ARTICLE: MERGERS - EUROPEAN UNION - DE FACTO CONTROL - MINORITY SHAREHOLDINGS - ECONOMIC DEPENDANCE

De facto control in EU merger control law

The Commission’s 2008 Consolidated Jurisdictional Notice addresses the concept of de facto control only superficially. In practice, the notion of de facto control raises many questions. Based on an analysis of the Commission’s decisional practice, this article aims to lay out the analytical grid used by the Commission to determine the existence of de facto control. The acquisition of a majority of voting rights at general meetings, the existence of common interests between minority shareholders or the ability to take advantage of a situation of economic dependence are all situations which are considered by the Commission to give rise to de facto control. The article sets out the Commission’s analysis for each situation and gives relevant insights to practitioners.

1. De facto control can sometimes seem to be an elusive notion for practitioners. This elusiveness stems not only from the diversity of situations which can lead to de facto control, but also from the scarce guidance offered by the Commission on this issue. The Consolidated Jurisdictional Notice under Council Regulation (EC) No. 139/2004 on the control of concentrations between undertakings (hereafter the “Notice”) is eleven years old and only offers a few scattered paragraphs on the application of the concept of de facto control to determine the Commission’s jurisdiction over transactions. 2. These observations motivated the need for an article compiling and analysing all the Commission’s decisional practice regarding de facto control. [1] This article aims at offering practical

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Alexandre Rouhette, Pierre Garenne, De facto control in EU merger control law, November 2020, Concurrences N° 4-2020, Art. N° 96817, www.concurrences.com

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