THERE IS a real possibility that the Republic’s mergers and monopolies legislation could have allowed anti-competitive deals to slip through the net over the last eight years, according to Dr Vincent Power, head of EU and competition law at Dublin commercial solicitors’ firm, A&L Goodbody.
The current system requires that any deal involving businesses with turnovers of €40 million or more be notified to the Competition Authority.
Dr Power said yesterday that this had allowed the regulator to be more focused and efficient in its approach.
However, he added that a review of the first 500 mergers that the authority investigated under this regime suggests that some anti-competitive agreements could have gone through, as they were not notified to the regulator.
Dr Power pointed out yesterday that of the 500 mergers investigated by the authority, only three were voluntarily notified to it. Those involved in the other 497 had to notify the regulator, as they were at or above the threshold.
He argued that it was possible that deals involving businesses which did not meet the threshold, and that were in fact anti-competitive, could have gone ahead with no investigation or inquiry.
Dr Power said that a number of changes would help bolster the existing regime and reduce the risk of anti-competitive deals going ahead un-noticed by the authority.
He pointed out that some countries also use a market share threshold, and suggested that this could also be introduced into the Republic’s competition legislation.
In addition, the lawyer said that the €40 million threshold could be seen as high in an economy that has been getting smaller over the last few years. He added that the US index links its thresholds for merger notification and investigation.
Overall, Dr Power said that the Competition Authority does a good job. The number of deals refused, three, or 0.6 per cent of the total, is in line with international norms. One of those, the Kerry-Breeo Foods takeover, is the subject of a Supreme Court challenge.
The current regime was introduced under the Competition Act, 2002, which became law at the beginning of 2003.
