By Janina C. Lim, April 4 2019; Business World
Image Credit to Business World
THE PHILIPPINE Competition Commission (PCC) has drafted rules for faster review of mergers and acquisitions (M&A) deals that are relatively simple or have little local impact.
PCC, which is asking for public comments on the draft until April 10 and aims to finalize the guidelines by June, on Wednesday issued the draft rules on expedited merger review.
Among others, the draft said qualified transactions will be reviewed within 15 days from the PCC’s receipt of notification and supporting documents, compared to 30-90 days for regular reviews.
“The context is clearly based on experiences so far. There are certain transactions that can easily be classified as easy cases from the point of view of the Mergers and Acquisitions [Office],” PCC Chairman Arsenio M. Balisacan said in a telephone interview.
The draft enumerated five traits that could qualify M&As for the expedited review, namely:
• there are no horizontal or vertical relationships between the acquiring and acquired entities;
• the merger is a global transaction wherein the acquired and the acquiring entities are foreign and their subsidiaries in the Philippines are merely manufacturers or assemblers of products which are all exported;
• the merger is global, and the acquiring and acquired entities have limited Philippine presence;
• the merger will result in the acquiring entity getting sole control over an entity over which it has joint control, provided the former is not operating in any other market except the one in which the joint venture operates;
• and joint ventures formed purely for construction and development of a residential or commercial real property project.
“These Rules on Expedited Merger Review may be revised or amended from time to time,” the draft read.
As of April 1, PCC had received 178 transactions worth P2.82 trillion. Of this complement, 116 deals had been approved by then. — Janina C. Lim