CYPRUS Law and Practice Contributed by: Marios Pelides, Dominique Pelides and Konstantinos Efthymiadis, Georgiades & Pelides
3. Procedure: Notification to Clearance 3.1 Deadlines for Notification The Law does not prescribe a particular deadline by which notification must be made, subject to the proviso that a concentration (or at least, those parts of a concentration that relate to Cyprus) may not be implemented without CPC clearance. See 3.2 Type of Agreement Required Prior to Notification with regard to the timing of submission of a notification. 3.2 Type of Agreement Required Prior to Notification A notification may only be made once an agreement as to the concentration has been concluded, or in the case of a takeover offer, following publication of the public takeover bid or acquisition of a controlling inter - est triggering a takeover bid. In practice and given that the concentration may not be implemented before CPC clearance is obtained, parties tend to submit notifications within a few days of signing the transac - tion documentation. There is one exception to the above, which is where the parties are able to demonstrate to the Service that they have good faith intent to reach agreement or (in the case of a takeover offer) where the relevant party has publicly announced its intention to make a takeo - ver bid. In practice, the Service will require evidence that there is a high degree of certainty that the transaction will proceed (eg, execution versions of the transac - tion documentation) as well as an explanation of the urgency involved (eg, that the transaction documents cannot be signed before a separate regulatory clear - ance is received, but there would be serious financial or other repercussions to delaying implementation for the duration of the CPC’s review period). 3.3 Filing Fees There is a flat filing fee of EUR1,000 for a notification. If the CPC decides to proceed to a Phase II investiga - tion, an additional fee of EUR6,000 is payable. The filing fee is paid when submitting the notification. The CPC’s review period does not begin until the fil - ing fee is paid.
Very few instances of penalties being imposed in this regard have been reported. The undertakings involved in those instances (which were published on the CPC’s website) received fines ranging from EUR5,000 to EUR20,000. It is worth noting in this regard that the Law (and con - sequently, the penalties described above) applies equally to foreign-to-foreign transactions. 2.14 Exceptions to Suspensive Effect There are no general exceptions to the suspensive effect unless specific clearance is obtained from the CPC to implement (parts of) a transaction pending CPC clearance (see 2.15 Circumstances Where Implementation Before Clearance Is Permitted ). 2.15 Circumstances Where Implementation Before Clearance Is Permitted Transactions subject to a Phase I investigation, or at least, those parts that relate to Cyprus and have triggered the requirement to file, may not be imple - mented until CPC clearance (including deemed clear - ance) is obtained. Parties may implement the parts of the transaction that are not subject to CPC approval pending clearance. The CPC does not technically have to be notified of this; however, it is good practice to be as transparent as possible. In cases where the CPC has decided to proceed to a Phase II investigation, the CPC may grant permission for a transaction or parts thereof to be implemented pre-clearance on the application of one or more of the parties involved. Permission is granted on a tempo - rary basis (meaning that, if the CPC ultimately decides not to approve the concentration, any implementation steps taken by the parties must be unwound following the CPC’s decision) and may be issued subject to any conditions the CPC considers appropriate. Applicants must demonstrate that they will suffer seri - ous damage if implementation of the transaction is delayed further. In deciding whether to grant permis - sion, the CPC will take into account the consequences of the delay in implementation on the participants as well as on third parties and will weigh such conse - quences against the perceived threat to healthy com - petition posed by the transaction.
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