I INTRODUCTION

The merger control framework in Romania is regulated by Competition Law No. 21/1996 (the Competition Law). The Competition Law has been republished three times, last time in February 2016. The latest amendments to the Competition Law were adopted in June 2017 through Government Emergency Ordinance (GEO) No. 39/2017. Apart from amending the Competition Law, GEO No. 39/2017 also transposed in Romanian law the Damages Directive 2014/104/EU. The Romanian Competition Council (RCC) is the national competition authority competent to control and authorise economic concentrations in Romania.

The RCC adopted Order No. 385/2010 approving the Regulation on economic concentrations of 5 August 2010 that contains additional information on the merger control procedure as well as the forms (both standard and simplified) to be used by the parties notifying an economic concentration.

In the past year, the RCC enacted new Guidelines on calculating the authorisation tax for economic concentrations by adopting Order No. 439/2016, in force since 14 July 2016. These new guidelines reflect the updated merger authorisation taxes, as per the amendments brought to the Competition Law, considerably increasing the tax applicable to Phase II clearance cases (i.e., up to €50,000). Also, new guidelines on accessing the file of the competition authority were adopted through RCC Order No. 438/2016.

Other secondary rules of relevance are the Guidelines on the concepts of economic concentration, undertakings concerned, full-function joint ventures and turnover calculation, approved through RCC Order No. 386/2010, the guidelines on restrictions directly related to and necessary for the implementation of economic concentrations (the Ancillary Restraints Guidelines), approved through RCC Order No. 387/2010 and the guidelines on commitments applicable in the case of economic concentrations, approved through RCC Order No. 688/2010.

When the RCC receives a notification of an economic concentration, it must also inform the Supreme Council of National Defence (SCND), which will analyse the transaction from a national security perspective. For transactions that fall below the threshold for notification to the RCC, the parties must themselves notify the SCND.

The RCC is also active in monitoring (either directly or through an appointed third party) remedies undertaken by the parties, as well as the impact of economic concentrations on the relevant markets.

II YEAR IN REVIEW

i Market overview and statistics

According to the latest European Economic Forecast released by the European Commission in May 2017, Romania had a GDP growth of 4.8 per cent in 2016 (one of the highest in Europe), whereas the 2017 GDP growth is expected to reach 4.3 per cent.2 The 2016 GDP growth figure was an eight-year high, mainly driven by consumption fostered by pro-cyclical fiscal policy and wage hikes, as indicated by the analysis of the European Commission.

As regards M&A activity, 2016 brought a slight decrease in the number of transactions (i.e., 113, down from 123 in 2015) in Romania.3 According to the same sources, the 2016 transactions had an estimated value of US$3.54 billion, down from US$3.65 billion in 2015. As regards the direction of the 2016 transactions, 56 per cent were inbound, 41 per cent domestic and only 3 per cent outbound (the least in the region), while manufacturing was the most active economic sector by deal volume.4

Despite the relative decrease in the number of transactions, the amount of transactions cleared by the RCC in 2016 increased to 625 from only 35 in 2015.6 By June 2017, the RCC had published on its website 47 of its 2016 decisions approving the economic concentrations notified to the authority.7 Also, according to the information made available by the RCC, the competition authority has not issued any decision prohibiting a merger during 2016 and the first months of 2017.

Some of the most prominent mergers cleared by the RCC during 2016 and the first months of 2017 involved economic sectors such as consumer goods retail,8 real estate,9 pharmaceuticals10 and medical services,11 insurance12 or dairy products.13 Other sectors analysed by the RCC were banking, IT, e-commerce, paints and varnishes, cosmetics, stock farming or recycling. In addition, the RCC required remedies before clearing two important mergers, the acquisition of Billa Romania by Carrefour14 and the takeover of PC Garage by Dante International (the regional online retailer eMAG).15

ii Gun-jumping decisions

Following the 2014-2015 period where it did not impose any sanctions for gun jumping, the RCC adopted three decisions during 2016 applying fines to undertakings not abiding by the standstill obligation not to implement a transaction prior to clearance.

