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You are here: Home / Competition / Merger Control in Bulgaria

Merger Control in Bulgaria

merger control in Bulgaria

April 10, 2016 by qlts_2016

The legal definition of merger control in Bulgaria strongly resembles the one provided by Council Regulation (EC) No 139/2004 (the EC Merger Regulation), and it reads the following:

A concentration shall be deemed to occur where a change of control on a lasting basis results from:

(a) the merger of two or more previously independent undertakings or parts of undertakings, or

(b) the acquisition, by one or more persons already controlling at least one undertaking, or by one or more undertakings, whether by purchase of securities or assets, by contract or by any other means, of direct or indirect control of the whole or parts of one or more other undertakings;

(c) the creation of a joint venture performing on a lasting basis all the functions of an autonomous economic entity shall also constitute a concentration.

Control, in the sense of the above definition, means acquiring rights, entering contracts or other means which provide the opportunity to exercise decisive influence (control) on an undertaking including on the composition, voting or decisions of the bodies of that undertaking.

Who shall be notified in case of a concentration?

When a conduct constitutes a concentration, the execution of such transaction shall be subject to the notification and/or approval by either the European Commission or the Bulgarian Commission on Protection of Competition. The European Commission is competent to hear cases when a concentration has a Community dimension.

Who shall be notified in case of a concentration?

When a conduct constitutes a concentration, the execution of such transaction shall be subject to the notification and/or approval by either the European Commission or the Bulgarian Commission on Protection of Competition. The European Commission is competent to hear cases when a concentration has a Community dimension.

The respective criteria and thresholds, for determining whether a transaction is subject to notification to the European Commission, are set forth by Council Regulation (EC) No. 139/2004.
Concentration with Community dimension

A concentration has a Community dimension when:

(a) the combined aggregate worldwide turnover of all the undertakings concerned is more than EUR 5000 million, and

(b) the aggregate Community-wide turnover of each of at least two of the undertakings concerned is more than EUR 250 million, unless each of the undertakings concerned achieves more than two-thirds of its aggregate Community-wide turnover within one and the same Member State (Article 1 (2) of Council Regulation (EC) No. 139/2004).

A concentration that does not meet the thresholds laid down Article 1 (2) of Council Regulation (EC) No. 139/2004 has a Community dimension where:

(a) the combined aggregate worldwide turnover of all the undertakings concerned is more than EUR 2500 million;

(b) in each of at least three Member States, the combined aggregate turnover of all the undertakings concerned is more than EUR 100 million;

(c) in each of at least three Member States included for the purpose of point (b), the aggregate turnover of each of at least two of the undertakings concerned is more than EUR 25 million; and

(d) the aggregate Community-wide turnover of each of at least two of the undertakings concerned is more than EUR 100 million, unless each of the undertakings concerned achieves more than two-thirds of its aggregate Community-wide turnover within one and the same Member State (Article 1 (3) of Council Regulation (EC) No. 139/2004).

Notification of Concentration under the PCA

Concentrations shall be reviewed by the Bulgarian national competition authority when the aggregate combined turnover of all undertakings participating in the concentration in the territory of Bulgaria in the preceding year exceeds BGN 25 million, and

(a) the turnover of each of at least two of the undertakings participating in the concentration in the territory of the Republic of Bulgaria during the preceding financial year exceeds BGN 3 million, or

(b) the turnover of the undertaking – subject to acquisition in the territory of the Republic of Bulgaria during the preceding fiscal year exceeds BGN 3 million.

Undertakings shall be obliged to notify the Commission on Protection of Competition in Bulgaria following the conclusion of the agreement, the public announcement of the bid or the acquisition of control, but before the undertaking of any actual actions to implement the transaction.

Decision of the Commission on Protection of Competition in Bulgaria

In assessing the effect of the notified concentration the CPC shall use the dominance test. In accordance with this test, for a given concentration to be prohibited, the following both conditions must be fulfilled: the concentrations shall lead to creating or strengthening of dominant position thus affecting the effective competition on the relevant market.

The CPC shall authorize the concentration provided that the latter does not result in the creation or strengthening of a dominant position that would significantly impede effective competition on the market concerned. Such an unconditioned authorization can be granted by the CPC as a result of either a preliminary investigation (Article (3) (2) of the Bulgarian Protection of Competition Act), or an in-depth investigation (Article 88 (1) (1) of the Bulgarian Protection of Competition Act).

 

Filed Under: Competition

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