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What are the potential outcomes of a merger control investigation in Argentina?
Under Section 13 of the Competition Act (25,156/1999), the potential outcomes of the merger investigation may include:
- the approval of the transaction;
- the imposition of conditions or undertakings to be fulfilled; or
- the prohibition of the transaction.
Undertakings are generally structural or behavioural. Most structural remedies have been imposed in horizontal cases, where the degree of concentration in the relevant market was considered excessive and the authorities sought to restrict the effects of the transaction as much as possible. The authorities are generally inclined to discuss undertakings with the parties, which the 2014 amendment to the Competition Act (Act 26,993/2014) has formally incorporated therein.
Behavioural undertakings can adopt many forms, including:
- the amendment of clauses in the documents relating to the notified transaction;
- non-discrimination warnings, normally within vertical cases where there may be a risk of restrictions in the sale of particular items to competitors of the merging parties downstream or warnings against tying practices; and
- not increasing market share in the given market for a certain period.
In certain cases, behavioural undertakings have been drafted in broad terms by the authorities, even extending into areas other than competition law. The determination of whether these have been fulfilled by the parties has become a challenge.
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