Merger Control

The aim of the rules concerning merger control contained by Chapter VI of the Competition Act is to keep under competition surveillance control all mergers and acquisitions which might be essential from the point of view of the national economy. If a given concentration did not create or strengthen a dominant position, which would have impeded the formation, development or continuation of effective competition (dominance test), until 1 June 2009 the GVH could not refuse to grant authorisation for the concentration. However, after this date the GVH cannot refuse to grant authorisation for a concentration if the concentration does not significantly reduce competition on the relevant market, in particular as a result of the creation or strengthening of a dominant position on the relevant market (significant lessening of competition test). Otherwise, balancing the concomitant efficiency advantages and disadvantages on competition the transaction may be blocked. The GVH may attach pre- or post-conditions to its decision to remedy the adverse effects of the concentration on competition (e.g. by prohibiting the sale of parts of undertakings or assets or by ordering the termination of control over an indirect participant).

From the point of view of the assessment of anticompetitive effects the horizontal or vertical nature of the transaction is of particular importance (being horizontal any concentration between competitors and being vertical any deal between parties having seller/buyer business relationship). In general, horizontal transactions directly lead to a change in the market structure, while vertical concentrations may have negative effect on the related markets. Certain transactions cannot be clearly categorised into one or another group due to the fact that they have both horizontal and vertical features. It may also happen that there is no market on which both undertakings would be active. Nevertheless, such concentrations may also have harmful effects on competition. Portfolio effect occurs when producers or distributors of complementary products (players of adjacent markets) become members of the same group of undertakings. Namely, in this case if one of the groups of undertakings has high market share on the market of a given product, as a consequence of the concentration the post-merger entity may be able to follow strategies which restrict competition on the market of other product(s) (e.g. by tying). Conglomerate effect occurs when - even if, analysing separately there is not any market on which dominant position would be created or strengthened - in its entirety the position of the undertaking improves considerably concerning its economic, financial or income conditions which are decisive factors of economic power affording possibility to use restrictive strategies (like predatory pricing).

Article 24 of the Competition Act defines the thresholds above which the authorisation of a concentration has to be applied for by the GVH. Since May 2004, according to the ECMR (Merger Regulation of the European Union) transactions, meeting the turnover thresholds of the ECMR (i.e. transactions having -Community dimension-) have to be notified to the European Commission, meaning that these concentrations are assessed by the European Commission and not by the GVH. The Commission and national competition authorities may transfer certain cases among themselves, provided that they meet given conditions.

The criteria for the assessment of concentrations changed in 2009. As a consequence, the more thorough analysis of the competition effects of the concentration got stronger emphasis. Experience, gained during the last few years in which several more considerable and complex concentrations were analysed, shows that more detailed market analyses can substantially contribute to the objective and fact-based analysis and clarification of competitive concerns. In cases having more importance, which can generally be assessed after comprehensive, complex analysis, it is even more essential that the assessment is made along well-determined, duly selected methodology and made on the basis of appropriate data and quantitative investigation, which makes economic market analysis possible.

To this end (in the form of questions and answers) the GVH prepared a brief guideline in which it makes public those theoretical considerations and methodological requirements along which it proceeds when analysing concentrations. Due to this guideline communication between the GVH, the parties and third parties and this way the investigation of the concentration itself will be faster and more effective. The aim of the guideline is to ease, for the parties to the concentrations, the collection of the necessary data (in due time and quality) in order to submit them even in parallel with the notification.

In addition to the guideline, the reader may find here the concentration-related theoretical statements of the Competition Council of the GVH and the form to be used for notification of concentrations.

In the first half of 2011 the GVH began to revise its merger control regime. The basic aim of this revision was to increase the transparency of merger control proceedings, fasten the process and ease the administrative burdens of the procedure. As the most essential result of the review - taking into account also the opinions arrived in the course of public consultations organised in the framework of the review - the notification form has been substantially modified. The new form contains actually two forms (since the second half of the form has to be completed only in the case of concentrations resulting in significant overlaps or relations, and even in the case of these concentrations only for markets on which the possibility of significant overlaps or relations exist). The new form is applicable for transactions to be notified on the 1st of February 2012 or after this date.

Please note that only the Hungarian version is authentic, the translation was prepared for information purposes only.

At the same time the GVH published a guidance on pre-notification contacts relating to the control of concentrations with the aim of facilitating the proper use of these contacts.


The notification of a concentration can be filed electronically

Pursuant to Article 43/J (1) of the Hungarian Competition Act, the form for the notification of a concentration published, both in word and pdf format, on the website of the Hungarian Competition Authority (“Gazdasági Versenyhivatal” hereinafter: GVH) may not only be submitted personally or in written form but also electronically. A notification of a concentration can be filed electronically using the electronic iForm application filing programme provided by the GVH. In case of electronic submission the notification form shall be attached to the iForm application form.

The iForm programme can be accessed on SZÜF: HERE (available only in Hungarian)

The GVH emphasises that the size of the enclosed files in the iForm programme cannot exceed 20MB. Further assistance concerning the electronic filing system can be downloaded in PDF format: HERE

Please note that this document is available on our webpage for information purposes only and the notification of a concentration can be submitted only in Hungarian (see here).