Mergers - Poland
The Act on Competition and Consumer Protection prevents concentration of undertakings, which may have negative effect on competition.
Types of concentration
The concentration of undertakings can take place by:
- merger of two or more independent undertakings;
- taking over – by way of acquisition or entering into a possession of stocks, other securities, shares or in any other way obtaining direct or indirect control over one or more undertakings by one or more undertakings;
- creation by undertakings of one joint undertaking;
- acquisition by the undertaking, of a part of another undertaking’s property (the entirety or part of the undertaking), if the turnover achieved by the property in any of the two financial years preceding the notification exceeded in the territory of the Republic of Poland, the equivalent of EUR 10 000 000.
The President of the Office of Competition and Consumer Protection (UOKiK) must be informed about an intention of concentration in case where:
- the combined worldwide turnover of undertakings participating in the concentration in the financial year preceding the year of the notification exceeds the equivalent of EUR 1 billion, or
- the combined turnover of undertakings participating in the concentration in the territory of the Republic of Poland in the financial year preceding the year of the notification exceeds the equivalent of EUR 50 million.
- links to the national and EU legal acts regarding concentration of undertakings in English can be find on website of Office of Competition and Consumer Protection
The duty of notification is excluded due to potentially insignificant impact of the planned transaction on the market, e.g. if a undertaking's revenue in Poland (in either of the two financial years preceding the notification) has not exceeded EUR 10 million, or if the merger concerns entities within the same capital group.
If a concentration results in a significant restriction of competition in the market, in particular by the creation or strengthening of a dominant position, the President of the UOKiK can prohibit it. The Act on Competition and Consumer Protection (art. 20) allows concentrations that limit competition if such a concentration leads to economic or technical development or has a positive effect on the economy.
Detailed conditions that should be met when reporting an intention of concentration along with a list of information and documents that should be submitted to the President of the UOKiK are given in the regulation concerning the intention of concentration of undertakings.
Companies whose intention of concentration is subject to obligatory notification are required to withhold from concentration until a decision has been issued by President of the UOKiK or until the lapse of time within which such a decision is to be issued.
Once launched, concentration procedures should be completed within two months.
Buying an existing company, with an already established structure, can be a good way of expanding your business.
Notification of an intention of concentration should be made by the undertaking performing the concentration. The following entities are required to submit a notification depending on the way that the undertakings intend to perform the merger:
- if the concentration is to take place by the merger of two or more independent undertakings - notification should be made jointly by the companies;
- if the concentration is to take place by acquiring control - notification should be made by the undertaking taking over control of the remaining undertakings;
- If the concentration is to take place by the creation of a joint undertaking by the undertakings taking part in the concentration - notification should be made by all the undertakings taking part in the creation of the new undertaking;
- If the concentration is to take place through purchasing or acquiring part of the assets of another undertaking - notification should be made by the undertaking purchasing or acquiring the assets.
Undertakings that lodge applications in merger cases are obliged to pay a fee. If the fee is not paid, the President of the UOKiK President shall call on the applicant to pay the fee within 7 days. Non-payment of the fee shall mean that the application shall not be reviewed.
Check also the legislation on this topic in: