1. Page 1 BIICL London, 16 November 2007 Practitioners’ Points: The Consolidated Jurisdictional Notice Dr Johannes Luebking Deputy Head of Unit, Directorate C-5, DG Competition The views expressed are personal and do not necessarily reflect the views of the European Commission nor those of DG COMP

2. Page 2 Scope and Sources Consolidation of current jurisdictional Notices Concept of Concentration Joint Ventures Undertakings concerned Calculation of Turnover Covers all issues relevant for Commission’s original jurisdiction under Merger Regulation Sources for review New Merger Regulation Recent jurisprudence, i.e. Cementbouw and Endesa Decisional practice of Commission

3. Page 3 Concentration Acquisition of control by investment funds Normally Investment company acquires indirect control under Article 3 (1), (3) Investment company indirectly holds rights in portfolio companies under Article 5(4) Consequence: turnover of all portfolio companies is taken together, even if held by different funds organised by same investment company

4. Page 4 Concentration Object of control Assets constituting a business with market presence Outsourcing cases: Concentration only if Transfer of assets and/or personnel That allow acquirer to develop market presence beyond outsourcing client Time-frame similar to start-up period for full- functionality of JVs

5. Page 5 Concentration (Joint) acquisition and immediate split-up of target Separate concentrations if Legally binding agreement on break-up No uncertainties that second transaction takes place within short time-frame Maximum normally 1 year

6. Page 6 Concentration Parking/warehousing transactions Interim purchaser acquires target “on behalf“ of ultimate purchaser on basis of agreement on future on-sale Often major part of economic risk shifted to ultimate purchaser who may be granted specific rights First transaction considered first step in single concentration comprising lasting acquisition of of (parked) target by ultimate purchaser First transaction no concentration in its own right and not considered to fall under Article 3(5)

7. Page 7 Concentration Interrelated transactions: when are several transactions considered one concentration? Under Article 3: Cementbouw, recital 20: Transactions unitary in nature Transactions de jure or de facto interconditional Only if control is acquired by same undertaking(s), not in cases of assets swaps or de-mergers of JVs Examples: One business, one economic entity Parallel (EQT/H&R/Dragoco) or serial acquisition (Kingfisher) Under Article 5(2)(2): Successive transactions between same parties within two- year period considered one concentration for calculation of turnover Assessment under Article 3 is precedent

8. Page 8 Types of control Sole control comprises Positive sole control Negative control by minority shareholder De facto sole control: on basis of past voting pattern and prospective analysis Joint control: more on commonality of interests and de facto situations Reduction in number of shareholders: concentration only if change from joint to sole control

9. Page 9 Joint Ventures Distinction between Joint acquisition of control of existing undertaking, falling under Article 3(1) Creation of a JV, falling under Article 3(4) Clarification of full-functionality criteria

10. Page 10 Community Dimension Relevant date for establishing jurisdiction: Earlier of Date of notification to Commission or national competition authorities Conclusion of agreement, announcement of public bid, etc. Turnover calculation Normally based on audited accounts of previous financial year Adjustments to be made in case of permanent changes in economic reality of undertakings concerned (CFI in Endesa)