Restructuring undertakings in difficulty and competition — Merger & State Aid

Introduction

Laurence Idot

Today’s theme invites us to a meeting between the law on companies in difficulty and competition law. We are not going to return to the question of the anti- or pro-competitive nature of the law on companies in difficulty, but to take a practical approach to the problems of competition law arising from restructuring measures.

First, a few points of definition. For the definition of firms in difficulty, reference can be made to point 20 of the Commission Guidelines on State aid for firms in difficulty of 2014, which amended the definition previously given by the 2004 Guidelines. Four alternative conditions are provided for, including the fact that the firm is the subject of collective insolvency proceedings. For the definition of the procedures, reference can be made to the Annex to the Regulation of 20 May 2015 on collective insolvency proceedings. For France, reorganisation and liquidation proceedings, but also safeguard proceedings, have been designated. Finally, the concept of restructuring is unclear. The takeover of a company in difficulty is only one possible variant, as restructuring can take place without sale.