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Content last updated: 25-09-2020

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  • Merger Control Regime
  • Merger Screening
  • Merger Filing

1. Supranationality

1.1 Membership of Supranational Organization

1.1.1 Is the jurisdiction a member of/party to a supranational jurisdiction?

Finland is a member of the EU.

1.1.2 Is the jurisdiction itself a supranational jurisdiction?

No, Finland is not a supranational jurisdiction.

1.1.3 If the answer to Section 1.1.1 and/or 1.1.2 above is in the affirmative, what are the implications hereof?

If a concentration qualifies as a concentration under the Council Regulation (EC) No 139/2004 of 20 January 2004 on the control of concentrations between undertakings (the EC Merger Regulation) and exceeds the applicable EU dimension turnover thresholds, the acquisition must be notified only to the European Commission, who has the sole power to investigate the merger. In that case, the Finnish merger control rules do not apply except in situations where the Commission refers the case to the Finnish Competition and Consumer Authority under the fourth paragraph of Article 4 or Article 9 of the EC Merger Regulation. However, it should be noted that the Competition Act does not include provisions exempting temporary ownership arrangements (please see Section 1.3.1 under the Merger Screening Schedule).

2. Nature of merger control regime

2.1 Mandatory or voluntary

2.1.1 Is filing mandatory or voluntary?

Filing is mandatory if the turnover jurisdictional thresholds set in the Finnish Competition Act (948/2011, Competition Act) are met. There are no exceptions.

2.2 Suspensory effect

2.2.1 Must completion of the transaction await clearance by the relevant authorities?

Yes. A concentration may not be implemented prior to a final decision in the matter in whole or in part.

1. What type of transactions are caught by the merger control regime?

1.1 Concentrations

1.1.1 Type of transactions that are caught by the merger control rules?

All arrangements that affect the structure of the market and result in a change of control or a transfer of business assets are subject to merger control.

More specifically, the following transactions constitute a concentration and are caught by merger control rules:

  • acquisitions of control under the Finnish Accounting Act (1336/1997) or an acquisition of a corresponding actual control,
  • acquisitions of a business or a part thereof,
  • mergers, or
  • the creation of a joint venture which will perform on a lasting basis all of the functions of an autonomous economic entity.

1.2 Joint ventures

1.2.1 What types of joint ventures are caught by the merger control rules?

Joint ventures that perform on a lasting basis all of the functions of an autonomous economic entity will be caught by Finnish merger control rules. The interpretation of a “full function” joint venture is performed in accordance with the Finnish Competition and Consumer Authority’s guidelines. The European Commission’s Consolidated Jurisdictional Notice and EU case law may also be used for interpretation where applicable.

1.3 Definition of "control"

1.3.1 How are the concepts of "control" and "change of control" defined?

There is no official definition for the concept of “control” or “change of control” in the Competition Act.

The Finnish Competition and Consumer Authority (FCCA) interprets the concepts of “control” and “change of control” in accordance with its own guidelines. The European Commission’s Consolidated Jurisdictional Notice may also be used for interpretation where applicable.

According to the FCCA’s guidelines, “control” means the possibility of exercising decisive influence over the actions and competitive behavior of an undertaking. The concept of “control” is not tied to the legal form of the arrangement. Instead, “the possibility of exercising decisive influence” can be found by holding the majority of the voting rights, having the right to appoint the majority of the members of the board or right to make decisions on the strategic business decisions of the company (strategic veto rights), or even historic patterns of attendance at general meetings.

Unlike the EC Merger Regulation, the Competition Act does not include provisions exempting temporary ownership arrangements. Therefore, a temporary change of control may require the undertakings concerned to notify the arrangement to the FCCA in case the jurisdictional thresholds defined in Section 2.3.1 below are met.

1.4 Minority shareholdings

1.4.1 Are minority and other interests less than control caught by the merger control rules?

No. Acquisitions of minority and other interests less than control are not caught by the Finnish merger control rules. However, merger control rules apply to acquisitions of minority or other interests that lead to an acquisition of control.

