Jonathan Galloway

Convergence in International Merger Control

(2009) 5(2) Competition Law Review 179-192

 

Abstract

A key consequence of the lack of any meaningful system of international competition law is that international mergers and acquisitions must comply with a plethora of national merger control regimes. In the absence of an international equivalent to the EU one-stop-shop, and in the context of globalised markets, merging parties must either notify the proposed transaction to each and every jurisdiction where the thresholds are satisfied, or engage in a risk assessment and only notify those jurisdictions that are most closely associated with the merger, and/or where the merging parties have 'assets on the ground'. Some sources suggest in excess of 70 jurisdictions have ex ante notification requirements, and most of those impose mandatory suspension pending review. Crucially, the triggering thresholds for notification vary and it is possible for merging parties to be legally obliged to notify the transaction even in the objective absence of a substantial nexus to the reviewing jurisdiction. There have been efforts to agree common principles in this area by the ICN and other international bodies, yet key points of divergence remain, which exacerbates the burden of compliance experienced by the merging parties. This article identifies some of the key 'unnecessary costs' that can be experienced by merging parties subject to multi-jurisdictional merger review and explores the extent to which international convergence efforts and case cooperation can benefit merging parties. In discussing international convergence, the article focuses more on procedural rather than substantive matters and also looks to the recently enacted merger control laws in China and India to determine whether internationally agreed best practices have been adhered to. The article also calls for a transparent debate between regulators, practitioners and academics as to the merits and demerits of multilateral cooperation in specific and appropriate cases, which does not take place at present in spite of the ever-increasing number of merger control regimes.

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From CLASF: http://www.clasf.org/CompLRev/Issues/Vol5Iss2Art2Galloway.pdf