The process

If a transaction falls within the scope of the EU Merger Regulation (EUMR), it will need to be notified to the European Commission (the Commission) and be cleared before the transaction can be completed. The Commission will investigate the transaction–if it has competition concerns, it can prohibit the transaction or accept remedies from the parties that address those concerns.

When will a transaction fall within the EUMR

A transaction will fall within the EUMR and require notification to the Commission if:

  1. it is a ‘concentration’

  2. the transaction is permanent, and

  3. it meets the financial thresholds set out in the EUMR.

The EUMR defines a ‘concentration’ as follows:

  1. where two independent businesses merge—this includes arrangements where previously 'independent' companies set up a common management team, or a dual listing on a Stock Exchange

  2. the acquisition of control by one (or more) business over another, either

    1. one business gaining 'sole control' over the target business (this could be through a majority shareholding or a minority shareholding if there are also veto rights over key commercial decisions)

    2. two or more businesses gaining 'joint

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Latest Competition News

UK Competition Appeal Tribunal issues rare judgment on application of competition law to online sales restrictions (Up & Running v Deckers)

Competition analysis: In this judgment, the Competition Appeal Tribunal (CAT) examined the compatibility with UK competition law of action taken by a brand operating a selective distribution system (Deckers) against one of its authorised retailers (UP & Running) to prevent it selling the brand’s products online at a discount. The judgment provides important guidance on the extent to which a brand may exercise its discretion when deciding when to eject a retailer from its selective distribution system; the steps that a brand can legitimately take to control a retailer’s online sales; and the extent to which a brand can manage sales of out of season products to avoid its retail margins being undermined. The case is also an interesting example of the CAT’s fast-track procedure in action, with the case proceeding from issuance of claim to final judgment in only a year. The CAT’s conclusion that the brand’s actions had infringed competition law, by unlawfully restricting the retailer’s ability to set its own prices and to use the internet, followed well-established precedent, as well as extensive EU and UK guidance. In reaching this conclusion, the CAT took care to emphasise that Deckers infringed the law because its selective distribution system was ‘incomplete and flawed in its design and operation’, rather than because selective distribution is inherently anticompetitive. Written by Becket McGrath, a partner at Euclid Law Ltd.

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