The Competition and Consumer Protection Act 2014 (the “2014 Act”), which came into force in late October 2014, reshaped the Irish merger control landscape. Some of the more noteworthy changes include changes to the rules triggering a filing requirement and the introduction of a revised Irish ‘media merger’ regime.
The amendments to the Competition Act 2002, introduced by the 2014 Act, clarified that a merger takes place where there is a transfer of property even where there is no corresponding transfer of a legal entity. Furthermore, the turnover thresholds were somewhat relaxed. A filing can now be required where a target's asset(s) has as little as €3 million in turnover in the State and provided that the aggregate turnover of the undertakings involved in the State is at least €50 million. This has clearly had implications for property transactions involving assets generating relatively small amounts of turnover, e.g. hotels, office blocks, bookmakers, and is reflected in the number and types of merger filings since the legislation entered into force.
In the first 8 months of 2015, there have been 41 merger filings to the Competition and Consumer Protection Commission (“CCPC”). This compares with 41 for the entire of 2014 and is on course to exceed the total for every year since 2007, when 72 transactions were notified. While this uptick in merger activity could be put down to the improved economic situation, it is likely that much can also be attributed to the changes introduced by the 2014 Act. For example, since the end of October 2014, when the new rules entered into force, of 52 mergers filed with the CCPC, approximately 45% were property-related transactions. This compares with just one in the preceding 12 months.
There is little doubt that many of these transactions would not have been caught under the old rules. For example, in Tedcastles/Ashbourne Oil Co. , turnover attributable to the target assets was a mere €4.28 million.
Also, a consequence of these changes is that the CCPC is now increasingly considering relatively small transactions with very little likelihood of raising competition concerns. For example, many hotel transactions notified have involved the transfer of a single hotel.
The 2014 Act also introduced substantial amendments to the Irish ‘media merger’ regime. As was previously the case, media mergers are automatically notifiable regardless of the turnover of the undertakings involved. However, media mergers must, following approval by the CCPC, now also be notified to the Minister for Communications, Energy and Natural Resources who is responsible for conducting a media plurality assessment introduced by the 2014 Act. Our EU & Antitrust team have been involved in the first three media mergers notified under the new regime, including the proposed acquisition of TV3 by Liberty Global.
The first ten months of the new merger control regime has seen a significant increase in the number of filings made to the CCPC. Changes introduced mean that some transactions which would previously have been exempt now require filing with the CCPC. The type of transactions being notified has therefore shifted, with a surge in the notification of relatively small transactions with very limited possibility of causing competition problems. These emerging trends look set to continue into the future.