EU Law and Practice Contributed by: Porter Elliott, Catherine Gordley and Niharika Parshurampuria, Van Bael & Bellis
for the 12-month period in question, as published by the European Central Bank. Financial Institutions The EUMR and the Consolidated Jurisdictional Notice provide specific rules that apply to the calculation and allocation of turnover for credit and other financial institutions. 2.7 Businesses/Corporate Entities Relevant for the Calculation of Jurisdictional Thresholds Undertakings Concerned The EUMR jurisdictional thresholds refer to the aggre - gate turnover of the “undertakings concerned”. In the case of mergers, the merging parties are both under - takings concerned. In the case of acquisitions, the undertakings concerned are the acquirer(s) and the target(s) but not the seller. If the transaction involves the acquisition of joint control over a pre-existing undertaking, then that undertaking is also an under - taking concerned. Control Group of the Undertakings Concerned EU turnover thresholds concern the aggregate turno - ver of all entities belonging to the control group of the undertaking concerned. For turnover purposes, the concept of control group includes: • the undertaking concerned; • any undertakings directly or indirectly controlled by the undertaking concerned; • any undertakings that directly or indirectly control the undertaking concerned (ie, its parent compa - nies); and • any undertakings other than the undertaking con - cerned that are also controlled by these controlling undertakings. The turnover of a target undertaking is limited to that of the target itself and its subsidiaries, but not the turnover of the target’s parent companies (the sellers) or any other subsidiaries of those parent companies. 2.8 Foreign-to-Foreign Transactions The EUMR applies to all concentrations with an EU dimension, regardless of the nationality of the parties involved. There are no special rules for foreign-to-for -
eign transactions, nor is there a local effects/presence test beyond the turnover thresholds. 2.9 Market Share Jurisdictional Threshold The EU notification thresholds are based solely on turnover. There are no market share-based thresholds. 2.10 Joint Ventures The EUMR applies only to “full-function” JVs. Non “full-function” JVs are not caught by the EUMR but are subject to the EU antitrust rules, specifically Article 101 of the TFEU. They may also require notification in certain member states that take a different approach to what constitutes a notifiable transaction, such as in Austria, Germany and Poland. A JV is considered “full-function” if it performs, on a lasting basis, all the functions of an autonomous economic entity. It must therefore have sufficient staff, assets and capital to function on the market indepen - dently of its parent companies. It must also have its own market presence, and not merely perform a single function on behalf of its parent companies (such as customer service or R&D), nor be overly reliant on its parent companies as either suppliers or customers. Concentrations involving full-function JVs may arise from the creation of a new greenfield operation or through a change in control over an existing business (eg, a change from sole to joint control or the addition of a parent company to an existing full-function JV). 2.11 Power of Authorities to Investigate a Transaction The Commission has no power to investigate or review on its own initiative transactions that do not meet the EU jurisdictional thresholds. However, the Commission can acquire jurisdiction to review such transactions as a result of a referral request lodged by either the parties or a member state (see 2.1 Notification ). 2.12 Requirement for Clearance Before Implementation Article 7 of the EUMR imposes a standstill obliga - tion, requiring parties to a concentration with an EU
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