CROATIA Law and Practice Contributed by: Mirna Mišetić, Mišetić & Partners
5. Decision: Prohibitions and Remedies 5.1 Authorities’ Ability to Prohibit or Interfere With Transactions The authorities have broad powers to prohibit or oth - erwise intervene in transactions that raise competi - tion concerns. If the Agency finds that a concentration does not significantly impede effective competition, it will clear the transaction, either explicitly or by opera - tion of law if no in-depth review is opened within the Phase I deadline. Where the Agency considers that a concentration may significantly affect competition, in particular by creat - ing or strengthening a dominant position, it may open an in-depth investigation and ultimately prohibit the transaction or approve it subject to conditions (behav - ioural or structural remedies). In addition, the Agency may revoke a clearance deci - sion or impose restorative measures and fines where a concentration was implemented without manda - tory notification or in breach of a prohibition decision, including ordering divestments or the unwinding of the transaction in order to restore effective competition. 5.2 Parties’ Ability to Negotiate Remedies Where the Agency identifies competition concerns, the parties are given the opportunity to propose reme - dies, typically in the context of a Phase II investigation. If such proposed remedies are deemed sufficient, they may be accepted in whole or in part by the Agency; failing that, the Agency may impose its own measures. Both structural (divestiture) and behavioural remedies may be used, either individually or in combination, depending on the nature of the competition con - cerns. In practice, structural remedies are generally preferred. Where divestiture is required, the purchaser must be capable of maintaining effective competition, and must be independent of the parties to the con - centration. Remedies are designed to address competition con - cerns identified in the Agency’s market analysis. They are not used to address non-competition or public interest considerations, which fall outside the scope of merger control.
5.3 Legal Standard There is no formally codified legal test setting out a detailed standard that remedies must meet. However, remedies must be sufficient to eliminate the competi - tion concerns identified by the Agency. The Agency assesses remedies on a case-by-case basis, in line with EU merger control principles, focusing on wheth - er the proposed measures are viable, enforceable and timely. 5.4 Negotiating Remedies With Authorities Discussions on remedies typically take place after the Agency has identified competition concerns and initi - ated a Phase II investigation. Once the Agency informs the parties that the concentration may only be cleared subject to conditions, the parties are invited to pro - pose appropriate remedies within a specified period, which is generally up to 30 days. Remedies may also be offered earlier, including at the notification stage. While remedies are usually proposed by the parties, the Agency is not limited to accepting those propos - als. If the proposed remedies are considered insuf - ficient, the Agency may impose its own remedies, including measures not agreed by the parties, pro - vided such measures are necessary to eliminate the identified competition concerns. Procedurally, the remedy phase involves the Agency’s communication of its preliminary concerns, the sub - mission and assessment of proposed remedies, and the adoption of a final decision either approving the concentration subject to conditions or prohibiting it if adequate remedies cannot be identified. 5.5 Conditions and Timing for Divestitures A concentration cleared subject to conditions may be implemented immediately upon receipt of the con - ditional clearance decision. Remedies are subject to specified deadlines and monitoring obligations. Fail - ure to comply with the imposed measures may result in the revocation or amendment of the clearance deci - sion, the imposition of restorative measures (including unwinding the transaction) and fines. 5.6 Issuance of Decisions A formal decision permitting (with or without condi - tions) or prohibiting a transaction is issued to the par -
139 CHAMBERS.COM
Powered by FlippingBook