In connection with mergers and acquisitions, one must consider whether the merger is subject to merger control – either nationally or at a European level. Mergers that are subject to merger control must be filed and approved before they can be implemented. In many situations, the obligation of notification is assessed based on the companies' turnover.
Horten's Merger Control Poster 2020 provides an overview of the thresholds for merger control in Europe. For instance, the new merger control poster has new thresholds for Latvia and Lithuania. Furthermore, Germany has implemented a requirement that certain mergers, where the transaction value exceeds € 400 M, must be notified to the German competition authority.
When is it a merger?
According to Danish law as well as EU law, change of control is the decisive element, when establishing whether a merger occurs. This will be the case, when there is a direct or indirect change of control of the ownership of a company.
Transfer of minority stakes is also covered if the transfer entails a change of control in the company. However, some countries also have merger control even if the acquisition of minority stakes does not entail a change of control. Furthermore, joint ventures may also be covered by the merger concept if they manage all of a company's functional work and is established on a permanent basis. The same principles generally apply in many national jurisdictions – although the rules may differ.
Generally, a merger shall be notified to the Commission or the national competition authorities, when the participating companies' turnover exceeds the stipulated thresholds.
The companies' turnover is the total annual turnover and is generally estimated based on the latest audited financial statements. However, please notice that the rules for estimating the turnover may vary from one country to another.
You can see the thresholds for the various countries in Europe on Horten's Merger Control Poster 2020.