CHILE Law and Practice Contributed by: Francisca Levin, Benjamín Torres, María Paz Dulanto and Antonia Silva, Cuatrecasas
4.2 Markets Affected by a Transaction To determine which markets may be affected by the transaction, the parties in their notification must iden - tify the affected relevant markets, according to the horizontal and/or vertical overlapping activities in which the acquiring entities, their related companies and the target operate. Once the markets are identified, the FNE will analyse market concentration indices to identify transactions that usually do not substantially lessen competition. The FNE will generally rule out further analysis if, according to the Herfindahl Hirschman Index (HHI), the market concentration index is: • less than HHI 1,500; • more than HHI 1,500 and less than HHI 2,500 (indicative of a moderately concentrated market), with a projected HHI variation (or ΔHHI) of less than 200; or • more than HHI 2,500 (indicative of a highly concen - trated market), with a ΔHHI of less than 100. Conversely, the FNE conducts a more detailed effects analysis where concentration thresholds are met or exceeded. Enhanced scrutiny may also apply below those thresholds where special circumstances jus - tify it, such as a horizontal merger involving a recent entrant or maverick firm, or relevant structural or con - tractual links between market participants. 4.3 Reliance on Case Law The FNE relies on its own decisional practice and on TDLC case law when applicable. It also frequently refers to foreign cases, soft law and guidelines when analysing similar markets or theories of harm, particu - larly from authorities in reference jurisdictions as the European Commission, the US Federal Trade Com - mission and Department of Justice, the UK’s Compe - tition and Markets Authority and other European and Latin American authorities. Although the FNE often refers to these precedents, it does not apply them mechanically. It uses them as reference points, for illustrative purposes, and adapts the analysis to the facts of each case and the realities of Chilean markets.
(ie, competitors, suppliers or clients of the parties or the target). These RFIs do not stop the clock or sus - pend the legal deadline for the FNE’s review, which explains the tight deadlines provided to respond. The amount of information requested varies depend - ing on the complexity of the transaction, the markets involved and available public information. The FNE may also request depositions from the par - ties’ or third parties’ executives for better understand - ing of the transaction and its effects on the market (either in person or remotely, via videocall). In merger investigations, it is mandatory for the parties and third parties to respond to RFIs in a timely and comprehensive manner, and to attend the depositions called by the FNE. Failure to comply may result in fines and even criminal penalties. 3.10 Accelerated Procedure There is no fast-track or accelerated procedure for review. All notifications are subject to the same legal review periods, as explained in 3.7 Review Process . However, the FNE’s review of a no-overlap simplified notification form will usually take a shorter time than an ordinary notification (around 22 business days). Concentration transactions are assessed against whether the transaction is capable of substantially lessening competition. According to the FNE’s Guidelines on Horizontal Mergers, this analysis consists of determining whether the particular transaction can generate the ability and incentives for the merged entity to increase its prices or affect other relevant variables in the competitive process affected by the transaction, to the detriment of consumers. In its assessment, the FNE essentially contrasts the expected competitive outcome follow - ing the completion of the transaction against the com - petitive conditions that would reasonably be expected to prevail in the absence of the transaction. 4. Substance of the Review 4.1 Substantive Test
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