SINGAPORE LAW AND PRACTICE Contributed by: Jeffrey Lim, Daniel Lim, Frederick Tay, Genevi Lim, Lakshmanan Anbarazan, Sarah Lai, Stephanie Goh and Tobias Andreas Satria, Joyce A. Tan & Partners LLC
6.2 Criteria for Antitrust/Competition Review The substantive test the CCCS applies in its review is whether the merger has resulted, or is expected to result, in a substantial lessening of competition in any Singapore market. To determine this, the CCCS compares the level of competition in the relevant market in the future with and without the merger. Its assessment focuses on key factors such as: • market concentration and shares before and after the merger; • barriers to entry or expansion that may limit new or existing competitors; • buyer power and ability to resist higher prices that could constrain the merged entity’s pricing or conduct; • efficiency gains like cost savings or innovation that may enhance competition or benefit consumers; and • other party-specific arguments, including failing firm arguments and non-horizontal (vertical or con - glomerate) effects. The CCCS treats this assessment as qualitative rath - er than purely numerical, as a finding of competitive harm may arise even if market shares fall below indic - ative thresholds. Further, the lessening of competition need not affect every competitor or every dimension of competitive rivalry. 6.3 Remedies and Commitments Remedies for competition concerns identified by the CCCS may come in the form of commitments or undertakings by the merging parties, which may be proposed at any time during the review process and accepted by the CCCS before a final decision is made, or as directions from the CCCS. Structural remedies are measures that change the market structure itself to remove or reduce anti- competitive effects arising from a merger. They are generally preferred by the CCCS because they pro - vide a lasting solution without ongoing supervision. Such remedies often involve the divestment of over - lapping businesses or assets to maintain or restore competition, or the licensing of key intellectual prop -
firms post-merger is ≥70%, with the merged entity’s market share being at least 20%, as these scenarios may raise competition concerns. Even without notification, the CCCS may investigate completed or anticipated mergers on its own initiative if it has reasonable grounds to suspect a substantial lessening of competition in any Singapore market, including the ability to impose interim measure direc - tions while investigations are ongoing. This “ex post” jurisdiction of the CCCS underscores the importance of pre-transaction risk assessment. Parties should therefore conduct a self-assessment as a first step before a merger to determine whether their proposed merger should be notified to the CCCS. If guidance is required, the parties may apply to the CCCS for confidential, non-binding advice on whether their proposed merger would result in a substantial lessening of competition. The proposed merger must not be publicly known at the time the CCCS’ advice is sought. If parties decide to notify the CCCS, this triggers a formal review process which consists of two phases: • In Phase 1, CCCS conducts an initial review based on information provided by the parties and other available data. This preliminary stage generally takes about 30 working days and the merger will be cleared if no competition issues are identified. The favourable decision will be published on the CCCS public register. • However, if the CCCS is unable to conclude that the transaction poses no competitive concerns, it will proceed to a Phase 2 review, where the CCCS seeks further information and conducts a more detailed investigation, which typically requires up to 120 working days to complete. If the CCCS preliminarily concludes that a merger may sub - stantially lessen competition, it issues a provisional decision outlining its reasoning and proposed directions. The parties may make written or oral representations or seek a public interest exemption from the Minister for Trade and Industry. Once all representations are considered, the CCCS delivers its final decision and publishes the outcome on the CCCS public register.
546 CHAMBERS.COM
Powered by FlippingBook