BIICL London, 16 November 2007

1. BIICL London, 16 November 2007 Practitioners’ Points: The Consolidated Jurisdictional Notice Dr Johannes Luebking Deputy Head of Unit, Directorate C-5, DG Competition The views expressed are personal and do not necessarily reflect the views of the European Commission nor those of DG COMP Page 1

2. Scope and Sources • Consolidation of current jurisdictional Notices • Concept of Concentration • Joint Ventures • Undertakings concerned • Calculation of Turnover • Covers all issues relevant for Commission’s original jurisdiction under Merger Regulation • Sources for review • New Merger Regulation • Recent jurisprudence, i.e. Cementbouw and Endesa • Decisional practice of Commission Page 2

3. Concentration • Acquisition of control by investment funds • Normally • Investment company acquires indirect control under Article 3 (1), (3) • Investment company indirectly holds rights in portfolio companies under Article 5(4) • Consequence: turnover of all portfolio companies is taken together, even if held by different funds organised by same investment company Page 3

4. Concentration • Object of control • Assets constituting a business with market presence • Outsourcing cases: Concentration only if • Transfer of assets and/or personnel • That allow acquirer to develop market presence beyond outsourcing client • Time-frame similar to start-up period for full-functionality of JVs Page 4

5. Concentration • (Joint) acquisition and immediate split-up of target • Separate concentrations if • Legally binding agreement on break-up • No uncertainties that second transaction takes place within short time-frame • Maximum normally 1 year Page 5

6. Concentration Parking/warehousing transactions • Interim purchaser acquires target “on behalf“ of ultimate purchaser on basis of agreement on future on-sale • Often major part of economic risk shifted to ultimate purchaser who may be granted specific rights • First transaction considered first step in single concentration comprising lasting acquisition of of (parked) target by ultimate purchaser • First transaction no concentration in its own right and not considered to fall under Article 3(5) Page 6

7. Concentration • Interrelated transactions: when are several transactions considered one concentration? • Under Article 3: Cementbouw, recital 20: • Transactions unitary in nature • Transactions de jure or de facto interconditional • Only if control is acquired by same undertaking(s), not in cases of assets swaps or de-mergers of JVs • Examples: • One business, one economic entity • Parallel (EQT/H&R/Dragoco) or serial acquisition (Kingfisher) • Under Article 5(2)(2): • Successive transactions between same parties within two-year period considered one concentration for calculation of turnover • Assessment under Article 3 is precedent Page 7

8. Types of control • Sole control comprises • Positive sole control • Negative control by minority shareholder • De facto sole control: on basis of past voting pattern and prospective analysis • Joint control: more on commonality of interests and de facto situations • Reduction in number of shareholders: concentration only if change from joint to sole control Page 8

9. Joint Ventures • Distinction between • Joint acquisition of control of existing undertaking, falling under Article 3(1) • Creation of a JV, falling under Article 3(4) • Clarification of full-functionality criteria Page 9

10. Community Dimension • Relevant date for establishing jurisdiction: Earlier of • Date of notification to Commission or national competition authorities • Conclusion of agreement, announcement of public bid, etc. • Turnover calculation • Normally based on audited accounts of previous financial year • Adjustments to be made in case of permanent changes in economic reality of undertakings concerned (CFI in Endesa) Page 10