Ukraine

Authority / Source

  • The Antimonopoly Committee of Ukraine (‘AMC’) / Cabinet of Ministers of Ukraine (‘CMU’)
  • Law “On Protection of Economic Competition”, dated 11 January 2001

Mandatory / Voluntary

Mandatory

When to notify?

Before the transaction is put into effect / completed. 

The transaction completion shall be suspended until clearance.

Threshold(s)

Financial thresholds (calculated for the financial year preceding the transaction):

  • The aggregate parties’ combined worldwide value of assets or sales (including related entities) exceeds EUR 12 m; and
  • each of at least two of the parties to the transaction, (including related entities) has aggregate worldwide value of assets or sales exceeding EUR 1 m; and
  • at least one party to the transaction (including related entities), has assets or sales in Ukraine with value exceeding EUR 1 m.

Market share threshold:

  • Any single party’s or all parties’ combined market share on any Ukrainian market affected by the concentration / transaction or on markets adjacent to an affected market exceeds 35%.

Obligation on whom

Joint obligation on all persons acquiring control and on the target (including sellers, when applicable).

Consequences of failure to notify

  • Fine of up to 5% of the parties’ worldwide group turnover for the fiscal year preceding the year in which the fine is imposed by the authority. Payment of the fine does not release parties from the clearance obligation;
  • invalidation of the transaction by court decision.

Consequences of implementing a transaction despite obligation to suspend until clearance

Fine of up to 5% of the parties’ worldwide group turnover for the fiscal year preceding the year in which the fine is imposed by the authority. Payment of the fine does not release parties from the clearance obligation;
invalidation of the transaction by court decision.

Consequences of implementing transaction despite prohibition decision

Fine of up to 5% of the parties’ worldwide group turnover for the fiscal year preceding the year in which the fine is imposed by the authority; invalidation of the transaction by court decision;
compulsory spin-off of the company (where applicable);
elimination of the negative consequences of transaction executed without approval.

Stages

First Stage – 15 calendar days

15 calendar days for the AMC to conduct a formal review of the notification and accept or reject it (after 15 calendar days, notification is deemed to have been accepted);

Second Stage - 30 calendar days

30 calendar days (starting after expiry of the initial 15-day period of review) for the AMC to consider the substance of the transaction (permission is granted or an in-depth investigation is opened);

Third Stage – three months

three months for an in-depth investigation of the transaction (so-called ‘concentration case’) that starts running after the AMC has received all additional information it needs from the notifying parties to reach a decision(in practice, it may take more than three months). In practice in-depth investigation of the transaction may be initiated by the AMC in complicated cases where the joint market share of the parties to the concentration (after execution of the contemplated transaction) exceeds 20%.

Fourth Stage

within 30 days after the AMC decision prohibiting the transaction, the notifying parties may apply for clearance to the CMU if they can prove that the positive social effect of the transaction will outweigh its anti-competitive impact.
This stage in practice is rarely resorted to.

Foreign-to-foreign mergers caught?

Foreign-to-foreign transactions are subject to clearance provided the filing thresholds are met (even if there are no subsidiaries in Ukraine and if the revenues generated in Ukraine by one party only are relatively low (e.g. where volume of import to Ukraine exceeds EUR 1 m).

Treatment of JVs

From the merger control perspective, joint ventures are treated the same way as all other types of business entities in Ukraine unless they are non-incorporated (contractual) ones. Establishment of a non-incorporated (contractual) joint venture may require a so-called “concerted actions” clearance with the AMC if it results in coordination of competition between its founders, including, in particular, incorporation of non-compete clauses.

Up to date as of 1 September 2014

Contact points

This manual is intended only to provide an overview of the merger control rules and regulatory requirements in the EU, the EEA and the European countries listed. The information and views expressed in this manual are not necessarily comprehensive and do not purport to give professional advice. If you would like further information, please contact any of the following:

CMS Cameron McKenna

38 Volodymyrska Street, 6th Floor
01034 Kyiv
Ukraine
T +380 44 391 33 77
F +380 44 391 33 88

CMS Reich-Rohrwig Hainz

19B Instytutska Street, 5th floor
01021 Kyiv
Ukraine
T +380 44 500 1718
F +380 44 500 1716