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In brief

On 7 January 2021, Peru´s new merger control law was published. The law underwent minor amendments and will replace the Emergency decree from November, and is expected to enter into force around 23 February 2021. The law remains predominantly the same, keeping many of the previous provisions, including thresholds, phases of the procedure, and deadlines for evaluating the concentration act, evaluation criteria, among others. Please refer to our client alert on the Emergency Decree, with details on of the main aspects of the merger control law.


Key takeaways

Prior to the new merger control law, Peru only imposed mandatory pre-notification and clearance requirements for mergers occurring in the industry of electricity generation, transmission or distribution. With the enactment of the new merger control law, all companies, in all sectors, will have to file a notification of the merger prior to closing, provided the merging parties have a combined turnover of at least 118,000 Peruvian tax units (USD 150 million) and the individual companies each have a turnover of at least 18,000 tax units (USD 23 million). The notification thresholds also apply to the value of the assets owned by the merging parties.

In more detail

The key modifications of the law, include the following:

Definition of economic agent National and foreign investment funds are included within the definition of “economic agent” subject to the law.
Thresholds Value of the companies’ assets must also be considered to determine whether a deal exceeds the thresholds and, consequently, whether it is subject to the prior approval regime.
Registration of acts It will not be necessary to present a sworn statement to the Notary or Public Registry stating that a deal complies with the law to request its registration.
Evaluation criteria Eliminated the failing firm defense as an express criterion for an evaluation of the transaction.
Ex officio review Indecopi may initiate an ex officio review of any deal, if it considers there are reasonable indications it may create a dominant position, or it affects competition in the relevant market.
Thresholds modification A modification of the notification thresholds (increase or decrease) will be approved by law.
Entry into force The law will enter into force within 45 calendar days from its publication, while the necessary complementary regulations are issued.

 

You may find the full text of law in this link.

Author

Teresa Tovar is a partner in Baker McKenzie in Lima Peru. Her practice focuses on the area of antitrust and competition, consumer protection, advertising and promotions, and market access. She has worked with various pension funds and clients in the cosmetics, food and beverage, electronics manufacturing and commercial sectors, and advised transport infrastructure companies on free competition and access to essential facilities, especially in the airport industry. On regards with the application of regulatory framework on public transportation infrastructure and telecommunications, she's always there to give counsels and as well as on conducting data privacy projects. Aside from that, Ms. Tovar also works with national and foreign credit agencies on issues related to personal information protection.

Author

Crosbby is a senior associate and has more than nine years of experience in competition law, advertising and regulation, both in the private and public sectors, which allows having a holistic view of the difficulties of our clients. He has participated in the most important investigations and procedures in competition law in Peru. Different law firm rankings have highlighted his work in the field of competition law and telecommunications, due to his deep knowledge in the subjects. Crosbby also has knowledge in microeconomics, which allows him to have a multidisciplinary approach in competition law that is an advantage for our clients. He also has solid technical knowledge in the field of telecommunications. Crosbby is in charge of legal counselling in competition matters, advertising regulation, consumer protection, telecommunications and data protection. In the same way, he is in charge of the defense of our clients in different proceedings before INDECOPI and OSIPTEL.

Author

Viviana is a senior associate and has extensive experience in competition law, with experience in advising companies on matters related with the application of the antitrust law, unfair competition law, and consumer protection law. Viviana has participated in several administrative procedures before the Free Competition Commission, the Unfair Competition Commission, the Consumer Protection Commission, and the Elimination of Bureaucratic Barriers Commission and before the Competition Court of the National Institute of Competition Defense and Protection of Industrial Property (INDECOPI). Viviana also has experience in data privacy matters, having advised several companies on their implementation to such legal framework.