In the first case, the RCC fined Publicis Groupe Holdings BV (Publicis BV)16 with around 760,000 lei for acquiring 80 per cent of the share capital of Zenith Media Communications SRL (Zenith), back in 2013, without notifying the economic concentration to the competition authority. The RCC gained insight into the matter in 2014, while it was analysing a merger filing from Publicis BV pertaining to the acquisition of sole control over five other undertakings (i.e., Leo Burnett & Target SA, iLeo Marketing Interactive SRL, Practice PR SRL, Opti Media SRL and Starcom Mediavest Group SRL). The RCC points out in the sanctioning decision how Publicis BV described in a specific section of the 2014 notification form the fact that it had acquired control over Zenith, following the conclusion of a share purchase agreement in 2013.

The RCC carried out its analysis in order to determine whether the notification thresholds had been met, taking into account the 2012 turnover in Romania of Zenith. Publicis BV defended itself by claiming that under paragraph 152 of the guidelines on the concepts of economic concentration, undertakings concerned, full-function joint ventures and turnover calculation, the relevant turnover for notification purposes consisted only of mark-ups and commissions when the relevant services (e.g., tourism and advertising services) were supplied through brokers. By applying this principle, Publicis BV claimed that the relevant turnover of Zenith was below the €4 million threshold.

The RCC acknowledged the principle that in a services market (including advertising), the relevant turnover could be adjusted to reflect the market power of the undertakings concerned. However, it highlighted that paragraph 152 of the Guidelines did not apply to Zenith, as it provided creative services (e.g., advertising, branding and design services) and not brokering services. Therefore, the RCC concluded that the relevant turnover of Zenith substantially exceeded the threshold and thus gun jumping had occurred.

The second gun-jumping decision involved the sanctioning of the investment fund Emerging Europe Accession Fund Cooperatief UA (EEAF UA) for acquiring direct sole control over Nextebank SA and indirect joint control (through Star Accession BV), together with a natural person, over Star Storage SA,17 without prior RCC clearance. The fine applied in this case was of only around 32,000 lei and represented an undisclosed percentage of the 2015 turnover of EEAF UA.

The third gun-jumping case involved the sanctioning of GLL CDG Plaza SRL with around 76,000 lei. The undertaking was fined for acquiring and exercising control over Charles De Gaulle Plaza, an office building situated in Bucharest, without seeking the prior approval of the RCC.

These decisions show little transparency as regards the basis for applying the fine. The RCC limited itself to mentioning that the fine imposed represented a percentage of the total turnover of the infringing party during the financial year before the sanctioning decision, merely citing the legal provisions in force at the time. However, the element of uncertainty regarding the turnover of foreign undertakings taken into account for fining purposes was very recently clarified, following the amendments brought by GEO 39/2017 to the Competition Law.18

The increase in the number of companies fined for gun jumping illustrates that enforcing the non-implementation obligation set by the Competition Law appears to have become one of the policy objectives of the RCC in recent times. As such, the RCC will focus on media articles, market information gained following sector inquiries or even inquiries directed to the parties notifying an economic concentration regarding the circumstances of past acquisitions.

iii The acquisition of Billa Romania by Carrefour

The acquisition of Billa Romania by the Carrefour group19 was one of the most prominent transactions of 2016 on the Romanian market and involved a very complex analysis from the RCC. The purchaser, Carrefour Nederland BV (Carrefour) acquired the 86 supermarkets operated by Billa Romania, together with a warehouse, as well as the related real estate management and development activities.

For the purposes of the concentration, the RCC determined the relevant markets as (1) the food and non-food products for daily use through hypermarkets, supermarkets, discounters and other similar stores (e.g., proximity stores), located within a 10-minute driving distance from each Billa store located in Bucharest and a 30-minute driving distance from all other Billa stores, at national level (including the respective city and surrounding areas), and (2) the market for supplying daily-use consumer goods at national level (the full definition of this market was left open). The RCC's analysis of this case distinguished itself from the older practice identifying the capture area of each store located in Bucharest as a 20-minute driving distance20 and confirmed the recent approach of the RCC (used in the latest Mega Image acquisitions),21 setting for a 10-minute driving distance as capture area. This reflects the RCC's increasing concern about concentrations in the retail market that could impair effective competition and lead to higher prices for consumers.

