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Under what circumstances is a transaction caught by the legislation?

The Competition Act applies to ‘concentrations’, which are defined as follows in Article 27:

  • a merger of two or more previously independent undertakings;
  • in case one or more natural or legal persons acquire(s) direct or indirect control of the whole or of parts of one or more other undertaking(s); and
  • the establishment of a joint venture that performs all the functions of an autonomous economic entity on a lasting basis.

‘Control’ is defined as “the ability to exercise decisive influence on the activities of an undertaking, either on the basis of factual or legal circumstances” and is in practice (but not as a matter of law) identical to the concept of control under the Merger Regulation and the Consolidated Jurisdictional Notice. The ability to exercise decisive influence refers to the ability to influence important strategic decisions such as decisions as to the appointment and dismissal of senior management, the annual budget, the business plan, or major investments.

Do thresholds apply to determine when a transaction is caught by the legislation?

Pursuant to Article 29(1) of the Competition Act, a concentration requires prior approval of the ACM if in the preceding calendar year:

  • the aggregate worldwide (group) turnover of all undertakings concerned was €150 million or more; and
  • the individual (group) turnover in the Netherlands of each of at least two of the undertakings concerned was €30 million or more.

‘Turnover’ comprises the (group) income from the supply of goods and services from the business of the legal entity after the deduction of rebates, tax and intra-group turnover. As under the Merger Regulation, the seller’s turnover is not taken into account. There are no legal provisions on how to allocate turnover to the Netherlands. The ACM calculates and allocates (group) turnover in accordance with the Merger Regulation and the Consolidated Jurisdictional Notice.

The same thresholds apply for credit and financial institutions and insurance companies. However, their turnover is calculated in a specific manner. Where financial institutions are concerned, Article 31(1) of the Competition Act lays down a specific regime for calculation of turnover that is almost identical to that of Article 5(3)(a) of the Merger Regulation. With respect to pension funds within the meaning of the Dutch Financial Supervision and Pension Funds Act, the merger control regime applies if:

  • the companies involved generated €500 million in gross written premiums; and
  • at least two undertakings received €100 million from the aforementioned amount from Dutch residents (Article 31(2) of the Competition Act).

Lower turnover thresholds apply for undertakings active in the healthcare sector. The ACM has jurisdiction to review concentrations if in the preceding calendar year:

  • at least two of the undertakings concerned achieved a turnover of €5.5 million through the provision of certain healthcare activities;
  • the aggregate worldwide turnover of all undertakings concerned was €55 million or more; and
  • the individual turnover in the Netherlands of each of at least two of undertakings concerned was €10 million or more.

As mentioned above, a concentration in the healthcare sector may also be subject to prior clearance by the Dutch Healthcare Authority.

Concentrations that fall below these thresholds do not require approval by the ACM. However, the Minister of Economic Affairs may decide to lower the thresholds temporarily for certain categories of undertakings by decree (Article 29(3) of the Competition Act). In addition, there is no requirement to notify concentrations that require the approval by the European Commission under the Merger Regulation.

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