GILS Antitrust law: Moldova

MOLDOVA

1. Is the mandatory merger control regime in force in Moldova?

In Moldova, the mandatory merger control regime is governed by the "Competition Law No. 183 dated 11.07.2012." This law sets out the framework for merger control, including the requirement for pre-merger notifications to the Moldovan Competition Council for certain transactions. The law aims to ensure that mergers and acquisitions do not negatively affect market competition.

2. Which authority is responsible for the merger control regime in Moldova?

In Moldova, the authority responsible for the merger control regime is the Competition Council of the Republic of Moldova (Consiliul Concurenței al Republicii Moldova). This body oversees the monitoring, assessment, and approval of mergers and acquisitions to ensure they do not negatively impact market competition.

3. What is the definition of concentration?

In Moldova, the term "concentration" refers to situations where a change of control on a lasting basis occurs. This can happen through the merger of two or more previously independent companies or parts of companies, the acquisition of direct or indirect control over one or more companies, or the creation of a joint venture performing all the functions of an autonomous economic entity. The key concept here is the acquisition of control, which allows one entity to exert a decisive influence over another.

The relevant thresholds for notification to the Moldovan Competition Council are based on the combined worldwide turnover of the involved undertakings exceeding MDL 25 million and at least two of the undertakings having a domestic turnover of at least MDL 10 million. Notifications are mandatory, and transactions must not be closed before obtaining approval from the Competition Council.

These definitions and requirements align closely with European Union regulations, reflecting Moldova's efforts to harmonise its competition laws with EU standards​. 

4. Is pre-merger filing or post-merger filing required?

In Moldova, a pre-merger filing is required. This means that companies must notify the Moldovan Competition Council and obtain approval before completing a transaction that meets the relevant thresholds. The filing must occur prior to the closing of the merger or acquisition. Failure to notify and obtain approval can result in significant fines and the potential unwinding of the transaction.

The notification thresholds are based on the combined worldwide turnover of the involved undertakings exceeding MDL 25 million and at least two of the undertakings having a domestic turnover of at least MDL 10 million. Only after the Competition Council reviews and approves the transaction can it be completed.

This requirement ensures that the transaction does not negatively affect market competition​.

5. Examples of key concentration types caught by merger control rules in Moldova.

In Moldova, key types of concentrations caught by merger control rules include:

• Mergers: Combining two or more previously independent companies.
• Acquisitions: One company acquiring direct or indirect control over another.
• Joint Ventures: Creation of a joint venture that performs all functions of an autonomous economic entity.

These transactions are subject to pre-merger notification and approval by the Moldovan Competition Council if they meet specific thresholds, ensuring they do not impede effective competition in the market​.

6. What are the notification thresholds, which a concentration must trigger for a merger control filing to be required?

In Moldova, the notification thresholds for a concentration that require a merger control filing are:

The combined worldwide turnover of all involved undertakings exceeds 25 million MDL.

At least two of the involved undertakings each have a domestic turnover of at least 10 million MDL.

These thresholds necessitate notifying the Moldovan Competition Council and obtaining approval before completing the transaction.

7. Does the authority have any discretion to review transactions that do not meet the notification thresholds?

In Moldova, the Competition Council does not have the discretion to review transactions that do not meet the established notification thresholds. Only transactions that exceed the specified combined worldwide turnover of MDL 25 million and a domestic turnover of at least MDL 10 million for at least two involved undertakings are subject to mandatory notification and review by the authority. Transactions below these thresholds are not subject to merger control filing and review.

8. Do the merger control rules apply to foreign-to-foreign transactions taking place outside Moldova?

Yes, the merger control rules in Moldova apply to foreign-to-foreign transactions if these transactions affect or may affect competition in the Moldovan market. This means that even if both companies involved are registered outside Moldova, they must notify the Moldovan Competition Council and obtain its approval if the transaction meets the established notification thresholds and has an impact on the Moldovan market.

