An interview with White & Case LLP discussing Merger Control in Greece

This article is an extract from GTDT Market Intelligence Merger Control 2022. Click here for the full guide.

Assimakis (Makis) Komninos is a partner in the Brussels office of White & Case LLP. A former Commissioner of the Hellenic Competition Commission (HCC), he advises on questions of EU and Greek competition law. His experience spans complex cases of abuse of dominance (Google Android, Google Shopping, Amazon, Microsoft, Bulgarian Energy Holding, Rambus, GSK-Lelos and Greek lignites) to restrictive agreements (GSK-Spain and Chalkor) and demanding Phase II merger cases in the energy, aviation and telecoms areas, including the landmark Aegean/Olympic II case. He is currently visiting professor at Panthéon-Assas University Paris II.

Brussels partner Strati Sakellariou-Witt advises on EU and Greek competition law. Her practice focuses on merger control reviews (DIC/ BASF Colors and Effects, Saudi Aramco/SABIC, Zimmer/Biomet and Aegean/Olympic II) and conduct cases (Toshiba–GIS, Chalkor, Toshiba–Power transformers and Toshiba–ne bis in idem). She was recently named a ‘rising star’ in Europe by Law.com (2021), a ‘rising star’ for competition/antitrust by Law 360 (2020), and Competition and Antitrust Lawyer of the Year in Europe (2021 and 2019) by Euromoney.

Iakovos Sarmas is a competition/antitrust associate at White & Case in Brussels. Iakovos has been involved in merger control proceedings before the European Commission, including one Phase II investigation, and has advised clients in merger control proceedings before the HCC. He has also represented a number of clients before the HCC in behavioural antitrust cases. Iakovos is qualified to practise law in Athens (Court of Appeal).

1 What are the key developments in the past year in merger control in your jurisdiction?

We would single out three particularly interesting developments.

First, the Hellenic Competition Commission’s (HCC) most notable merger case since the previous GTDT discussions was Delivery Hero/ALFA et al., which included a lengthy in-depth investigation that led to a remedy package. Although the HCC has not yet published its decision, this investigation signalled a strong appetite by the HCC’s current leadership to monitor consolidation in digital markets and test novel theories of harm to force commitments on merging parties.

Second, the HCC imposed an exorbitant fine of €500,000 on OPAP, the leading company organising and conducting games of chance in Greece, for delaying to notify a merger filing within the statutory deadline. There was no finding of gun-jumping as OPAP notified the relevant acquisition and received unconditional clearance prior to closing. However, the Greek merger control regime remains one of the few jurisdictions worldwide that still imposes a 30-day deadline to file from signing. This represents an anachronistic regulation that has been criticised in previous GTDT issues, mainly for the practical anomalies it causes in the Greek merger notification process.

Third, the HCC updated its formal merger notification template, issued alongside a recommendation on merging parties to engage in pre-notification talks with the HCC should they think it might facilitate the process. As we have noted in previous issues of this title, pre-notification talks with the HCC can come in handy, depending on the complexity and timing considerations of each transaction.

2 Have there been any developments that impact how you advise clients about merger clearance?

As of January 2022, the recent amendment to the Greek Competition Law took effect, enabling merging parties to offer commitments in Phase I. This could prompt parties in some transactions where a clear-cut remedy can be offered to launch commitment discussions at an early stage in the review process and get the transaction cleared in Phase I without Phase II review. To date, the HCC has not adopted any Phase I decision with remedies.

Moreover, the HCC issued, in June 2022, an update to its formal merger notification template. Traditionally, the Greek merger notification form has mirrored its EU equivalent, Form CO, and this year’s update did not include major changes. However, the HCC added two notes in its latest update.

First, the HCC invited notifying parties to identify information that, despite being listed as mandatory in the form, was not essential for the merger review process, and to explain why this would be the case. The HCC reviews the request in the notification form and decides whether or not to accept it. However, this does not represent a new option for merging parties; the HCC always had the discretion to waive certain requirements in the notification form. Although the HCC’s new clarification may be encouraging for merging parties, the use of such an approach will depend on the HCC’s policy of exercising that discretion.

Second, the HCC invited merging parties to consider engaging in pre-notification talks with the HCC. In simple, unproblematic cases where the case team could be handed with a draft notification early in the process and informally spot omissions and request clarifications, one could see the merit of such discussions. We should note, however, that in complex cases involving overlaps and vertical links in industries that the HCC does not have prior experience in, finding a pre-notification window can be challenging in light of the 30-day deadline to file from signing.

3 Do recent cases or settlements suggest any changes in merger enforcement priorities in your jurisdiction?

A particularly concerning development was the fact that the HCC evoked the obsolete statutory requirement of 30 days to make a merger notification from signing in order to impose a fine of €500,000 for failure to comply with that deadline. The HCC’s decision (752/2021) is concerning from both a substantive and a policy point of view.