According to the analysis conducted by the RCC, the activities of the parties overlapped in the relevant market for the sale of products for daily use on 15 local markets, whereas no overlap was encountered in 18 cities. Moreover, the RCC also carried out a projection of the market shares during the post-merger period (also taking into account the stores that would enter the market during this time). Consequently, the RCC concluded that the aggregate market share of the parties would exceed 40 per cent in the county of Brăila, aspect that raised doubts regarding the compatibility of the transaction with a normal competitive environment.

In order to address the competition concerns highlighted by the RCC, Carrefour committed to transfer two supermarkets operating in Brăila under the ‘Carrefour Market' brand and one supermarket from Brăila operated by Billa and the merger was subsequently cleared by the competition authority. Several months following the clearance of this transaction, the RCC also approved Zanfir SNC as buyer of the two Carrefour stores in Brăila.22

III THE MERGER CONTROL REGIME

i Merger filing to the RCC

Economic concentrations falling within the criteria and thresholds set by the Competition Law must be notified to the RCC. A concentration must be notified to the RCC after conclusion of the agreement based on which control is to be acquired, but before its implementation.

Under the Competition Law, clearance from the RCC must be obtained prior to implementation of an economic concentration. Until the RCC clears the transaction, there is a mandatory suspension obligation before the transaction may be lawfully implemented.

As an exception, the RCC has the right to grant derogation from the non-implementation rule based on a reasoned request received from the parties. However, in practice, the RCC has approved few derogations and only in exceptional circumstances (e.g., financial and economic distress of the target undertaking, potential risk of losing part of the business).

ii Scope of the merger control framework

Under the Competition Law, a concentration is deemed to arise where a change of control on a lasting basis results from:

  • a the merger of two or more previously independent undertakings or parts of undertakings;
  • b the acquisition, by one or more persons already controlling at least one undertaking, or by one or more undertakings, whether by purchase of securities or assets, by contract or by other means, of direct or indirect control of the whole or parts of one or more other undertakings; or
  • c the creation of a joint venture performing on a lasting basis all the functions of an autonomous economic entity (a ‘full-function' joint venture).

Control is defined as the power to exercise a decisive influence over another undertaking. Decisive influence represents the power to determine the strategic commercial behaviour of an undertaking on the market (e.g., appointment of its board of directors, approval of its budget or business plan, entry into new product or geographical markets). Control may be acquired by various means such as, for example, acquisition of shares, veto rights, power to appoint more than half of the board members. Control can also be exercised on a de facto basis.

Notification is required for a merger, acquisition or joint venture where:

  • a the combined worldwide turnover of the undertakings concerned exceeds the lei equivalent of €10 million; and
  • b the turnover of each of at least two of the undertakings concerned derived from activities carried out in Romania exceeds the lei equivalent of €4 million.

The lei equivalent is calculated at the official exchange rate published by the National Bank of Romania for the last day of the financial year preceding the economic concentration.

The turnover represents the income resulting from the sale of products or provision of services in the year preceding the notification. There are specific rules for determining the undertakings concerned and their groups, the concept of turnover and rules for its calculation, and for the geographical allocation of turnover, among others. The turnover must be adjusted according to several rules prescribed by the RCC, the most important being that intra-group turnover, any taxes directly related to the sale of products or the provision of services (e.g., excise duties) and export values (including intra-community deliveries) must be excluded.

Foreign-to-foreign mergers, and the creation of full-function joint ventures must also be notified if the transaction meets the notification thresholds even if such economic concentrations have no impact in Romania (i.e., there is no local effects test).

The Competition Law provides several exceptions to the above rule, where even though the thresholds are met, clearance is not required. The following operations are not considered economic concentrations:

