The concept of “merger” is introduced in Article 7 of the Law on the Protection of Competition No. 4054 (“Competition Law”). It is further analyzed in the Guidelines on Cases Considered as a Merger or an Acquisition and the Concept of Control. A merger can occur in two ways: de jure and de facto.
A de jure merger occurs when (i) two or more independent companies amalgamate into a new company by terminating their legal entities, or (ii) a company is merged with and into another company entirely. In the latter case, the legal personality of one company is terminated whereas the legal personality of other continues to exist.
A de facto merger occurs when the combination of two or more independent companies’ activities results in the creation of a single economic unit, although the companies do not amalgamate into a single legal entity. In other words, two or more companies establish a common economic management contractually, while retaining their individual legal personalities. A prerequisite for the determination of a de facto merger is the existence of a permanent single economic management structure. While these mergers may be based on contractual arrangements, they can also be reinforced by cross shareholdings between the parties.
Please also see the “merger control notification form” for further information.