By Pilar Manuel, September 16, 2022; CNN Philippines
Metro Manila (CNN Philippines, September 16) — The Philippine Competition Commission (PCC) announced Friday new thresholds for required notifications on mergers and acquisitions with the expiry of temporary caps set by the Bayanihan to Recover as One Act.
In a statement, the PCC said that effective Sept. 16, it must be notified on mergers and acquisitions reaching a size of party (SoP) of ₱6.1 billion and a size of transaction (SoT) of ₱2.5 billion for mandatory merger review.
The antitrust body says the SoP refers to the total value of assets or revenues in the Philippines of the ultimate parent entity in the transaction. Meanwhile, the SoT is the value of assets or revenues of the entity that will be acquired and the entities it controls.
“Since the 2-year temporary thresholds of ₱50 billion for SoP and SoT under the Bayanihan to Recover as One Act (Bayanihan 2) were set to expire on September 15, 2022, the PCC calculated the thresholds to be provisionally set by updating the 2020 thresholds based on the country’s nominal gross domestic product (GDP) growth in the past two years,” it said.
Companies who want to confirm whether they are not subject to the previous ₱50-billion thresholds must submit definitive agreements signed before Friday along with their letter of non-coverage to the Mergers and Acquisitions Office, the PCC added.
Prior to Bayanihan 2, the PCC’s thresholds for mandatory notification were ₱6 billion for SoP and ₱2.4 billion for SoT.
“Originally set at ₱1 billion in 2015 under the Philippine Competition Act, the initial merger thresholds have since been subject to adjustment under PCC Memorandum Circular 2018-001. This ensures that the notification thresholds account for inflation and the country’s overall economic performance,” said the competition watchdog.
The PCC was formally established on February 2016. Among its powers and functions are probing and deciding on cases involving violations of the PCA and its implementing rules; monitoring and analyzing the practice of competition in markets, and issuing advisory opinion, rules, and guidelines on competition matters.