  • a banks and other credit and financial institutions, insurance and reinsurance companies - the normal activities of which include transactions and dealing in securities for their own account or for the account of others - that acquire securities on a temporary basis for resale, provided that they do not exercise voting rights in respect of those securities to determine the competitive behaviour of that undertaking or provided that they exercise such voting rights only to prepare the disposal of those securities and that any such disposal takes place within one year of the date of acquisition (the RCC may extend the one-year term);
  • b control is acquired by a liquidator appointed by a court decision or by another person mandated by a public authority to pursue proceedings related to cessation of payments, judicial liquidation or any other similar proceedings;
  • c restructuring and reorganisation transactions within the same group of undertakings (intra-group operations);
  • d the acquisition of control is made by an undertaking - the sole business purpose of which is to acquire, manage, and dispose of the respective participations - without involvement in the management of that controlled undertaking and without exercising the voting rights in respect of that controlled undertaking, in particular, in relation to the appointment of the management and supervisory bodies of the controlled undertaking, except where only to maintain the full value of such investment, but not to determine directly or indirectly the competitive conduct of the controlled undertaking.
iii Process

The prior notification and clearance of an economic concentration that meets the turnover thresholds in the Competition Law is mandatory and the concentration cannot be implemented before the RCC has cleared the transaction.

Within the pre-notification phase, informal guidance can be obtained in practice from the RCC before actual submission of the notification. Based on a pre-agreement or other binding agreements, pre-notification meetings or discussions can be organised with the case team allocated by the RCC. Such meetings are advisable in order to clarify any aspects regarding the notification and the overall process.

Following the pre-notification phase, the parties to the concentration submit the formal notification of the economic concentration to the RCC. Pursuant to the law, the undertaking acquiring control has the obligation to notify the RCC. In practice, this means that:

  • a in the case of mergers, each of the merging undertakings must notify;
  • b in an acquisition of sole or joint control, the acquirer or acquirers must notify; and
  • c where a full-function joint venture is created, the undertakings that will hold joint control must notify.
iv The procedure for assessing economic concentrations

Within five days following submission of the notification, the RCC informs the parties in writing whether the notification file meets (from a formal perspective) the requirements to be deemed validly submitted.

Valid submission of a notification form triggers Phase I of the procedure. The RCC has 20 days to request additional information if it considers that the notification form is incomplete (the parties must respond no later than 15 days after receipt of the request for information from the RCC). There may be several rounds of requests for information and answers until a notification is deemed complete by the RCC.

The notification becomes effective as of the date the RCC considers that the information received is both accurate and complete. The RCC must immediately inform the notifying parties in respect of the date when the notification became effective.

In addition, upon receiving a notification of an economic concentration, the RCC will publish on its website or in the press a note regarding the notified operation. The note will identify the undertakings concerned, their country of origin, the nature of the concentration, the economic sectors concerned and the date when the RCC received the notification. However, the parties can request (providing sound reasons) that no publication be made until the issuance of the final decision.

Within 45 days of the effective date, the RCC must either issue a non-objection decision (subject to conditions where appropriate) or order the initiation of an in-depth investigation if it believes that the economic concentration may significantly impede competition. If the RCC does not issue a decision within the above term, the concentration is considered authorised.

If the RCC decides to initiate an investigation, proceeding to Phase II of the procedure, it will analyse the compatibility of the economic concentration with the competition environment.

At the end of the investigation, the RCC can issue a refusal decision, an authorisation decision or a conditional authorisation decision.

The investigation must be completed within five months from the effective date. If the RCC does not issue a decision within this term, the concentration is considered authorised.

At the end of the procedure, the decisions of the RCC are published on its website. The parties are asked before publication to identify the confidential information in the decision that should not be published and to provide reasons as to why confidentiality is requested.

In the case that the RCC intends to accept remedies or undertakings proposed by the parties, it will publish a summary of the case and contents of the proposed remedies and any interested third parties can send their observations within the term set by the RCC.

v Economic concentrations likely to be refused

The substantive test applied by the RCC in merger control proceedings is whether a concentration leads to significant impediments to effective competition on the Romanian market or a substantial part thereof (the SIEC test), in particular by creating or strengthening a dominant position in the Romanian market or a part thereof (under Romanian law dominance is presumed at a market share of 40 per cent or more).

In its assessment of economic concentrations, the RCC will consider a broad set of criteria, including the market position of the parties and the degree of concentration in the relevant market, entry barriers (regulatory, financial, or otherwise), the position of actual or potential competitors and the extent to which other competitive constraints exist in order to limit the market power of the undertaking concerned.

However, in assessing the compatibility of an economic concentration with competition law, the RCC will also consider economic efficiency criteria benefits for consumers (e.g., reduction of costs and prices, increased innovation on the market or improvement of supply, or technical progress) that the concentration may bring.

