Aktualita
MERGERS: AMO SR imposed fines on the undertakings GRAFOBAL GROUP development, a. s., and Bratislavská vodárenská spoločnosť, a. s., for the failure to notify a merger and the premature implementation of rights and obligations arising from it
Content
On 20 May 2020 the Antimonopoly Office of the Slovak Republic, the Division of Concentrations, (hereafter "the Office") issued a decision, by which it imposed a fine on the undertaking GRAFOBAL GROUP development, a. s., Bratislava (hereafter "GGD") in the amount of EUR 27 000 and on the undertaking Bratislavská vodárenská spoločnosť, a. s., Bratislava (Bratislava Water Company, hereafter "BVS") in a symbolic amount of EUR 1 000.
In the decision, the Office stated that the undertakings GGD and BVS infringed the Article 10 Paragraph 7 of the Act on Protection of Competition (hereafter "the Act") by failing to notify a merger grounded in the acquisition of their joint control over the undertaking Infra Services, a.s., Bratislava (hereafter "Infra Services"), which arose on 20 May 2019 in a way specified in the Office´s decision No. 2019/KOV/SKO/3/281, before rights and obligations arising therefrom began to be exercised.
The Office also said that the undertaking GGD infringed the Article 10 paragraph 11 of the Act by exercising rights and obligations arising from this merger before the Office´s decision on the merger came into force, i. e. on 5 September 2019. The merger in question was established by two legal acts, with the undertaking GGD implementing one of them by acquiring 49 % of the shares in Infra Services on 20 May 2019 by being endorsed, transferred and entered in the list of shareholders of the company Infra Services, and on 20 June 2019 it paid a part of the purchase price for these shares.
In relation to the undertaking BVS, the Office stopped the proceedings in the matter of the infringement of the Article 10 Paragraph 11 of the Act, as the Office in the proceedings did not prove that the undertaking BVS infringed the provision of the Act in question.
Due to the fact that a settlement was reached with the undertaking GGD in relation to the infringements of the Article 10 Paragraph 7 and Paragraph 11 of the Act, the Office reduced its fine by 50 % in comparison to the amount of fine, which it would otherwise have imposed on it.
In imposing the fine, the Office relied mainly on the gravity and in the case of the infringement of the Article 10 Paragraph 11 of the Act also on the duration of the infringement. Within the gravity of the infringement of the Article 10 Paragraph 7 of the Act, the Office took into account, inter alia, the fact that the Office ultimately issued a decision approving the merger, further in a certain respect also the precedent nature of this case and in the case of the undertaking BVS the facts related to its non-participation in legal acts establishing the merger in question, too. In case of the infringement of the Article 10 Paragraph 11 of the Act by the undertaking GGD, the Office took into account, inter alia, the scope of the acts, by which the undertaking GGD committed the infringement of the Act in this case, as well as the alleged precedent nature of this case.
In the case of the infringement of the Act by the undertaking GGD, the Office, with regard to the need to ensure the preventive and repressive effect of the fine, specifically took into account also the fact that the undertaking GGD belongs to a group with a strong economic background.
With regard to the information published, according to which BVS intends to acquire a sole control in Infra Services2, the Office has noted that the transaction is different from the one in respect of which the Office imposed fines.
The decision has not come into force yet.
1 Decision on the merger is available at https://www.antimon.gov.sk/grafobal-group-development-as-bratislava-bratislavska-vodarenska-spolocnost-as-bratislava/ and related press release is at https://www.antimon.gov.sk/koncentracie-pmu-sr-schvalil-koncentraciu-podnikatelov-grafobal-group-development-a-s-bratislavska-vodarenska-spolocnost-a-s-a-infra-services-a-s/
2 Information can be found at http://www.bvsas.sk/sk/aktuality/ (18 May 2020, Bratislavská vodárenská spoločnosť wants to take full control over its subsidiary company Infra Services...)
In the decision, the Office stated that the undertakings GGD and BVS infringed the Article 10 Paragraph 7 of the Act on Protection of Competition (hereafter "the Act") by failing to notify a merger grounded in the acquisition of their joint control over the undertaking Infra Services, a.s., Bratislava (hereafter "Infra Services"), which arose on 20 May 2019 in a way specified in the Office´s decision No. 2019/KOV/SKO/3/281, before rights and obligations arising therefrom began to be exercised.
The Office also said that the undertaking GGD infringed the Article 10 paragraph 11 of the Act by exercising rights and obligations arising from this merger before the Office´s decision on the merger came into force, i. e. on 5 September 2019. The merger in question was established by two legal acts, with the undertaking GGD implementing one of them by acquiring 49 % of the shares in Infra Services on 20 May 2019 by being endorsed, transferred and entered in the list of shareholders of the company Infra Services, and on 20 June 2019 it paid a part of the purchase price for these shares.
In relation to the undertaking BVS, the Office stopped the proceedings in the matter of the infringement of the Article 10 Paragraph 11 of the Act, as the Office in the proceedings did not prove that the undertaking BVS infringed the provision of the Act in question.
Due to the fact that a settlement was reached with the undertaking GGD in relation to the infringements of the Article 10 Paragraph 7 and Paragraph 11 of the Act, the Office reduced its fine by 50 % in comparison to the amount of fine, which it would otherwise have imposed on it.
In imposing the fine, the Office relied mainly on the gravity and in the case of the infringement of the Article 10 Paragraph 11 of the Act also on the duration of the infringement. Within the gravity of the infringement of the Article 10 Paragraph 7 of the Act, the Office took into account, inter alia, the fact that the Office ultimately issued a decision approving the merger, further in a certain respect also the precedent nature of this case and in the case of the undertaking BVS the facts related to its non-participation in legal acts establishing the merger in question, too. In case of the infringement of the Article 10 Paragraph 11 of the Act by the undertaking GGD, the Office took into account, inter alia, the scope of the acts, by which the undertaking GGD committed the infringement of the Act in this case, as well as the alleged precedent nature of this case.
In the case of the infringement of the Act by the undertaking GGD, the Office, with regard to the need to ensure the preventive and repressive effect of the fine, specifically took into account also the fact that the undertaking GGD belongs to a group with a strong economic background.
With regard to the information published, according to which BVS intends to acquire a sole control in Infra Services2, the Office has noted that the transaction is different from the one in respect of which the Office imposed fines.
The decision has not come into force yet.
1 Decision on the merger is available at https://www.antimon.gov.sk/grafobal-group-development-as-bratislava-bratislavska-vodarenska-spolocnost-as-bratislava/ and related press release is at https://www.antimon.gov.sk/koncentracie-pmu-sr-schvalil-koncentraciu-podnikatelov-grafobal-group-development-a-s-bratislavska-vodarenska-spolocnost-a-s-a-infra-services-a-s/
2 Information can be found at http://www.bvsas.sk/sk/aktuality/ (18 May 2020, Bratislavská vodárenská spoločnosť wants to take full control over its subsidiary company Infra Services...)