CROATIA Law and Practice Contributed by: Mirna Mišetić, Mišetić & Partners
Only the turnover of the business or assets being acquired is taken into account on the seller’s side; the seller’s remaining turnover is excluded. By contrast, the turnover of the acquirer is calculated on a group- wide basis, meaning that the turnover of all entities ultimately controlled by the same undertaking on the side of the acquirer is included. Changes in the business during the reference period, such as other acquisitions, divestments or business closures, are reflected as recorded in the audited accounts for that financial year. 2.8 Foreign-to-Foreign Transactions Croatian merger control requires that at least one undertaking concerned has a seat or branch in Cro - atia, and that at least two undertakings concerned generate a sufficient level of turnover in Croatia. These requirements ensure a link to the Croatian market, even where the target itself has no direct local pres - ence. Transactions with no expected impact on the Croatian market are usually cleared quickly in Phase 1. 2.9 Market Share Jurisdictional Threshold The market share is not taken into consideration for jurisdictional purposes under current legislation. 2.10 Joint Ventures Joint ventures are subject to merger control where they qualify as full-function joint ventures – ie, where they are autonomous in operational terms. This requires that the joint venture has its own management respon - sible for day-to-day operations and access to suffi - cient resources to carry out its business activities on a lasting basis. Where these conditions are not met, the joint venture does not constitute a concentration and is instead assessed under the rules on anti-com - petitive agreements. The jurisdictional thresholds applicable to joint ven - tures are the same as those applicable to other types of concentrations. Merger control applies both to the creation of new joint ventures and to transac - tions resulting in the acquisition of joint control over an existing business, subject to specific rules on the identification of undertakings concerned for turnover calculation purposes.
In the case of newly created joint ventures, the under - takings concerned are the parent companies acquir - ing joint control. The same approach applies where a pre-existing subsidiary or business, previously under the sole control of one undertaking, is contributed to a newly formed joint venture. In such cases, the turno - ver of the contributed business is attributed to the parent undertaking and not treated separately. Con - versely, if undertakings newly acquire joint control of a pre-existing undertaking or business, the undertak - ings concerned are each of the undertakings acquiring joint control and the pre-existing acquired undertaking or business. Where joint control exists both before and after the transaction, all undertakings exercising joint control are considered undertakings concerned, together with the joint venture itself if it already generates turnover. 2.11 Power of Authorities to Investigate a Transaction Croatian competition law does not provide for a gener - al “call-in” power allowing the Competition Agency to review transactions that do not meet the jurisdictional thresholds. Concentrations falling below the statutory thresholds are therefore not subject to merger control at national level. 2.12 Requirement for Clearance Before Implementation The implementation of a transaction must be sus - pended until clearance is received from the Croatian Competition Agency. 2.13 Penalties for the Implementation of a Transaction Before Clearance The implementation of a concentration prior to clear - ance is classified as a minor infringement, punishable by fines of up to 1% of the infringing party’s group turnover. In practice, fines imposed by the Agency have generally been at the lower end of the statutory range. Decisions imposing fines are published pub - licly. 2.14 Exceptions to Suspensive Effect There are no general exceptions to the standstill obli - gations, even for public bids. The Competition Act requires concentrations to be notified after the conclu -
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