees are €17,450 for the notification and €34,900 for the licence application.

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

The implementation of a concentration pending the statutory waiting period of four weeks following notification of the proposed concentration is prohibited. There are two exceptions to this rule. The implementation of a public bid is not prohibited if the ACM is notified immediately and the acquirer does not exercise its voting rights. Further, the ACM may for serious reasons (such as risk of irreparable harm) grant a dispensation from the prohibition at the request of one of the notifying parties. The ACM quite regularly grants exemptions to the standstill obligation in cases involving a target company in financial distress. If the parties go ahead with implementation of the transaction prior to obtaining clearance, they assume the risk that competition concerns are subsequently identified by the ACM, which may require amendment or even unwinding of the transaction.

If the ACM decides that an application for a licence is required, the concentration will be further suspended for the 13-week period following the application for a licence. Here again, an exemption can be granted upon request to prevent serious damage.

The four-week and 13-week periods will be suspended from the day on which the ACM requires further information from the undertakings involved in the concentration until the day on which such information is provided. The ACM frequently makes use of its power to request additional information. Parties should take possible requests for additional information and following up on those requests into account when planning the timing of the notification and the implementation of a concentration.

The notifying parties have the possibility to submit a reasoned request to suspend the four-week period. The ACM will allow such a suspension if it assists in the assessment of the notification. This voluntary suspension may only be requested once. In addition, the 13-week period can be suspended, at the request of the notifying party or at the initiative of the ACM. In both cases, written assent of all undertakings concerned is required.

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?

The implementation of a concentration before the ACM that has been notified thereof or during the subsequent period of four weeks, or of a concentration for which a licence is required where no licence is granted, may result in a void transaction. In addition, the ACM can impose administrative penalties, such as fines up to a maximum of €900,000 or 10 per cent of the annual turnover of the company (whichever is higher), which can be imposed on each party that is responsible for filing.

The ACM may also make an order, backed by periodic penalty payments, that the undertakings concerned cease or reverse the infringement.

The competition authority has imposed fines for implementing a concentration without having notified and received clearance in several cases, indicating that it is fully prepared to impose tough sanctions for gun jumping violations. An example is the sale by the Dutch state of shares in Fortis Corporate Insurance to Amlin. Amlin did not notify this transaction before transferring the shares. The competition authority therefore imposed a fine of €1,366,000 on Amlin. In 2012, the Court of Appeal for Trade and Industry ruled that the seller is not responsible for filing the proposed transaction and that therefore the competition authority is not entitled to impose sanctions on the seller. In addition, in 2013, the District Court Rotterdam ruled that the fine imposed on Amlin should be reduced to €130,000 because the method used to calculate the fine led to an arbitrary result. The ACM had imposed the fine in the year after the concentration was implemented, meaning that the turnover of Fortis Corporate Insurance was also taken into account when determining the amount of the fine. Had the authority imposed the fine during the year that the concentration was implemented, the Fortis turnover would have been excluded, resulting in a much lower fine.

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

As indicated in question 12, the ACM is prepared to impose sanctions for gun jumping violations. The Dutch competition authority has also shown its willingness to impose sanctions in foreign-to-foreign mergers that have not been notified before implementation. An example concerns the acquisition of Vinnolit and Vintron by Advent. Vinnolit and Vintron were both German undertakings that were acquired by Advent. Because of an incorrect calculation of the turnover of Advent in the Netherlands, the parties had determined that a notification in the Netherlands was not necessary. After implementation, however, Advent noticed its mistake and voluntarily informed the competition authority. The competition authority found that the parties had violated the Act and imposed sanctions on Advent and the sellers.

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

Specific solutions are not available, but a divestment or other measure before closing, so that the notification thresholds are no longer met, means that clearance is no longer required. In addition, the parties also have the opportunity to request a derogation from the prohibition on implementing an intended concentration before clearance from the ACM (see question 11).

Public takeovers

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

The implementation of a public bid is exempt from the prohibition on implementing an intended concentration before clearance provided that the ACM is notified immediately and the acquiring party does not exercise its voting rights.

