M&A: Overview of merger clearance and practical issues   

One of the most important elements for а healthy business environment and a key prerequisite for economic growth is maintaining effective competition in domestic and national markets.

Among the powers, available to national competition authorities and the European Commission in terms of maintaining effective competition, is the control over concentrations when the sum of the total turnover of the undertakings involved in the concentration [1] exceeds a certain threshold. For Bulgaria this threshold is determined as follows - the sum of the aggregate turnover of all undertakings participating in the concentration on the territory of the Republic of Bulgaria in the preceding fiscal year exceeds BGN 25 million and   

► The turnover of any one of at least two undertakings participating in the concentration on the territory of the Republic of Bulgaria in the previous fiscal year exceeds BGN 3 million,


► The turnover of the undertaking - subject to acquisition on the territory of the Republic of Bulgaria in the previous fiscal year exceeds BGN 3 million.

In the event that these thresholds are reached, the parties to the concentration will be obliged to notify the national competition authority (for Bulgaria it is the Commission on Protection of Competition / CPC) in order to assess the effect of the concentration on competition.

Most concentrations do not raise competition concerns and they are quickly cleared by the CPC without opening stage II of the proceedings - the "in-depth analysis"[2]. However, others may have an adverse effect on the competitive environment, for example when they lead to the elimination of competitors from the market or lead to the creation of companies with excessive market power.   

Who is responsible for filing the notification of a concentration?

The concentration notification should be filed jointly by the undertakings that are parties to the merger or acquisition, or have created a joint venture, respectively by the party acquiring sole control.   

Notification form

Since 1 January 2020, the CPC has been applying new merger filing guidelines for merger notification. The previous guidelines did not distinguish simplified and complex transactions in view of potential competition concerns.  The new notification form is available here


A concentration assessment procedure must be initiated within three days of receipt of the notification by the Commission or after all the necessary information has been submitted to the Commission.

Following the initiation of the concentration approval procedure, the stage of the so-called "fast-track inquiry" begins, which ends within 25 working days.

The procedure can continue for another 4 months, if after the completion of the fast-track inquiry a second phase is initiated - an in-depth analysis. In cases of factual and legal complexity, the period may be extended by no more than 25 working days.     

Concentration assessment

A Bulgarian peculiarity is that the CPC uses the dominance test of the assessment of concentrations in Bulgaria. In order to prohibit a concentration, it is necessary for the cumulative fulfillment of two conditions: the concentration to lead to the creation or strengthening of a dominant position and thus to the distortion of effective competition on the respective market.

Unlike Bulgaria, when assessing concentrations with a Community dimension, the European Commission assesses whether the notified transaction would significantly impede effective competition within the common market or a significant part of it, in particular as a result of the creation or strengthening of a dominant position.

Thus, the criterion for clearing a concentration in Bulgaria is much lower than that of the EC, as in Bulgaria the CPC prohibits concentrations only if it finds that after the transaction there will be a dominant position , and if such existed before it, that it has strengthened. The EC's approach analyses the effects of the transaction and it can be prohibited even if it does not lead to the establishment of a dominant position, as long as it can lead to a serious distortion of effective competition in the relevant market.    

Practical issues

In the European and Bulgarian case law there are several problematic moments in merger control, related to illegal coordination between the companies involved in the concentration before the approval of the transaction (the so-called “gun jumping” ). Such are:   

1) Procedural issues

Failure to notify

This remains the most common omission of the parties concerned and is usually due to an incorrect calculation of the turnover of the parties to the concentration.

Violation of the standstill obligation

Following the notification of the planned transaction, the parties concerned must observe the standstill obligation not to implement any kind of factual or legal actions related to the intended concentration.   

2) Substantive issues

Often, when companies intend to enter a concentration, they start to exchange information. This is ancillary to a merger agreement, for example when the parties prepare a due diligence report on the transaction. However, the need for a legal analysis does not justify the exchange of competitively sensitive information and the exchange or even agreement of pricing or terms of business, allocation of clients and future business strategies between competitors[3] The parties planning a concentration must take into account that such conduct violates antitrust rules.

[1] Pursuant to Art. 22 of the Protection of Competition Act (“PCA”), concentration between undertakings exists when a permanent change of control occurs:

1. in case of merger or acquisition between two or more independent undertakings, or

2. when one or more persons already controlling at least one undertaking gain, by means of purchasing securities, stakes or property, by means of a contract or in any other manner, direct or indirect control over other undertakings or any parts thereof.

Тhe establishment of a joint undertaking which permanently performs all functions of an economically independent subject also constitutes a concentration.

[2] An in-depth analysis of a concentration shall be performed when, as a result of the assessment performed during the fast-track inquiry, the Commission finds that the concentration gives serious reason for suspicion that such concentration would result in the establishment or reinforcement of an existing dominant position and effective competition in the relevant market would be significantly impeded.

[3] Pursuant to a report by Organisation for Economic Co-operation and Development (“OECD”).

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