Worldwide: Doing Business In Asia: Merger Control

Last Updated: March 17 2015
Article by Mark C. Katz

This presentation, moderated by Mark Katz, provides an overview of merger control regimes, covers recent significant developments in this area, and touches on what to look forward to in 2015.

2015 Asia Forum: ABA Section of International Law, Tokyo, Japan


  • Kala Anandarajah - Rajah & Tann Singapore LLP
  • Janet Hui (Xu Rongrong) – Jun He
  • Kyoung Yeon Kim – Yulchon LLC
  • Takahiro Azuma – Nishimura & Asahi
  • Mark Katz – Davies Ward Phillips & Vineberg LLP (moderator)


  1. Overview of Merger Control Regimes
  2. Significant Recent Developments
  3. International Considerations
  4. What to Look for in 2015
  5. Questions


  • Merger filings by foreign companies are increasing
  • Requirements for filing differ depending on the type of transaction, but relatively easily triggered
  • Timing of merger filing is flexible (no need for a definitive agreement) and the notification form is relatively simple
  • However, it sometimes takes time for a draft notification to be formally accepted
  • Merger filing is required for five types of transactions as long as the turnover thresholds are met: (1) share acquisition; (2) merger; (3) company split (demerger); (4) joint share transfer; and (5) acquisition of business/assets
  • Concept of "control" does not exist under Japanese antitrust law
  • Formation of a new company, including a joint venture, is not subject to merger filing unless it involves any of these five transactions
  • No exception for a foreign-to-foreign transaction
  • No short form or simplified review process; however, the form is relatively simple and usually does not take too long to prepare
  • First phase review period is 30 days and the second phase review period is 90 days
  • Few cases proceed to second phase review
  • JFTC will issue a few rounds of questions before it formally accepts the draft notification but clock does not stop
  • If JFTC decides to proceed to second phase review, it will issue a substantial information request at the end of the first phase review/ second phase review period will not start until the parties respond


  • Korea is very active in terms of the number of mergers reviewed and sanctions imposed
  • In 2014, KFTC handled total 571 cases, including 120 foreign to foreign cases (around KRW 172.1 trillion)
  • KFTC ordered sanctions (cease and desist orders or administrative fines) for non-compliance in 685 cases from the time of enactment (1981) to the end of 2013
  • KFTC is very demanding with its data requests but flexible in some aspects of formality (translation, POA, filing fees, etc.)
  • The antitrust statute lists five types of transactions for which a merger filing may be required: (1) interlocking directorate; (2) merger; (3) share acquisition; (4) business transfer, i.e., asset acquisition; and (5) formation of a new company (e.g., a joint venture)
  • Two jurisdictional tests: size-of-party test and size-of-transaction test
  • Size-of-party test applies to all transactions; size-of transaction test does not apply to interlocking directorates and mergers
  • Size-of-party test: (1) either party to the transaction has consolidated worldwide assets or sales of 200 billion won or more during the most recently ended fiscal year, and (2) the other party to the transaction has consolidated worldwide assets or sales of 20 billion won or more during the most recently ended fiscal year
  • Size-of-transaction test: share acquisition (more than 20% (15% in listed companies) of total issued and outstanding shares, being the largest shareholder in the newly established company, etc.)
  • Where both parties to a transaction are foreign entities (i.e., as in a foreign-to-foreign transaction), the local nexus test is satisfied if each party has Korean sales of 20 billion won or more during the most recently ended fiscal year
  • There are two types of filings - simplified form and general form, and the filing in simplified form is usually become the subject of simplified review
  • The initial review period is 30 days but KFTC may extend it by an additional 90 days
  • Simplified reviews are usually completed within 14 days
  • There is no clear concept such as phase 1 and phase 2 review in Korea

To read this Presentation in full, please click here.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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Mark C. Katz
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