The Lexpert Guides to the Leading US/Canada Cross-Border Corporate and Litigation Lawyers in Canada profiles leading business lawyers and features articles for attorneys and in-house counsel in the US about business law issues in Canada.
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INTERNATIONAL MERGER NOTIFICATION COMPETITION LAW NOTIFICATIONS FOR MULTI-NATIONAL MERGERS A MERGER THAT INVOLVES MULTI-NATIONAL ENTITIES MAY REQUIRE CONSIDERATION OF NUMEROUS JURISDICTIONS, SOME OF WHICH MAY HAVE UNCLEAR OR DEVELOPING NOTIFICATION THRESHOLDS OR PROVISIONS By John Bodrug and Jim Dinning; Davies Ward Phillips & Vineberg LLP WITH THE CANADA/US Free Trade Agreement in 1988, then the North American Free Trade Agreement in 1994, followed by increasing globalization of many markets, Canadian companies are increasingly involved in mergers and acquisitions where the parties have assets or sales in multiple jurisdictions around the world. Such transactions can be subject to competition law approval or notification and waiting period requirements in jurisdictions in which the parties and their affiliates have significant assets or sales — even if the parties do not compete and the transaction clearly does not otherwise lessen or prevent competition. For many years, as a practical matter, Canadian companies involved in such transactions needed to consider only the competition law regimes of Canada, the US and the EU. That is no longer the case. More than a hundred countries now have competition laws providing for merger review. Many of them include pre-merger notification regimes, and some of those are triggered by low sales or asset thresholds. The laws in many of these countries may impose lengthy waiting periods before closing can occur, and provide for significant fines for failure to comply. Some jurisdictions take inconsistent approaches to when notices must be filed, the calculation of financial review thresholds, and other aspects of notification procedure. To avoid unpleasant surprises and delays to implementation, parties to a multi-national transaction need to assess the potential foreign competition notifications and approval requirements at a relatively early stage of transaction planning. 34 | LEXPERT • June 2013 | www.lexpert.ca C-00-Firm.indd 34 13-05-17 10:06 AM