Fine of EUR 20 Mio for breach of the standstill obligation

On 23 July 2014 the European Commission („Commission“) imposed a fine of EUR 20 Mio. on the salmon farmer and processor Marine Harvest ASA (“Marine Harvest”) for a breach of the standstill obligation.

Marine Harvest had acquired 48.5 % of the competitor Morpol ASA (“Morpol”) on 18 December 2012, obtaining de facto sole control due to the low level of share rates and participation of other shareholders, conceding Marine Harvest a majority of votes within the acquired company. However, since the transaction was closed before the formal notification and clearance from the Commission, it was a breach of the standstill obligation and thus an infringement of the European merger control regulation.

The Commission gave a conditional clearance for the concentration on 13 September 2013, nine months after the transaction had been already closed.

Marine Harvest’s non-compliance was considered as a negligent conduct since it was familiar with the relevant merger control rules and thus should have been aware of the unfulfilled obligations. In this particular case the failure to comply resulted as a serious infringement since the Commission only granted conditional clearance and the transaction as planned originally would have raised anti-competitive concerns.

Regarding the calculation of the amount of the fine and to assure its adequateness to ensure sufficient deterrence, the Commission took the following mitigating factors into consideration: (i) Marine Harvest had not exercised its voting rights in Morpol before clearance by the Commission and had notified the Commission briefly after the transaction was closed.

Furthermore, the Commission points out that envisaged transactions that hit the turnover thresholds must be notified and cleared prior to closing in order to avoid permanent and irreparable damages to effective competition and consequently serious breaches of the merger regulation.

Authors

Dr. Christina Hummer
Ori Kahn