GERMANY Law and Practice Contributed by: Daniela Seeliger, Christoph Barth and David-Julien dos Santos Goncalves, Linklaters
viduals (eg, board members) who violate the suspension obligation are subject to fines of up to EUR1 million. Fines In the past, the FCO has issued fines in several cases where a concentration has been imple - mented prior to clearance and is certainly will - ing to continue this practice. The highest fines imposed on an undertaking at the time of writing amounted to EUR4.5 million in 2008 and EUR4.1 million in 2009 (which in the latter case, howev - er, was revoked). Fines for undertakings usually range between EUR200,000 and EUR400,000. In most cases, the FCO issues a press release indicating the penalty for gun jumping and the undertakings concerned. Based on publicly available information, the FCO has already imposed a fine of EUR40,000 on a board member for breaching the suspension obligation (however, this was later revoked by the courts). In practice, individual fines for gun Legal acts (eg, the transfer of shares) that infringe the suspension obligation are void. However, legal invalidity resulting from gun jumping may be remedied. Remedying such actions requires notification of the implementation of the transac - tion to the FCO. The FCO then opens demerger proceedings, in the course of which it applies the same substantive test as in a standard merger control review. Demerger proceedings are not subject to any deadlines. Should the FCO be satisfied that the transac - tion does not meet the requirements for a pro - hibition (as it is or after removal of the relevant competition concerns through obligations and conditions) or if the Federal Minister for Eco - jumping seem to be rare. Demerger Proceedings
nomic Affairs and Energy grants permission to implement the transaction (as discussed below), the FCO will close the demerger proceedings. This has an effect tantamount to a clearance decision, so the legal acts carried out in rela - tion to the transaction will retroactively become valid. Otherwise, if the FCO does not approve the transaction, it may dissolve it. Furthermore, under the ARC, the invalidity of specific transactions caused by gun-jump - ing may be cured by way of registration. This applies to real estate agreements once they have become legally valid by entry into the land register; to certain agreements on the conver - sion, integration or formation of an undertaking; and to enterprise agreements once they have become legally valid by entry into the appropri - ate register. 2.14 Exceptions to Suspensive Effect The suspension obligation does not apply to public takeover bids or to the acquisition of shares in a series of transactions via stock exchanges as long as those concentrations have been notified to the FCO and the acquirer does not exercise the voting rights related to the shares, or exercises them only to maintain the full value of its investment on the basis of an exemption granted by the FCO. The FCO may, upon application, grant deroga - tions from the suspension obligation if the par - ties can justify such exemptions; however, in practice, derogations are rarely granted. In clear- cut Phase I cases, it is normally faster to obtain a clearance decision than derogation from the suspension obligation.
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