GERMANY Law and Practice Contributed by: Daniela Seeliger, Christoph Barth and David-Julien dos Santos Goncalves, Linklaters
1. Legislation and Enforcing Authorities 1.1 Merger Control Legislation
2. Jurisdiction 2.1 Notification Notification is mandatory. 2.2 Failure to Notify
German merger control rules are contained in Section 35 et seq of the German Act against Restraints of Competition ( Gesetz gegen Wett- bewerbsbeschränkungen (GWB) or ARC). Fur - thermore, the German Federal Cartel Office ( Bundeskartellamt or FCO) has issued several guidance papers on its website – eg, in relation to domestic effects, market dominance and the size-of-transaction threshold. 1.2 Legislation Relating to Particular Sectors Concerning other relevant legislation for foreign transactions or investment, Germany has one of the most established and active foreign invest - ment control regimes in Europe. See 9. Foreign Direct Investment/Subsidies Review . With regards to legislation relating to particu - lar sectors, Germany recently introduced and amended a sector-specific exemption to the scope of application of the general merger con - trol rules for certain hospital mergers (Section 187 (9) and (10) ARC), see Section 2.3 Types of Transactions . 1.3 Enforcement Authorities The German merger control regime is enforced by the FCO, which has its seat in Bonn. The FCO is headed by a president, currently Andreas Mundt. If a merger has been prohibited by the FCO, the parties may apply to the Federal Ministry for Economic Affairs and Energy under Section 42 of the ARC and ask for a ministerial authorisation of the transaction.
The ARC does not sanction a failure to notify but does impose sanctions for the implementa - tion of a notifiable transaction prior to clearance (see 2.13 Penalties for the Implementation of a
Transaction Before Clearance ). 2.3 Types of Transactions
For merger control purposes, the ARC exhaus - tively defines concentrations as any of the fol - lowing transactions: • an acquisition of assets constituting the whole or a substantial part of an undertaking; • a transaction conferring direct or indirect con - trol of the whole or parts of an undertaking; • the acquisition of shares in another under - taking if such shares alone, or together with shares already held, amount to or exceed 25% or 50% of the undertaking’s share capi - tal or voting rights; or • any other combination of undertakings where one or several undertakings can exercise, directly or indirectly, competitively significant influence over another undertaking. The latter covers acquisitions of minority stakes of less than 25% in another company. Such transactions have to be notified if they confer upon the acquirer the ability to exercise influ - ence on commercial policy and, thus, affect the competitive behaviour of the target company. As in the EU merger control regime, the acquisi - tion of shares for resale by credit institutions, financial institutions or insurance undertakings is not considered a concentration as long as
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