Merger Control & Foreign Investment Regimes

Introduction

Join Davina Garrod of Akin Gump Strauss Hauer & Feld LLP who will discuss how more than 130 countries around the world now have merger control regimes, with around 70 enforcing foreign investment screening as well. Some merger control regimes also screen for foreign investments/national security, such as China and South Africa. Others run parallel regimes, including the UK, Canada, the US and Germany. At the start of every proposed transaction - whether traditional M&A, a JV, minority investment or a financial restructuring - multijurisdictional merger control and foreign investment analyses need to be done in order to identify those regimes requiring pre-notification and approval prior to closing. Understanding the target’s geographic footprint, and obtaining its country-by-country revenue and asset breakdown, go a long way towards producing a definitive list of filing jurisdictions. Failure to notify and obtain approval (so-called “gun-jumping”) can give rise to fines of up to 10% of the parties’ global revenues, an unwinding of the transaction and reputation damage.

Strategic transactions (e.g. where companies in the same sector combine) as well as private equity investments (e.g. where a portfolio company of the acquirer competes with target) can in particular give rise to substantive merger control risk in various jurisdictions, which needs to be carefully quantified at the outset so that risk allocation can be addressed in the transaction documents. Certain jurisdictions are particularly rigorous merger control enforcers, such as the UK Competition & Market Authority and the US Federal Trade Commission, and which have extraterritorial reach. Others can have long review timelines, such as China, Brazil and India.

From 4 January 2022 the UK National Security & Investment Act became effective, and operates in parallel with the UK merger control regime. Other leading foreign investment/national security regimes include US CFIUS, German BMWk, Australian FIRB and Canadian ICA. Determining whether target is active in any of the prescribed sensitive sectors, such as defence, dual-use, AI and critical infrastructure, is an important first step towards identifying where foreign investment filings are needed and how long approvals will take.

What You Will Learn

This live and interactive session will cover the following:

• Which transactions are caught by the major merger control and foreign investment rules around the world
• How to identify where merger control and foreign investment/national security approvals will be needed
• Fines, reputational damage and other negative consequences of failure to file a qualifying transaction
• Which types of transactions will give rise to substantive merger control and/or foreign investment risk
• What remedies/orders competition and foreign investment authorities can impose
• Risk allocation provisions in merger agreements
• Building merger control and foreign investment approvals into the transaction timetable
• Key provisions of the UK merger control and UK National Security & Investment regimes
• European substantive and procedural developments and trends
• Major regimes in Europe, Asia and the Americas

Recording of live sessions: Soon after the Learn Live session has taken place you will be able to go back and access the recording - should you wish to revisit the material discussed.