Notification and clearance timetable

Filing formalities

What are the deadlines for filing? Are there sanctions for not filing and are they applied in practice?

The Act does not provide for a specific deadline as such for the filing of the notification. The ‘intention of concentration’ has to be notified. It means that the notification has to be submitted before the concentration is implemented (ie, prior to closing). In other words, the parties to a concentration are obliged to refrain from implementing the transaction until (unconditional or conditional) clearance is obtained or a one-month waiting period elapses without the authority making its decision (the ‘guillotine effect’). However, it should be added that clearance by the mere passage of time is rather unlikely to occur.

It is worth noting that the Act provides for a worldwide bar on closing.

If an undertaking has implemented a concentration, even if unintentionally, without the OCCP’s clearance, the Act allows the OCCP to fine the undertaking by way of a decision, with a fine not to exceed 10 per cent of the turnover earned by the undertaking in the financial year preceding the year in which the fine is imposed.

Moreover, article 108 of the Act authorises fines on persons holding managerial positions or members of managing bodies of such undertakings if the persons or members have not notified an intention of concentration. The fine may be up to 50 times the average monthly remuneration in the business sector in Poland in the last month of the quarter preceding the day of issuance of a decision.

Additionally, the OCCP may revoke its decisions if they were based on misrepresentations for which the undertakings participating in the concentration were responsible or where undertakings did not comply with the conditions (remedies) specified by the OCCP. Once revoked, the decision may be re-adjudicated by the OCCP on the merits of the case.

If, in cases described above, the concentration is already implemented and restoration of the competition in the market is otherwise impossible, and if the intention to concentrate has not been notified, or if a concentration ban has not been respected, the OCCP may order such measures as division of the merged undertaking, disposal of the undertaking’s assets, disposal of stocks or shares conferring control, or dissolution of a jointly controlled company.

Sanctions were imposed, for example, in decision No. DKK-1/07 of 12 July 2007, where the OCCP fined Sobieski Trade 40,000 zlotys for failure to notify. In decision No. DKK-37/09 of 18 June 2009, the OCCP imposed a fine of 70,000 zlotys on Przedsiebiorstwo Panstwowe ‘Porty Lotnicze’ (the national airport operator) and the provincial government of the Subcarpathian Voivodeship, again, for failure to notify. Moreover, in 2012 the OCCP issued two decisions and in 2013 only one decision imposing fines for non-compliance with the obligation to notify the concentration. Among more recent cases please note two decisions from 2017: in decision No. DKK-86/2017 of 5 June, the grocery wholesaler Bać-Pol S.A. was fined of 527,000 zlotys for failure to notify of the takeover of a portion of assets of another company called Klementynka. The authority initiated proceedings against Bać-Pol after receiving information that one of its subsidiaries implemented a concentration without prior authorisation by the OCCP. In a second case the consumer eggs producer was obligated to pay 339,000 zlotys for failure to notify of its takeover of a portion of the assets of another company operating in the same relevant market (decision No. DKK-145/2017 of 19 September).

All fined undertakings were Polish-based companies. No penalties on individuals (management board members) were imposed.

Nevertheless, it should be noted that, to the best of our knowledge, there have been no cases so far in Poland where the focus of the OCCP was on actions of the undertaking concerned that could qualify as a ‘gun jumping’ (ie, a de facto implementation of the concentration prior to clearance). The only cases that have been made public are the cases where the concentration has been consumed (ie, the transaction has been closed or the joint venture has been formed and registered) prior to clearance. Moreover, such fines were imposed on undertakings that have notified a merger already, but their action was taken too late.

Which parties are responsible for filing and are filing fees required?

The intention of concentration should be notified by:

  • the merging undertakings jointly;
  • an undertaking taking over the control;
  • jointly all undertakings participating in the creation of a joint undertaking; or
  • an undertaking acquiring some of the assets of another undertaking.

The general rule is that the notification has to be submitted by the undertakings directly participating in the concentration. However, where a dominant undertaking implements a concentration through at least two dependent undertakings, the notification should be submitted by the dominant undertaking. Moreover, if the undertakings directly participating in the concentration include a corporate vehicle established only for the purpose of the transaction and to which the intent of concentration cannot be attributed, the notification can be submitted by the dominant undertaking with respect to such a corporate vehicle. However, in such a case the notifying party has to clearly indicate in the notification that the undertaking taking over control is a corporate vehicle only.

The fee to be paid for an application to initiate proceedings in concentration cases was raised on 1 January 2017 and currently amounts to 15,000 zlotys.

What are the waiting periods and does implementation of the transaction have to be suspended prior to clearance?

The undertakings whose intention of concentration is to be notified are under an obligation to refrain from implementing the concentration until the OCCP issues its decision or the time limit to issue the decision lapses. 

Pre-clearance closing

What are the possible sanctions involved in closing or integrating the activities of the merging businesses before clearance and are they applied in practice?

Under Polish merger control regime sanctions, closing before clearance is treated similarly as the failure to notify. As a result, the consequences for both types of infringements are the same (see question 9).

In practice, the OCCP rarely imposes fines for such infringements. In 2010 there was one decision imposing a fine on an undertaking for not notifying the intended concentration. In 2011, there were no cases of this kind. In 2012 there were two decisions and in 2013 only one such decision. In 2014 there was also only one decision of this kind. In 2015 and 2016 there were no cases of this kind. An upward trend can, however, be observed with two decisions in 2017 (2018 statistics are not yet available).