Documentation

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

Standard forms (in Dutch) must be used for both the notification and the licence application (an unofficial English language version is available on the ACM’s website). The notification form requests information on the undertakings concerned such as a description of their business activities, a description of the sectors in which they are active, information on the group (if applicable), and a financial outline of the preceding year showing the total turnover and the turnover in the Netherlands. Further, the notification form requests a description of the transaction and supporting documentation (the supporting documents can be submitted in another language, though the ACM may ask for a translation), such as the most recent annual accounts and reports of the undertakings, the most recent documents showing the intent to effectuate the concentration and the granting of powers of attorney by the undertakings concerned to the designated contact person or persons. Parties must also submit market research reports and, if there is an overlap between their activities, information on their major competitors, customers and trade organisations active in the sectors in which the parties’ activities overlap. Moreover, parties must indicate whether there are any ancillary restraints and if they wish the ACM to declare whether they fall within article 10 of the Act (see question 28). If there are markets to be investigated, parties should provide both value and volume-based market share figures. Parties are also asked to indicate whether the concentration has been or will be filed with any other competition authority in the EU and, if so, to provide details.

The ACM has the authority to impose fines of up to €900,000 or 1 per cent of the relevant turnover of the undertaking concerned (whichever is higher), if it has been provided with wrong or misleading information. Such fines are imposed only very rarely. An example is a fine of €468,000 (reduced on appeal to €312,000) for providing incomplete information regarding activities of subsidiaries and for understating market shares. It cannot be excluded that the ACM may follow the recent practice of the European Commission whereby the provision of accurate and complete information is more critically assessed and more sanctions are imposed in this respect.

Investigation phases and timetable

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

Cases that do not present substantive competition concerns are typically submitted to the ACM after a brief call to indicate that the filing will be submitted. Cases that do potentially present substantive competition concerns are typically submitted to the ACM after pre-notification discussions. However, pre-notification discussions are optional and parties may choose to immediately make a formal filing even if it raises competition concerns.

Upon receipt of the notification, the ACM must take a decision within four weeks (this period can be suspended, if a reasoned request is submitted by the notifying parties). This period will start running the day after the receipt of the notification provided that it is not a Saturday, Sunday or public holiday. The ACM will publish the fact of notification within a few days, assess the notification and, when necessary, ask the undertakings involved for further information. Information may also be requested from third parties such as customers, suppliers and competitors. Third parties with sufficient interest are allowed to intervene. The parties will be informed of the conclusions of the investigation and requested to indicate the parts of the decision that they consider confidential. The decision is then published. The vast majority of cases are decided within four weeks. Some cases take longer, owing to suspension of this time period resulting from requests for additional information and replies to these (see question 11).

If the ACM considers that it cannot clear the concentration within the first phase, it will determine that a licence is required. Following receipt of the application for a licence, an in-depth second-phase investigation will commence. The ACM must take a decision within 13 weeks following the application for the licence. It will ask the notifying parties, as well as third parties, for further information and can also commission expert reports. If the assessment reveals competition concerns, the ACM will usually (although it is not obliged to do so) communicate its preliminary assessment in writing to the undertakings concerned and to affected third parties. The undertakings may respond to this document, propose remedies or do both. The ACM is also, in certain circumstances, willing to organise intermediate state of play meetings.

If a notified case fulfils certain requirements, the ACM may issue a summary decision. The ACM has published guidelines on when a case definitely does not fulfil these requirements, and is therefore not a candidate for a short-form decision. It will normally issue a short-form decision if it is clear that Dutch merger control is applicable, that the concentration does not raise any competition concerns and if there are no objections from third parties. The adoption of a short-form decision may speed up the process.

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

The vast majority of cases are cleared through a short-form decision. Those cases, which do not present substantive competition concerns, are usually cleared in three to four weeks from notification. The ACM is willing to provide clearance even faster when the parties can explain the need for doing so. Examples include financial distress of the target company and the need to safeguard business continuity. The ACM’s approach to pre-notification meetings is set out in guidelines. Simple cases do not require lengthy pre-notification discussions. Informally announcing the notification a few days in advance is sufficient for cases that do not raise potential concerns.

For more complex cases, if the ACM decides that a licence is required that triggers an in-depth second-phase investigation, a decision will need to be adopted within 13 weeks of the application for the licence. However, the ACM often stops the clock to request further information, which extends the time frame for obtaining a second-phase decision significantly. To illustrate, second-phase investigations in recent years on average lasted more than 280 days in total.

Substantive assessment

Substantive test

What is the substantive test for clearance?

