Streamlined Notification Requirements for Simplified Review of Concentrations under the Antimonopoly Law
On September 14, 2024, China’s State Administration of Market Regulation (SAMR) unveiled significant revisions to the Notification Form of Antitrust Simplified Review for Concentrations of Business Operators (Notification Form) and Public Notice Form of Simplified Review Case for Concentrations of Business Operators (Public Notice Form).1 The revisions streamline the submission requirements for notifying mergers, acquisitions, and joint ventures notified for antitrust review pursuant to the Antimonopoly Law under the simplified procedures for certain categories of transactions that are unlikely to have significant competitive effects in China. Specifically, the revisions reduce the requirements for competitive effects analysis and detailed market share information, eliminate the requirement for non-confidential versions of the notification, and cut redundant questions. The updated filing requirements for the simplified procedure will take effect on October 12, 2024.
Elimination of Non-Confidential Version of Notification Form for Simplified Reviews
Under current practice, notifying parties seeking simplified review are required to submit three distinct forms: 1) a confidential version of the notification form; 2) a non-confidential version of the notification form; and 3) a public notice form. The public notice form is used to publish basic information about the transaction to the public upon the initiation of the review to solicit public comment on the requested expedited clearance of the concentration within the 10-day public notice period.
Under the updated procedures, notifying parties will only be required to submit a confidential application form and a public notice form when seeking simplified review.
Reduction in Competitive Assessment Reporting Requirements for Simplified Reviews
Under current practice, notifying parties seeking simplified review are required to submit assessments of the impacts of the proposed concentration on the relevant markets. In addition to narrative explanations, parties are also required to submit data on the estimated market shares of the parties and the leading competitors in the relevant markets. Developing robust market share data frequently proves challenging in diffuse industries where third-party industry reports are not readily available.
The updated filing requirements dramatically reduce the competitive analysis required for simplified cases, distinguishing between different categories of simplified cases based on their apparent effects in China.
Where the concentration involves either (a) the establishment of a joint venture outside China that does not engage in economic activities in China or (b) acquisitions of the equity or assets of targets outside China that do not engage in economic activities in China, notifying parties will no longer be required to submit either market share data or other competitive analysis
In the case of (a) (i) horizontal concentrations in which the parties combined market shares in any relevant market do not exceed 15%; (ii) vertical and conglomerate concentrations in which each party’s shares in the markets relevant to the concentration do not exceed 25%; or (b) transfers of control over a joint venture among the controlling parents, the notifying parties will no longer be required to complete the competitive assessment in the initial submission. SAMR may, however, subsequently request a competitive assessment.
The reporting requirements are further relaxed in horizontal concentrations in which the parties’ combined market shares in any relevant market do not exceed 5% and to non-horizontal concentrations in which each party’s shares in its respective relevant markets do not exceed 5%. Under such circumstances, if the notifying parties “have difficulty obtaining market share data issued by a third party recognized by the industry”, then it is permissible to provide only the market share data of the operators involved in the concentration and the overall market size data (without providing market share data for other competitors). The SAMR may require supplemental information on competitor market shares if necessary.
Reduction in Mandatory Items for Simplified Reviews
The number of information items required in the Notification Form has been reduced from 44 to 38, significantly cutting down the workload for operators applying for simplified review.
Parties seeking simplified treatment are no longer required to submit “internal and third-party research, analysis, and reports” (previously required Item 5.1.16) of the operators involved in the concentration or the “National Bureau of Statistics Codes and Product or Service Descriptions” (previously required Item 8.1) related to the businesses of all parties involved in the concentration.
In addition, parties are no longer required to provide separate responses to several items that, in practice, are routinely addressed in answers to other questions on the form. These include: information on “historical circumstances of establishment and significant changes” of the operators involved in the concentration (previously required in Item 5.1.10); information “relationship between the ultimate controller(s) and the operators involved in the concentration” (previously required in Item 5.1.13); and information on main competitors” (previously required in Item 8.4).
SAMR has not announced changes to filing requirements for standard notifications.
Streamlining the filing requirements for the simplified procedure reduces burdens on both the notifying parties and SAMR personnel.
Runyu Liu of Shanghai Kaiman Law Firm also contributed to this article.
1市场监管总局关于修订发布《经营者集中简易案件反垄断审查申报表》《经营者集中简易案件公示表》的公告 (The State Administration for Market Regulation’s Announcement on the Revision and Release of the “Anti-Monopoly Review Declaration Form for Simplified Cases of Business Operator Concentration” and the “Public Notice Form for Simplified Cases of Business Operator Concentration”) (Ch.)
