A proposal by the Finnish Government to lower the national merger control thresholds will significantly increase the number of transactions notifiable to the Finnish Competition and Consumer Authority. However, a focus on national markets could result in fewer notifications from global operators.
Must I notify the Finnish Competition and Consumer Authority of my merger or acquisition? Concerning transactions involving Finnish operations, the answer may, in the future, more often be a “yes”. In September 2022, the Finnish Government submitted a proposal for new legislation (‘Proposal’) that would significantly lower the turnover thresholds that trigger an obligation to notify a merger to the Finnish Competition and Consumer Authority (‘FCCA’). The proposal introduces a fully Finnish ‘100+10’ rule. This means that transactions between parties whose combined turnover from Finland exceeds EUR 100 million and of which at least two generate a turnover of at least EUR 10 million from Finland need to be notified to the FCCA in the future. The proposal is a shift from the current threshold, which in a similar sense could be described as a ‘global 350 + Finnish 20’ -rule.
“The proposal introduces a fully Finnish ‘100+10’ rule.”
The Proposal estimates that the annual amount of transactions subject to the Finnish merger control regime doubles. While the number of notifiable deals likely increases, the Proposal clearly concentrates the FCCA’s focus on Finnish merger activity. One of the Proposal’s core aims is to weave the net of Finnish merger control tighter so that it would catch national industries and markets of local significance that have so far been small enough to swim through the holes. On the flipside, this means that transactions without substantial links to the Finnish economy that the soon-past global threshold caught are released. According to the Proposal, there were nine such transactions between 2017 and 2019.
The amendment brings the Finnish merger control jurisdiction closer to its Nordic counterparts. However, contrary to, for example, the Swedish and Norwegian regimes, the Finnish system will not include a possibility for the FCCA to require a notification of a transaction below the threshold. The FCCA had proposed a possibility for such ex post merger control, but it was abandoned due to resulting uncertainties for future transactions.
“Signing during the few months left of 2022 is therefore the last chance to avoid notifying a transaction that falls within the ‘100+10’ rule.”
The renewed rules come into force in January 2023. Consequently, the new thresholds apply to transactions which are signed, where control is acquired, or where a public bid has been announced after the entry into force of the upcoming law. Signing during the few months left of 2022 is therefore the last chance to avoid notifying a transaction that falls within the ‘100+10’ rule. Simultaneously, the Government is also introducing a renewed form for notifying transactions to the FCCA. The new form should ease the notification process for transactions where no horizontal or vertical links exist, and should be used for any notifications to the FCCA as of January 2023.
Since the reform concerns only the turnover threshold, the FCCA retains its competence to require, for example, penalties for jumping the gun and the dismantling of a notifiable merger implemented without its approval. Therefore, while a transaction might ultimately not be notifiable to the FCCA, it always pays to ensure in advance that it actually is so.
