The Austrian Cartel and Competition Law Amendment Act 2021 (KaWeRÄG 2021) will introduce - in part substantial - amendments to the Austrian merger control regime as of 1 January 2022. The amendment originated in the context of the implementation of the ECN+ Directive. However, the Austrian legislator seized the opportunity to, among other things, refine the Austrian merger control regime by introducing a second domestic turnover threshold and implementing the SIEC test, as well as to strengthen the FDI screening mechanism.
1. Introduction of a second domestic turnover threshold
While the proposed amendment leaves the transaction value test
untouched, the KaWeRÄG introduces a second domestic turnover
threshold for the primary thresholds. According to the new
provision, the turnover of at least two undertakings needs to
exceed EUR 1m in Austria to trigger a filing obligation.
This filter is to be seen against the fact that the number of
mergers notified to the Austrian Federal Competition Authority
(FCA) has been rising steadily throughout the past years, peaking
in 2019 at almost 500 notifications, with a significant number of
filings concerning target companies generating only trivial
domestic turnover of a few thousand euros (or no Austrian turnover
at all). The FCA expects that the second turnover threshold will
result in a reduction in the number of annual filings by more than
40 %. At the same time, the filing fee for merger control
notifications will be raised from EUR 3,500 to
EUR 6,000.
Furthermore, the KaWeRÄG foresees the implementation of the
significant impediment of effective competition (SIEC) test in
Austria. The long-awaited alignment with the European standard is
an important step in the modernisation of the Austrian merger
control regime. By having one benchmark for merger control
assessments throughout the EU, legal certainty is achieved and the
potential of diverging decisions minimised.
Alas, the amendment grants the pre-existing market dominance test a
somewhat special position in the Austrian merger control review, as
it places the market dominance test not as a subcategory of the
SIEC, but as a test in its own right that is to be applied in
parallel to the SIEC. Practice will show whether the amendment, due
to this duality, will have any impact on the results of the merger
control assessment in Austria.
3. Further strengthening of FDI screening
The amendment further foresees an obligation of the FCA to
forward merger notifications to the Federal Minister for Digital
and Economic Affairs (BMDEA). This will reinforce FDI screening
under the Austrian Investment Control Act (InvKG). Companies are
advised to check whether a transaction needs to be notified to the
FCA but is also subject to a notification obligation under the
ICA.
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