Antitrust Authority director general Michal Halperin is considering a change in the Restrictive Trade Practices Law to allow companies with a combined turnover of up to NIS 350 million to merge without asking for permission from the Antitrust Authority, sources inform "Globes."
The plan is part of a plan by Minister of Economy and Industry Eli Cohen for easing restrictions on small and medium-sized businesses. The Antitrust Authority believes that raising the limit on the business volume of companies being merged will make it easier for many small and medium-sized companies to merge.
The exemption from the requirement for the Antitrust Authority's approval will not apply to merging companies with a monopoly, or companies whose merger will give them a monopoly.
Under the Restrictive Trade Practices Law, the Antitrust Authority must be notified of a merger between companies in three cases: a company being merged with another company having a monopoly; when the merger will create a monopoly, e.g. if each of the companies has a 30% market share; and when the merging companies have a combined turnover of NIS 150 million or more.
Amending the law concerning corporate mergers is not expected to affect the first two cases; it involves the third - the merging companies' aggregate annual volume of business.
In this case, it is being proposed that the maximum joint annual business turnover be raised from NIS 150 million to NIS 350 million, because most of the merger requests submitted to the Antitrust Authority concern companies in this category.
According to Antitrust Authority figures brought to the attention of "Globes," 200 merger requests a year are submitted for companies with a combined turnover of over NIS 150 million, and the Antitrust Authority approves 90% of them, after an examination shows that the merger will not create a problem. "This entire process is based on a law that has not been changed since 1999. The Israeli market has changed since then," a senior Ministry of Economy and Industry source told "Globes." "The idea is to reduce bureaucracy and shorten procedures. When the amounts are relatively small, and there is no real concern about the creation of a monopoly, a green light can be given. This change obviously does not eliminate the need for the Antirust Authority to check for the creation of a monopoly or agreement in restraint of trade."
Published by Globes [online], Israel Business News - www.globes-online.com - on September 7, 2017
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