Procedures for investigations into merger cases – Changes following discussions with stakeholders

The Competition Authority has recently been working on a change to its procedures and rules of procedure for the handling of merger cases. To this end, the Competition Authority held a meeting on 16 October last autumn with lawyers who have appeared on behalf of merger parties before the Authority since the beginning of 2018. The meeting was part of a series of meetings that the Competition Authority has held in recent years under the title A conversation about competition. The meeting included useful discussions on the experience of handling merger cases at the Authority and the desirable changes that could be made to improve the framework and efficiency of investigations. Following the meeting, the Competition Authority also publicly sought the views of interested parties wishing to submit suggestions on how the handling of merger cases could be improved, see e.g. News on the regulator's website on 17 October.

The Competition Authority has now reviewed the views and comments received regarding the above. The Authority's assessment is that experience has shown the current rules and procedures for investigating merger cases have, on the whole, worked reasonably well. Thus, the majority of mergers are notified using the so-called short-form procedure, which offers considerable advantages for the merging parties. Furthermore, the investigation into the majority of merger cases is concluded at the Phase I stage or within 25 working days.

In light of experience gained and feedback received, the Competition Authority is establishing enhanced and improved dialogue between the Authority and merger parties before and during an investigation, in order, among other things, to promote improved notification of mergers and to provide information as early as possible on the status of an investigation and potential competition concerns. At the same time, the Competition Authority has stringent requirements for merger notifications to meet the set criteria, but experience from the beginning of 2018 to autumn 2019 shows that in around 40% cases, a merger notification was deemed insufficient. In the authority's view, this is too high a proportion.

Following this work, the Competition Authority has made certain changes to its handling of merger cases submitted to the institution, which are intended to improve the framework and efficiency of investigations. The main ones are as follows:

• The regulator now encourages merger parties to hold discussions with it in the run-up to a merger notification. Pre-notification contacts) By having a dialogue with the Competition Authority, before a merger notification is submitted to the authority, about the relevant merger and the information that it is desirable to have available before an investigation begins, the likelihood of information in the merger filing being considered insufficient is reduced. Furthermore, such discussions can help to expedite the merger review, as the process can focus earlier on the issues that are most critical for the competition assessment. This procedure also places a requirement on the merging parties to prepare the transaction thoroughly.
• The Competition Authority has adopted the practice, in more complex cases requiring further investigation (phase II), of holding a so-called status conference with the merger parties. State of play meeting) At such a meeting, the authority presents the merging parties with the status of the investigation and the issues that have arisen during it, such as likely competition concerns. Experience shows that such meetings are conducive to allowing the merging parties to present their views and potential remedies at an earlier stage of the process. Furthermore, such meetings can also help to find a solution to matters where there are obvious competition concerns.
• The Competition Authority intends to formalise in more detail than has been the case to date the manner in which discussions on possible settlements in merger cases are conducted. This ensures that the merging parties are informed of the objectives and purpose of the discussions from the outset and are given a specific timeframe (a timetable).
• These changes may also be followed by further changes. This includes considering whether the preparation of response documents can be shortened and simplified, in order to expedite the processing of cases.

Amendments to the merger rules of competition law

In addition to the above, the Competition Authority intends to update Rules on the notification of mergers. In that review, the supervisory authority will take into account the views received in connection with the above review of the procedure, as well as those Amendments to competition law which were passed by the Althingi on 29 June 2020 call for a review of the regulations. The main changes to the merger rules of the Competition Act, as adopted by the Act, were an increase in the turnover thresholds for notifiable mergers, a broader power to submit a short-form notification for mergers, and updated provisions on time limits for merger investigations. The rules on merger fees were also revised.