Lexology GTDT Market Intelligence provides a unique perspective on evolving legal and regulatory landscapes. This interview is taken from the Merger Control volume discussing topics including enforcement priorities, evidence review and notable cases within key jurisdictions worldwide.
1 What are the key developments in the past year in merger control in your jurisdiction?
From October 2020 to September 2021, the Hellenic Competition Commission (HCC) reviewed 14 merger notifications and reported as many unconditional clearances. One of these cases, OPAP/Kaizen Gaming, included an in-depth (Phase II) investigation. The acquirer, a former state-owned gambling monopoly and current industry leader, acquired an operator of a major sports betting platform. The HCC has not yet published its full decision on the case.
In terms of Phase I cases, the HCC saw an increased consolidation among Greek energy players, with five deals notified to the HCC in the markets for renewable energy sources (Teforto Holdings/Wind Farms and Depa Commercial/North Solar), production and supply of electricity (PPC Group/Geoenergy Aegean/Geothermal Target TWO II and Thermoilektriki Komotinis JV), and gas supply (GEK Terna/Heron I and Heron II).
Moreover, the HCC, keeping up with the recent wave of procedural infringement cases at the European Commission, showed its teeth in two investigations concerning alleged gun-jumping and tardy notification. Specifically, in January 2021, the HCC convened to review whether PPC (the leading electricity provider in Greece) and TERNA Energy (a major operator of renewable energy sources) violated the standstill obligation imposed by Greek merger control by establishing a joint venture in the electricity market without prior clearance from the HCC. The Case Rapporteur sided with the defendants, arguing that that they were not culpable. The HCC has not disclosed further details on the case, and its decision is still pending.
Finally, in April 2021, the HCC was investigating a potential procedural infringement by OPAP (the leading operator of gambling and betting services) for delaying the notification of the acquisition of the Greek and Cypriot business of Kaizen Gaming to the HCC. The Greek merger control regime is still the only one in the European Union, and among just a few globally, that requires notifying parties to submit a concentration notification within a prescribed deadline (30 calendar days) from signing the transaction. In this case, the Case Rapporteur found that OPAP had failed to notify the relevant acquisition within the 30-day deadline, and proposed the imposition of a fine. The HCC’s decision is still pending.
2 Have there been any developments that impact how you advise clients about merger clearance?
A major development, currently in the making, is an amendment of the Greek Competition Law (L. 3959/2011) that would enable the offering of commitments within 15 calendar days of launching the Phase I review of a notified deal. To date, Greek merger control procedure only allows for commitments discussions during an in-depth investigation. If the amendment passes a vote in parliament (expected in autumn 2021) it could prompt merging parties in potentially problematic transactions to trigger commitments discussions at an early stage in the review process, powering through Phase I and securing timely clearance without Phase II review.
That said, it is noted that Greece remains one of the very few merger control regimes globally that imposes a mandatory 30-day filing deadline after the signing of a transaction. It may thus seem unrealistic for merging parties to come up with suitable remedies within such a short time frame, and for the HCC case team to remain confident of their appropriateness without spending sufficient time reviewing the case and carrying out the investigation. However, it is entirely exceptional for Phase I review to commence immediately after submitting the notification. Once the HCC receives the filing, it has seven days to revert with follow-up questions before formally declaring the notification complete and the clock starts running. This can lead to lengthy periods (up to four months, depending on the complexity of the transaction) in which the parties are gathering the information requested by the HCC case team. Naturally, merging parties can use this window, when the Phase I clock is not running, to explore potential remedies with the HCC case team.
On that note, the HCC’s recent merger control practice has confirmed that parties should anticipate that concentration investigations will not be launched immediately after the notification is filed, as the HCC’s Directorate General (DG) usually finds the merger filing incomplete. Specifically, in all merger control decisions published in 2021, the DG deemed the notification form incomplete and the parties had to supply additional information. This year, delays in the formal launching of the investigation ranged from 16 days (Motor Oil/CF Ventus, Decision 735/2021) to two months (Green Pixel JV, Decision 728/2021).
