Merger control & hedge funds: Is there a need for a dedicated regime?

Law & Economics workshop organised by Concurrences Review with Etienne Chantrel (Autorité de la concurrence) in partnership with McDermott Will & Emery.

Jacques Buhart

The question of the applicability of merger law to investment funds is important and may be the subject of forthcoming reforms. The three key topics of the conference are the determination of the concept of control for investment funds, the turnover issue and the specificities of the competitive analysis when the acquirer is an investment fund. The notion of control is central to merger control because funds often take minority stakes that do not necessarily constitute control based on the shareholders’ agreement. Equally important are the thresholds of ss figures. For investment funds, the question arises as to whether only the turnover of the management company should be taken into account, or whether it should include the turnover of the portfolio companies. In the Facebook/WhatsApp case, the transaction was analysed by the Commission even though the turnover of the target did not meet the EU thresholds. Finally, the competitive analysis may be impacted if the acquirer is an investment fund, in particular because of the issues of the influence that the fund can exert either on companies in the same market (horizontal restraints) or on upstream or downstream companies (vertical restraints).

Photos © Léo-Paul Ridet

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  • McDermott Will & Emery (Paris)
  • French Competition Authority (Paris)
  • Caisse des Dépôts (Paris)
  • Franklin (Paris)