The RCC's analysis focuses on the level of concentration in the market (and the likelihood of an increase in the market share of the parties), prices (and the likelihood of the concentration leading to higher prices). The RCC uses economic analysis (e.g., the upward pricing pressure test for analysis of unilateral effects in horizontal mergers, which consists of identifying the incentives of firms to raise prices post-merger by comparing the upward pricing pressure due to loss in competition and the opposing downward pricing pressure exerted due to cost synergies).

Lastly, it is important to note that the Competition Law provides for the right of the Romanian government to issue a decision prohibiting an acquisition of control over undertakings or assets, upon proposal from the SCND, where the operation poses risks to national security.

vi Third-party views

The RCC may ask for and take into account the views of third parties or other stakeholders in the assessment of economic concentrations, which is often the case in practice in respect of relevant markets where there is little data available.

To this end, the RCC may ask third parties to provide information and documents that it considers relevant in the assessment of the concentration, including through interviews (provided the person concerned agrees to be interviewed), questionnaires addressed to third parties, such as suppliers, customers, competitors or trade associations, and meetings with representatives of the undertakings concerned.

In practice, the RCC publishes on its website an invitation for third parties to submit comments in respect of economic concentrations that are under analysis. The RCC may also ask third parties to submit their comments when it intends to accept commitments proposed by the undertakings concerned.

vii Possible remedies

If an economic concentration has the potential to adversely affect competition in the Romanian market or a substantial part thereof, the parties may propose remedies that address the anticompetitive concerns and make the concentration compatible with a normal competitive environment.

The Competition Law allows both behavioural and structural remedies. However, in theory, structural remedies are preferred due to their likelihood to better address the competition issues raised by the concentration and the ability of the RCC to monitor more efficiently their compliance. Possible remedies include divestments of assets or activities that may be operated independently; termination or amendment of existing exclusive agreements; granting access to necessary infrastructure, networks or key technologies.

The proposed remedies must be sufficient to eliminate all competition concerns identified by the RCC and must be complete, efficient, and capable of being enforced in a timely manner.

viii Ancillary restraints

Economic concentrations often involve certain restrictions that are directly related and necessary for the respective concentration to be effectively implemented by the parties, also known as ‘ancillary restraints'.

According to the Ancillary Restraints Guidelines, such restrictions include non-compete, non-solicitation, and confidentiality obligations, as well as other types of restrictions necessary for the effective implementation of an economic concentration, such as license agreements (where the vendor retains ownership over the intellectual property rights connected to the assets and know-how transferred) or obligations of supply (usually agreed between the vendor and the buyer for a transitory period, where this is necessary for the effective operation of the business transferred).

A clearance decision of an economic concentration by the RCC will generally also cover those restrictions, provided they are directly related and necessary to the relevant concentration. However, the undertakings concerned must assess for themselves whether and to what extent the restraints are ancillary to the economic concentration.

ix Limitations on the permissible duration and geographical scope of restraints

As concerns duration, non-compete, non-solicitation, and confidentiality obligations will be considered ancillary to the concentration provided they are limited to a maximum of three years, when the transfer of the undertaking includes the transfer of customer loyalty in the form of both goodwill and know-how, and a maximum of two years when only goodwill is included. A longer duration is permitted in the case of full-function joint ventures.

The geographical area where such restrictions may apply is only the areas where the vendor offered the relevant products or services prior to the transfer. Exceptionally, areas where the vendor intended to penetrate (provided it also made investments for this specific purpose) may be covered by the ancillary restraints.

The object of the ancillary restraints will be limited to those services and products that formed the scope of activity of the transferred undertaking prior to the concentration.

x Challenging the decisions of the RCC

A decision of the RCC in the field of merger control can be challenged before the Bucharest Court of Appeal within 30 days of communication. The judgment of the Court of Appel can be further appealed before the High Court of Cassation and Justice.

xi Potential sanctions

The RCC may impose severe sanctions for breaching the merger control or other antitrust laws.