Otherwise, the HCC merger investigation is straightforward and predictable. During the investigation, the DG frequently sends requests for information (RFIs) to the parties by email and carries out market tests. The case team may also hold informal meetings with the companies involved and organise interviews with third parties. The HCC’s past activity demonstrates a track record of keeping to deadlines once the notification is formally accepted and the investigation launched.
Moreover, in 2021, the HCC signed bilateral memoranda of partnership (MoPs) with the competition authorities of Albania, Armenia and North Macedonia, while similar MoPs are in the making with the authorities from Egypt and Bosnia and Herzegovina. The HCC also established channels of communication with the competition authorities of Israel, Russia, Serbia, Ukraine and the United States, covering the exchange of information on legislative developments, antitrust enforcement, procedural infringements, etc. While not expressly focused on merger control issues, these initiatives are a testament to the HCC’s renewed extroversion under the leadership of HCC President Ioannis Lianos. They also indicate that, in potential cross-border transactions notifiable in Greece and other jurisdictions, the HCC will be keen to cooperate closely with its foreign counterparts, whether they are part of the European Competition Network or not.
Under the Lianos presidency, the HCC has also signed MoPs with a number of regulatory authorities. After partnering with the Hellenic Single Public Procurement Authority in September 2019 and the Regulatory Authority for Energy in September 2020, the HCC signed a MoP with the Regulatory Authority for Ports. It is noted that the HCC’s cooperation with industry regulators has in the recent past extended to merger control. For example, in the past three years, the HCC has frequently, in the context of its merger control review of transactions, reached out to other industry regulators to gain insights into the relevant sectors. For example, in 2019–2020, the HCC twice engaged with the National Audiovisual Council in the Alpha Media JV (Decision 679/2019) and Motor Oil/Alpha Media (Decision 700/2020) cases, and also asked for the opinion of the Railway Regulatory Authority in the TrainOSE/EESTY case (Decision 680/2019).
3 Do recent cases or settlements suggest any changes in merger enforcement priorities in your jurisdiction?
The HCC did not block any transactions in the past year, and no clearance reported by the HCC in 2021 mentioned conditions for approval. Going beyond 2021, the HCC’s recent merger control activity has demonstrated an increased focus on the vertical effects of concentrations. In most cases where the HCC identified affected markets, its competition concerns were vertical. In merger filings before the HCC, parties are therefore best advised to identify all potential vertical overlaps and carry out an assessment of the vertical effects of the merger.
On a general note, the HCC is a technocratic agency that does not account for political considerations in exercising its merger control powers. It is, however, noted that, after a long and stable period of independence until 2018, the previous government appointed as president and members of the HCC people who had previously held positions as advisers to members of the executive. In the wake of winning the July 2019 election, the new government presented new legislation on rules on conflicts, which led to the ousting of the HCC president, vice-president, two commissioners and the director-general. New appointments came through in September 2019, including the new president, Ioannis Lianos, a competition law and policy scholar. Merger enforcement has not been affected by this political turbulence.
4 Are there any trends in merger challenges, settlements or remedies that have emerged over the past year? Any notable deals that have been blocked or cleared subject to conditions?
The only occasion on which the HCC blocked a transaction was in the very early days of Greek merger control enforcement. Even so, the prohibition was subsequently overturned by the Minister of Development based on the (now repealed) system of ministerial authorisation.
During the past year, the HCC has reported 14 clearance decisions and no clearance conditions. Most of the relevant decisions have not been issued, to date, and public knowledge on the details of HCC’s review is confined to the relevant HCC press releases.
5 Have the authorities released any key studies or guidelines or announced other significant changes that impact merger control in your jurisdiction in the past year?
