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Merger Control In Times Of Crisis

 |  March 28, 2022

By: Tobias Pukropski (Antitrust Politics)

International merger control proceedings are a challenge in itself for companies. Potentially facing proceedings in jurisdictions or with regulators in crisis adds an entirely different layer of uncertainty. This post is written from and limited to the view of a practitioner advising companies on merger control proceedings globally. Questions on how to approach these proceedings when regulators or entire countries are in crisis fortunately only come up rarely (even though I wish they would not come up, for anyone, ever).

An example from the recent past: Brazil

In mid-2019, for nearly three months the Brazilian regulator lacked the internal quorum required to take decisions in merger cases, because the government had not nominated new commissioners in time to replace their departing predecessors. This left more than 70 transactions in limbo.

At the time, companies involved in ongoing proceedings – halted for what then was an uncertain period of time – would ask themselves how do deal with the situation and how to plan for their transaction timeline. Some decided not to accept the uncertainty and to instead close their transactions without clearance in Brazil. One of them was IBM, whose acquisition of Red Hat was ultimately cleared unconditionally. However, the parties were also fined approx. EUR 12.4 million for closing the transaction prior to clearance.


The current situation in Russia has a particular angle – at least for “Western” companies. The EU, amongst others, has imposed heavy sanctions on Russia. The International Competition Network, a global network of competition regulators, has suspended Russia’s regulator from participating in the network. Many companies (and law firms) have announced that they will leave the Russian market and will close their local operations – Russia has reportedly reacted by considering introducing a law to dispossess such companies…