On 9 July 2018 at the Competition Talk of the Austrian Federal Competition Authority (AFCA) in Vienna, the Director General of the AFCA, Dr Theodor Thanner, and the Vice President of the Bundeskartellamt, Professor Dr Konrad Ost, presented the final joint guidance on the new transaction value threshold.
In May 2018 the AFCA and the Bundeskartellamt published a consultation version of the joint guidance. Altogether the authorities received a total of 13 comments on the consultation version. These contained many important aspects which were taken into consideration in the final version.
Theodor Thanner, Director General of the Austrian Federal Competition Authority: "With this joint guidance the AFCA and the Bundeskartellamt embarked on the path of transparency in order to create legal certainty for undertakings. The joint guidance on the transaction value threshold gives an excellent overview of the definition of the consideration and how the term "substantial domestic operations" needs to be interpreted. Last but not least the paper explains the application with some practical examples."
Konrad Ost, Vice President of the Bundeskartellamt, stated: "The new provisions which have been introduced in Germany and Austria complement merger control particularly in technology and innovative-driven markets with the aim to prevent any possible market foreclosure effects and barriers to entry and to protect the potential for innovation. The new guidance paper provided by the two authorities will make the new provisions easier to apply.”
Last year merger control thresholds in both Germany and Austria were supplemented with a threshold based on a purchase price criterion. Prior to this, corporate mergers in both countries only had to be notified and examined if the turnover achieved by the companies concerned reached certain minimum turnover thresholds. Since a few months ago mergers also have to be notified to the competition authorities if the consideration exceeds a certain value and the target company has substantial operations in the domestic market. In Austria a merger must be notified where the value of the consideration exceeds 200 million euros and in Germany if it exceeds 400 million euros. The aim of the transaction value threshold is to be able to analyse mergers where the target company does not (yet) reach a relevant turnover threshold but has great competitive market potential as reflected in the value of the consideration.
The English version of the joint guidance on the transaction value threshold and the comments submitted will be published in due course.
Please click here for the guidance on the new transaction value threshold (in German).