Competition and Consumer Protection Bill proposes significant changes to Irish merger control rules
The long-awaited Competition and Consumer Protection Bill was published on 31 March 2014. This Bill contains significant changes to Irish merger control rules. It also provides for the dissolution of the National Consumer Agency (“NCA”) and the Competition Authority (“CA”) and the establishment of the Competition and Consumer Protection Commission (“CCPC”).
Establishment of the Competition and Consumer Protection Commission
The rationale behind the planned merger of the CA and the NCA is to improve co-ordination between the policies of consumer protection and competition. This proposal is in line with international precedent. For instance, the US Federal Trade Commission and the UK’s recently-established Competition & Markets Authority each have both a competition enforcement and a consumer protection role. The Bill also sets out the structure, powers and functions of the CCPC. The new body will not have a board but will be governed by an executive chair and membership. The Bill makes provision for up to six members. The current chairperson of the CA, Isolde Goggin, is the chairperson designate of the CCPC. The three other current members of the CA along with the current Chief Executive of the NCA, Karen O’Leary, are also intended to become members of the CCPC.
Major reform of media mergers
The Bill contains major reforms to the jurisdictional, procedural and substantive aspects of Irish media merger rules. With the exception of a few minor amendments, the proposed reform accepts each of the recommendations of the report of the Advisory Group on Media Mergers which was published in early 2009. The Bill specifically applies to transactions involving web-based media businesses. By contrast, the existing media merger rules do not apply to transactions involving companies which provide a broadcasting service over the Internet. The Bill requires the parties to a media merger to make separate notifications to both the CCPC and the Minister for Communications, Energy and Natural Resources. Under the current regime, the undertakings involved must notify the CA only and as the review process evolves, the Minister for Jobs, Enterprise and Innovation may become involved. In making a notification to the Minister for Communications, Energy and Natural Resources, the parties should address whether the proposed transaction will impair the diversity of content and the diversity of ownership of media in the State. This ‘plurality of the media’ criterion is more focused than the existing statutory list of public interest factors.
Updating other aspects of merger control
The Bill significantly extends the time available to the CCPC to review mergers and also allows the CCPC to ‘stop the clock’ during a Phase II investigation by issuing a formal request for information or ‘RFI’. The CCPC will have an initial period of 30 working days from the date of notification to do one of the following: clear the merger; move to a Phase II investigation or issue an RFI. Under the existing rules, the CA must choose one of these three options in less than one calendar month. In addition, a Phase II investigation may last for up to 120 working days from the date of notification, or, where the CCPC issues an RFI within an initial Phase I, 120 working days from the date of receipt of a complete set of responses. Finally, the clock stops if the CCPC issues an RFI within 30 working days of the date of its decision to open a Phase II investigation and will only re-start once the parties have complied with this statutory request.
From the CCPC’s perspective, the proposed changes are likely to ease the time pressures that sometimes emerge during merger reviews. That said, merging parties are likely to have longer delays before they can complete notified transactions.