June / July 1999

Spain: Reform of merger control rules introduces mandatory regime

01 June 1999

Although the procedure used to enact the reform is open to criticism, the reform itself is generally welcome. The previous system of voluntary notification did not function properly and resulted in very few competitively significant transactions being notified and investigated by the Spanish competition authorities. The introduction of undertakings seems a pragmatic way of clearing mergers which impose no major obstacles to the maintenance of effective competition. Making the procedure more transparent and the express reference in the Decree to a 'guidance' procedure before the SDC are also welcome. However, the retention of market shares as one of the alternative thresholds for jurisdiction in a compulsory notification regime is not in line with other European merger control regimes, under which market share thresholds, because of the difficulty of defining markets and the legal uncertainty that this creates, are rarely used, or, as in Belgium, have recently been dropped. Finally, in order to avoid confusion the new definition of 'concentrations' should have been accompanied by a definition of 'control'.