2. Establishing jurisdiction for notification of mergers

2.1 Merging parties/undertakings concerned

2.1.1 Which undertakings are considered parties to the merger ("undertakings concerned") in the various types of transactions identified under Section 1.1.1 and 1.2.1.

The form of the merger affects the determination of the undertakings concerned:

Acquisition of control:

  • the undertakings concerned comprise the party acquiring control and the undertaking being acquired.

Acquisition of a business or a part thereof:

  • the undertakings concerned comprise the party acquiring the business, or a part of a business, and the business or function being acquired.

Mergers:

  • In situations involving absorption, the undertakings concerned comprise the receiving undertaking and the merging undertaking.
  • In the case of amalgamation, the undertakings concerned comprise the merging undertakings that form the receiving undertaking.

Joint ventures:

Creation of a joint venture

  • the undertakings concerned comprise the founding members of the joint venture.

Acquisition of joint control

  • the undertakings concerned comprise the undertakings acquiring joint control on the one hand and the undertaking or business being acquired on the other hand.

A change from sole control to joint control

  • the undertakings concerned comprise both the undertaking previously in sole control and the undertakings acquiring control.

A change from joint control to sole control

  • the undertakings concerned comprise the undertaking that gains sole control and the undertaking over which control is exercised.

A replacement of an existing shareholder in an already jointly controlled undertaking or other change in the structure of control:

  • the undertakings concerned comprise the shareholders that have joint control (i.e. the shareholders that retain joint control and the new shareholder that joins in the joint exercise of control) and the undertaking over which control is exercised.

Acquisition of control through a joint venture

  • In situations where shareholders of a joint venture use the joint venture as a means of acquiring control, the undertakings concerned comprise the shareholders of the joint venture (rather than the joint venture) and the undertaking over which control is acquired.
  • If the undertaking acquiring control is a full-function joint venture, the undertakings concerned usually comprise the joint venture and the undertaking over which control is acquired, unless the parent companies of the joint-venture are the real players behind the operation.

2.2 Date for establishing jurisdiction

2.2.1 Which date is relevant for concluding whether the transaction is notifiable?

The date of the conclusion of the agreement, acquisition of control or the announcement of a public bid or the date when the parties demonstrate with sufficient certainty their intention to conclude a concentration by filing the notification.

2.3 General thresholds

2.3.1 Threshold(s) for when a concentration must be notified under the general merger control regime?

A concentration must be notified to the Finnish Competition and Consumer Authority if:

  • the combined global turnover of the undertakings concerned exceeds EUR 350,000,000, and
  • the turnover of at least two of the undertakings concerned exceeds EUR 20,000,000 in Finland.

2.3.2 For each threshold, can the threshold be triggered by only one party having local turnover?

It is possible to trigger the first threshold by only one undertaking concerned having local turnover since the first threshold requires that the combined global turnover exceeds EUR 350,000,000.

2.3.3 For each threshold, can the threshold be triggered without any party having local turnover?

It is not possible to trigger the second threshold without at least two of the undertaking concerned having local turnover since the second threshold requires that the turnover of at least two of the undertaking concerned exceeds EUR 20,000,000 in Finland.

2.3.4 Are there any circumstances where transactions falling below these thresholds may be still investigated?

Transactions falling below the thresholds described in Section 2.3.1 above may not be investigated by the Finnish Competition and Consumer Authority.

2.4 Other national thresholds for ex ante merger control (e.g. sector-specific rules)

2.4.1 Relevant thresholds for sector-specific or other ex ante merger control rules?

There are not sector-specific thresholds or other ex ante merger control rules in Finland.

However, the notification process differs from the standard procedure for transactions governed by relevant insurance legislation. Pursuant to Section 23(2) of the Competition Act, the Finnish Competition and Consumer Authority (FCCA) needs to be notified once the parties have received information from the Finnish Financial Supervisory Authority (FIN-FSA) that it gives consent to the merger or does not object it. In case the FIN-FSA has consulted the FCCA and the FCCA has issued an opinion stating that there are no objections to the merger, no notification is required. A notification to the FCCA is required if the FCCA’s opinion given to the FIN-FSA states that the merger cannot be approved.

