Comparative Guides
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Results: 4 Answers
Merger Control
2.
Definitions and scope of application
2.1
What types of transactions are subject to the merger control regime?
 
Azerbaijan
The following transactions are subject to the merger control regime:

  • the merger of two business entities, if the resulting entity will hold more than 35% of the relevant product market;
  • the merger of two business entities, if the asset value of the resulting entity will exceed AZN 13.5 million; and
  • the liquidation or division of state-owned or municipal entities with a total asset value of more than AZN 9 million.
For more information about this answer please contact: Leyla Safarova from BM Morrison Partners LLC
2.2
How is ‘control’ defined in the applicable laws and regulations?
 
Azerbaijan
‘Control’ is not defined in the Anti-monopoly Law.

For more information about this answer please contact: Leyla Safarova from BM Morrison Partners LLC
2.3
Is the acquisition of minority interests covered by the merger control regime, and if so, in what circumstances?
 
Azerbaijan
The Anti-monopoly Law does not specifically regulate the acquisition of minority interests. The two tests for a transaction to qualify for notification are as follows:

  • restraint of trade in the relevant product market, primarily applicable to foreign-to-foreign/local transactions; and
  • the thresholds set out in question 2.6.
For more information about this answer please contact: Leyla Safarova from BM Morrison Partners LLC
2.4
Are joint ventures covered by the merger control regime, and if so, in what circumstances?
 
Azerbaijan
The concept of an incorporated joint venture is not recognised under Azerbaijani law. Joint ventures exist only in non-incorporated form - that is, they are created through agreements concluded among the participating business entities.

Under Section 10(1) of the Anti-monopoly Law, ‘cartel arrangements’ are understood as voluntary dealings in any form between two or more financially and legal independent business subjects competing in the same market to drive other competitors out of that market and/or prevent new competitors from entering that market through any of the following activities:

  • division of the market by area or sales volumes;
  • division of the market by customers;
  • refusal to deal;
  • price fixing;
  • application of privileges, discounts or mark-ups on the sale of goods or provision of services; or
  • application of other means to restrict competition.

Such activities constitute illegal horizontal and vertical arrangements that cause or may cause a restriction of competition.

Agreements between business subjects that create joint ventures for the purposes of restricting or eliminating competition are also illegal under Section 10(4) of the Anti-monopoly Law.

For more information about this answer please contact: Leyla Safarova from BM Morrison Partners LLC
2.5
Are foreign-to-foreign transactions covered by the merger control regime, and if so, in what circumstances?
 
Azerbaijan
The reach of the State Service for Anti-monopoly Policy and Protection of Consumer Rights also extends to foreign-to-foreign transactions which cause or may cause a restriction of competition in Azerbaijan. The test for such purposes typically involves whether either or both parties to the foreign-to-foreign transaction have a presence in the Azerbaijani market – if only one party has a presence, this could be an argument that competition is not restrained.

For more information about this answer please contact: Leyla Safarova from BM Morrison Partners LLC
2.6
What are the jurisdictional thresholds that trigger the obligation to notify? How are these thresholds calculated?
 
Azerbaijan
If restraint of competition is established, the obligation to notify is triggered if the transaction meets the following thresholds:

  • mergers - more than 35% per cent of a relevant market; or
  • acquisitions - more than 20% of the shares or more than 10% of the assets.

For mergers, filing (advance regulatory consent) is further required where:

  • at least one of the parties to the merger has at least 35% of the relevant market; or
  • the aggregate book value of the assets (in Azerbaijan) of all parties to the merger exceeds AZN 13.5 million.

In acquisitions, the applicable thresholds are as follows:

  • the acquisition of more than 20% of the voting shares (participation interests) of a target by a transferee (including a group of transferees or a group of entities controlling each other’s assets);
  • the transfer to a transferee of the right of ownership of or the right to use the target’s assets, if the book value of such assets accounts for more than 10% of the target’s total fixed and intangible assets in Azerbaijan before the transfer; or
  • the acquisition of the right to determine the target’s business activities or the right to manage the target by a transferee (including a group of transferees or a group of entities controlling each other’s assets).

If one of the thresholds above is met, the further applicable thresholds are as follows:

  • The combined book value of assets in Azerbaijan of both the transferee and the target exceeds AZN 13.5 million;
  • The transferee’s and/or the target’s share of a ‘relevant commodity market’ in Azerbaijan exceeds 35%; or
  • The transferee controls the target.
For more information about this answer please contact: Leyla Safarova from BM Morrison Partners LLC
2.7
Are any types of transactions exempt from the merger control regime?
 
Azerbaijan
The Anti-monopoly Law provides for no exemptions.

For more information about this answer please contact: Leyla Safarova from BM Morrison Partners LLC