On 7 May 2020, the Competition and Consumer Protection Commission (CCPC) announced that a new Simplified Merger Notification Procedure (the Simplified Procedure) would commence on 1 July 2020 and published Simplified Procedure Guidelines (the Guidelines).

According to the CCPC, the Simplified Procedure will lead to shorter review periods for relevant transactions. The maximum statutory review timeframe for a Phase I decision (absent extensions) is 30 working days.

The CCPC states that it will in principle apply the Simplified Procedure in the following circumstances:

1. where none of the parties are active in the same product or geographic market or upstream or downstream of each other (no overlap cases); or
2. where parties are active in the same market, but their combined market share is less than 15%; or
3. where parties are active in a market upstream or downstream to each other, but the market share of each is less than 25%; or
4. where a party, which already has joint control over a company, is to acquire sole control over it.

Where the Simplified Procedure applies, the parties would not have to answer all of the questions on the CCPC merger notification form. In particular, the parties would not need to provide, in areas of overlap between them, information on key contracts, shareholdings, trade associations, suppliers, customers and competitors and their internal documents assessing the competitive effects of the proposed transaction. In no overlap cases, the parties would also not need to define the relevant market or provide market share estimates.

However, the CCPC reserves the right to revert to the Standard Merger Notification Procedure and require full information at any point. The CCPC states that this may arise, for example, in transactions involving concentrated markets, maverick firms and pipeline products. It says that it would do so by issuing a statutory requirement for information or by declaring the notification invalid and requiring a fresh notification.  In both cases, the effect would be to restart the statutory review timeframe from Day 1.
The CCPC will inform parties whether the transaction qualifies for the Simplified Procedure after the expiry of the period for third party submissions, which runs for ten working days from the date of the CCPC web announcement following a notification.

What does this mean in practice?

Where it applies, the Simplified Procedure will somewhat reduce the information which must be provided on a Merger Notification Form on certain types of transactions. In no overlap transactions, it is already the case that the notifying parties do not need to fully complete the Merger Notification Form but under the Simplified Procedure they will also not need to provide market definition and market shares. Where overlap is de minimis, the notifying parties may already seek exemption from the CCPC in respect of parts of the Merger Notification Form so the Simplified Procedure may not make much difference. However, in transactions involving a move from joint to sole control and which involve overlap, the Simplified Procedure certainly reduces the information required.

Applying for review under the Simplified Procedure introduces an element of uncertainty for notifying parties. The CCPC will not confirm to parties that their transaction will be reviewed under the Simplified Procedure until after the expiry of the period for third party submissions, which is usually some two weeks after the notification has been made, and there is a risk that this may take longer. In addition, as outlined in the Guidelines, there are numerous circumstances in which the CCPC may decline to apply the Simplified Procedure and revert to the Standard Procedure, requiring full information and restarting the clock. However, it is hoped that as the CCPC operates the Simplified Procedure over time, the CCPC will develop a consistent and therefore predicable practice. If this is achieved, the Simplified Procedure has the potential to become a useful part of the merger control regime.
Further, if the Simplified Procedure results in consistently shorter review timeframes for transactions raising no competition concerns, this would certainly be welcomed by business. The CCPC has on occasion cleared “no issue” deals in as little as 11 working days, though the average timeframe for Phase I decisions (absent extensions) in 2019 was 24.7 working days.

For further information, see the CCPC Simplified Procedure Guidelines.

Please contact Sheila Tormey, Cormac Little, Claire Waterson or your usual William Fry contact with any queries.