Following a sector inquiry into basic consumer goods, the HCC published its reports in March 2021. With respect to merger control, the report contained two useful conclusions for future cases. First, it noted that, with respect to consumer goods, the relevant geographic market should amount to a ‘geographical circle’ covering a radius of 10–30 minutes by car (depending on the region). Second, it acknowledged that, when it comes to certain premium fast-moving consumer goods, for large supermarket chains or digital platforms, market shares that would otherwise be lower than required to establish dominance may do so when combined with increased bargaining power.
Moreover, in July 2021, the HCC launched a public consultation process on its proposal to create a sandbox for sustainable development in the Greek market. The proposal would create a supervised environment (sandbox) where businesses can take initiatives that contribute to the goals of sustainable development without significantly hindering competition. The sandbox would operate as a digital platform connected to the HCC website, providing a secure messaging space for the parties and the HCC. ‘Sustainability advocates’, appointed by the HCC, would support the submission and further elaboration of proposals for ‘green’ business initiatives. With the aim of strengthening legal certainty and reducing regulatory risks, the HCC’s role would be to monitor the initiative from an antitrust compliance perspective, until issuing a ‘no-action letter’.
The sustainability sandbox mechanism, if established, would be unlikely to overlap with the Greek merger control regime, given that it currently seems to cover ‘concentrations’ in the sense of L. 3959/2011 and the EU Merger Regulation. Nevertheless, such sandbox regime may prompt parties that would have otherwise opted for a joint venture structure to implement a particular investment to pursue a more lax cooperation under the auspices of an HCC no-action letter.
6 Do you expect any significant changes to merger control rules? How could that change your client advocacy before the authorities? What changes would you like to see implemented in your jurisdiction?
Greece’s merger control regime does not currently allow the offering of commitments during Phase I review of a notified concentration. This will likely change in the coming months by way of an update to the Greek Competition Law (L. 3959/2011). Based on the current drafting of the proposed provision (article 8(4a)), notifying parties would be able to offer remedies within 15 calendar days from notification. Such an offer will not extend the ordinary Phase I review period (30 calendar days). The same bill would also enable the Greek executive to tweak merger control thresholds in particular industries, following a periodic statistical analysis carried out by the HCC every three years. The relevant draft bill underwent public consultation in August–September 2021 and is expected to enter parliamentary discussions and vote in autumn 2021. It seems that the current President of the HCC believes that the notification thresholds are too high, so a degree of realignment cannot be excluded.
A basic reform needed in Greek merger control procedure to bring the regime in sync with those of the EU and most member states is the repeal of the mandatory deadline (30 calendar days from signing) for filing the merger notification. This deadline effectively rules out the possibility for the HCC case team to present the notifying parties with constructive feedback and targeted information requests ahead of the formal submission and undermines pre-notification discussions. However, no such amendment is currently being considered.
The Inside Track
What should a prospective client consider when contemplating a complex, multi-jurisdictional transaction?
Market definition is critical to the outcome of a case before the HCC. However, the average number of merger cases handled by the HCC does not tend to exceed 10 or 15 per year. As a result, the HCC may often lack the necessary experience and data in relation to specific industries, which may in turn delay its market test and analysis. It is therefore important that notifying parties have readily available as much market data as possible, to allow the HCC to expedite its knowledge gathering and education
In your experience, what makes a difference in obtaining clearance quickly?
Early engagement with the HCC’s DG and case handlers may lead to a short yet fruitful pre-notification period. After notifying, it is very likely that the HCC will revert with a request for information, which prevents the start of the Phase I review clock. Merging parties are encouraged to take advantage of that time to establish channels of communication with the HCC case handlers to efficiently address the requests and minimise concerns that might arise.
What merger control issues did you observe in the past year that surprised you?
During the past year, the HCC opened two merger control procedural infringement cases, one for an alleged gun-jumping violation, and one for an alleged delay in submitting the concentration notification. The HCC does not have a rich track record in pursuing such infringements, so its decisions in those cases are widely anticipated.