9. Are there specific merger control rules relating to the notification thresholds (e.g., specific merger control notification thresholds for specific sectors; different rules to calculate turnover for specific industry sectors such as banks and insurances or retail, specific rules relating to foreign subsidies, companies, etc.)?

In Moldova, there are no specific merger control rules that alter the notification thresholds for particular sectors or industries, such as banks, insurance, or retail. The general thresholds apply universally across all sectors: a combined worldwide turnover of MDL 25 million and a domestic turnover of at least MDL 10 million for at least two involved undertakings. However, the calculation of turnover for financial institutions, like banks and insurance companies, may follow specific accounting rules in line with international standards. There are no distinct rules relating to foreign subsidies or companies beyond these general thresholds. 

10. Whether Moldova requires the payment of filing fees and if yes, when?

Yes, Moldova requires the payment of filing fees for merger notifications. The fee is 0.1% of the annual turnover of all involved undertakings obtained in Moldova, with a maximum limit of MDL 75 000 . This fee must be paid before the notification is submitted to the Competition Council to ensure the notification process is complete and the transaction can be reviewed.

11. Whether there is a filing deadline in Moldova requiring a notification to be filed within a certain period of time following a particular transactional event (e.g., signing a share and purchase agreement)?

In Moldova, there is no specific filing deadline that requires a notification to be filed within a certain period following a particular transactional event, such as signing a share and purchase agreement. However, the notification must be made and approval obtained before the transaction is completed. This means the parties involved in the transaction must ensure they file the notification and receive clearance from the Competition Council before closing the deal to avoid penalties for non-compliance.

12. What information and documents must be disclosed or provided to the authority for the purposes of merger clearance? 

For merger clearance in Moldova, the following information and documents must be disclosed or provided to the Competition Council:

• Notification Form: Completed with details of the parties involved, the nature of the transaction, and the rationale behind it.
• Corporate Information: Names, addresses, and contact details of the parties.
• Transaction Details: Description of the transaction, including the type of concentration and the means of control acquisition.
• Market Information: Information about the markets affected, including market shares and competitive conditions.
• Financial Data: Turnover figures for the involved parties.
• Supporting Documents: Copies of transaction agreements, annual reports, and any relevant studies or analyses.

All documents should be provided in the format required by the Competition Council, and any additional information or clarifications requested by the Council must also be submitted.

13. What are the time periods within which the authority must reach a decision on the merger clearance? Is any fast track or simplified procedures available? 

In Moldova, the time periods within which the Competition Council must reach a decision on merger clearance are:

Phase I: Up to 30 working days from the receipt of a complete notification to make a decision.

Phase II: If an in-depth investigation is needed, the review period can be extended to 90 working days.

Fast Track or Simplified Procedures:

A simplified procedure is available for transactions with minimal impact on competition, which reduces the review time and the amount of required documentation.

These procedures aim to expedite the assessment of less complex transactions.

14. What are the penalties which the authorities may impose for "failure to file" or "late notification"?

In Moldova, the penalties for "failure to file" or "late notification" of a merger include:

• Fines: Companies can be fined up to 5% of their total annual turnover for failing to notify a notifiable economic concentration.
• Transaction Reversal: The Competition Council may order the unwinding or dissolution of the transaction.
• Legal Proceedings: Additional legal consequences may arise, including potential damage claims from affected parties.
• These penalties ensure compliance with the merger control regime and deter companies from bypassing mandatory notifications.

15. Have there been any recent developments regarding the merger control regime in Moldova?

Yes, there have been recent developments in Moldova regarding the merger control regime. In July 2023, significant amendments were made to the Competition Law, aligning it more closely with EU competition standards. These changes include increased maximum fines for violations, the introduction of new remedies, expanded inspection powers for the Competition Council, and the direct application of EU competition principles and case law in Moldova. Additionally, the thresholds for mandatory notification of economic concentrations were adjusted to reflect higher turnover values.

Author: Igor Popa