2.4.2 Are any such schemes mandatory or voluntary?

Not applicable.

2.5 Foreign-to-foreign mergers

2.5.1 Do any exemptions, special thresholds etc. apply to foreign-to-foreign mergers, i.e. where none of the undertakings concerned is domiciled in the jurisdiction?

Transactions meeting the above thresholds have to be notified to the Finnish Competition and Consumer Authority, regardless of whether the undertakings concerned are domiciled outside of Finland.

3. Calculation and allocation of turnover, asset value, transaction value etc.

3.1 Relevant turnover

3.1.1 How is turnover defined (e.g. is income from other sources than "ordinary activities to be included, and how are rebates, taxes, internal turnover etc. treated)?

Turnover refers to the gross sales of the ordinary activities of an entity or foundation (i.e. sales of products and the provision of services) based on the most recent financial statements drawn up, of which the sales rebates granted, value-added tax and other taxes directly related to the turnover have been deducted as prescribed in the Finnish Accounting Act (1336/1997).

3.1.2 Identification and link to any official rules, guidance etc. on how to calculate turnover?

More detailed provisions on the calculation of turnover are provided in the Finnish Government Decree on the calculation of turnover of parties to concentration (1011/2011). The English translation is available at: https://www.kkv.fi/en/facts-and-advice/competition-affairs/legislation-and-guidelines/decree-by-the-state-council-on-the-calculation-of-turnover-of-parties-to-concentration-10112011/.

Further information on calculating turnover can be found from the Finnish Competition and Consumer Authority’s guidelines on merger control, available at: https://www.kkv.fi/globalassets/kkv-suomi/julkaisut/suuntaviivat/en/guidelines-1-2011-mergers.pdf.

3.2 Relevant period for calculation of turnover

3.2.1 Which financial year(s) is relevant for the calculation of turnover?

The turnover is based on the latest financial statements drawn up preceding the notified merger. In most cases, the latest audited financial statements are used but during the first months of the financial year, there may be the need to also consider unaudited financial statements if they have been drawn up.

3.2.2 Should adjustments be made for e.g. divestitures, acquisitions, closings and other changes of the economic reality of the undertaking concerned made after or during the relevant financial year?

Adjustments must be made in case the length of the financial year is shorter or longer than 12 months. In this case, the turnover is adjusted to correspond to a period of 12 months.

The turnover also needs to be adjusted if the turnover reported in the last audited financial statement does not fully reflect the acquisitions, divestures or closures made during or after the relevant financial year, e.g. in case, one party has conducted such transaction after the end of the financial year. The turnover generated by a divested or closed business needs to be deducted from the turnover reported in the latest financial statement, while any turnover generated by an acquired business needs to be added to the figures. However, adjustments need to be made only for transactions that have closed prior to the notified merger unless the acquisition or sale of a business is prerequisite for the implementation of the merger.

3.3 Relevant undertakings for the calculation of turnover

3.3.1 The "undertakings concerned", i.e. which parties?

See Section 2.1.1 above.

3.3.2 The undertakings whose turnover is taken into account?

See Section 2.1.1 above.

3.3.3 Shall the turnover of the existing seller be included in the target's group turnover?

The seller's turnover is not included in the target's group turnover.

3.4 Geographical allocation of turnover

3.4.1 The principles for the geographical allocation of turnover?

As a main rule, turnover from the sales of products or the provision of services is considered to have been generated in the geographic location of the customer at the time of the transaction and in the geographic location where the undertaking competes with other goods or services providers.

3.5 Valuation and allocation of assets

3.5.1 The principles for valuation and allocation of assets?

Not applicable.

3.6 Calculation of other thresholds

3.6.1 The principles for calculation of metrics for other thresholds (e.g. transaction value, market share, share of supply etc.)?

Not applicable.

