GERMANY Law and Practice Contributed by: Daniela Seeliger, Christoph Barth, David-Julien dos Santos Goncalves and Kaan Gürer, Linklaters
history within that period is then relevant for the turno - ver calculation, from the time of the last transaction. Turnover can be calculated in accordance with Sec - tion 277 (1) of the German Commercial Code ( Han- delsgesetzbuch ) or based on internationally recog - nised accounting standards such as IFRS. Thresholds are related to turnovers and thus are not asset-based. Special Turnover Calculation Rules Special turnover calculation rules apply to: • banks, credit institutions, building societies and insurance companies (premium income – the same rules as in the European Merger Control Law); • undertakings wholly or partly engaged in the distri - bution of goods (only three-quarters of the turnover resulting from distribution is taken into considera - tion); and • undertakings wholly or partly engaged in the pub - lication, production or distribution of newspapers or periodicals and broadcasting companies (the turnover must be multiplied by four). 2.7 Businesses/Corporate Entities Relevant for the Calculation of Jurisdictional Thresholds For the assessment of turnover thresholds, the group turnover of the participating undertakings in the last financial business year must be considered. Acquirer and Target Participating undertakings are usually the acquirer (including its parent companies and its subsidiaries) and the target (either the legal entity and its subsidi - aries or the business/assets to be acquired). Thus, on the acquirer’s side, all undertakings controlling the acquirer and all undertakings controlled by the acquirer form a group and have to be considered for the calculation of turnover. On the target’s side, only turnover achieved by the entities controlled by the target and the target’s turno - ver are taken into account. If parts of one or more undertakings are acquired, only the turnover relating to those parts is considered when calculating the turnover on the seller’s side. This does
not, however, apply if the seller keeps control of 25% or more of the shares. Joint Venture Company In the case of a joint venture company, the turnover of all parent companies that, following the concentra - tion, will either jointly control the joint venture or have a shareholding of at least 25% is relevant with a view to the turnover thresholds. Seller The turnover of the seller is generally not taken into account. However, this does not apply if the seller keeps control of 25% or more of the shares in the tar - get. In these cases, the seller is a participating under - taking within the meaning of German merger control. This is, in particular, relevant for the setting up of a joint venture with no previous business activities. Scope of Turnover Information Turnover information has to be provided for the last business year. However, with respect to subsequent acquisitions and divestments, the date of the notifi - cation is relevant for the basis of consolidation. All acquisitions, divestments or business closures that were implemented up until the date of notification of the intended transaction have to be considered. When calculating the relevant turnover, it has to be deter - mined what the turnover of the group (as it stands at the notification date) would have been in the last completed business year. 2.8 Foreign-to-Foreign Transactions Generally, German merger control rules also apply to mergers taking place outside Germany, as long as the relevant turnover thresholds are met and the proposed merger has a domestic effect. The FCO’s Guidance on domestic effects in merger control (2014) deals with domestic effects of foreign- to-foreign mergers and joint ventures. According to these guidelines, a transaction has domestic effects if it is likely to influence competition on the German market directly (appreciable effect). Different factors are taken into account – eg, the involved parties’ busi - ness activities in Germany or parties’ domestic sub - sidiaries/branches and the combined market shares
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