The Finnish Competition and Consumer Authority (“FCCA”) has frequently expressed its view that it has insufficient tools to intervene in transactions that, in its opinion, lead to harmful market concentration. The FCCA has raised the necessity of a call-in power, and publicly stated that it aims to obtain the call-in power during the current government term ending in spring 2027. This article provides a brief overview of what we know thus far of the possible introduction of a call-in power in Finland and its implications for M&A strategies.
What is a call-in power?
A call-in power refers to the right of a competition authority to review a transaction that falls below the customary notification thresholds. In Finland, the relevant turnover thresholds, determining whether a transaction must be notified to the FCCA, are as follows:
- the combined Finnish turnover of the parties exceeds EUR 100 million, and
- the Finnish turnover of each of at least two of the parties exceeds EUR 10 million.
In practice, the introduction of a call-in power for the FCCA would mean that, despite a transaction falling below the customary turnover thresholds, a merger review would be possible if the FCCA deemed the transaction as meriting merger scrutiny due to its possibly harmful impacts on competition . The exercise of the call-in power itself would not mean that the transaction in question would be prohibited: based on the subsequent merger review, the FCCA may approve the transaction, either unconditionally or conditionally, or submit a prohibition proposal to the Finnish Market Court.
“The introduction of a call-in power for the FCCA would mean that, despite a transaction falling below the customary turnover thresholds, a merger review would be possible if the FCCA deemed the transaction as meriting merger scrutiny due to its possibly harmful impacts on competition.”
The Finnish turnover thresholds were lowered and came into force in connection with the latest merger control reform in 2023 (see our previous articles here, here and here). Despite the FCCA’s wishes to the contrary, the call-in power was rejected at the time, especially due to the active opposition by the Finnish Bar Association. However, it did not take long for the FCCA to become active in this regard again.
Aftermath of Illumina / Grail: more call-in powers in the EU?
The introduction of call-in powers around the EU has been a hotly debated topic also following the European Court of Justice’s (“ECJ”) judgment in Illumina / Grail (Joined Cases C-611/22 P and C-625/22 P) in September 2024. In Illumina / Grail, the European Commission (“EC”) had applied its own new interpretation (of Article 22 of the EU Merger Regulation, see our articles here and here) of having the jurisdiction to review transactions referred to it by one or more national competition authorities even where (i) the transactions fell below the relevant EU and national notification thresholds and (ii) the national competition authorities did not otherwise have jurisdiction, such as through call-in powers, to review the transactions.
However, the ECJ concluded that the EC’s approach was not compatible with EU merger control rules and raised the “cardinal importance” of turnover thresholds set for determining whether a transaction must be notified for merger review or not. The aftermath of Illumina / Grail may be merger control reforms and the introduction of even more call-in powers in different EU Member States1, allowing national authorities to request transactions for their own merger review or to refer them, based on the call-in power, for EC’s merger review. Moreover, the EC is currently even actively encouraging the EU Member States to adopt such powers. The authorities’ expansive powers highlight the need for a thorough evaluation of the potential merger control notification obligations and deal feasibility in different jurisdictions.
What are the pros and cons of a call-in power?
According to the FCCA, harmful market concentration is emerging in Finland in different business sectors, such as in veterinary services, private healthcare, and therapy and care. The FCCA’s concern is that transactions escaping merger review in such sectors weaken the competitiveness of the sector and lead to negative effects, such as higher prices for the services. The FCCA believes that prior merger scrutiny is the way to prevent harmful changes in market structure, as opposed to retrospective scrutiny2.
This time around, the FCCA has not yet proposed any concrete details about the possible call-in power, but the obvious criticism regarding a call-in power is the legal uncertainty it will create for businesses. This and the importance of the predictability of the merger control system were also highlighted by the ECJ in Illumina / Grail. The risk of a call-in merger review would naturally be most probable in markets that are highly concentrated, or would become highly concentrated, and where individual transactions do not meet the customary notification thresholds. This risk applies naturally to the aforementioned sectors that have drawn the FCCA’s attention, but the call-in power would probably not be limited to particular sectors or industries. The possibility of a transaction triggering a merger review even below the customary notification thresholds would decrease deal certainty and add increased costs and possible delays due to the authority’s review process and timelines. The risk of a call-in merger review should be carefully assessed in advance and negotiated in the M&A context already now in multijurisdictional mergers, but eventually also in Finnish mergers, should the FCCA gain the competence to review below-thresholds mergers.
To limit legal uncertainty, limitations to the exercise of the call-in power have been discussed. Such limitations could be, inter alia, a separate threshold for the combined turnover of the transaction parties, descriptive criteria, or market share or time limits for the exercise of the call-in power, or a combination of some of these or similar factors. The FCCA has also mentioned the possibility of requesting from it a separate advance view on whether the call-in power will be exercised or not. In practice, getting such a view could require a voluntary notification to the FCCA, and it is hoped that the voluntary notification process together with the possible subsequent merger control notification itself would not impose an undue burden on the parties.
The debate surrounding the call-in power may be seen as a continuum of the bigger trend of increased investigatory powers granted on many fronts to competition authorities. Dittmar & Indrenius will continue to follow the discussion on the potential introduction of a call-in power in Finland. In the meantime, please feel free to reach out to your usual D&I competition contacts in case of any questions.
1The call-in power has already been implemented in several EU Member States and in other Nordic countries apart from Finland. The introduction of a call-in power has also been contemplated at least in France, the Netherlands, Belgium, and Greece.
2In certain scenarios, the FCCA may also initiate ex post investigation of a transaction based on abuse of a dominant position.