3.7 Special rules

3.7.1 Do any special rules or principles apply to the calculation, allocation etc. of turnover, assets etc. for specific undertakings (e.g. State-owned undertakings, investment funds, credit and financial institutions, insurance companies, financial holding companies, others)?

Specific rules apply to the calculation of turnover for state-owned undertakings, undertakings controlled by state-owned undertakings, credit institutions, investment firms, and other financial institutions as well as insurance companies and pension providers.

3.7.2 Does any exemptions apply?

Not applicable.

1. Practical information

1.1 Responsibility for filing

1.1.1 The parties responsible for filing?

The type of merger determines the responsible party/parties for filing. According to Section 23 of the Competition Act, the obligation to notify falls on the acquirer of control; the acquirer of business operations or a part thereof; the parties to a merger; and the founders of a joint venture are responsible for filing. However, it should be noted that the standstill obligation applies to all parties and the sanctions may be ordered to any party to the concentration that implements the concentration in whole or in part prior to a final decision on the matter.

In mergers involving a replacement of one or more of the parties exercising joint control, or where the structure of control changes otherwise, the undertakings that retain joint control may have an obligation to notify even if they are not actually contractual parties to the transaction.

1.2 Deadlines for filing

1.2.1 Are there any mandatory deadlines for filing, and, if so, how these are calculated?

There are no mandatory deadlines for filing. A concentration must be notified to the Finnish Competition and Consumer Authority following the conclusion of the agreement, acquisition of control, or the announcement of a public bid but prior to the implementation of the transaction.

1.2.2 Are there any sanctions for not filing within the deadlines?

Not applicable.

1.3 Early filing

1.3.1 Is it possible to file before the signing of merger agreement?

Yes. A concentration may be notified to the Finnish Competition and Consumer Authority as soon as the parties demonstrate with sufficient certainty their intention to conclude a concentration. Good faith intent can be demonstrated, for example, by a letter of intent or a memorandum of understanding signed by all of the interested parties or by a public announcement of the intention to make a public bid. However, the merger must be sufficiently tangible and public to allow the Finnish Competition and Consumer Authority to consult third parties as normal.

1.4 Filing fees

1.4.1 Are there any fees for filing, and, if so, please describe how such fees are calculated?

There are no filing fees.

1.4.2 When must the filing fee must be paid?

Not applicable.

1.5 Publicity

1.5.1 When and in which format will the authority publish receiving a notification?

The Finnish Competition and Consumer Authority publishes a list of submitted notifications on its website.

1.5.2 How will the authority in general handle the case publicly, e.g. will it usually comment in the media, send out press releases etc.?

The Finnish Competition and Consumer Authority will publish a summary of the merger and the final decision on its websites. Business secrets and other confidential information are not revealed. The Finnish Competition and Consumer Authority does not usually comment on pending merger investigations.

A press release is commonly issued on merger notifications transferred to Phase II and on the most important decisions made.

1.5.3 Will third parties be able to review the notification?

Only the final decisions made in merger cases will be published. Prior to publication, business secrets and other confidential information will be removed.

Third parties may also request a non-confidential version of the notification as well as any other documents submitted in the course of the process from the Finnish Competition and Consumer Authority.

2. Procedure and timing

2.1 Normal and simplified procedures

2.1.1. Does the regime allow for a simplified (fast track) procedure, and, if so, what are the criteria for using the simplified procedure?

The Finnish Competition and Consumer Authority (FCCA) may waive some of the information that needs to be provided based on the Decree by the State Council on the obligation to notify a concentration (1012/2011) upon the notifying party’s request, should this information be deemed irrelevant for the investigation, but this does not amount to an actual fast track procedure.

In simpler cases, the FCCA may reach a decision considerably earlier than the 23rd working day. By simpler cases, the FCCA refers to such concentrations that do not involve any horizontal or vertical relationships between the companies in question, or where such relationships clearly cannot result in competition being impeded on any market.

2.2 Procedural stages (cf. timetable below)

2.2.1 The various stages of (i) a simplified procedure and (ii) a normal procedure?

Most of the notified mergers are preceded by an informal pre-notification phase with the Finnish Competition and Consumer Authority (FCCA), in which a draft of the notification is delivered to the FCCA for assessment and further discussion.

