New legislation which came into effect on 31 October 2014, made a number of changes to the Irish merger control regime. In particular, the change to the financial thresholds triggering notification, together with the new approach of the Competition and Consumer Protection Commission (CCPC) to asset acquisitions, means that it is now more likely that property transactions will need to be notified to the CCPC for merger control clearance.
The legislation changed the rules on when an acquisition of assets will be caught by the merger control regime. A transaction will be caught where there is an acquisition of assets to which a turnover can be attributed. It appears that the CCPC considers that this new wording on asset acquisitions applies to pure property transactions. For example, in February 2015, the CCPC took the view that the acquisition of the Atrium Buildings (two office buildings in Dublin, with major tenants such as Salesforce and Microsoft) by the Blackstone Group constituted a notifiable transaction.
The legislation also changed the financial thresholds which trigger notification. The new financial thresholds are: combined turnover in the Republic of Ireland of all of the entities involved of at least €50 million; and turnover in the Republic of Ireland of each of two or more of the entities involved of at least €3 million. Previously there was a requirement for at least two of the entities involved to have world-wide turnover of at least €40 million. The new lower financial thresholds may also increase the potential for property deals to be caught; for example, the acquisition of a building in Ireland with a rent roll of greater than €3 million per year could satisfy the financial test if the acquirer’s turnover in the Republic of Ireland is sufficiently high.
Failing to notify a notifiable transaction carries significant negative consequences, including voiding of the relevant transaction. As such, parties to property deals should bear in mind the potential application of merger control rules.