INTERESTING(?) DEVELOPMENT ON JURISDICTIONAL ISSUES IN EU AND HUNGARIAN MERGER CONTROL

About three weeks ago the Hungarian Metropolitan Tribunal obliged the Hungarian Competition Authority (Gazdasági Versenyhivatal (GVH)) to re-evaluate a merger decision. The interesting part comes here: the GVH decided that it has no jurisdiction since the concentration meets the EU thresholds in the Merger Regulation. Therefore it has terminated the procedure. The parties turned to the Metropolitan Tribunal and argued that the concentration is not a full-function joint venture so the European Commission has no jurisdiction, but according to Hungarian national rules it must be notified to the GVH.

The GVH turned to the European Commission whether the concentration has a Community dimension or not (the GVH thinks according to the order of the court that it has), and the court used this opportunity to oblige the authority to re-initiate the procedure, stay it and wait for the answer of the European Commission.

The funny(?) part of the situation is that non full-function joint ventures don't have to be notified in Hungary to the GVH or in the EU to the European Commission. If it is a full-function joint venture than the GVH is by law not allowed to re-initiate the procedure, since the merger regulation prevents it from doing so (lack of jurisdiction - exclusive jurisdiction). If it is not a full-function joint venture, than the GVH shall not start according to the competition act a merger procedure and reconsider the situation, since it is not a concentration under Hungarian law. But in this case it must start a procedure according to Article 11 of the Hungarian Competition Act (or even under Article 101 TFEU). I can not see how this might be good for the clients of the law firm which asked the Metropolitan Court to order the GVH to re-examine the concentration. (I also wonder why the undertakings used the merger notification form to notify a transaction which is not a concentration according to them...)

Here is the original judgement.

pdfHere is a draft translation by me.

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