The Law of Ukraine on Protection of Economic Competition of 2001 ("Competition Law") provides for a basic set of rules regulating, among others, merger control issues that cover the concept of concentration, notifiability thresholds, exemptions, basic procedural rules, sanctions, etc.

The requirements of the Competition Law are further detailed in the Regulation on the Procedure for Filing Applications with the AMC for Obtaining its Prior Approval of the Concentration of Undertakings of 2002 ("Concentrations Regulation") and in a number of laws and regulations, that include:

• The Law on the Antimonopoly Committee of Ukraine of 1993;
• The AMC Methodology for Establishment of the Monopoly (Dominant) Position of the Undertakings on the Market of 2002; 
• The AMC Recommendatory Guidelines on Calculation of Fines for Violations of Competition Laws of 2016 (the Fining Guidelines);
• The Guidelines on the Assessment of Horizontal Mergers of 2016;
• The Guidelines on the Assessment of Non-horizontal Mergers of 2018;
• The Guidelines on the Definition of Control of 2018;
• The Guidelines on the Assessment of Joint Ventures of 2019, and
• Guidelines on the Application of SSNIP Test 2020

The Antimonopoly Committee of Ukraine ("AMC") is the primary state authority entrusted with ensuring the protection of competition; it has powers to grant or refuse clearances for mergers (concentrations), as well as to investigate and penalize violations of the merger control regime. If the AMC prohibits a concentration, the Cabinet of Ministers of Ukraine may overrule such a decision on public interest considerations.

No, there is not a supranational regulatory agency that has, or may have exclusive competence.

Yes. Merger (concentration) filing requirements are set out in Chapters V and VI of the Competition Law and further detailed in the Concentrations Regulation.

The Competition Law uses the term ‘concentrations’, broadly defined as covering:

• The merger of two or more previously independent undertakings or the takeover of one undertaking by another;
• The direct or indirect acquisition (including rights to use) of shares (participation interest) ensuring 25%, 25%+, 50%, and 50%+ of the votes in the highest governing body of the undertaking concerned ;
• The acquisition of direct or indirect control over an undertaking (including through the acquisition/use of a significant part of its assets, appointment to management positions and so on); and 
• The establishment by two or more undertakings of a new undertaking that will independently pursue business activities on a lasting basis and whose establishment does not result in the coordination of competitive behavior between the parents or between the new undertaking and its parents.
• The establishment of a joint venture through the formation of a new company may qualify as a concentration or concerted practice.

In particular, under the Competition Law, a joint venture is considered a concentration if such a new company:

• is established by two or more independent undertakings;
• will independently pursue business activity on a lasting basis; and
• does not result in coordination of competitive behavior either of its parents or the joint venture on the one hand, and its parents on the other.

In 2019 the AMC published the Guidelines on the Assessment of Joint Ventures, which provided further guidance as to the assessment if the criteria above, as well as introduced the full-functionality criterion (ie, ability to perform all functions of an autonomous economic entity) for joint ventures to be considered a concentration.

Joint ventures that do not meet the above-mentioned criteria may be considered concerted practices that may require antitrust clearance (which is different from the merger one).

Notably, the AMC requires separate notification for each step of multiple acquisitions. For example, in deals involving the direct acquisition of shares in a number of entities by one undertaking from the same (ultimate) seller, the AMC clears each acquisition through separate clearance decisions.

The following are not considered concentrations:

• The establishment of a new undertaking aimed at, or which results in, the coordination of competitive behavior between the parents or between the new undertaking and its parents. This kind of establishment is generally regarded as a concerted practice and may require an antitrust (as opposed to a merger) clearance;
• The acquisition of shares qualifying as a financial buyer transaction (that is, shares are acquired by a financial institution for the purposes of further resale within one year (extendable), provided that the acquirer does not exercise voting rights attached to the acquired shares);
• The acquisition of control over an undertaking or part thereof by a receiver or a representative of state authority (e.g., through an insolvency procedure);
• Intra-group transactions provided that control links within the group have been established in compliance with Ukrainian merger control rules; and
• The acquisition by a bank or other financial institution of shares/assets of an undertaking, if such acquisition is made in recovery proceeding and corresponds to certain other requirements, assuming such shares/assets will be further resold to 3rd party during the next two years (the exemption was designed to support Ukrainian financial system, application to foreign transactions is limited).

Acquisition of shareholdings reaching or exceeding 25% of the votes in the highest governing body of the target qualifies as concertation and is subject to the merger control rules. Acquisition of less than 25% of voting stock does not constitute a merger unless it provides the acquirer with any kind of control over the target.

There is no local effects test; generally, it is presumed that once the applicable thresholds are met, the concentration is notifiable and requires prior AMC clearance.

A transaction that qualifies as a concentration requires merger clearance by the AMC if:

• The combined parties' worldwide value of assets or turnover exceeded €30 million and the value of assets in Ukraine or Ukrainian turnover of each of at least two parties exceeded €4 million; or 
• The value of assets in Ukraine or the Ukrainian turnover of the target (including its controlling shareholder or seller group) or of at least one of the founders of a new entity exceeds €8 million and worldwide turnover of at least one other party exceeds €150 million.

In each case, the thresholds are considered at their group level. That means that value of assets and/or turnover of the controlling shareholder(s)/seller(s) should be counted towards those of the target for the thresholds check.

