The Cyprus Control of Concentrations Between Undertakings Law (Law 83(Ι)/2014) (hereinafter the “Law”) forms the rules for the control of concentrations in order to ensure that they do not result in the distortion of the effective competition in a market.
Pursuant to the provisions of the Law concentrations of major importance must be notified to the Cyprus Commission for the Protection of Competition (hereinafter the “CPC”) prior to their implementation, following the conclusion of the relevant agreement or the publication of the relevant takeover or the acquisition of a controlling interest. Notification can also take place where the undertakings concerned prove to the CPC their bona fide intention to conclude an agreement or, in the case of a takeover offer or of an offer for the acquisition of a controlling interest, following a public announcement of an intention or final decision to make such offer.
In accordance with the Law, the following events give rise to a “concentration” and trigger an obligation by the undertakings participating in the particular transaction to notify accordingly the CPC:
- a merger of two or more previously independent undertakings;
- one or more persons that already control one or more undertakings acquiring direct or indirect control of the whole or part of one or more other undertakings (this can be done through a purchase of securities or assets, by agreement or otherwise); or
- the establishment of a joint venture that permanently carries out all the functions of an autonomous economic entity.
A concentration however shall only be notifiable if the following apply cumulatively:
- at least two of the participating undertakings each have a worldwide aggregate turnover in excess of €3.5 million;
- at least two of the participants engage in commercial activities within the Republic of Cyprus; and
- at least €3.5 million of the worldwide aggregate turnover of all the participants relates to the provision of goods or the supply of services in Cyprus.
Irrespective of the above, a concentration shall also be notified to the CPC if it is declared as being of “major importance” by the Cyprus Ministry of Energy, Commerce and Industry.
Notifications are mandatory, must be made in writing (by paying an administrative fee of €1,000) in Greek by way of a prescribed form (supporting documents may be filed in English), and must be submitted by one or more participants.
The relevant transaction must be put into effect pending the outcome of the Commission’s investigation, but one or more of the participants can apply to the Commission for permission to complete the transaction before approval subject to any conditions that the Commission may impose. The Commission’s decision either to clear the concentration or to order a full investigation must be notified to the notifying party within one month of receipt of a complete notification. The CPC has also the power to order the partial or total dissolution of a concentration of major importance to secure the restoration of the functioning of competition in the market, provided that the requirements of the Law are met.
Our firm advises on both Cyprus and EU competition related issues to ensure that our clients’ business operations remain fully compliant. Our services include the provision of advice on competition rules governing the avoidance of anti-competitive conducts; abuse of dominant market positions; cartels and staid aid.
We also advise on the competition and regulatory aspects of acquisitions, mergers and joint ventures and represent clients throughout the entire notification – merger control process.
If you require any further information, please do not hesitate to contact us.