Failure to notify an economic concentration prior to its implementation (‘gun jumping') can be sanctioned with an administrative fine between 0.5 and 10 per cent of the total turnover of the infringing undertaking during the year preceding the year of the sanctioning decision. In order to clear any uncertainty as regards the basis for applying the fine for gun jumping to non-residents, GEO No. 39/2017 brought specific amendments to the Competition Law. As per the latest changes, for the purposes of setting the fine, the turnover of a non-resident person is replaced with the sum of the following revenues:

  • a the turnover of each of the undertakings registered in Romania under the control of the infringer;
  • b the revenues generated in Romania by each of the non-resident undertakings under the control of the infringer; and
  • c revenues generated in Romania by the infringer and registered in its individual financial statements.

The Competition Law defines the ‘non-resident person' as any foreign person as well as any other foreign entities, including collective investment undertakings without legal personality, not registered in Romania.

Where a concentration has been implemented and it is subsequently prohibited, the RCC may request that the concentration be unwound (e.g., by dissolution of the merger or new entity resulting from the concentration, the disposal of the shares or the acquired assets) or may impose any other measures adequate to restore the situation before the concentration.

Failure to comply with the conditions or measures imposed by a decision of the RCC may be subject to an administrative fine between 0.5 and 10 per cent of the total turnover of the infringing undertaking during the year preceding the year of the sanctioning decision.

Providing incomplete, inaccurate or misleading information to the RCC may result in an administrative fine between 0.1 and 1 per cent of the total turnover of the infringing undertaking during the year preceding the year of the sanctioning decision.

IV OTHER STRATEGIC CONSIDERATIONS

The Competition Law and secondary rules provide for close cooperation between the RCC and the SCND whenever the competition authority receives a filing regarding an economic concentration. Transactions that are economic concentrations meeting the notification thresholds are automatically notified to the SCND by the RCC, after receipt of the notification of the concentration. Transactions below the notification thresholds must be notified directly to the SCND by the parties.

Since the legislation was rather inconsistently amended, at this stage it appears that every transaction below the relevant thresholds must be notified to the SCND, if it falls within the areas of interest for national security, which are quite broadly defined. The SCND will assess the transaction from a national security perspective according to its decision identifying the main areas of interest for national security. The prohibition decision is then taken by the government, based on the assessment of the SNCD.

In terms of timetable, the SCND must decide within 30 calendar days of receiving the notification if the transaction should be analysed from a national security point of view. If so, the SCND must reach a conclusion within 45 calendar days from receiving all the documents and information required (the clock does not start to run until these have been received).

The real life risk of a prohibition largely depends on the specific circumstances of each case. To date, there has been no prohibition and there is no express sanction for gun jumping regarding the notification to the SNCD.

Apart from the cooperation with the SNCD, the RCC has also concluded a cooperation protocol with the Anticorruption Prosecution Office (DNA).23 According to this protocol, the two institutions offer each other support and exchange any information gathered that might be of relevance for the cooperating party. As such, the DNA informs the RCC about the results of its monitoring of companies that might lead to identifying anticompetitive practices.

In addition, the RCC also works together with the energy regulatory authority (ANRE) on matters of common interest. For instance, the two authorities have recently conducted a joint investigation into the steep rise of electricity prices on the Romanian power exchange in January 2017, in order to determine whether any market manipulation had occurred.

V OUTLOOK & CONCLUSIONS

Taking into account economic dynamics and latest market developments, the future could foster further concentration in the banking (Banca Românească and Bancpost are expected to change owners in the near future) and insurance markets. At the same time, significant M&A activity could also continue in the real estate market (including both the office retail and logistics segments) whereas major privatisations are not likely to take place in the near future.

In its draft Strategic Plan for the 2017-2020 period,24 that the RCC published for public consultation on 16 May 2017, the competition authority emphasises the five strategic objectives it will focus on during the next three years.

According to the first draft made available by the RCC, the main policy objectives of the institution until 2020 are (1) enhancing the impact of competition policy on the economy, especially for sectors essential for both consumers and competitiveness, (2) mobilising state aid expertise to foster economic growth and proper use of public funds through appropriate public policies, (3) expanding the boundaries of competition, (4) increasing transparency and predictability of its processes and activity and (5) improving institutional performance.

