Merger Activity and Regulation in Ireland in 2020:  CCPC Annual Report

PUBLISHED: 21st September 2021

The CCPC has published its 2020 Annual Report which contains a summary of its merger control activities for the year.

The Annual Report also details how the CCPC responded to the challenges presented to its operations by the pandemic and it previews legislation that is scheduled to be introduced in 2021 that will affect mergers and competition law in Ireland.

The numbers

Merger activity continued in Ireland in 2020 despite the pandemic.

• There were 41 merger notifications -- a 13% decrease on 2019.
•  There were 43 merger determinations.  One required commitments to secure clearance.
• There were 15 extended Phase 1 investigations.  Two required Phase 2 investigations.
• Nonextended Phase 1 investigations were completed within an average of 22.9 working days.  The 2019 figure was 24.7 working days.

According to the CCPC, the most notable sectors in 2020, in terms of transactions notified to them, were information and communications (nine) and healthcare (eight).  Notifications of transactions in the motor and real estate sectors fell in 2020 compared to 2019.

Simplified merger notification procedure (SMNP)

An SMNP was introduced in July 2020 for mergers or acquisitions that do not pose significant competition concerns.  Where applicable, it is quicker and more efficient for the businesses involved.  Seven mergers were cleared under this process between July and December 2020 with the CCPC taking an average of 13.4 working days to arrive at a decision.

COVID-19

The CCPC instituted some changes to procedures in March 2020 in response to the pandemic.

• The electronic notification of mergers was introduced for situations where the notification forms could be completed and submitted electronically.
• Notified mergers were reviewed by staff working remotely.
• The deadlines for responses to Requests for Information (RFIs) were extended.
• The CCPC was designated as a statutory body that can conduct remote oral hearings in Phase 2 merger investigations.

Business continuity was maintained and the CCPC continued to review notified mergers and acquisitions.

New legislation

Directive (EU) 2019/1 empowering national competition authorities to be more effective enforcers and to ensure the proper functioning of the internal market was due to be implemented into Irish law by February 2021.  That has not happened yet, but a Competition (Amendment) Bill 2021 will be introduced in 2021 to implement this Directive, which is known as the ECN+ Directive (ECN = European Competition Network).  The CCPC states that it supports the objectives of this Directive, which will extend its powers of enforcement to include financial sanctions for non-criminal breaches of competition law.

The Bill will also contain measures that do not relate to the ECN+ Directive.  The measures will include changes to the regulation of mergers in Ireland such as: 

• The CCPC will be allowed to take summary prosecutions for gun jumping offences to reduce the burden on the DPP and to increase the enforcement of the gun-jumping provision generally. 
• The Bill will clarify that the CCPC has the power to accept notifications in respect of mergers and acquisitions that have been completed which are notified to the CCPC on a voluntary basis.
• The Bill will ensure that the CCPC has the power to make interim orders, which prevent any action (for example integrating the merging businesses) that may prejudice or impede its review of any voluntary notifications received.  These orders would remain in force until the merger is cleared or remedial action is taken.
• The Bill is to provide that in the event that the CCPC finds that an already implemented merger gives rise to a substantial lessening of competition in any market, the CCPC will have the power to require that the merger be unwound and the pre-merger status quo restored to safeguard competition in the relevant market(s).

Thoughts

The CCPC is to be commended for adapting so seamlessly to the changes required to maintain ‘business as usual’ despite the challenges of the pandemic and for its success in reducing turnaround times for decisions.  Further change is on the way with the forthcoming publication of the Competition (Amendment) Bill 2021. 

Marco is the Head of the EU, Competition and Regulated Markets Team at LK Shields.  Marco is the author of “Merger Control” published by Thompson Reuters which is the only book exclusively devoted to merger control in Ireland.