Clifford Chance

Since not too long after his entry into office in 2018 as the Chairman of the Dutch competition authority (the Authority for Consumers and Markets, the ACM), Martijn Snoep has consistently been asking for a power to call in transactions that do not meet the thresholds for a mandatory merger control notification ("below threshold" mergers). On 18 March 2025, a legislative proposal (the "Proposal") has been issued for consultation that will finally grant the ACM with the competence to call in such transactions, provided these result in a significant impediment to effective competition in the Netherlands, or a part thereof.

The Proposal does not come as a surprise. The ACM has recently initiated second phase investigations into two notifiable transactions over concerns that the parties had previously acquired multiple businesses in the same sector, in transactions that fell below the thresholds for review (so-called roll-up strategies): the acquisition of DWP and Vierhouten by Foresco (ultimately cleared by the ACM in February 2025) and the acquisition of Delta’s fiber-optic networks by KPN’s joint venture (review ongoing).

Subsequently, the ACM announced that it had launched an investigation into a below-threshold acquisition of cash-in-transit company Ziemann by rival company Brink’s on 7 March 2025. This is not a merger control investigation, but rather an investigation into whether the transaction breaches the EU competition law prohibitions on abuse of dominance and/or anticompetitive agreements, following the 2023 EU Court of Justice judgment in Towercast, which confirmed the power of national competition authorities to apply those prohibitions to mergers (see our briefing here). However, such investigations are not well suited to mergers, as there is no binding deadline for the authority's decision and no clear mechanism for parties to a merger to obtain comfort, before they close, that their merger will not become subject to such an investigation. In addition, the Dutch Competition Act currently states that the implementation of a concentration cannot be considered as abusing a dominant position.

As such, it makes sense that the ACM wants to extend the merger control regime to capture below-threshold mergers. The explanatory memorandum to this Proposal (the "Memorandum") provides that it seeks to prevent competition concerns following from roll-up strategies, in particular in local and niche markets (for example, veterinary clinics and general practitioners), and killer acquisitions (i.e., acquisitions of upcoming potential competitors by dominant players). It also explains that the Netherlands joins other EU Member States in implementing the option to call in below-threshold transaction (currently, competition authorities in eight Member States have such call-in powers). However, many of these jurisdictions still apply some form of monetary threshold to call in transactions, which the Proposal does not.

So how does it work?

A transaction party can be asked by the ACM to provide it with data or documents reasonably necessary to assess whether a below threshold transaction could significantly impede actual competition in the Netherlands or a part thereof. This request must be made within four weeks following the earliest of:

1. the time at which (one of) the parties publicly announce(s) the transaction;
2. the time at which the ACM becomes aware of (envisaged) transaction; or
3. six months after the time at which the transaction agreement has become effective.

What are the consequences?

If the ACM considers that the transaction could lead to a significant impediment to effective competition, it will require the parties to notify the transaction to the ACM. From that moment, the review of the transaction will follow the already established merger control process, with a Phase I and (possible) Phase II review. However, the ACM could also refer the transaction to the European Commission by using Art. 4(5) or Art. 22 of the EU Merger Regulation. This fills the gap left open following the European Court of Justice's ruling in Illumina/Grail (see our briefing here).

What is the impact on your transaction?

As the ACM indicated, it wants to capture mergers in local and niche markets. The expectation therefore is that call-in transactions will equally form a niche. However, if you are contemplating a below-threshold transaction as part of buy-and-build strategy, you may want to engage early once the Proposal has entered into force as law.