CROATIA Law and Practice Contributed by: Iva Basarić, Marija Gregorić and Matija Skender, Babic & Partners
Merger Control Thresholds, Procedure and Clearance Under the Croatian Competition Act, a concentration is notifiable to the CCA if the following thresholds are cumulatively met: • the combined worldwide annual turnover of all undertakings concerned is at least EUR132.72 million in the financial year preceding the con - centration and at least one undertaking party to the concentration has a seat or a branch office in Croatia; and • the aggregate national turnover in Croatia of each of at least two undertakings concerned is at least EUR13.23 million in the preceding financial year. However, these thresholds do not apply to transac - tions in the media sector, where transactions must be notified regardless of whether the above thresh - olds have been reached, provided that the acquirer is also a media company. If an acquisition of electronic communications operators does not meet the above thresholds, the transaction would not need to be noti - fied to the CCA, but would still need to be notified to and cleared by the Croatian Regulatory Authority for Network Industries (abbreviated in Croatian as HAKOM) if the transaction would involve operators with significant market power or operators that hold a licence for use of RF spectrum for the Croatian ter - ritory. The CCA is required to conclude its Phase I investi - gation within 30 days from the date of receipt of the complete notification. If the CCA does not adopt a decision on the commencement of a Phase II inves - tigation, the notified concentration will be presumed approved. On the other hand, if the CCA finds that the concentration may give rise to an appreciable effect on competition in the relevant market, it will take a decision on the commencement of a Phase II investi - gation. The Phase II process must generally be com - pleted (with an unconditional or conditional clearance decision, a prohibition decision or a remedial decision after the implementation of a prohibited concentra - tion) within three months from the CCA’s decision on the commencement of Phase II proceedings, with a possibility for the CCA to extend this deadline for an additional three months.
is authorised to revoke approval and order divestment within nine months (which may be extended for up to six months in exceptional cases and on the basis of the reasoned request). During the divestment period, an investor’s shareholder rights would be restricted. The remedy described is also applicable in case of failure to notify. It should be noted that the FDI Act also provides for retroactive application, meaning that the authorities will be authorised to screen transactions that closed prior to the FDI Act coming into force, within the period of three years from the FDI Act coming into force. Based on public commentary, such retroactive screening would only be applied to investments which have a (materially) negative impact on national secu - rity and public order in Croatia, but no such caveat has been expressly introduced in the Act. 2.4 Antitrust Regulations The Croatia merger control regime is governed by the Croatian Competition Act. Croatian merger control rules follow the key principles of the EU merger con - trol regime, as governed by the EU Merger Regulation (139/2004). In addition, the Croatian Competition Act expressly provides that, in case of gaps or uncertain - ties in interpretations of Croatian competition laws, the criteria set forth by the rules of EU competition laws shall be applied as appropriate. The relevant merger control authority in Croatia is the Croatian Competition Agency (CCA). Definition of a Concentration The regime applies to concentrations of undertakings that involve the change of control of the undertaking on a lasting basis through a merger by acquisition or a merger by forming a new company, or through the acquisition of direct/indirect control or a controlling influence by one or more undertakings over one or more other undertakings or parts thereof by way of the acquisition of a majority shareholding or a majority of the voting rights, or by other means. This also includes the creation of a full-function joint venture. The Croatian Competition Act exempts internal reor - ganisations from the duty to notify.
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