Dossier of notification of economic concentration in Vietnam under the Competition Law

Dossier of notification of economic concentration in Vietnam under the Competition Law (Internet image)

1. Categories of economic concentration in Vietnam

According to Article 29 of the Competition Law 2018, economic concentration includes the following categories:

- Merger of enterprises means an act whereby one or several enterprises transfer all of its/their property, rights, obligations and legitimate interests to another enterprise, and at the same time terminate the existence of the merged enterprises.

- Consolidation of enterprises means an act whereby two or more enterprises transfer all of their property, rights, obligations and legitimate interests to form a new enterprise and, at the same time, terminate the existence of the consolidating enterprises.

- Acquisition of enterprises means an act whereby an enterprise acquires the whole or part of property or shares of another enterprise sufficient to control or dominate all or one of the trades of the acquired enterprise.

- Joint venture between enterprises means an act whereby two or more enterprises jointly contribute part of their property, rights, obligations and legitimate interests to the establishment of a new enterprise.

2. Criteria for determining notification of economic concentration in Vietnam

The enterprises engaging in economic concentration must file a dossier of economic concentration notification (hereinafter referred to as notification dossier) to the National Competition Commission as prescribed in Article 34 of the Competition Law 2018 before initiating economic concentration if they reach the notification threshold.

Specifically, in Clause 2, Article 33 of the Competition Law 2018, the notification threshold shall be determined based on one of the following criteria:

- Total assets of the enterprises engaging in the economic concentration on the Vietnamese market;

- Total turnover of enterprises engaging in the economic concentration on the Vietnamese market;

- The transaction value of the economic concentration;

- Combined market share of enterprises engaging in the economic concentration on the relevant market.

3. Dossier of notification of economic concentration in Vietnam

A notification dossier shall consist of:

- A notification of economic concentration issued by the National Competition Commission;

- Agreed contents of the economic concentration or draft contracts, memorandum of understanding regarding economic concentration between/among enterprises;

- Valid copies of the business registration certificates of similar documents of all enterprises engaging in economic concentration;

- Financial statements of all enterprises engaging in economic concentration in two consecutive years before the notification year or, in case of newly-established enterprises, from the establishment time to the notification time as per the law;

- The list of parent companies, subsidiaries, associate companies, branches, representative offices and other affiliated entities of every enterprise engaging in economic concentration (if any);

- The list of goods, services dealt in by each enterprise engaging in economic concentration;

- Information about market shares in the sector where economic concentration will take place held by every enterprise engaging in economic concentration in 2 consecutive years before the notification year;

- Proposed remedies for possible anti-competitive effects of the economic concentration;

- Report on assessment of positive effects of economic concentration and measures to enhance the positive effects of economic concentration.

(Clause 1, Article 34 of the Competition Law 2018)

4. Violations against regulations on economic concentration in Vietnam

According to Article 44 of the Competition Law 2018, the violations against regulations on economic concentration include:

- An enterprise fails to notify economic concentration under the provisions of the Competition Law 2018.

- An enterprise implements economic concentration without receiving a notification of preliminary assessment result from the National Competition Commission prescribed in Clause 2 Article 36 of the Competition Law 2018, except for the case prescribed in Clause 3 Article 36 of the Competition Law 2018.

- An enterprise implements economic concentration before the National Competition Commission issues a decision on economic concentration prescribed in Article 41 of the Competition Law 2018 although it is subject to official assessment of economic concentration.

- An enterprise fails to meet or fully meet conditions specified in the decision on economic concentration prescribed in Point b Clause 1 Article 41 of the Competition Law 2018.

- An enterprise implements economic concentration which is prohibited under Point c Clause 1 Article 41 of the Competition Law 2018.

- An enterprise implements economic concentration which is prohibited under Article 30 of the Competition Law 2018.

Thanh Rin

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