The pre-notification contacts provide both the FCCA and the parties with an opportunity to preliminarily assess the competitive effects of the merger and discuss the scope of the information to be submitted in the final merger notification. The pre-notification phase also helps the parties assess whether the notification is complete from the FCCA’s point of view.  It also enhances the FCCA’s abilities to process the matter in an efficient manner after filing.

The FCCA may waive some of the information that would need to be provided according to the Decree by the State Council on the obligation to notify a concentration (1012/2011) during the pre-notification consultations if a full notification is deemed unnecessary for appraising the merger.

The FCCA initiates the formal merger control investigation procedure as soon as the notification is submitted. However, investigation of the merger and the period for the deadlines set for it do not commence until the notification is deemed complete by the FCCA.

The investigation procedure begins with the so-called Phase I proceeding during which the main competitors, customers and suppliers of the parties are heard by the FCCA. If the acquisition clearly does not have restrictive effects for competition or if the restrictive effects can be prevented by conditions proposed by the parties, the acquisition will be cleared during Phase I.

Should the transaction give rise to competition concerns on the basis of the Phase I investigation, the FCCA will take a decision to initiate further proceedings (the so-called Phase II) during which the transaction and its competitive effects will be thoroughly investigated. The acquisition may still be cleared as such or approved with conditions.

If the commitments offered by the parties are not sufficient for clearing the acquisition, the FCCA makes a proposal to the Market Court to prohibit it. The Market Court may decide to accept the merger either as such or with conditions or prohibit the merger.

2.2.2 Is pre-notification contact with the relevant authorities customary/obligatory/encouraged/etc.?

The pre-notification phase is voluntary, but the Finnish Competition and Consumer Authority (FCCA) strongly recommends that the parties contact the FCCA well in advance of submitting the notification to ease the merger investigation proceedings. The pre-notification contact is customary and typically the first stage in most merger control cases. The primary objective of preliminary consultations is to increase the understanding of both the FCCA and the parties to the concentration of any issues that may arise during the notification process.

2.2.3 Are there any sanctions for not filing within the deadlines?

Not applicable.

2.3 Timetable (cf. timetable below)

2.3.1 The statutory timetable/deadlines for review of a notification?

The Phase I proceedings take 23 working days at most. The deadline of the Phase I proceedings are calculated from the date following the receipt of a complete merger notification.

The Phase II proceedings take 69 working days at most. The investigation period of Phase II starts to run when the Finnish Competition and Consumer Authority decides to open further investigations on the case. The Market Court may extend the Phase II deadline by a maximum of 46 working days, thus resulting in a maximum of 115 working days in total.

2.3.2 Can the statutory timetable/deadlines be suspended ("stop-the-clock"), and if so under which conditions?

The deadlines set for the investigation do not start to run if the notification submitted is deemed materially incomplete by the Finnish Competition and Consumer Authority (FCCA). If some sections of the notification are incomplete, the notification must include an explanation as to why the information in question has not been provided. The authority may also give a stop-the-clock order during the investigation if the information provided in the notification changes materially and if these changes have significant implications on the notification process.

The FCCA has no obligation to start investigating transactions that have not been made public by the parties. In these cases, the deadlines set for the investigation do not lapse even if the transaction is properly notified. Hence, as the FCCA publishes a list of notified transactions on its website, transactions are typically not filed by the parties before they have made them public.

2.3.3 If pre-notification with the relevant authorities contact is possible/customary, how long will the duration of such contact usually be?

There is no statutory timetable/deadline for the pre-notification consultations. Typically, the duration is from two weeks to several months depending for example on the complexity of the transaction. 

3. Format and content of notification

3.1 Notification forms

3.1.1 Must the notifying parties use any mandatory notification forms, e.g. for simplified and normal procedures, and, if relevant, add a link to the relevant forms?

