In Ireland, a merger or acquisition which meets certain financial thresholds requires clearance from the Competition and Consumer Protection Commission (CCPC). These thresholds will increase from 1 January 2019. The change to the thresholds requires confirmation by the Irish Parliament, which will be a formality.
Benefit to SMEs
The move is to be welcomed and will remove the additional financial burden on smaller businesses. Overall, this change will align the Irish merger control regime with international norms.
Consultation and recommendation
The increase in the thresholds follows a public consultation by the Irish Department of Business, Enterprise and Innovation (“DBEI”), in which we as a firm participated. We noted in our submission to DBEI that the current thresholds were introduced at a particular time in the evolution of Ireland’s economy and that practical experience in dealing with the thresholds dictated they were too low. Clearly unproblematic transactions, such as the acquisition of individual fuel stations, office blocks and small hotels were falling within the CCPC’s net. The position is discussed further in the latest edition of The Irish Merger Control Insight available here
Under the new thresholds, a merger or acquisition must be notified to the CCPC if, in the most recent financial year:
- The undertakings involved had a combined turnover in the Republic of Ireland of at least €60 million (increased from €50 million)
- At least two undertakings involved had individual turnover in the Republic of Ireland of at least €10 million (increased from €3 million)
The media merger regime, for which special jurisdictional rules apply, remains unchanged.
The CCPC has not yet published guidance on how to approach the question of jurisdiction for mergers or acquisitions signed before 1 January 2019, but which will be put into effect after 1 January 2019. The CCPC issued relevant guidance when the thresholds were changed in 2014. That guidance suggests that any binding agreement concluded or public bid announced prior to 1 January 2019 should be assessed under the current thresholds.
The Irish merger control regime was changed in 2014 so that a notifiable merger or acquisition no longer required to be notified within one month of the conclusion of a binding agreement or the making of a public bid. A merger or acquisition can now be notified to the CCPC at any time before it is put into effect and on the basis of a good faith intention to conclude an agreement, or where there is a publicly-announced intention to make a public bid.
We expect the CCPC will follow the approach set out in its 2014 guidance. However, we anticipate a relevant candidate merger or acquisition will occur which will test whether the CCPC is prepared to place greater emphasis on the date the transaction was put into effect, rather than on the date of the conclusion of a binding agreement or the making of a public bid.