This article was originally published in the schoenherr roadmap`10 - if you would like to receive a complimentary copy of this publication, please visit: http://www.schoenherr.eu/roadmap.
On 1 September 2009, a simplified procedure for assessing certain types of concentrations was introduced into the Czech regulation of concentrations. This new procedure should shorten and simplify the assessment of certain types of concentrations. The new procedure could be of importance particularly for the rescue of undertakings in economic difficulties during the financial crisis.
Introduction
The simplified procedure for assessing certain types of concentrations (simplified procedure) was introduced into the Czech Competition Act No. 143/2001 (CCA) by amendment No. 155/2009 on 1 September 2009. It is contained in Section 16a of the CCA. The Czech Competition Office (the Office) also published an explanatory notice on the simplified procedure. The aim of the simplified procedure is to shorten and simplify the assessment of certain, non-problematic concentrations. The Office should then have more resources to focus on concentrations that could have a negative impact on competition on the relevant market. The regulation on the simplified procedure was influenced by a similar regulation in the EC Merger Control Regulation No. 139/2004.
When Is The Simplified Procedure Applicable?
The simplified procedure applies to concentrations where (i) either none of the parties to the concentration is active on the same relevant market, or their combined market share on such market is below 15%, respectively and, at the same time, none of the parties to the concentration is active on a market that is upstream or downstream to the activities of the other party, or the market share on such a vertically related market is below 25% or (ii) the acquiring party acquires sole control over a joint venture in which the acquiring party had exercised joint control until now.
How To Proceed?
When the conditions of a simplified procedure are present, the notification can be provided on a simplified notification form. The notification form is contained in the Decree of the Office No. 252/2009, which was also adopted in connection with the amendment of the CCA. The simplified notification form does not require information on competitors, suppliers or customers of the parties to the concentration, or information on the general markets. However, the notifying party does have to prove to the Office that the conditions for the simplified procedure have been fulfilled.
The Office publishes the initiation of a simplified procedure on its website. No publication in the Commercial Gazette is required, as in the case of a standard procedure. Third parties have five days to submit any objection to the concentration. The Office should issue its decision on the concentration within 20 days of receipt of the complete notification. The deadline for a first-phase decision in the standard procedure is 30 days.
The Office issues its decision on the concentration with an abbreviated statement of its reasons. This statement only contains the indications of the parties to the concentration, indication of the relevant market or area in which the parties to the concentration are active and the fact that the decision on the concentration was issued in the form of a simplified procedure.
The Office has the right to switch from a simplified procedure to a standard procedure if it concludes that it needs more information for the proper assessment of a concentration. In this case, the Office informs the parties to the concentration within 20 days from the opening of the simplified procedure. The parties to the concentration are then obliged to provide a standard concentration notification. A new deadline for the Office to assess the concentration starts to run from the provision of the complete standard notification. This deadline is a standard one, i.e. 30 days in the case of a first phase or up to 5 months in the case of a second phase.
Exemptions From The Simplified Procedure Regime
According to the explanatory notice of the Office on simplified procedures1, the simplified procedure may not be applicable in the following cases:
- a definition of the affected relevant market and market shares of the parties to the concentration is difficult;
- the notified concentration raises questions as to the impact of the concentration on the competition which have not yet been resolved by the Office;
- the concentration concerns markets with significant barriers to entry or high levels of concentration, or gives rise to other competition concerns;
- the market power of the parties to the concentration can increase by means of a concentration of their technology, financial or other sources;
- the subject of the notification is the acquisition of sole control over a joint venture in which the notifying party has so far exercised joint control, whilst the previous acquisition of joint venture control was not subject to notification to the Office;
- the acquisition of joint control over a joint venture could lead to the coordination of competition behaviour of the parties to the concentration which remain independent on the market;
- when the Office has obtained reasonable objections to the notified concentration and, after a review, comes to the conclusion that the concentration could affect competition on the relevant market.
The Czech Competition Office has the right to switch from a simplified procedure to a standard procedure if it concludes that it needs more information for the proper assessment of a concentration.
The Czech Competition Office has the right to switch from a simplified procedure to a standard procedure if it concludes that it needs more information for the proper assessment of a concentration.
This article was originally published in the schoenherr roadmap`10 - if you would like to receive a complimentary copy of this publication, please visit: http://www.schoenherr.eu/roadmap.
Footnote
1. www.compet.cz/fileadmin/user_upload/Sekce_HS/Guidelines/Oznameni_o_zjednodusenem_rizeni__konecne.pdf
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