First, the HCC reasoned in its decision that ‘late notification affects the effective implementation of [merger control], since it deprives the supervising authority of the possibility of systematic and timely supervision of large concentrations’. This is unfounded, unless we were to question the effectiveness of most merger control regimes globally, including those of the EU, Germany, France and the US, that do not impose such a requirement. The vast majority of jurisdictions do not provide for any deadline to file from signing (this is usually a contractual matter provided for in the parties’ merger agreements). Rather, most jurisdictions reasonably rely on the standstill obligation to ensure ‘effective implementation’ of merger control. Although the HCC could have assumed the opportunity presented in the OPAP investigation to advocate in favour of that sensible practice, it chose to defend an outdated statutory requirement.

Second, OPAP argued before the HCC that the agreement that it had failed to notify in a timely manner was not binding based on Maltese law, which was the governing law of the contract. The HCC rejected this defence, arguing that Greek competition law enforcement cannot depend on the interpretation of the contract’s governing law. It thus engaged in its own interpretation of the contract, without regard to the Maltese Civil Code, and concluded that the agreement was binding. This is a controversial finding. In cross-border transactions that involve filings in several jurisdictions, the HCC’s practice could encourage merging parties to carve out the Greek merger notification process, based on how the HCC is expected to interpret memoranda of understanding and term sheets, and at the same time stick to the governing law of the contract in relation to all other jurisdictions that are potentially triggered.

Finally, the HCC’s imposition of a €500,000 fine for a technical violation that was harmless for competition seems disproportionate.

In terms of substantive merger control enforcement, the case that stood out during the past year is Delivery Hero/ALFA et al. The transaction concerned the acquisition by Delivery Hero, the operator of the leading food ordering and delivery platform in Greece (efood), of a number of companies active in e-commerce for food and beverages (wholesale and retail distribution) and restaurants. One of these companies (E-table) provides online restaurant reservation services. By putting forward a rather novel conglomerate theory of harm, the HCC alleged that efood would have the capacity and incentive to engage in tying of services provided by efood and E-table. This would allegedly reduce competition in the latter’s market and strengthen the merged entity’s position, in particular by leveraging on user data gathered from efood. To secure clearance, Delivery Hero committed to not offer tied services and offers to restaurants and to not combine user data drawn from the respective platforms without prior user consent.

The conglomerate theory of harm advanced in Delivery Hero/ALFA et al. was unexpected, as were the commitments offered. The user data commitment in particular, whereby efood and E-table would provide an opt-in to their respective users for combining their data, is hardly linked with competition and rather resembles a data privacy compliance undertaking. More broadly, the case can be interpreted as an implied invitation to merging parties to offer merger control remedies that go beyond competition and address neighbouring public policy concerns. That is unfortunate and is also inconsistent with recent EU precedent (Google/Fitbit).

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 time 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.

As of the end of November 2021 until now, the majority of industries covered by the HCC’s merger work concerned consumer-facing industries, including dairy products, hospital care, hospitality and tourism, snack foods and supermarkets. Over that time, the HCC reported 14 unconditional Phase I clearances and one Phase II clearance with commitments (Delivery Hero/ALFA et al.), on which the HCC has yet to publish its reasoned decision.

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?

As previously mentioned, the HCC, through its recent update to the template merger notification form, encouraged notifying parties to (1) provide reasoned requests for not providing information required per the template and (2) engage in pre-notification discussions with the HCC prior to formal filing. No other major guidelines or studies were issued by the HCC in respect of merger control during the past year.

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?

A long-needed reform in Greek merger control procedure is the repeal of the mandatory deadline (30 calendar days from signing) for filing a 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 potentially undermines pre-notification discussions. However, no such amendment is currently being considered.

More broadly, the HCC needs to bring the Greek merger control procedure in line with global transaction needs. In a number of mature regimes, including those in France, Germany and others, the reasonable duration of a merger investigation into an unproblematic transaction would not take longer than one month from filing. In the HCC, however, Phase I clearance decisions are issued after an average 87 calendar days (this covers 14 Phase I clearances publicly announced by the HCC from 29 November 2021 (Decision 753/2021) to 5 August 2022 (Decision 795/2022)).

To streamline the process and reduce average clearance times, the HCC should implement internal screening procedures and deadlines, lower the information-gathering burden for merging parties and drastically reduce the length of its clearance decisions, particularly for transactions that appear to raise no competition concerns. In the same spirit, the HCC can establish a practice, particularly when dealing with traditionally fragmented industries that thrive in Greece (eg, tourism, real estate development and shipping), of issuing two-pager clearance decisions without substantive analysis and reasoning.

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, but it also occupies a significant part of a clearance decision. 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 as much market data as possible readily available to allow the HCC to expedite its knowledge gathering and education.

In your experience, what makes a difference in obtaining clearance quickly?

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. Absent pre-notification discussions, merging parties are encouraged to take advantage of that time to establish channels of communication with the HCC case handlers in order to efficiently address the requests and minimise follow-up requests.

What merger control issues did you observe in the past year that surprised you?

The most surprising development was the HCC’s €500,000 fine to OPAP for an innocuous delay in filing of a merger and without any finding of gun-jumping. Apart from its substantive errors, the decision marks a concerning precedent of the HCC abusing its sanctioning powers for publicity and fine collection purposes.