1. The number of transactions notified to the Comisión Nacional de Mercados y de la Competencia (“CNMC”) increased by 3.61 % from last year (from 83 to 86). However, in the past four years, the number of reportable transactions has decreased over 17.30 % (from 104 in 2016 to 86 in 2019), probably reflecting the performance of the Spanish economy over the same period.
2. The industries with the most notified transactions in 2019 were manufacturing (13 cases), foodstuffs (10 cases), energy (9 cases), information technology (7 cases), chemicals and pharmaceuticals (7 cases) and financial services (7 cases).
3. Spain’s merger control system continues to be relatively agile. The average duration of an initial (“Phase I”) investigation is c. 20 days, i.e., around ten days prior to the expiry of the one-month legal deadline. The average duration of an in-depth (“Phase II”) investigation depends on the particularities of the case. For instance, in the transaction C/0966/18 Quirón/Clínica Santa Cristina (the only Phase II transaction decided in 2019), 6 months passed between the decision to initiate the phase II and the approval of the transaction.
4. Overall levels of intervention remain relatively low. In 2019 the CNMC granted 85 Phase I clearances of transactions (96.59 % of the total of transactions decided in 2019). The CNMC decided to initiate a Phase II as regards C/1052/19 Çimsa/Activos Cemex and approved C/0966/18 Quirón/Clínica Santa Cristina, a Phase II initiated in 2018, with behavioural commitments (as previously noted in this blog). The CNMC obtained remedies in 4.7 % of its Phase I clearances. Conversely, 92.05 % of the approved transactions were authorized unconditionally during 2019. In every Phase II investigation initiated, commitments were required to the parties. No transaction was reviewed by the Government under the so-called “Phase III” during 2019.
5. Spain continues to vigorously enforce its market share threshold. During 2019, around 42.7 % of the transactions were filed in application of country’s turnover threshold, 50.56 % under the market share threshold and a 6.74 % in application of both.[1]
6. There was no litigation deriving from Spanish merger control during 2019. Like the European Commission and unlike, e.g., the US antitrust agencies, the Spanish authority can intervene (and obtains remedies or prohibits transactions) without going to court. Despite the hype about the CNMC’s mixed record in the courts,[2] the parties continue not to challenge the decisions of the CNMC in the domain of merger control.
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About Spanish Merger Control. There have been approximately 1,151 notifications of transactions, 16 Phase II investigations and no prohibition decisions issued by the CNMC since the entry into force of the Spanish Competition Act in 2007.
The Spanish Competition Law requires parties to certain mergers and acquisitions to file a notification with, and obtain authorization from, the CNMC prior to consummating the proposed transaction. Upon filing, a one month waiting period begins during which the parties may not close the transaction. During this window, the CNMC assess whether the transaction is likely to have any anticompetitive effects. If deemed necessary, the CNMC is authorized to extend the waiting period, including by initiating a Phase II investigation. In those cases where the CNMC decides either to prohibit the transaction or to clear it subject to commitments or conditions, the Ministry of the Economy may ask the Government to decide whether to confirm the CNMC’s decision or authorise it, subject or not to commitments or conditions. In the second case, the Government’s decision must be based on certain specified public interest criteria other than competition. In such cases, the Ministry of the Economy has 15 days to decide whether to ask the Government to intervene. If it does, the government has one month to decide on the transaction. The intervention of the government in merger control proceedings is informally known as ‘Phase III’.
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[1] There is no information as regards 2 transactions. Pursuant to the Spanish Competition Act, a merger or acquisition shall be notified to the CNMC when: (i) the combined Spanish turnover of the parties exceeds EUR 240 million and the individual turnover achieved in Spain by at least two of the parties exceeds EUR 60 million; or (ii) as a result of the transaction, a share equal to or higher than 30% of a relevant product market in Spain (or in a geographic market within Spain) is acquired or increased. There is a 'de minimis' exception pursuant to which no market share notification is triggered where the following two cumulative conditions are also met: (i) the turnover achieved in Spain by the target company or assets to be acquired is below EUR 10 million and (ii) the individual or combined market share of the parties does not reach 50% in any affected market in Spain (or a narrower geographic market defined within it).
[2] See, e.g., Global Competition Review, “Spain's National Commission of Markets and Competition” (September, 5, 2019), available at: https://globalcompetitionreview.com/benchmarking/rating-enforcement-2019/1197076/spains-national-commission-of-markets-and-competition.
Garrido Abogados lawyers are available to assist in addressing any questions you may have regarding these developments. To learn more about these issues, please contact the Garrido Abogados lawyer with whom you usually work, any member of the firm’s EU and Competition department, or the following lawyers in Madrid:
Pablo Figueroa (+34 91 210 67 86, Pablo.Figueroa@garrido.es)
Rubén Gil Puente (+34 91 319 60 62, Ruben.Gil@garrido.es)
Julia González Fernández (+34 91 319 60 62, Julia.Gonzalez@garrido.es)
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