GERMANY Law and Practice Contributed by: Daniela Seeliger, Christoph Barth, David-Julien dos Santos Goncalves and Kaan Gürer, Linklaters
of five undertakings or fewer that account for a com - bined market share of 66%. Presumptions can also be rebutted. To do so, the par - ties have to show either that competition conditions allow for the assumption of continuous substantial competition between the respective undertakings or that the (group of) undertaking(s) has no paramount market position over the remaining competitors. Presumptions do not keep the FCO from assuming a dominant market position in cases where market shares are lower than those discussed. In March 2012, the FCO published on its website extensive guidance on substantive merger control and the test of mar - ket dominance that details its approach and shows a sharper focus on economic findings and concepts in the decision-making process in line with the criteria of the SIEC test. Special Rules Special rules apply to concentrations in so-called de minimis markets. These are markets where goods or commercial services have been offered for at least five years and where sales of less than EUR20 million were generated in Germany in the last calendar year, unless the market is characterised by the offer of products or services free of charge. This assessment is carried out on a combined-market basis. While these concentra - tions have to be notified, the FCO cannot prohibit the transaction on the basis of a significant impediment to effective competition in such markets. The de minimis rule does not apply to notifications filed on the basis of the size-of-transaction threshold. 4.3 Reliance on Case Law The FCO is an independent body performing its own assessment of the case. However, in practice, it also includes the decisional practice of the Commission
zontal mergers) and consider both co-ordinated and non-coordinated effects. Horizontal Mergers In the case of horizontal mergers, in order to establish single dominance, the FCO investigates which factors determine the parties’ market positions in the relevant market and whether, and if so how, these positions change as a result of the transaction. In addition to market share and concentration levels in the relevant market, various market and company-related fac - tors may be relevant for the assessment: capacities and capacity constraints, customer preferences and switching costs, IP rights and know-how, market phase, access to suppliers and customers, corporate and personal links with other companies, financial resources, barriers to entry and countervailing buyer power. In cases of collective dominance, the FCO analyses whether the transaction enables the parties to co- ordinate their behaviour in the market or if the trans- action facilitates existing co-ordination or makes it more stable. Vertical Mergers In the opinion of the FCO, vertical mergers are con - sidered to have more indirect competitive effects. Still, the FCO is also increasingly assessing these mergers in detail. The FCO assesses in detail any foreclosure effects (input and customer foreclosure) on upstream and/or downstream markets taking into account pre-exist - ing links between the merging companies, alternative supply sources for competitors and the degree of ver - tical integration of other market players, etc. However, such effects may create competition concerns only if the parties additionally have the ability and the incen - tive to foreclose. A further concern may be that the vertically integrated company might gain access to the competitively sen - sitive information of its competitors. In the case of collective dominance, the FCO assesses whether the vertical merger enhances co-ordination between the dominant companies.
and courts in its assessment. 4.4 Competition Concerns
The FCO broadly distinguishes between horizontal mergers, vertical mergers and conglomerate mergers. Generally, it will investigate in each case the creation or strengthening of single or collective dominance (or, on the demand side, of buyer power in cases of hori -
262 CHAMBERS.COM
Powered by FlippingBook