Luxembourg’s new bill on merger control

Luxembourg is the last EU Member State without a legal framework on merger control. At present, the Competition Authority (“Authority”) can only intervene ex post by sanctioning a merger to the extent it amounts to an abuse of dominant position. Mergers threatening competition in Luxembourg could be reviewed by the European Commission upon request by the Authority under certain conditions and according to a specific procedure defined in EU merger control law.

Merger control protects consumers by assessing whether a proposed transaction could adversely affect competition and therefore result in a reduction in choice, quality, innovation and an increase in prices of the products and services concerned.

Bill 8296 submitted to Parliament on 23 August 2023 (see link here – only in French) introduces an ex ante merger control in Luxembourg by the Authority based on a mandatory notification requirement defined by turnover thresholds and a standstill obligation. The two-phase review procedure and substantive test of the likelihood of significantly harm to competition, in particular by creating or strengthening a dominant position, mirror features of the EU and/or other EU Member States’ merger control regime.

Some specific features proposed in the Bill such as the possibility for the Authority to call in transactions below the thresholds, a governmental evocation power for reasons of general interest as well as an exemption for certain transactions in the banking and insurance sector in specific circumstances of urgency are noteworthy.

The timetable for adoption of the Bill cannot be estimated at this stage, given that a new government took office in mid-November. The coalition agreement states that the Bill will be “re-evaluated”.

For more information on the scope of application of the proposed regime, procedurals aspects, and possible sanctions, please read our article here.