As regards the influence of these strategic lines of action over the RCC's merger control policy, the Strategic Plan outlines the importance of rigorous analysis of economic concentrations in all cases where effective market competition could be distorted. Moreover, the RCC affirms that it will focus more on structural remedies than on behavioural ones and that it will closely monitor the fulfilment of commitments.

Among the key performance indicators for meeting its transparency and predictability objective, the RCC also mentions a short review period for merger clearances of around two months, except for concentrations where a simplified notification form is used, that it aims to clear, on average, within only one month. This shows the self-awareness gained by the RCC as regards its merger clearance process, sometimes perceived as too lengthy or cumbersome by the business environment, and its willingness to improve its institutional performance in order not to stand in the way of economic momentum.

Another aspect of relevance mentioned in the Strategic Plan of the RCC is the dynamics and frequency of competition cases and the specialisation of lawyers in this field that, according to the RCC, have led to an increase in the expertise of courts handling competition disputes.

The inception of such a Strategic Plan of the RCC with clear objectives and related performance indicators demonstrates the institution's desire to become more efficient in the future. This should translate into shorter merger clearance periods, strict observance of any commitments undertaken by market participants and a greater level of scrutiny as regards potential gun-jumping practices, including any foreign-to-foreign mergers that the parties may not have notified in Romania.

Kinstellar

8-10 Nicolae Iorga

Bucharest

Romania

Tel: +40 21 307 1500

Fax: +40 21 307 1555

iustinian.captariu@kinstellar.com

catalin.graure@kinstellar.com

www.kinstellar.com

Iustinian Captariu

Kinstellar

Iustinian Captariu is a partner in Kinstellar's Bucharest office. He has been practicing competition law for more than 10 years dealing with all aspects including antitrust proceedings before the competition authority and before the courts, merger control, abuse of dominant position, cartels and vertical agreements, state aid, dawn raids, unfair competition and compliance programmes. Iustinian regularly advises clients in various sectors of the economy exposed to antitrust risks, such as the energy, automotive, pharma, retail or financial services sectors. He is a member of the Bucharest Bar.

Cătălin Graure

Kinstellar

Cătălin Graure is an associate in Kinstellar's Bucharest office, focusing on competition law. Cătălin advises clients on various aspects of competition law, including antitrust proceedings before the competition authority and before the courts, dawn raids and compliance programmes. Cătălin regularly advises clients in various sectors of the economy exposed to antitrust risks, such as the energy, automotive or retail sectors. He is a member of the Bucharest Bar.

1 Iustinian Captariu is a partner and Cătălin Graure is an associate at Kinstellar.

2 European Economic Forecast Spring 2017, 11 May 2017, p. 107, available at: https://ec.europa.eu/info/sites/info/files/ip053_en_1.pdf.

3 According to the EY M&A Barometer 2016 - Central and Southern Europe, p. 3, available at: www.ey.com/Publication/vwLUAssets/2017-MA-Barometr-CSE/$FILE/M&A2016_CSEl.pdf.

4 Idem, pp. 4-5.

5 RCC Annual Report 2016 (Synthesis), p. 29, available at: www.consiliulconcurentei.ro/uploads/docs/items/id12185/brosura_sinteza_raport_anual_2016.pdf.

6 RCC Annual Report 2015, p. 30, available at: www.consiliulconcurentei.ro/uploads/docs/items/id11011/raport_anual_2015.pdf.

7 According to the decisions portal of the RCC, consulted on 9 June 2017, available at: www.consiliulconcurentei.ro/ro/documente-oficiale/concurenta/decizii.html.

8 On 21 June 2016, the RCC adopted Decision No. 37 approving the acquisition of sole control by Carrefour Nederland BV over Billa Romania SRL, Billa Invest Construct SRL and Allib Rom SRL, available at: www.consiliulconcurentei.ro/uploads/docs/items/id11770/decizia_37_2016_carrefour_billa.pdf. The transaction was analysed and cleared by the RCC after a referral from the European Commission.

Also, on 9 February 2017, the RCC published a press release announcing that it had authorised the acquisition of Profi Rom Food SRL by MEP Retail Investments SRL (part of private equity fund Mid Europa Partners). The deal involved the sale of over 500 supermarkets and proximity stores all around Romania. The authorisation decision has not been published by the RCC until June 2017.