There is no mandatory notification form, but the information to be given in the notification is specified in the Decree by the State Council on the obligation to notify a concentration (1012/2011). The information provided in the notification must be given using the numbering and headings of the Decree.

An unofficial English translation of the Decree is available at: https://www.kkv.fi/en/facts-and-advice/competition-affairs/legislation-and-guidelines/decree-by-the-state-council-on-the-obligation-to-notify-a-concentration-10122011/.

All documentation needs to be provided in electronic format.

3.2 Supporting documentation

3.2.1 List of the supporting documentation which must as a minimum be submitted along with the notification?

Cf. checklist below.

3.3 Originals, legalization and apostillation (cf. checklist below)

3.3.1 List of all documents which must be submitted in original/legalized versions and whether any documents must be apostilled?

Not applicable.

3.3.2 If the merger regime has a mandatory filing deadline, must all the documents identified under Section 3.3.1 be submitted within this deadline?

Not applicable.

3.4 Language

3.4.1 Which languages may be used for drafting and filing a notification?

The notification must be written in Finnish or Swedish. Annexes to the notification can usually also be in English. The Finnish Competition and Consumer Authority can order the notifying parties to provide a Finnish or Swedish translation of any, especially important or ambiguous annexes.

3.4.2 Does translations have to be certified/legalized and apostilled?

Not applicable.

Statutory timetable

Step Description Time
1

Pre-notification

The pre-notification phase is voluntary, but the Finnish Competition and Consumer Authority (FCCA) strongly recommends that the parties contact the FCCA well in advance of submitting the notification to ease the merger investigation proceedings. The pre-notification contact is customary and typically the first stage in most merger control cases. The primary objective of preliminary consultations is to increase the understanding of both the FCCA and the parties to the concentration of any issues that may arise during the notification process.

The FCCA may waive some of the information that would need to be provided according to the Decree by the State Council on the obligation to notify a concentration (1012/2011) during the pre-notification consultations if a full notification is deemed unnecessary for appraising the merger.

There is no statutory timetable/deadline for the pre-notification consultations. Typically, the duration is from two weeks to several months depending for example on the complexity of the transaction.

2

Phase I

The FCCA initiates the formal merger control investigation procedure as soon as the notification is submitted. However, investigation of the merger and the period for the deadlines set for it do not commence until the notification is deemed complete by the FCCA.

The investigation procedure begins with the so-called Phase I proceeding during which the main competitors, customers and suppliers of the parties are heard by the FCCA. If the acquisition clearly does not have restrictive effects for competition or if the restrictive effects can be prevented by conditions proposed by the parties, the acquisition will be cleared during Phase I.

The Phase I proceedings take 23 working days at most. The deadline of the Phase I proceedings are calculated from the date following the receipt of a complete merger notification.

Please be aware that "stop-the-clock" is possible (cf. 2.3.2 above).

3

Phase II

Should the transaction give rise to competition concerns on the basis of the Phase I investigation, the FCCA will take a decision to initiate further proceedings (the so-called Phase II) during which the transaction and its competitive effects will be thoroughly investigated. The acquisition may still be cleared as such or approved with conditions.

If the commitments offered by the parties are not sufficient for clearing the acquisition, the FCCA makes a proposal to the Market Court to prohibit it. The Market Court may decide to accept the merger either as such or with conditions or prohibit the merger.

The Phase II proceedings take 69 working days at most. The investigation period of Phase II starts to run when the Finnish Competition and Consumer Authority decides to open further investigations on the case. The Market Court may extend the Phase II deadline by a maximum of 46 working days, thus resulting in a maximum of 115 working days in total.

Please be aware that "stop-the-clock" is possible (cf. 2.3.2 above).

  • Step 1 1
  • Step 2 2
  • Step 3 3
  • Not defined
  • 23 days
  • 69 + 46 days

Checklist

List of the supporting documentation which must as a minimum be submitted along with the notification.

Supporting documentation

This content was delivered
and last updated on 25-09-2020 by
Contact Person
Sari Hiltunen, Partner
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Kiti Karvinen, Counsel
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