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Notification

Is the notification process voluntary or mandatory?

Notification of concentrations that meet the relevant turnover thresholds is mandatory.

What timing requirements apply when filing a notification?

As a rule, a concentration is deemed to have taken place with the acquisition of the ability to substantially influence the target undertaking’s economic behaviour. The concentration must be notified before it is carried out, after the parties have reached an agreement on the essential aspects of the operation, so as to allow the Italian Competition Authority (ICA) to fully appraise the proposed operation.

More specifically:

  • in case of a merger, the operation must be notified before the merger deed is drafted;
  • in case of acquisition of control of an undertaking, whenever this is done by means of purchase of equities or shares in a company, the prior notification obligation is deemed to have been complied with where the full effectiveness of the deeds establishing acquisition of control is made conditional on the ICA’s approval;
  • in case of creation of a new joint venture, the operation must be notified before the memorandum of incorporation is filed with the Register of Companies.

A national public takeover bid that may give rise, if completed, to a notifiable concentration must be submitted to the ICA at the same time of filing with the Italian financial regulator.

Can a merger be implemented before clearance is obtained?

There is no standstill obligation (ie, an obligation to suspend the transaction after filing but prior to clearance), although in practice many parties to a transaction make clearance by the ICA a condition of closing, particularly if the transaction is a complex one. However, the ICA, when opening Phase II, can order the parties to suspend the implementation of the concentration until the investigation is concluded. A takeover bid that has been notified to the ICA may not be suspended provided that the acquirer does not exercise any voting rights conferred by the securities in question.  

What guidance is available from the authorities?

As explained above, parties may approach the ICA during the phase prior to the formal notification of acquisitions and mergers, to discuss any problems. In addition, quite detailed information on merger procedures is available, also in English, on the ICA’s website.

What fees are payable to the authority for filing a notification?

There are no filing fees.

What form should the notification take? What content is required?

Notification may be made in the full form or the short form (both available on the ICA’s website).

Full-form notification

The ICA requires full-form notification for concentrations between independent undertakings subject to the prior notification obligation where:

  • two or more parties to the concentration operate in the same affected market and the concentration will lead to a combined market share of 25% or more; or
  • one of the parties to the concentration will have, after the concentration, a market share of 40% or more, provided that at least one other party operates in an upstream or downstream market.

In any event, full-form notification is not required where the market share of the undertaking being acquired or merged is less than 1%.

Full-form notification must only be made in relation to the affected markets in respect of which at least one of the aforementioned conditions is met, as well as in relation to the relevant upstream and downstream market in the event that the condition the second bullet point above is met.

Short-form notification

Short-form notification is permitted for all concentrations subject to a prior notification obligation, for which full-form notification is not required. The ICA nevertheless reserves the right to request the information required under full-form notification whenever the ICA considers that the short-form notification does not permit an adequate assessment of the proposed operation. In this case, the time limit for examining the merger does not start running until the full-form notification is received.

The short form version of the notification requires information listed under the following headings: 

  • Form A: Background information.
  • Form B: Details of the concentration.
  • Form C: Participating parties.
  • Form D: Financial and personal links.
  • Form E: Affected markets.
  • Form F: Supporting documents.

The full-form notification forms are the same as the short-form notification forms, with some differences in Form E and an additional set of information, Form G, on general conditions on the affected markets.

Is there a pre-notification process before formal notification, and if so, what does this involve?

See above.

Can a merger be implemented before clearance is obtained?

There is no standstill obligation (ie, an obligation to suspend the transaction after filing but before clearance), although in practice many parties to a transaction make clearance by the ICA a condition of closing, particularly if the transaction is a complex one. However, the ICA, when opening Phase II proceedings, can order the parties to suspend implementation of the concentration until the investigation has been concluded. A takeover bid that has been notified to the ICA may not be suspended provided that the acquirer exercises no voting rights conferred by the securities in question.

What guidance is available from the authorities?

As explained above, parties may approach the ICA during the phase before the formal notification of a merger or acquisition to discuss any issues. In addition, detailed information on merger procedures is available (in Italian and English) on the ICA’s website.

What fees are payable to the authority for filing a notification?

There are no filing fees.

What provisions apply regarding publicity and confidentiality?

In some cases, the ICA may consider it necessary to consult widely with the market in relation to formally notified mergers and acquisitions. In those cases the ICA published (unless parties otherwise require) a notice on its website with a brief description of the proposed transaction and the markets, inviting comments from third parties.

The non-confidential version of Phase I and II decisions of the ICA is published on the ICA website and in the ICA Bulletin.

Parties can, by a motivated request, ask the ICA to treat certain documents, or parts of documents, as confidential. In the absence of such request, the ICA is not legally bound to carry out a confidentiality assessment in relation to the information submitted. However, under the principle established by the Italian Supreme Administrative Court in Judgment 6481/2010 it is possible that the ICA can by its own motion consider certain information provided by the parties as confidential. Although the judgment concerned documents relating to a leniency application, it is reasonable to argue that it may also apply to other types of documents, such as notification forms and other documents filed by the parties with the ICA in the context of merger control proceedings.

Are there any penalties for failing to notify a merger?

When companies fail, intentionally or negligently, to notify a concentration within the set time frame the ICA can impose a fine of up to 1% of the responsible undertaking's turnover in the preceding year (Article 19(2), Law 287/1990). However, the ICA usually imposes limited fines to undertakings that inform them spontaneously of such failure.

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