A licence application will be required where the ACM considers that a concentration may significantly impede effective competition (SIEC) in the Dutch market or any part thereof, in particular as a result of the creation or strengthening of a dominant position. A licence will be granted if the ACM concludes after its second-phase investigation that this will not occur. As this test mirrors the SIEC test in the EUMR, it will cover all competition issues raised by mergers, including unilateral effects cases.

Is there a special substantive test for joint ventures?

Joint ventures performing on a lasting basis all the functions of an autonomous economic entity are dealt with under Dutch merger control, but are subject to the same substantive test as other concentrations.

Theories of harm

What are the ‘theories of harm’ that the authorities will investigate?

Since the 2007 amendment to the Act, the test applied is whether a proposed transaction significantly impedes effective competition in the Dutch market or any part thereof, in particular as a result of the creation or strengthening of a dominant position. In applying the test, the ACM generally applies the same criteria and theories of harm as used by the European Commission, including the criteria set out in the horizontal and non-horizontal guidelines, and by the European courts.

Non-competition issues

To what extent are non-competition issues relevant in the review process?

Only competition issues are relevant in the ACM’s review process. However, if the ACM refuses to issue a licence authorising an envisaged concentration, the Minister of Economic Affairs may, in response to a request to that effect, decide that a licence will be granted if this is desirable for general interest reasons - either economic or non-economic - that outweigh the expected detriment to competition. To date, the Minister has not made use of this power. It should be noted that this is a separate power of the Minister, not a right to give instructions to the ACM in specific cases (see question 1).

Economic efficiencies

To what extent does the authority take into account economic efficiencies in the review process?

The Dutch competition authority has generally not paid specific attention to economic efficiencies in the review process. Since the alignment of the test with the EUMR in 2007, there is more room for taking efficiencies into account. In 2009, the competition authority considered an efficiency defence in a case concerning the merger of two hospitals in the province of Zeeland. In that case, at first instance, the competition authority had concerns regarding the market power of the combined entity as there appeared to be no real alternatives to these hospitals. After the hospitals submitted an ‘efficiency defence’ claiming that the merger would lead to consumer benefits, the competition authority stated that the present Act leaves room for the competition authority to take such efficiencies into account. Subsequently, the competition authority concluded that, in that case, the parties’ claim was ‘unsubstantiated’ and could, therefore, not be accepted. The parties thereafter submitted a significant remedy package, which was accepted by the competition authority. The transaction was ultimately cleared. It is believed that the ACM will be as reluctant as the Commission in accepting efficiencies as a justification for clearing a concentration that would otherwise fall foul of competition law. The authority will especially focus on whether it is credible that efficiency gains will be passed on to consumers.

Remedies and ancillary restraints

Regulatory powers

What powers do the authorities have to prohibit or otherwise interfere with a transaction?

If a concentration is implemented despite a standstill obligation, it is null and void and the ACM may order it to be reversed within a specified time limit. Contravention of the standstill obligation as well as of several other merger control provisions (eg, supply of incorrect information) may be sanctioned with fines or an order to remedy the infringement, subject to periodic penalty payments on non-compliance with such order, or by a combination of these sanctions.

The administrative fine for refusal to cooperate amounts to €900,000 or a maximum of 1 per cent of the relevant turnover of the undertaking concerned (whichever is higher).

Remedies and conditions

Is it possible to remedy competition issues, for example by giving divestment undertakings or behavioural remedies?

Since 1 October 2007, the Act has provided the possibility of offering remedies during the notification stage of the investigation. This possibility exists if the competition problem is clear and it is certain that the remedies will remove this problem. The ACM may attach conditions to the decision. The Act provides that if the ACM imposes conditions in the notification stage, the suspension obligation stays in place until the conditions are fulfilled. This reduces the importance of this possibility in practice. It is also possible to make amendments to the original notification, thereby alleviating the concerns of the ACM. If the original notification is amended, the transaction (as notified in the amended notification) may be closed after the decision is adopted.

The ACM may attach conditions to the granting of a licence in the second phase; for example, that changes be made to the intended transaction, or certain aspects of it.

