On April 20, 2023, the Commission adopted the 2023 Merger Simplification Package (the “2023 Package”) designed to streamline its procedure under the EU Merger Regulation. In particular, the 2023 Package (1) expands the types of concentration eligible for treatment under the simplified procedure, (2) streamlines the review of both simplified and non-simplified cases, and (3) simplifies the notification process.
The simplified procedure in principle enables parties to concentrations to provide less information and obtain a clearance decision faster than under the normal procedure. Therefore, the Commission’s decision to increase the number of transactions that are eligible for notification under the simplified procedure means that the notifying parties of such transactions will see their costs and time to obtain clearance reduced. The Commission will also save on resources for those unproblematic cases. In particular, the new simplified procedure is expected to cover an additional 14% and 19% of all horizontal and vertical transactions respectively.
The 2023 Package will enter into force on September 1, 2023.
The Main Changes of the 2023 Package
The changes brought about by the 2023 Package can be classified under three categories: (a) the expansion and clarification of the categories of the simplified procedure; (b) the simplification of the review of simplified and non-simplified cases; and (c) the simplification of electronic notifications.
a) Expanding and detailing the categories of simplified cases
The 2023 Package expands and clarifies the categories of simplified cases in three ways.
First, the 2023 Notice on Simplified Procedure (the “Notice”) includes two new categories of cases that can benefit from simplified treatment. Both relate to vertical transactions (i.e., transactions between a supplier and a customer):
- Cases where under all plausible market definitions, the individual or combined upstream market share of the parties to the concentration is below 30% and their combined purchasing share is below 30%; and
- Cases where under all plausible market definitions, the individual or combined upstream and downstream market shares of the parties to the concentration are below 50% and the Herfindahl–Hirschman index delta is below 150 and the smaller undertaking in terms of market share is the same in the upstream and downstream markets.
Second, the Notice introduces three flexibility clauses whereby, at the request of the notifying parties, the Commission may review under the simplified procedure certain concentrations that do not fall under any of the simplified treatment categories:
- For horizontal overlaps, where the combined market shares of the parties to the concentration are below 25%.
- For vertical overlaps, where the combined market shares of the parties to the concentration are below 35% in the upstream and downstream markets or below 50% in one market while being below 10% in all the other vertically related markets.
- For joint ventures, where the annual current turnover of the joint venture and the turnover of the contributed activities is less than EUR 150 million in the EEA and the total value of asset transfers to the joint venture in the EEA planned at the time of notification is less than EUR 150 million.
These flexibility clauses can be combined with the simplified treatment categories. Consequently, provided the conditions in the flexibility clauses are met, one market above the simplified treatment threshold will not bar the application of the simplified procedure.
Third, the Notice provides a very detailed list of the circumstances when a concentration that technically qualifies for simplified treatment will nevertheless be investigated as a non-simplified case. The list is extensive and gives the Commission significant flexibility in refusing the simplified treatment, which may undermine the impact of the new simplified procedure in practice.
Noteworthy, one of these exceptions relates to non-controlling shareholdings. Where one party to the concentration has a non-controlling minority shareholding in a company that has “very significant” market share in the same market as the target or in a market upstream or downstream to it, the concentration may not be reviewed under the simplified procedure, even if the thresholds for simplified procedure are met. This exception may be particularly significant for transactions involving private equity or conglomerate firms, which may hold a non-controlling shareholding in various leading firms across numerous markets. Unhelpfully, the phrase “very significant market share”—which has never been used in the Commission’s Notice, Guidelines, or legislative texts—obscures the scope of this exclusion.
b) Streamlining the review of simplified and non-simplified cases
The 2023 Package streamlines the information requirements in simplified and non-simplified cases.
Regarding simplified cases, the 2023 Package introduces a new Short Form CO in a “tick-the-box format”. Instead of containing open text questions, the new Short Form CO includes primarily multiple choice questions and tables to be completed by the notifying parties. In addition, the Notice introduces a new “super-simplified”treatment for concentrations relating to extra-EEA joint ventures and all cases where there are neither horizontal overlaps nor vertical relationships between the merging parties’ activities. The parties are invited to notify these concentrations directly without any pre-notification contacts.
Regarding non-simplified cases, the 2023 Package provides for further information on waiver possibilities, introduces tables requiring information on horizontal overlaps and vertical relationships involving pipeline products, and eliminates certain information requirements.
c) Electronic notifications
Since May 2020, the Commission has been encouraging the notification in digital format due to Covid-19. The revised Merger Implementing Regulation now permanently establishes that transmission of documents to and from the Commission, including notifications of concentrations, should normally be made electronically.
 European Commission’s Press Release, “Mergers: Commission further cuts red tape for merging businesses” April 20, 2023, available at: https://ec.europa.eu/commission/presscorner/detail/en/ip_23_2357.
 European Commission’s Staff Working Document, “Impact Assessment Report Accompanying the Documents Commission Implementing Regulation (EU) …/… implementing Council Regulation (EC) No 139/2004 on the control of concentrations between undertakings and repealing Commission Regulation (EC) No 802/2004 and Commission Notice on a simplified treatment for certain concentrations under Council Regulation (EC) No 139/2004 on the control of concentrations between undertakings” SWD(2023) 80 final, April 20, 2023, available via https://ec.europa.eu/transparency/documents-register/detail?ref=SWD(2023)80&lang=en, page 58.
 The Notice, point 5(d)(ii)(bb).
 Ibid, point 5(d)(ii)(cc).
 Ibid, point 8(a).
 Ibid, pint 8(b).
 Ibid, point 9.
 Ibid, point 10. The categories are mentioned in point 5 of the Notice.
 Ibid, points 11-24.
 Ibid, point 15.
 Ibid, point 26.
 Revised Merger Implementing Regulation, Article 22.