TAIWAN Law and Practice Contributed by: Stephen Wu, Yvonne Hsieh, Wei-Han Wu and Erica Chiu, Lee and Li, Attorneys-at-Law
tion disadvantages to the Taiwan market caused by the proposed transaction. 5.2 Parties’ Ability to Negotiate Remedies Although the TFTA provides no remedy mech - anism, experience suggests that the parties are able to propose remedies to the TFTC for its consideration when it has concerns about a transaction. If the proposed remedies would constitute a material change to the notification, and thereby lead to the TFTC requiring additional information for its evaluation, the TFTC may stop the clock and the waiting period will be reset only after the supplemental information is sub - mitted. If the proposed remedies would not con - stitute a material change to the notification, the TFTC will take into account such remedies when rendering its decision on the merger notification before the waiting period expires. The TFTC will assess whether it would grant its clearance with conditions referring to such remedies. Typical Remedies In terms of the particular kinds of remedies that are typically used in practice, since the prima - ry purpose of the remedies is to eliminate the anti-competition concerns, most competition authorities in different jurisdictions recognise that divestitures (a type of structural remedy) are the best way to achieve such a goal. In line with these international practices, the TFTC appears to accept structural remedies for divestitures (disposal of shares held by the party) and impose such remedies as conditions to clearance. In fact, the public records indicate that the TFTC has indeed adopted the divestment approach in a transaction involving a cable television busi - ness. The TFTC amended the Merger Guidelines in September 2012 to include its official standards
for remedies. According to the Merger Guide - lines, the TFTC can impose the following rem - edies as conditions. • Measures impacting the structural aspect – order the parties to take measures to: (a) dispose of the shares or assets in their holding; (b) transfer part of their operations; or (c) remove personnel from certain positions. • Measures impacting the behavioural aspect: (a) order the parties to continue to supply critical facilities or essential elements to businesses outside the merger; (b) order the parties to license such busi - nesses to use their intellectual property rights; and (c) prohibit the parties from engaging in exclusive dealing, discriminatory treat - ment and tie-in sales. Despite this, the TFTC still reserves the right to impose other types of remedies on a case-by- case basis. The Merger Guidelines also point out that the TFTC may seek the parties’ opinions on the possible remedy before making a final decision. Whether remedies are ever required to address non-competition issues is unclear since no case precedent is available. 5.3 Legal Standard There is no legal standard that remedies must meet in order to be deemed acceptable. 5.4 Negotiating Remedies With Authorities The parties can begin negotiating remedies with the TFTC within the waiting period by submit - ting a proposal to the TFTC. Meanwhile, the TFTC has the authority to propose remedies on
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