The competition authority’s 2007 guidelines on remedies set out both its procedural and substantive policy. They are similar to the approach of the European Commission in that both divestment (ie, structural remedies) and behavioural remedies are possible, though structural remedies are preferred. In relation to some past concentrations involving hospitals, the ACM accepted a behavioural remedy in the form of a price cap to address competition concerns. However, in the more recent Stichting Albert Schweitzer Ziekenhuis/Stichting Rivas Zorggroep (2015) case involving hospitals, the ACM indicated that it considered a behavioural remedy in the form of a price cap to be unsuitable. Therefore, it seems unlikely that the ACM will accept a behavioural remedy in the form of a price cap in relation to hospitals in the future, similar to its position with respect to other sectors. The ACM will only accept an amendment of the original notification if a structural remedy is used.

What are the basic conditions and timing issues applicable to a divestment or other remedy?

The remedy guidelines set out the basic conditions for a divestment or other remedy. The guidelines are modelled closely on the European Commission notice on remedies and Commission practice.

The undertakings concerned should take the initiative in proposing adequate remedies, preferably in the pre-notification discussions. Structural remedies are preferred to behavioural remedies and, according to the guidelines, the ACM does not accept behavioural remedies in the notification phase.

Proposals offered by the undertakings concerned must include an adequate and proportional solution to the competition concerns of the ACM. The conditions that the ACM includes in a first-phase decision must remove the identified competition concerns and be implemented before the transaction is closed. Conditions that the ACM includes in a second-phase decision must ensure that the concentration does not significantly impede effective competition. These conditions generally involve divestment of the businesses that give rise to the impediment of competition, or severance of links between the undertakings concerned and these businesses. Where divestments are involved, the purchaser must be independent of the undertakings concerned and should have sufficient expertise and financial resources to guarantee the continuity of the activities of the business. As the divestment is intended to ensure that the market remains competitive, the ACM has the right to approve the prospective purchaser. Where the undertakings concerned are not able to divest the businesses concerned, the ACM may require the appointment of a trustee who will ensure that this process is carried out. The undertakings concerned must ensure that prior to the sale, the activities of the business to be divested remain intact and that their continuity and position on the market are not jeopardised. Where the conditions laid down are aimed at ensuring that a certain business remains independent of the parties involved in the takeover, the undertaking concerned must take measures to guarantee that such independence will continue to exist in the future. The ACM may supervise the divestment process for a limited time (and may require the divestment of the activities concerned). On timing, the guidelines clearly favour discussing remedies in the pre-notification meetings and strongly recommend submission of remedies at least one week prior to the end of the four-week time limit. With remedies in the licence phase, the guidelines state that, as a general practice, the ACM will inform the parties of the competition problems it perceives in its preliminary assessment, typically after eight weeks. This gives parties the opportunity to submit remedies should they not have done so at an earlier stage. At this stage, remedies in the licence phase should be proposed at least three weeks prior to the deadline for the decision.

What is the track record of the authority in requiring remedies in foreign-to-foreign mergers?

In the ACM’s decisional practice there have only been a limited number of cases involving remedies. To date, we are not aware of any that involved foreign-to-foreign mergers. However, parties have amended their filing in response to the competition authority’s concerns in at least one concentration involving two foreign-owned undertakings, which sought to take joint control over two Dutch undertakings.

Ancillary restrictions

In what circumstances will the clearance decision cover related arrangements (ancillary restrictions)?

When submitting a notification, parties must indicate whether there are any ancillary restraints. Parties may ask the ACM to declare that the related arrangements fall within article 10 of the Act, meaning that they are directly related to and necessary for the implementation of the concentration as a result of which the cartel prohibition contained in article 6 of the Act does not apply to the restraint.

Involvement of other parties or authorities

Third-party involvement and rights

Are customers and competitors involved in the review process and what rights do complainants have?

The ACM may request information from customers, suppliers and competitors on the envisaged transaction or relevant markets. Third parties whose interests are directly involved may submit their comments on the proposed transaction to the ACM and are invited to express their view on the preliminary assessment issued by the ACM eight weeks after the application for a licence. In practice, the ACM attaches value to observations made by third parties. This is especially the case in relation to concentrations involving hospitals, where the ACM will attach significant importance to the opinion of health insurers and patients.

Publicity and confidentiality

What publicity is given to the process and how do you protect commercial information, including business secrets, from disclosure?

After a notification, and following the filing of an application for a licence, the ACM publishes an announcement in the Official Gazette and on its website, inviting interested parties to submit their views on the proposed transaction. Decisions by the ACM, including a decision that a licence is required and decisions to end procedures, are also made public. Sensitive information (ie, business secrets) is omitted from these publications. Prior to publication, parties are given the opportunity to submit a reasoned request that certain information is to be treated confidentially and removed from public documents. If the ACM disagrees, it will inform the parties in due time, so as to allow them to file for an injunction against publication.

