On 8 April 2019, the European Commission ("Commission") imposed a fine of € 52 million on GE for negligently providing incorrect information to the Commission during the merger review of its acquisition of LM Wind.
On 11 January 2017, GE notified its proposed acquisition of LM Wind to the Commission. According to the Commission, GE stated in its notification form that it did not have any higher output wind turbine for offshore applications in its development pipeline beyond its 6 megawatt turbine. However, the Commission was later informed by a third party that GE was offering a 12 megawatt offshore wind turbine to potential customers. On 2 February 2017, GE withdrew its notification. On 13 February 2017, GE refiled the notification with complete information and the Commission later unconditionally approved the transaction after a Phase I investigation. Subsequently, on 6 July 2017, the Commission issued a Statement of Objections ("SO") alleging that GE had breached its procedural obligations under the EU Merger Regulation.
Under the EU Merger Regulation, the Commission may impose a fine of up to 1% of group-wide turnover on companies which intentionally or negligently provide incorrect or misleading information during a merger review. By its latest decision, the Commission has found that GE's statement in its notification form that it had no higher power output wind turbines for offshore in development was incorrect and that GE should have been aware of the relevance of the information for the assessment. According to the Commission, the € 52 million fine reflects the fact that GE committed a serious procedural infringement as it prevented the Commission from having all relevant information for the assessment of the transaction.
Other procedural cases
In the past five years, the Commission has opened multiple cases for procedural infringements of the EU Merger Regulation. Two previous cases resulted in significant fines. In May 2017, the Commission fined Facebook € 110 million for providing misleading information during its WhatsApp review (see VBB on Competition Law, Volume 2017, No. 5, available at www.vbb.com). In April 2018, the Commission imposed a fine of € 124.5 million on Altice for implementing its acquisition of PT Portugal prior to clearance (see VBB on Competition Law, Volume 2018, No. 4, available at www.vbb.com).
Three further investigations of procedural infringements are ongoing: in July 2017, the Commission sent an SO to Merck and Sigma-Aldrich alleging a failure to provide correct information, while a separate SO alleged that Canon had implemented its acquisition of Toshiba prior to clearance (see VBB on Competition Law, Volume 2017, No. 7, available at www.vbb.com). In February 2019, the Commission issued an SO to Telefónica Deutschland alleging a breach of certain merger commitments offered during its acquisition of E-Plus in 2014 (see VBB on Competition Law, Volume 2019, No. 2, available at www.vbb.com).
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.