What is a concentration?
“According to law No.9121, dated 28.07.2003 “On Competition Protection” Chapter III Article 10 Concentrations of undertakings are present when there is a stable change of control as a result of:
- Merger of two or more undertakings or parts of undertakings independent of one another;
- Acquisition of direct or indirect control by one or more natural persons that simultaneously control at least one other undertaking or by one or more undertakings, over one or more undertakings or parts of them, through the purchase of shares, quotas or assets, contracts or any lawful means;
- Direct or indirect control over one or more undertakings or part of the latter;
- The creation of a joint venture which does have as a goal or consequence the coordination of competing activities between two or more independent undertakings”.
- Merger of two or more undertakings or parts of undertakings independent of one another;
- Acquisition of direct or indirect control by one or more natural persons that simultaneously control at least one other undertaking or by one or more undertakings, over one or more undertakings or parts of them, through the purchase of shares, quotas or assets, contracts or any lawful means;
- Direct or indirect control over one or more undertakings or part of the latter;
- The creation of a joint venture which does have as a goal or consequence the coordination of competing activities between two or more independent undertakings”.
Types of concentrations
Concentrations are:
Horizontal- if the participating undertakings are active in the same relevant market
Vertical- if the undertakings operate at different levels of the market Mixed- if the undertakings, although they may not be at different levels of the market, are active in different product markets. These are also called non-horizontal concentrations.
Mergers or concentrations can be neutral to competition or, in some cases, make undertakings more efficient, strengthen their competitiveness and lead to lower costs, thereby increasing the benefits to consumers. The merger activity is part of industrial restructuring and is seen as necessary to respond to the challenges of the world economy.
Horizontal- if the participating undertakings are active in the same relevant market
Vertical- if the undertakings operate at different levels of the market Mixed- if the undertakings, although they may not be at different levels of the market, are active in different product markets. These are also called non-horizontal concentrations.
Mergers or concentrations can be neutral to competition or, in some cases, make undertakings more efficient, strengthen their competitiveness and lead to lower costs, thereby increasing the benefits to consumers. The merger activity is part of industrial restructuring and is seen as necessary to respond to the challenges of the world economy.
When is a concentration subject to scrutiny by the Albanian Competition Authority?
“A concentration shall be subject to scrutiny by the Albanian Competition Authority, so it is notified to the Authority for authorization only if it fulfills the condition foreseen in Article 12/1 of the law: “Concentrations of undertakings shall be notified to the Authority to obtain authorization, if in the last financial year, before the concentration:
a) the turnover of all participating undertakings together in the international market is more than ALL 7 billion and the turnover of at least one domestic market participant is more than ALL 200 million.
b) The turnover of all participating undertakings together in the domestic market is more than ALL 400 million and the turnover of at least one participating undertaking in the domestic market is more than ALL 200 million.
a) the turnover of all participating undertakings together in the international market is more than ALL 7 billion and the turnover of at least one domestic market participant is more than ALL 200 million.
b) The turnover of all participating undertakings together in the domestic market is more than ALL 400 million and the turnover of at least one participating undertaking in the domestic market is more than ALL 200 million.
When should a concentration be announced?
The concentration fulfilling the condition above (Article 12/1 of the law) must be notified within 30 days from the conclusion of the merger or acquisition of control or the establishment of a joint venture with the characteristics provided for in Article 10/3 of the law, as well as the publication of the offer for purchase or exchange. Even an oral agreement of the parties selling or buying is considered a concentration and should be notified within one week to the ACA, but always when meeting the turnover limit. (Article 12/2. The concentrations provided for in paragraph 1 of this Article shall be notified within 30 days from the conclusion of the merger or acquisition of control or the establishment of a joint venture with the features provided for in Article 10/3 of the law, as well as from the publication of the public offer for purchase or exchange).
We emphasize that the concept of concentration, the obligation to notify or the entire concentration control procedure provided for in law No.9121, dated 28.07.2003 “On Competition Protection”, is the same as that provided by the European legislation. In this context, and in compliance with the obligation set forth in Article 84 of the law, it is also:
a) “The regulation on the implementation of undertaking concentration procedures” (see the Regulations-archive to download the Regulation)
b) Guideline for Concentration Notice Form (see Guidelines and Forms-archive to download the Guideline) and Concentration Notification Form (see Guidelines and Forms-archive to download the full or simplified Form), which are made available to parties having the obligation to notify the concentration. The above-mentioned by-laws are in conformity with the European legislation for this purpose.
We emphasize that the concept of concentration, the obligation to notify or the entire concentration control procedure provided for in law No.9121, dated 28.07.2003 “On Competition Protection”, is the same as that provided by the European legislation. In this context, and in compliance with the obligation set forth in Article 84 of the law, it is also:
a) “The regulation on the implementation of undertaking concentration procedures” (see the Regulations-archive to download the Regulation)
b) Guideline for Concentration Notice Form (see Guidelines and Forms-archive to download the Guideline) and Concentration Notification Form (see Guidelines and Forms-archive to download the full or simplified Form), which are made available to parties having the obligation to notify the concentration. The above-mentioned by-laws are in conformity with the European legislation for this purpose.
When does the obligation for notification in a simplified procedure arise?
In case of concentrations that do not result in changes to the relevant market structure, the notifying party fills out the simplified notification form. All this procedure begins with a request by the notifying party, where it argues that the concentration achieved has no consequence for increasing or creating the position of the unit after the concentration. This is the case where the transaction is a change of ownership, which does not cause a change within the unit of the transaction, but also in the relevant market sector. Nevertheless, it is the Albanian Competition Authority (The Secretariat) that decides that the notifying party will use the simplified form of notification.
Stages of considering a concentration
The control procedure of a concentration lasts 5 months and is divided into two stages:
Pre-trial phase (2 months)
In-depth procedure phase (3 months)
In a concentration notification procedure, the Albanian Competition Authority also invites third parties who feel that they may be directly or indirectly affected by this concentration.
The in-depth procedure is opened only where the realized and announced concentration shows signs of significantly restricting competition in a market or a part of it, in particular, as a result of the creation or strengthening of a dominant position and this procedure begins by decision of the Commission.
Pre-trial phase (2 months)
In-depth procedure phase (3 months)
In a concentration notification procedure, the Albanian Competition Authority also invites third parties who feel that they may be directly or indirectly affected by this concentration.
The in-depth procedure is opened only where the realized and announced concentration shows signs of significantly restricting competition in a market or a part of it, in particular, as a result of the creation or strengthening of a dominant position and this procedure begins by decision of the Commission.
Rights deriving from the authorization of a concentration
The authorization or not of a concentration is the exclusive right of the Albanian Competition Authority and cannot be returned by the Court either. Article 65/3 of the law “The requirements for exemption from a prohibited agreement and concentration control procedures are not subject to the jurisdiction of the courts.”