DENMARK Trends and Developments Contributed by: Morten Jensen, Elise Ross-Hansen, Frederik André Bork and Paula Grønlund, Bruun & Hjejle
Merger control regime and call-in option Denmark’s merger control regime, governed by the Danish Competition Act, largely mirrors EU Merger Regulation principles. According to the Danish merger control rules, concentrations meeting certain turnover thresholds must be notified to the Danish Competition and Con - sumer Authority. The concentration must not be implemented before the merger has been noti - fied and approved by the Danish competition authorities. Further, as of 1 July 2024, the Dan - ish Competition and Consumer Authority may review and require notification of mergers falling below the standard turnover thresholds ( “call in” ) if the combined aggregated turnover in Denmark of the undertakings concerned is at least DKK50 million and there is a risk that the merger in ques - tion will significantly impede effective competi - tion, in particular as a result of the creation or strengthening of a dominant position. The Foreign Subsidies Regulation As of 12 July 2023, the rules stemming from the Foreign Subsidies Regulation (Regulation (EU) 2022/2560) have enabled the European Com - mission to investigate and address distortions in the EU internal market caused by foreign sub - sidies. Key aspects in an EU (and Danish) context include: • mergers – mandatory notification of certain M&A transactions involving foreign subsidies; • public procurement – notification require - ments for bidders receiving foreign subsidies; and • ex officio investigations – the Commission can investigate foreign financial contributions even outside notified cases.
Regulatory Framework for Foreign Direct Investments in Denmark Foreign direct investments With the entry into force of the Danish Investment Screening Act in 2021 regarding the screening of foreign direct investments, Denmark has adopt - ed a more restrictive regime for such screening. The Act introduced a mandatory filing obligation with the Danish Business Authority for: • non-Danish investors who are looking to obtain “qualifying holding” in a Danish under - taking within “particularly sensitive sector or activity” ; or • a non-EU investor who is looking to enter into “special financial agreements” with a Dan - ish undertaking within “particularly sensitive sector” . The five particularly sensitive sectors covered by the mandatory screening mechanism include: • the defence sector; • the sector for IT security functions or pro - cessing of classified information; • the production of dual-purpose products; • other critical technology (consisting of 11 listed technologies); and • critical infrastructure (consisting of 11 listed subsectors, such as energy and healthcare). There has been a greater focus on – and under - standing of – the rules, especially following breakout of the war in Ukraine. With that per - spective in mind, together with the broad draft - ing of the Act, foreign direct investment screen - ings (and potentially filings) will likely be relevant in a substantial number of M&A cases involving a Danish subsidiary and a foreign investor (in particular, targets within the tech industry).
614 CHAMBERS.COM
Powered by FlippingBook