Cross-border regulatory cooperation

Do the authorities cooperate with antitrust authorities in other jurisdictions?

The ACM cooperates formally and informally with foreign competition authorities; for example, as a member of the European Competition Authorities and the International Competition Network and with the Commission, as a member of the European Competition Network. It may inform the relevant competition authorities if it requests information from foreign companies and may provide competition authorities in other jurisdictions with information it has collected. The ACM contacts other competition authorities where a transaction is filed in several jurisdictions and may exchange information or coordinate its proceedings with these authorities. The notification form also requests parties to indicate whether the transaction has been, or will be, notified to other antitrust authorities.

Judicial review

Available avenues

What are the opportunities for appeal or judicial review?

Appeals against decisions by the ACM must be lodged with the District Court of Rotterdam (Chamber of Administrative Law). The judgment of the District Court may be further appealed to the Court of Appeal for Trade and Industry in The Hague. Any person whose interests are directly affected may appeal against a decision. The Minister of Economic Affairs may, in response to a request, grant a licence for an envisaged concentration even though the ACM has refused to grant one (see question 22). Decisions of the Minister are also subject to judicial review.

In 2012, the District Court of Rotterdam reduced the sanction imposed on the newspaper publisher Wegener. The competition authority had imposed a fine of €19 million for non-compliance with conditions imposed in a decision granting a licence for a merger. The District Court of Rotterdam reduced the sanction to €2 million. The competition authority had moreover imposed sanctions on five individuals. The District Court reduced the fines imposed on three of these and annulled the decision in relation to the remaining two individuals.

In 2016, the Court of Appeal for Trade and Industry annulled the ACM’s 2012 prohibition decision involving biscuit producers AA ter Beek and Continental Bakeries. Continental Bakers produces private label biscuits while AA ter Beek produces private label biscuits in addition to branded biscuits. According to the ACM, the upstream market for the production of biscuits comprises both private label and branded products, meaning that the combined market share of the parties would be very high. The market definition was based on reasoning by the ACM that, when purchasing biscuits, retailers will take into account pricing for both private label and branded biscuits. The court annulled the decision on the basis that the ACM had not investigated and explained properly why and how the upstream market should cover private label and branded products, as a result of the purchasing behaviour of retailers.

In 2016, the Rotterdam District Court upheld, on appeal by Vodafone, a 2014 ACM clearance decision in relation to the acquisition of sole control by Dutch incumbent telecom operator KPN in Reggefiber, a fibre optics cable operator. KPN already had joint control in Reggefiber, which was cleared in 2008 subject to remedies. The ACM had cleared the change from joint to sole control unconditionally, on the basis of sector-specific regulation that, in its view, prevented competition concerns. The sector-specific regulation, inter alia, requires KPN to put in place Chinese walls, act in a non-discriminatory manner and it imposes maximum prices. The District Court agreed that the sector-specific regulation could be taken into account by the ACM in its prospective analysis when assessing the effects on the concentration. The court accepted that the sector-specific regulation is sufficient to prevent concerns.

In 2017, the Rotterdam District Court dismissed two appeals against ACM clearance decisions. One case related to the clearance decision by the ACM of the acquisition by the Lotto of the Staatsloterij, which was appealed by Stichting Speel Verantwoord and Lottovate. The Rotterdam District Court dismissed the appeal and the case is now pending in the Court of Appeal for Trade and Industry. The other case the Rotterdam District Court dismissed related to the clearance of the acquisition by Brocacef of Mediq, which was appealed by Mosadex.

Time frame

What is the usual time frame for appeal or judicial review?

While the time frame for appeal and judicial review will depend on the courts’ agendas and workloads, litigation may take up to a year, and perhaps longer. The Court of Appeal for Trade and Industry considers that appeal at the District Court level as well as subsequent appeal to the Court of Appeal for Trade and Industry should each take at most two years, to prevent a violation of the right of a fair trial as contained in the European Convention on Human Rights.

Enforcement practice and future developments

Enforcement record

What is the recent enforcement record and what are the current enforcement concerns of the authorities?

