AUSTRIA Law and Practice Contributed by: Gerhard Fussenegger and Florian Neumayr, bpv Huegel
rights in an undertaking (independent of the acquisition of control); • the establishment of cross-directorships, ie, acts that ensure that at least half of the mem - bers of the executive board or the supervisory board in two or more undertakings are the same; • the achievement of any other relationship between undertakings whereby an undertak - ing may directly or indirectly exercise a deci - sive influence over another undertaking; and • the creation of a joint venture that performs, on a lasting basis, all the functions of an autonomous economic entity. Some of the above-listed transactions (bullet points two, four and potentially also five) by definition cover operations that do not involve the transfer of shares or assets. A controlling influence without a transfer of shares or assets might be achieved, eg, by: • attaching special rights to preferential shares (eg, the minority shareholders’ right to appoint more than half of the members of the supervisory board); • a de facto controlling influence by minority shareholder who are highly likely to achieve a majority at the shareholders’ meetings due to the percentage of shareholders in attendance; or • minority shareholders acting together in exer - cising their voting rights. Intra-group restructurings or reorganisations are not covered by Austrian merger control. 2.4 Definition of “Control” “Control” is not defined in the Cartel Act. The Austrian Supreme Cartel Court (Case No 16 Ok 7/07) has confirmed that a controlling influ -
ence under the Cartel Act, Section 7 is identi - cal to exercising “decisive influence” within the meaning of Article 3 of Council Regulation (EC) No 139/2004 on the control of concentrations between undertakings (EUMR). In the same decision, the Supreme Cartel Court also defined ”sole” and “joint” control as follows. Joint Control Joint control exists where the controlling share - holders all have the “possibility to influence stra - tegic decisions”, eg, where such decisions can - not be taken without the participation of other shareholders. In defining the term ”strategic decisions”, the Supreme Cartel Court referred to the Commission’s Consolidated Jurisdictional Notice No 139/2004 and listed the “budget, the business plan, major investments or the appoint - ment of senior management” as rights that typi - cally confer joint control. Sole Control Sole control is achieved if the acquirer is able to influence the strategic competitive behaviour of the target independently. The Supreme Cartel Court again follows the Commission’s Jurisdic - tional Notice (including for cases of negative sole control). Acquisition of Shares As discussed in 2.3 Types of Transactions , the direct or indirect acquisition of 25% or more (or 50% or more) of the shares or voting rights of an undertaking is caught by Austrian merger con - trol, independent of whether control is acquired or not. In addition, under Austrian case law, the acquisition of even less than 25% of the shares or voting rights in an undertaking is caught by Austrian merger control if the acquirer gets rights that are comparable to minority rights typically attributed to a 25% or more shareholder.
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