NORWAY Law and Practice Contributed by: Beret Sundet, Elin Moen, Olav Kolstad and Harald K. Selte, BAHR
In addition, as mentioned in 2.11 Power of Authori- ties to Investigate a Transaction , certain companies are under an obligation to disclose all acquisitions in specified markets to the NCA. Failure to make such disclosure can result in a fine of up to 1% of the liable party’s annual aggregated turnover. In recent years, the NCA fined one company NOK20 million for failing to satisfy this requirement (but later withdrew the fine). Another company was fined NOK3 million. Breach of the standstill obligation may also give rise to individual criminal liability, including fines and/or imprisonment for a period of up to three years (or up to six years if severely aggravating circumstances exist) where the infringement is grossly negligent or inten - tional. To date no individuals have been sanctioned for such breach, and there are no known cases where the NCA has reported individuals for criminal enforcement in relation to merger cases. It is worth noting that non-confidential versions of all sanction decisions under the Competition Act are made public. 2.14 Exceptions to Suspensive Effect A general exception to the standstill obligation exists for the execution of a public bid or a series of transac - tions in securities. This only applies if the transaction is immediately notified to the NCA, and the acquirer refrains from exercising the voting rights associated with the securities or only does so to maintain the full value of their investment in accordance with a special exemption granted by the NCA. Even if the above criteria do not apply, it is still pos - sible for notifying parties to apply to the NCA for an exception, for example where the target is insolvent. While the NCA has issued conditional derogations from the standstill obligation under these conditions, the NCA is generally reluctant to grant exemptions. In cases where there is no significant overlap, the NCA instead appears to prefer an expedient handling of notifications. 2.15 Circumstances Where Implementation Before Clearance Is Permitted Except for the circumstances explained in 2.14 Exceptions to Suspensive Effect , there are no gener -
Parties that are not already subject to the disclosure requirement described above, but nevertheless con - sider they are at risk of the NCA ordering a notification, can notify a transaction voluntarily. This triggers the NCA’s deadlines. 2.12 Requirement for Clearance Before Implementation All concentrations subject to mandatory notification are subject to the “standstill obligation” in Section 19 of the Competition Act. This states that a concen - tration meeting the notification thresholds cannot be implemented until the NCA has completed its handling of the case – ie, by clearing the transaction or by mak - ing a commitment decision allowing the transaction to be completed. When the NCA initiates an investigation of an acquisi - tion of control below the notification thresholds or an acquisition of a minority interest, the standstill obli - gation will only apply from the moment the parties receive the order for notification from the NCA. The standstill obligation also applies from the time when a notification is submitted voluntarily. If the transaction has already been completed at the stage when the standstill obligation comes into force, the NCA does not have the power to order the parties to reverse the transaction while the case is under review. However, the NCA has the power to require a divestment rem - edy as part of a decision to block the transaction. If such decision is appealed to the CAT, the NCA and the CAT may impose hold-separate measures as a condi - tion to grant deferred implementation of the decision on appeal. 2.13 Penalties for the Implementation of a Transaction Before Clearance If a party breaches the standstill obligation – ie, by implementing a transaction subject to mandatory noti - fication or where notification has been ordered (see 2.5 Jurisdictional Thresholds ) prior to receiving clearance from the NCA, the NCA can impose an administrative fine of up to 10% of the liable party’s annual aggregate turnover, provided that the infringement was grossly negligent or intentional. The NCA has previously fined Norway’s largest grocery chain NOK25 million for the transfer of several leases for shop spaces from a com - petitor before obtaining approval from the NCA.
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