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MEDIA BRIEFING NOTE: Substantial Reform of EU Merger Control - Review of Minority Interest for the First Time

14 July 2014

On 9 July 2014, the European Commission published a White Paper setting out proposals to amend the EU merger control system. The proposed reform of the system is the biggest in the last 10 years and could have an impact on many corporate transactions.

Most significantly, the proposed reforms include the expansion of the Commission's powers to review the acquisition of non-controlling minority shareholdings.
The proposals also cover the streamlining of the system for referral of cases between the Commission and the EU Member States; and measures aimed at simplifying certain procedures, including the amendment of the EU Merger Regulation so that extra-EEA joint ventures do not require notification and the introduction of exemptions for simple merger cases.

This White Paper follows from a consultation document that was published by the Commission in June 2013 and aims to include feedback from that consultation.

Mark Jones, partner in the Hogan Lovells competition/antitrust team, notes:

"The current proposals risk imposing a significant additional regulatory burden, with associated deal uncertainty, on parties to corporate transactions involving minority interests.  Business should take full advantage of this opportunity to influence the Commission's thinking, particularly with respect to minority shareholdings, where it should aim to ensure that any new rules do not lead to unnecessary cost and delay for investors or, worse, deter transactions from happening at all."

Click here for further information on the EU merger control system.


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