Are sanctions applied in cases involving closing before clearance in foreign-to-foreign mergers?

As mentioned in question 9, in the case of closing the transaction without (or before) the OCCP’s clearance, the undertaking in question as well as persons holding managerial positions or members of managing bodies of such undertakings can be fined. The same rule applies equally to Polish and foreign-to-foreign mergers.

Nevertheless, to the best of our knowledge so far, cases where fines for closing transaction without (or before) the OCCP’s consent involved purely domestic transactions.

What solutions might be acceptable to permit closing before clearance in a foreign-to-foreign merger?

The Act provides for a worldwide bar on closing. However, in one of the decisions issued by the OCCP (No. DOK-37/2007 Olympus Capital Holdings Asia/Arysta Life Science, 6 April 2007), the competition authority seemed to hold that the concentration may be completed before its clearance, as long as the parties refrain from implementing its Polish aspect that has local effects in Poland. In this decision, the OCCP did not question the rationale for completing the transaction before clearance. The OCCP only pointed out that no relevant evidence was offered to show that the parties refrained from implementing that aspect of the transaction that had local effects in Poland. Because there is only one such decision and the Guidelines suggest that this scenario is unlikely, such solutions will always be associated with risk and need a case-by-case analysis.

Public takeovers

Are there any special merger control rules applicable to public takeover bids?

The same rules and requirements apply. However, the bar on closing will not be considered breached by implementing a public offer to purchase or exchange stocks that has been notified to the OCCP prior to implementation, provided that the buyer does not exercise the voting rights arising from the acquired stocks or exercises them solely in order to maintain the full value of its capital investment or to prevent substantial damage that might affect the undertakings participating in the concentration.

Documentation

What is the level of detail required in the preparation of a filing, and are there sanctions for supplying wrong or missing information?

The official filing form (the list of information and documents (LID)), as established by way of a regulation of the Council of Ministers, requires rather detailed information regarding the planned transaction to be provided by the notifying party in the notification (even if there are no overlaps between the undertakings concerned). Section 1 of the LID contains questions relating to the undertakings concerned (inter alia, data identifying undertakings involved, authorities authorised to represent them and the subject of the actual activity as well as the detailed description of intended concentration is included); section 2 involves information on the relevant markets and the effects of the transaction on the market.

A detailed market analysis is necessary when the market is affected horizontally or vertically or when the market is affected by a conglomerate concentration.

The LID, as well as the application itself, has to be submitted in Polish. Normally, the application runs to around 35 to 40 pages, plus attachments.

The LID has to be submitted together with certain documents such as inter alia excerpts from relevant commercial registers for the applicants (for undertakings that are obliged to file the notification please see question 10), executed versions of most relevant transaction documents, most recent financial statements of the parties concerned, structure charts of the parties concerned. Documents prepared in foreign languages have to be sworn translated into Polish.

In terms of possible sanctions please note that under the Act providing untrue data in a transaction notification may result in a financial sanction in the equivalent of up to €50 million. Such fines are rather uncommon in practice. Nevertheless, it should be mentioned that in 2012 the OCCP imposed on UPC Polska a fine amounting to 775,000 zlotys for providing false information regarding possessing documents material for an assessment of the pending merger proceedings (decision No. DKK-6/2012, UPC Polska/Aster, 30 January 2012). In short, UPC applied to the OCCP for the consent to acquire Aster. The OCCP addressed the undertaking to complete the notification inter alia with providing information if the company and the to-be-acquired entity possessed any reports, analyses or marketing enquiry concerning the access market to pay TV in Poland. During the proceedings it turned out that UPC concealed the market analysis containing significant information for the examined transaction. The document not revealed by the company confirmed inter alia the OCCP’s opinion, stating that the concentration would have a significant impact on local markets of particular cities. This was contrary to the stance of UPC Polska, which claimed during the pending proceedings that the market of pay TV shall be defined on a nationwide level.

There were cases where OCCP imposed fines on the third parties (competitors, clients, suppliers of the parties to the concentration) for not providing information in course of a market test carried out in a merger control case (such penalties were relatively low and aimed at disciplinary effect).

Investigation phases and timetable

What are the typical steps and different phases of the investigation?

In 2015, Poland finally adopted a two-stage merger review procedure – something that has been desired since the first modern competition legislation was adopted in 1990.

The Act currently stipulates that the antimonopoly proceedings in non-problematic concentration cases should be finalised within one month from commencement (first stage review). Complex cases, cases that can cause competition concerns (where there is a risk that a significant impediment to competition might occur) or that require a sector inquiry will enter (by way of a resolution of the OCCP that cannot be appealed) a second stage of the review. This will entail a four-month extension of the process, prolonging the duration of the whole procedure to five months in total.

However, the OCCP is able to stop the clock – in any of the stages – each time it asks questions or requires new data or documents to be provided in the course of the proceedings. The deadline may also be extended if a statement of objections is issued or remedies are being discussed.

The Act does not provide for any measures to speed up the proceedings. Neither are there any fast-track procedures available.

What is the statutory timetable for clearance? Can it be speeded up?

As indicated in question 17, the Act sets out a two-stage merger review procedure, where the first stage takes up to one month, potentially extendable to five months if the concentration requires an in-depth review in the second stage.

There are no official pre-notification contacts before the formal submission of the notification. However, the Guidelines indicate that it is possible to contact the OCCP before filing.