9 One of the largest transactions of 2016 was the taking over by Immofinanz AG of CA Immobilien Anlagen AG (RCC Decision No. 47/6 July 2016) which involved the change of control over 10 undertakings in Romania.

10 Farmaceutica Remedia SA acquired seven pharmacies held by MC Serv Tour SRL (RCC Decision
No. 3/26 January 2016); Interbrands Marketing&Distribution SRL acquired sole control over Europharm Holding SA, the former GlaxoSmithKline distribution company in Romania (RCC Decision No. 13/9 March 2016) and Sensiblu SRL acquired control over 78 pharmacies previously owned by Sibpharmamed SRL (RCC Decision No. 62/15 September 2016).

11 Centrul Medical Unirea SRL acquired Delta Health Care SRL and Delta Health Trade SRL (RCC Decision No. 30/17 May 2016), whereas Med Life SA acquired Dent Estet Clinic Group (RCC Decision No. 36/21 June 2016) and Anima Speciality Medical Services SRL and Anima Promovare și Vânzări SRL (RCC Decision No. 19/24 April 2017).

12 Ergo Austria International AG acquired Credit Europe Asigurări Reasigurări SA (RCC Decision No. 16/21 March 2016) and Vienna Insurance Group acquired Axa Life Insurance SA through BCR Asigurări de Viață SA and Omniasig SA (RCC Decision No. 68/10 October 2016).

13 In 2016, the French Lactalis group strengthened its presence on the Romanian dairy products market by acquiring one of its local competitors, Albalact. In December 2016, market sources also indicated that Lactalis had reached an agreement for the acquisition of Covalact (the RCC has yet to announce any decision clearing this transaction). The acquisition of Albalact (made through BSA International) was cleared through RCC Decision No. 44/27 June 2016.

14 See note 8 above.

15 The RCC published a press release in November 2016 announcing that it had cleared the merger. Up to June 2017, the clearance decision has not yet been published by the competition authority. According to the press release, the merger leads to the consolidation of the market position of Dante and to a decrease in competition pressure regarding certain product categories.

In order to obtain the clearance, Dante committed to divest four online stores (i.e., www.pcfun.ro, www.shopit.ro, www.garagemall.ro and www.electrofun.ro). Also, Dante committed not to get involved in the divested activities for a period of at least 10 years. The divestiture will take the form of a transfer and will not entail business disruption. Dante will undertake the necessary efforts to maintain the economic viability and competitiveness of the online stores to be transferred and will supply products on a non-discriminatory basis to any future acquirers.

16 Decision No. 42/24 June 2016, available at: www.consiliulconcurentei.ro/uploads/docs/items/id11966/decizie_42_2016_publicis_bv_neconfidentiala_finala.pdf.

17 Decision No. 66/5 October 2016, available at: www.consiliulconcurentei.ro/uploads/docs/items/id12088/decizie_eeaf_ua.pdf.

18 See below, Section III.xi, infra.

19 See note 8 above.

20 For instance, Decision No. 32/29 July 2013 authorising the acquisition of sole control by Auchan Romania SA over real Hypermarket Romania SRL, p. 11, available at: www.consiliulconcurentei.ro/uploads/docs/items/id8688/decizia_auchan_site.pdf.

21 Decision No. 46/14 November 2014 authorising the acquisition by Mega Image SRL of assets belonging to Angst Retail SRL, p. 12, and Decision No. 48/20 October 2015 authorising the acquisition by Mega Image SRL of assets belonging to General Nic Import Export SRL, p. 10.

22 See the press release published by the RCC on 11 January 2017, available at: www.consiliulconcurentei.ro/uploads/docs/items/id12020/autorizare_carrefour_zanfir_ian_2017.pdf.

23 As per the press release published by the RCC in September 2015, available at: www.consiliulconcurentei.ro/uploads/docs/items/id10568/protocol_dna_sept_2015.pdf.

24 The Strategic Plan for the 2017-2020 period is available at: www.consiliulconcurentei.ro/ro/docs/177/12175/consultare-publica-cu-privire-la-planul-strategic-pentru-perioada-2017-2020-al-
consiliului-concurentei.html.