In brief: the key features of merger control legislation in Belgium

Legislation and jurisdiction

What is the relevant legislation and who enforces it?

The relevant legislation is included in Book IV of the Code of Economic Law and the Royal Decree of 30 August 2013 on the notification of concentrations. On 2 May 2019, a new law was adopted that replaced Book IV of the Code of Economic Law in full, resulting in a new numbering of its articles. The decisions mentioned in this chapter shall be read as referring to the corresponding provisions of the new text. 

The Belgian Competition Authority (the Authority) is responsible for the enforcement of the Competition Act. The Authority is a single and independent administrative body and is composed of a president, the Competition College (presided by the president), the Investigation and Prosecution Service (headed by the Competition Prosecutor General) and a management committee. The Investigation and Prosecution Service conducts the investigations (both in merger and conduct-related cases) and presents its cases to the Competition College, which has the decision-making power. The members of the Investigation and Prosecution Service can also issue decisions regarding simplified merger filings.

What kinds of mergers are caught?

The definition of a concentration in Book IV of the Code of Economic Law is similar to that under the EU Merger Regulation (EUMR). A concentration occurs where:

• two previously independent undertakings merge;
• an undertaking or a person already controlling an undertaking acquires control over the whole or part of another undertaking; or
• two or more undertakings form a ‘full-function’ joint venture.

What types of joint ventures are caught?

The merger control provisions of Book IV of the Code of Economic Law apply only to ‘full-function’ joint ventures, that is, those that perform ‘on a lasting basis all the functions of an autonomous economic entity’. However, to the extent that a full-function joint venture between undertakings that remain independent could lead to coordination of the behaviour of the parent companies, such coordination will be assessed under the criteria set out in article IV.1 of the Code of Economic Law (ie, the Belgian equivalent to article 101 of the Treaty on the Functioning of the European Union (TFEU)).

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

Book IV of the Code of Economic Law defines ‘control’ fairly broadly, so that the acquisition of a minority shareholding can be caught in certain circumstances. As is the case under EU law, control means the possibility of exercising decisive influence on an undertaking, whether by contract or otherwise. For example, in cases where outright legal control is not acquired, rights attaching to use or ownership of assets, shareholders’ agreements and board representation will be considered. In its Belgacom SA/Vodafone Belgium SA/Belgacom Mobile SA decision of 30 October 2006, the Authority confirmed that joint control may exist where minority shareholders have additional rights that allow them to veto decisions that are essential for the strategic commercial behaviour of the joint venture. In its Picanol NV/Tessenderlo Chemie NV decision of 21 October 2013, the Authority found that Picanol NV, by purchasing 27.6 per cent of the shares in Tessenderlo Chemie NV, acquired de facto control over Tessenderlo Chemie NV because the remaining shares were dispersed among a large number of shareholders.

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

Concentrations must be notified if the parties have an aggregate Belgian turnover exceeding €100 million and at least two of the parties have an individual Belgian turnover of at least €40 million. Under the Code of Economic Law, for the purpose of establishing jurisdiction, Belgian turnover is the total turnover during the previous financial year attributable to the Belgian national market. The Authority seeks to align its approach regarding the geographic allocation of turnover with the practice of the European Commission. The Belgian rules for the calculation of turnover credit institutions and other financial institutions are the same as the EUMR rules (see article IV.8 of the Code of Economic Law).

The Authority confirmed in a decision on interim measures (Alken-Maes NV/AB Inbev NV) that it is competent to assess whether non-notifiable mergers constitute an abuse of a dominant position insofar as the potential anticompetitive effects go beyond those directly linked to the bringing about of the merger.

Book IV of the Code of Economic Law does not apply to concentrations falling under the EUMR (with exceptions, provided for in the EUMR).

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

Filing is mandatory for concentrations that meet the turnover thresholds. Concentrations must be notified to the Competition Prosecutor General prior to completion of the transaction. There are no exceptions to this rule.

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

Foreign-to-foreign mergers must be notified in Belgium where the turnover thresholds are met, regardless of the location or nationality of the parties. Many foreign-to-foreign mergers may therefore trigger an obligation to file where the parties have sales in Belgium, even if they have no Belgian-based assets.

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

There are special rules applicable to investment in certain sectors, including banking, insurance and media, but these generally apply irrespective of whether the investor is foreign. Also, the works council or employees’ organisation of a Belgian company must be informed in advance of certain structural or other changes that will affect the company, including mergers and takeovers. In specific circumstances, consultation with the works council or union representatives concerning employment prospects and the organisation of work is mandatory.

Public undertakings and undertakings to which the public authorities have granted exclusive or specific rights are subject to the same rules as private undertakings insofar as this does not undermine their assigned role.

Since 2018, there has been a limited foreign investment control regime at Flemish level, providing for a type of ‘emergency brake’ procedure for strategic investments into government-owned entities. The rules allow the Flemish government to annul or declare void any foreign acquisition that would threaten the strategic interests or the independence of the Flemish Region or Flemish Community or both.

In April 2021, the federal government announced its plans to create an ad hoc investment screening commission within the Ministry of Economy. Going forwards, acquisitions of more than 25 per cent of the voting rights in companies active in critical infrastructures such as energy, transport, healthcare, communications and defence will be subject to a mandatory notification process. Further, the commission will base its assessment on national security considerations. Although the commission will have the power to prohibit acquisitions that threaten national security, the government has announced there will be a preference for mitigating any potential risks through remedies.