FRANCE Law and Practice Contributed by: Malik Idri and Mathieu Relange, FTPA Avocats
Merger Regulation, as referenced in Article L. 430-2 FCC. Total turnover comprises amounts derived from the sale of products and provision of services by the undertakings concerned in the last financial year, in the ordinary course of business, after deduction of sales rebates, value-added tax and other directly related taxes. Intra-group transactions (transactions between undertakings within the scope of Article 5 (4) of the EU Merger Regulation) are excluded from the total turnover. Specific rules on the calculation methods for credit institutions, other financial institutions and insurance undertakings are set out in paragraph 3 of the same Article. The French notification thresholds are based solely on turnover. Conversion of Turnover into Euros Turnover expressed in a foreign currency must be converted into euros. The FCA accepts conversions based on official exchange rates, typically the aver - age exchange rate for the financial year concerned as published by the European Central Bank. 2.7 Businesses/Corporate Entities Relevant for the Calculation of Jurisdictional Thresholds Undertakings Concerned for Turnover Calculation The undertakings concerned for turnover calculation depend on the type of transaction: • for a merger, the undertakings concerned are the merging undertakings; • for an acquisition of sole control, the undertakings concerned are the undertaking acquiring control and the pre-existing target undertaking; and • for an acquisition of joint control over an existing undertaking, the undertakings concerned are the undertakings acquiring control and the pre-existing target undertaking. If the pre‑existing target was previously under the sole control of one company and new shareholders acquire joint control while
the original parent company remains, the undertak - ings concerned are each of the companies exercis - ing joint control (including the original shareholder). In that case, the target company is not an under - taking concerned and its turnover is included in that of the original parent company; • for a change from joint control to sole control, the undertakings concerned are the undertaking acquiring control and the target undertaking. The selling undertakings are not regarded as undertak - ings concerned; and • for the creation of the new joint venture (JV), the undertakings concerned are the controlling under - takings. The newly created JV is not regarded as an undertaking concerned (as it has no prior turnover). If a controlling undertaking contributes assets to the JV, the turnover attributable to those assets is included in that controlling undertaking’s turnover. Calculation of Total Turnover of One Undertaking The total turnover of an undertaking concerned shall be calculated by adding together the turnovers of: • the undertaking itself; and • subsidiary undertakings where the undertaking itself, directly or indirectly, has: (a) more than half of the capital or business assets; (b) the power to exercise more than half of the voting rights; (c) the power to appoint more than half of the members of the supervisory or administrative board or of the bodies legally representing the undertaking; or (d) the right to manage the affairs of the undertak - ing; • parent undertakings that have the rights or power listed above over the first undertakings; • subsidiary undertakings of the parent undertakings (as defined above); and • jointly controlled undertakings where two or more undertakings from the above categories jointly have the rights or powers listed above. All turnover figures must be based on audited accounts for the last completed financial year. Adjustments are only permitted to reflect permanent changes in the
234 CHAMBERS.COM
Powered by FlippingBook