Merger Controls First Edition - J Sagar Associates

Spain
Jaime Folguera Crespo & Borja Martínez Corral
Uría Menéndez
Overview of merger control activity during the last 12 months
In the last twelve months, the activity of the Spanish Competition Commission (“CNC”) in merger control procedures
has recovered some pulse after the dramatic decrease felt in previous months as a consequence of the financial crisis
starting in 2008.
In view of the information published on the CNC’s website, the general overview of the merger control activity of the
CNC in the last twelve months can be summarised as follows: between June 2010 and July 2011, 129 transactions have
been filed with the CNC under the Spanish merger control legislation. Out of this number, only 4 notifications were
archived (i.e., closed without a decision), while all the remaining 125 have been cleared.
In this period, only two transactions were referred to a second phase assessment and subject to certain conditions. Only
in one case did the CNC impose conditions on a first-phase decision (see “Key economic appraisal techniques”, below).
New developments in jurisdictional assessment or procedure
In this period, there have been three relevant developments in relation to the jurisdictional assessment of mergers and the
merger control procedure: (i) the implementation of a de minimis notification threshold; (ii) the publication of draft
guidelines for simplified notifications; and (iii) an increase in the CNC enforcement activity in relation to merger control.
(i) Implementation of a merger control de minimis threshold to exclude small transactions from the notification obligation
Perhaps the most noticeable development in Spanish merger control in the last year has been the implementation of a new
de minimis threshold. The new threshold, that complements the existing ones, is aimed at excluding transactions that, due
to their size and to their foreseeable impact in the market, are not likely to raise competition concerns.
On 15 February 2001, the Spanish Parliament definitively approved the new threshold as an amendment to Article 8 of
Law 15/2007, of 3 July, on the Defence of Competition (the “Competition Act”).
Up to the entry into force of this amendment, the obligation to file an economic concentration to the Spanish competition
authorities was triggered if any of the following alternative thresholds was met: (a) the transaction entailed the acquisition
of a market share equal to or higher than 30%; or (b) the global turnover in Spain for all the undertakings concerned in the
last accounting year exceeded EUR 240 million, providing that at least two of them achieved an individual turnover in
Spain higher than EUR 60 million.
Under the new de minimis rule, certain economic concentrations will not fall within the notification obligation in cases
where the 30% market share threshold is met but:
a) the joint market share of the parties resulting from the transaction is below 50%; and
b) the target’s aggregate turnover in Spain is below EUR 10 million.
The turnover notification threshold has not been affected by this amendment.
The amendment constitutes an improvement in relation to the previous threshold, as it eliminates the need to file
transactions that are not relevant from a competition perspective, eliminating the legal and economic burden that the
clearance procedure represents for the notifying parties. However, in our view, the new de minimis threshold is to have a
narrow application, as it would only affect a limited number of transactions. Most small and non-relevant transactions
would still fall within the notification obligation anyway (particularly in relation to acquisitions of Spanish companies by
foreign entities where there is no overlap whatsoever).
(ii) Publication of draft guidelines for simplified notification cases
In the spring of 2011 the CNC also published a draft of guidelines for merger control addressing the simplified notifications
which are intended to enter into force later this year. This would be the first time that the CNC issues guidelines on merger
control proceedings since the entry into force of the current Competition Act in September 2007.
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