On 29 September 2017, the Department of Business, Enterprise and Innovation (DBEI) launched a consultation (the "Consultation") on the merger control provisions of the Competition Act 2002, as amended (the "Act"). The Consultation focuses on the financial thresholds triggering notification and the statutory review timeframes.
The financial thresholds which trigger notification in Ireland were reduced in 2014 to the following: in the most recent financial year, in the Republic of Ireland:
- the combined turnover of all of the undertakings involved is not less than €50m; and
- the turnover of each of two or more undertakings involved is not less than €3m.
The objective was to ensure that the regime would catch mergers which had a real nexus to Ireland and the Minister at the time committed to reviewing the operation of the revised thresholds in due course. In the Consultation, the DBEI acknowledges that the obligation to notify mergers to the Competition and Consumer Protection Commission (CCPC) is perceived as a burden by business, in terms of management time and cost, and that it also creates uncertainty which can impact on funding. Further, the DBEI noted that the low individual financial threshold results in certain asset acquisitions (e.g. hotel acquisitions) being notifiable even though normally such transactions will not have any substantial effect on the market.
The DBEI asked the CCPC to analyse whether raising the financial thresholds to €60m for the aggregate threshold and €10m for the individual undertaking threshold would impact the number of mergers notified. The CCPC noted that 133 non-media mergers were notified to it in 2015-2016. Media mergers were excluded because they are notifiable to the CCPC regardless of whether the financial thresholds are met. The CCPC found that an increase in the individual undertaking threshold to €10m would have resulted in 51 fewer notifications in 2015-2016. Further, the CCPC noted that none of the cases which would have been excluded raised any serious competition concerns.
The DBEI also undertook a comparison of the individual undertaking threshold in Ireland with that of European jurisdictions, such as Belgium and Denmark, with comparable Gross National Income per capita. The DBEI noted that a higher individual undertaking financial threshold would appear to bring Ireland more into line with other jurisdictions.
The concept of "Working Day" was also introduced into the merger control provisions of the Act in 2014, replacing the term "day". For example, the CCPC has 30 Working Days from filing to complete a Phase I determination, assuming no time extension. The DBEI notes that the CCPC has met its statutory deadlines in all cases between 2015 and 2017 H1.
The Consultation requests input on the following questions:
In relation to the financial thresholds introduced in 2014, should the individual turnover threshold level be amended, and if so, to what level? Secondly, should the aggregate turnover threshold level be amended, and if so, to what level?
Should the numbers of "working days" set out in the Act be amended, and if so, how many days would be suggested?
Are there any other issues relating to the merger and acquisition provisions of the Act which respondents wish to raise?
The Consultation is available here.
The deadline for responses to the consultation is 30 November 2017.