INSTRUCTION on the manner for calculation of total income of parties involved in concentration in case when the control is to be acquired over the part of the company

 

Article 21, paragraph 1, item 2 of the Law on Protection of Competition defines that the concentration between market participants shall occur in case of direct or indirect acquisition of control over whole or a part of other market participant by one or more market participants.

The control mentioned in the above paragraph is deemed to constitute of decisive influence on business activities of market participant, on the grounds of granted rights, agreements or any other legal or actual facts, particularly the following:

1) ownership over or the right to dispose with whole or part of the property of the market participant;

2) contractual authorization or any other grounds enabling decisive influence on composition, activities or decision making of another market participant.

When the market participant has acquired control only over a part of another market participant in concentration procedure, parties involved in concentration are considered to be market participant acquiring control and only a part of market participant over which a control has been acquired. Pursuant to the stated, mutual total annual income of parties involved in concentration is calculated as a sum total of income of acquiring company (taking into account also total annual income of all market participants with which acquring company is considered to be related in line with Article 5 of the Law) and a part of company over which a control has been acquired.

A part of market participant over which a control has been acquired shall be deemed to constitute one or more separate organizational units (e.g. branches) which can act independently on market, or internal organizational units (e.g. departments), as well as specific means which can be used for performance of business activities (e.g. licences), i.e. all those parts of market participant where the total anuual income realized in market can be calculated.

 

 

INSTRUCTION for calculation of total annual income referred to in Article 23 of the Law on Protection of Competition relating to Article 5 of the Law

 

Article 5 of the Law on Protection of Competition defines that the Law is applied also to related market participants, where two or more related market participants pursuant to the Law, shall be considered as a single market participant.

Two or more market participants shall be considered as related market participants when one of them directly or indirectly, exercises decisive influence on the management of the market participant, particularly on the grounds of holding majority share capital, exercises more than half of voting rights in managements boards, has a right to appoint more than half of the members of management or supervisory board and the persons authorised to act as proxies to market participant and agreements on transfer of controlling interest.

On submitting the request for approval of concentration, in case when related market participants are involved pursuant to Article 5 of the Law, total annual income referred to in Article 23 of the Law shall be calculated as a sum total of all incomes realized by market participants considered as related and belonging to the same group.