PCC shortens M&A review period

MANILA, Philippines — The Philippine Competition Commission (PCC) will shorten its review period to 15 days for certain merger and acquisition (M&A) transactions as part of the government’s efforts to improve the ease of doing business in the country.

In a resolution issued on May 28 released to the media yesterday, the PCC said the review period would be cut by half from the existing 30 working days and would be available starting July 2 for deals less likely to prevent, lessen or restrict competition in their relevant markets.

Among the transactions which could apply for the fast track review are those which do not involve overlaps in businesses of the parties.

In addition, global transactions where the acquiring and acquired entities identified in the definitive agreement are foreign entities, and their subsidiaries in the Philippines would act merely as manufacturers or assemblers of products with at least 95 percent of such products exported to the foreign parents, subsidiaries, affiliates or third parties located outside the Philippines, are likewise qualified for the fast track review.

Also eligible are global transactions involving parties with limited presence in the Philippines.

Lastly, joint ventures for real estate projects may apply for the faster review.

The PCC said applications for the expedited review may be made within 30 days after signing the definitive agreement on the deal, but prior to any acts of consummation.

“The PCC recognizes that a strong and vibrant economy stimulates firms’ appetite for business consolidation, corporate takeovers and market expansion. The expedited merger review is a testament of PCC’s commitment to be efficient in the review of transactions deemed less likely to pose competition concerns,” PCC chairman Arsenio Balisacan said.

He said the expedited merger review shows PCC’s commitment to provide a conducive regulatory environment for doing business while performing its legal mandate to look into transactions that may substantially lessen competition in the market.

“Every merger review employs different levels of technical expertise and resources. The expedited review of mergers that are less likely to pose competition issues will lead to more efficient use of commission resources towards the implementation of a holistic merger control regime,” he said.

Currently, the PCC’s regular 30-calendar day period for merger review is among the shortest  in the world.

Apart from having a short review period, the PCC also offers free pre-notification consultation to parties, including if transactions may qualify for the expedited process.

The PCC conducts a review of mergers and acquisitions, as provided by law, to ensure that these deals would not lessen competition in the market and harm the interest of consumers.

To date, the PCC has received 184 notifications with a total transaction value of P2.87 trillion.

Of the notifications, the PCC has approved 174 and blocked one transaction.

The PCC said the most active sectors for mergers and acquisitions are manufacturing with 42 transactions; finance and insurance with 30; real estate with 24; electricity and gas with 24; and transportation and storage with 13.