NMa Publishes Guidelines on the Conditions Applicable to Mergers and Acquisitions

The Netherlands Competition Authority (NMa) has published the consultation document 'Guidelines for Remedies' on the content, submission and implementation of conditions applicable to mergers, acquisitions and certain types of joint ventures (concentrations). If competition concerns arise as a result of the realisation of a concentration, the parties may make proposals to remove these concerns. NMa may include the commitments proposed by the parties (remedies) as limitations and instructions in its decision granting its consent to the concentration. The guidelines make it easier for parties to anticipate the demands made by NMa when they submit remedies. This is beneficial to the quick processing of the case. In the document a link is established to the policy of the European Commission in this area. Responses to this document may be submitted until 1 November 2002.

The proposed remedies must be effective, clear and detailed and must be presented in good time. The Competition Act does not offer the possibility of taking a conditional decision in the first phase of the assessment of a concentration. Under certain circumstances, however, it is possible to amend the notified transaction in this phase and, by doing so, to remove the competition concerns. This avoids a far-reaching second phase investigation. NMa can only accept an amendment to the transaction if the competition problem can be precisely defined and if the proposals made by the parties offer a full and final solution to this problem.

In general, the proposed remedies must be of a structural nature to ensure that the structure of the market changes permanently and that, in principle, no further supervision is required after their implementation. In addition, the part of the company to be divested must be a 'going concern'. It must be able to operate independently of the parties and, in fact, to compete with the new company. NMa tests the proposed remedies on the basis of their feasibility and effectiveness by carrying out a market test amongst market players. Once NMa has approved the proposed remedies, an independent trustee is responsible for ensuring the implementation of and compliance with these.