Serbian Competition Authority interprets merger filing requirements

The Serbian Competition Commission has been laying low since the outbreak of corona virus, with the activities at the minimum. There has not been much news on its website either, except that on 1 June 2020, it clarified who is considered to be a party to a concentration and how merger filing thresholds are calculated. Even though there has not been much dispute around these issues, the clarification is a useful primer.

Parties to a concentration

Determination of the parties to a concentration is relevant for the purpose of calculating merger filing thresholds, as well as for the contents of the notification, given that the notification has to include various information on the parties to the concentration.

In case of merger as a change of corporate status, the parties to the concentration are all undertakings participating in the merger.

In case of acquisition of direct or indirect sole or joint control by undertaking(s) over another undertaking or a part of an another undertaking (business with a market presence to which a market turnover can be clearly attributed), parties to the concentration are the acquirer(s) of control and its entire group (notifying party(ies)), and the target(s). The seller is not a party to the concentration unless it retains joint control with the acquirer post-transaction.

In case of full-function joint venture formation, all joint venture participants and their respective groups are parties to the concentration.

If several transactions between the same undertakings take place within a period of two years and thus constitute a single concentration within the meaning of Article 17(2) of the Competition Act, parties to the single concentration are the acquirer(s) and target(s) in all transactions.

Turnover thresholds calculation

The aggregate annual turnover relevant for the calculation of thresholds triggering a merger filing obligation is a sum of operating, financial and other income in the year preceding the concentration.

In the context of merger control, the relevant turnover for the purpose of determining whether merger notification is required is calculated as a sum of operating, financial and other income of the acquirer and its related undertakings, and the sum of operating, financial and other income of the target(s).

The worldwide turnover for the purpose of merger notification obligation includes Serbian turnover irrespective of whether the notifying party is local or foreign. Serbian turnover is turnover generated in Serbia either directly or indirectly, by registered subsidiaries or third parties (i.e. distributors).

The turnover generated between parties to the concentration themselves is not taken into account for the purpose of calculating the merger filing thresholds.

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