Contributed By CHSH Cerha Hempel Spiegelfeld Hlawati
The relevant pieces of merger legislation are the Austrian Cartel Act 2005 (Kartellgesetz 2005) and the EU Merger Control Regulation (Regulation (EC) No 139/2004). Depending on turnover thresholds, transactions of a certain size become subject to the requirement of merger control clearance by either the Federal Competition Authority or the European Commission. The European Commission has exclusive jurisdiction if the transaction results in concentrations with an EU dimension. Where a transaction does not fall within the exclusive jurisdiction of the European Commission, it may require (pre-merger) notification to and clearance by the Federal Competition Authority.
The Austrian merger control regime catches several corporate transactions, such as the direct or indirect acquisition of shares, if a shareholding of 25% or 50% is attained or exceeded, any other combination (even below this threshold) enabling the buyer to exercise a controlling influence on the target or joint ventures. These concentrations have to be notified to the Federal Competition Authority if the following turnover thresholds are fulfilled cumulatively in the last business year immediately preceding the transaction in question:
However, concentrations exceeding these turnover thresholds are exempt from mandatory notification if only one undertaking achieved a turnover in Austria of more than EUR5 million and the other undertaking(s) achieved an aggregate turnover of not more than EUR30 million worldwide.
Furthermore, an additional threshold has applied under Austrian merger control law since 1 November 2017. This additional threshold is linked not only to the turnover of the undertakings involved, but also to the transaction value. Specifically, concentrations meeting the following thresholds must in future be notified to the Federal Competition Authority:
Within one month of receiving the complete notification, the Federal Competition Authority and the Federal Cartel Prosecutor conduct an initial assessment (Phase I) and, most commonly, following the transaction is cleared at the end of that period. In more critical cases, the Federal Competition Authority or the Federal Cartel Prosecutor initiates the main examination proceedings (Phase II). Here, the Cartel Court has five months to finalise the investigations, consider whether the transaction creates or strengthens a dominant market position and finally either clears the transaction (which may be subject to conditions and/or obligations) or prohibits it (which is quite rare in practice).