FINLAND Law and Practice Contributed by: Anna-Stéphanie Roubier, Johanna Kauppinen and Milja Vuopio, HPP Attorneys Ltd
raise prices, or to lower production volumes or prod - uct quality. Non-horizontal concentrations can also significantly impede effective competition in some circumstances. Vertical concentrations generally only give rise to sig - nificant competition concerns where the transaction is likely to give rise to market foreclosure. Conglomer - ate mergers generally only have significant anti-com - petitive effects in situations where they confer on the concentration the ability to leverage a strong market position in one market, in order to foreclose rivals in another market. 4.5 Economic Efficiencies According to the FCCA’s Guidelines, in appraising whether a concentration would significantly impede effective competition, any efficiency gains resulting from the concentration also need to be assessed. Efficiencies generated by a concentration can enhance its ability and incentive to act pro-competitively for the benefit of consumers. This can counteract any adverse competitive effects that the concentration may otherwise have. Efficiencies can be production- related, such as improvements in product quality, pro - duction and/or distribution, or a wider product offering using the same inputs. Consumers can also benefit from dynamic efficiencies, such as the introduction of new and improved products based on innovations in production or distribution. The weight given to effi - ciency claims in the FCCA’s assessment depends on how substantial the claimed efficiencies are, how likely they are to be achieved, and whether they pro - mote competition for the benefit of customers and consumers. According to the FCCA’s Guidelines, the more signifi - cant the anti-competitive effects of a concentration, the more substantial the efficiencies must be. The FCCA must have sufficient certainty that the com - petitive pressure will be sufficient post-transaction to ensure that the concentration has the incentive to operate pro-competitively, and to pass on efficiency gains, to a sufficient degree, to consumers. It is highly unlikely that a concentration with market power will be approved purely on the grounds of efficiency gains.
The FCCA must also ascertain that the claimed effi - ciencies are likely to be realised and that they actu - ally benefit consumers. The nature of the efficiencies can be significant in this context. For example, cost efficiencies that lead to reductions in variable or mar - ginal costs are more likely to be relevant for assess - ing whether efficiencies will lead to a net consumer benefit than more speculative, dynamic efficiencies relating to innovation. Ostensible efficiencies, such as cost reductions that merely result from anti-compet - itive reductions in output, cannot be considered as efficiencies benefiting consumers. The timeframe within which efficiencies are likely to be passed on to customers and consumers is also relevant. To be considered as a counteracting factor for anti-competitive effects that a concentration would otherwise have, the efficiencies must be sufficiently timely. Theoretical efficiencies that can potentially benefit consumers some time in the distant future are not sufficient. It is for the parties to provide all relevant information to substantiate any efficiency claims, and to demonstrate that they are merger-specific – ie, that the efficiencies would not arise in the absence of the concentration and that they result directly from the concentration. Finally, the claimed efficiencies must materialise in the Finnish market and be passed on to consumers or customers in Finland. 4.6 Non-Competition Issues The FCCA’s appraisal is based purely on competi - tion considerations, and it cannot reflect any extra- competition issues (such as industrial policy, national security, employment, environmental or other public- interest issues) as part of its merger review mandate. FDI (the screening of foreign corporate acquisitions) is governed by the Screening Act. The rules, process and assessment are separated from the merger con - trol rules. See 1.2 Legislation Relating to Particular Sectors for an overview of the Finnish FDI rules and process. Finland’s regulatory framework for foreign subsidies is governed by the EU’s Regulation (EU) 2022/2560 on foreign subsidies distorting the internal market. Accordingly, there is no separate national legislation covering foreign subsidies. The FCCA acts in the role
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