In 2010, the competition authority imposed fines in three cases for breaching article 34 of the Act (ie, implementing a concentration without having notified and therefore failing to receive clearance prior to closing). In 2001, a fine was imposed in the case of a foreign-to-foreign merger: only German undertakings were involved in the transaction. The competition authority repealed this fine in 2002.

In its latest annual report, the ACM indicated that it would focus in the coming year in particular on the digital economy, the energy market, ports and transport, (digital) data, the healthcare sector and the pharmaceutical sector (noting in particular its research into prices of medicines, the report of which is expected to be published in 2019). However, not all these priorities may become relevant in the context of merger control.

Reform proposals

Are there current proposals to change the legislation?

It is expected that new legislation will enter into effect by which the ACM will take over the test currently performed by healthcare regulator NZa in relation to concentrations involving healthcare providers. This test, which will apply in addition to ACM’s merger control assessment, consists primarily of a procedural test, to see whether the parties have taken due account of the interests and opinions of stakeholders. However, it is uncertain if this legislative proposal will in fact be introduced.

In addition, some mostly technical changes to the Dutch Competition Act are expected. This includes the removal of an existing legal requirement to, in case of conditions attached to a Phase I clearance decision, observe the conditions prior to being allowed to implement the concentration.

Update and trends

Key developments of the past year

What were the key cases, decisions, judgments and policy and legislative developments of the past year?

Key developments of the past year36 What were the key cases, decisions, judgments and policy and legislative developments of the past year?

In 2018, 108 merger notifications were submitted to the ACM and 97 decisions were taken. The vast majority were short-form decisions. Of the reasoned decisions, five relate to the healthcare sector (ie, more than 50 per cent of all reasoned decisions). One Phase II decision and one amended Phase II decision were adopted in 2018, both relating to the healthcare sector. This further illustrates the importance of healthcare concentrations to the ACM.

In July 2018, the ACM published a decision amending the 2016 Phase II decision in the Brocacef/Mediq case. In 2016, the ACM had concluded that the transaction would lead to a significant impediment to effective competition in the supply of products and services by pharmacies on the retail market in a number of geographic areas, including Ermelo (a village in the Netherlands). In Ermelo, two pharmacies were preferred partners of Mediq and one pharmacy was a franchise of Brocacef. As of 1 January 2018, the two preferred partner pharmacies terminated their relationship with Mediq/Brocacef, resulting in the removal of the overlap. Therefore, Brocacef requested the ACM to amend its Phase II conditional clearance decision by removing one of the pharmacies listed as a remedy-pharmacy as a condition to the decision. The ACM granted Brocacef this request.

The substantive Phase II decision of 2018 also involved the healthcare sector and related to the combination of Bergman Clinics and Healthcare Clinics, which was unconditionally cleared by the ACM in December 2018. The Phase II investigation focused on the following: (i) a potential deterioration in the bargaining power of health insurers with regard to the combined entity; or (ii) market power or unilateral effects on the local market for the supply of eye care in Amersfoort. The ACM concluded that there would be (virtually) no change in the bargaining position of the combined entity with regard to the health insurers, and thus no competition concerns. As to the supply of eye care in Amersfoort, the ACM assessed whether the parties were each other’s closest competitors and eventually concluded that they were not. The ACM also found that competitors could relatively easily and sufficiently quickly expand their operations in Amersfoort if the health insurers so requested. The ACM cleared the transaction.

Another noteworthy case was the concentration between ZorgSaam Zorggroep Zeeuws-Vlaanderen and Warmande - two healthcare providers specialised in both intramural and extramural elderly care - where the ACM concluded that there were concerns on the relevant markets, but that Warmande would imminently disappear from the market (as it was in financial difficulties) and thus accepted the parties’ ‘failing firm defence’. Indeed, the ACM considered that without the concentration all Warmande’s personnel and patients would move to ZorgSaam. The ACM finally concluded that there were no other operators that showed any interest in acquiring (the activities of) Warmande or becoming active in the region of West Zeeuws-Vlaanderen. Therefore, it concluded that there were no alternatives to the concentration and accepted the failing firm defence.

In 2017, the ACM focused on, inter alia, the digital economy and online consumers, conducting several investigations and closely monitoring competition in the online domain. For 2018 to 2019, the ACM has published its agenda in 2018 and identified four key priorities: the digital economy, energy markets in transition, prescription drug prices and ports and transport. Indeed, throughout 2018 the ACM has focused on these areas and it is expected to continue that focus throughout 2019.