All figures are calculated for the financial year immediately preceding the year of the concentration, excluding VAT, other turnover-based taxes and intra-group revenues (if those are accounted). Special rules apply to the calculation of turnover/assets of commercial banks and insurance companies, as follows:

• Banking companies. One-tenth of the bank's assets must be considered for the purposes of the turnover/asset threshold; and
• Insurance companies. The net assets of an insurance company must be considered for the purposes of the asset threshold, and the revenues from insurance activities must be considered for the purposes of the turnover threshold. 

Even if a transaction falls below the thresholds, the parties can still apply for clearance on a precautionary basis.

The filing is mandatory.

There is no specific timeline in which the filing must be made. The principal rule is that the clearance must be received prior to implementation of the concentration (e.g., transfer of the title to shares, acquisition of control or registration of a new entity). It is possible to file a notification in the early stages of a transaction when no definitive agreement has been reached.

There is no automatic waiting period, though, the parties are subject to a standstill obligation. Closing without or before clearance constitutes a violation of merger control law.

The Concentrations Regulation sets short and full-form notifications for simplified and standard review procedures, respectively. The parties must also submit electronic versions of the notification and all documents attached to it on CD (and/or flash drive). Short-form notifications must include:

• A description of the transaction structure, indicating transaction stages and the timeline for their implementation, as well as a draft or copy of the transactional documents; 
• Information if the clearance is sought or granted in other jurisdictions;
• A description of the source of financing, indicating terms and conditions, as well as documents to confirm the availability of funds (e.g., a balance sheet or an excerpt from a bank account) or to evidence that a financial institution lending funds will not acquire control over the borrower as a result of the financing arrangement (e.g., a loan agreement); 
• The parties’ asset and turnover data, globally and in Ukraine, for the previous financial year; 
• Information on the parties’ ultimate beneficiary owners (if any);
• A general outline of the parties’ activities in all markets, globally and in Ukraine, indicating Ukrainian subsidiaries and companies active in Ukraine; and
• Value and volume-based sales and market share data for the relevant markets, indicating competitors and their estimated market shares in overlapping markets. 

In addition to the documents and information required under the short-form notification, full-form notifications must include:

• A detailed economic analysis of the transaction’s effect on the Ukrainian market (similar to Form CO under the EU Merger Regulation); and
• The parties’ excerpts from the trade register or similar (in notarized and apostilled or legalized hardcopies).

The notification and all attachments should be submitted in Ukrainian or accompanied by Ukrainian translations.

The obligatory filing fee is UAH 20,400 (approximately €500) per notification. There may be multiple notifications depending on the transaction structure; in this case, multiple filing fees must be paid.

The standard merger review procedure includes the following steps:

• Preview period – the AMC has 15 days to decide whether the notification is complete and can be forwarded for substantive review (i.e., Phase I). If the AMC considers the notification to be incomplete, it will be rejected. The parties then have the right to resubmit it, after that the clock restarts.
• Phase I review – this stage involves the AMC’s substantive review and assessment of whether the concentration can be approved or whether there are potential grounds to prohibit it (in which case, Phase II is initiated). The assessment must be completed within 30 days of the acceptance of the notification for substantive review. During this period, the AMC will either issue the clearance or initiate Phase II.
• Phase II review – this involves a close analysis of the transaction and the associated competition concerns, as well as the examination of expert opinions and other additional information. The recommended Phase II review period is up to 135 days starting from the day on which Phase II notice is sent to the parties, additional questions and information requests do not stop the clock. The parties, however, can request an extension of the review period, if necessary. During this period, the AMC will either issue the clearance (conditional or unconditional) or adopt a decision prohibiting the concentration.

A simplified 25-day review procedure applies for transactions with no or limited overlaps (i.e. where only one party is active in Ukraine, or the parties' market share does not exceed 15% in any overlapping market or 20% on any vertically related market in Ukraine). In practice, the AMC may interpret 15%/20% market share thresholds quite restrictively, in some cases looking also at non-relevant markets. 

The AMC usually takes the full review period and clears non-problematic transactions on the last panel meetings within the Phase I period, however, it may be possible to negotiate with the AMC an expedited review if the notified transaction is not significantly complicated and filers submitted all material information requested by the AMC with no delays, etc. 

If by/on the date of Phase I or Phase II expiry the AMC has failed to adopt any decision on the concentration, clearance by tacit consent is deemed to have been granted, although in practice the AMC does not use this option.

The validity of an AMC clearance is time-limited. For merger clearance, the standard duration is one year, unless stated otherwise in the clearance. The duration can be longer subject to the reasoned motion from the parties; however, the AMC is not obliged to satisfy it and rarely does so in practice. The law does not provide for the possibility to prolong the validity period of the granted clearances, meaning that where closing occurs after the lapse of the one-year period, the parties must file a new merger application (unless the deal does not require clearance under the merger thresholds).

Ukraine introduced sanctions against certain Russia-related companies. The list includes companies that are mainly from Russia and Ukraine, including Crimea, as well as several companies from other jurisdictions.

The AMC will reject merger control notifications or drop their review (if the notifications have already progressed into Phase I or II) if:

• any of the parties to the concentration (or any individuals or entities connected to them by relations of control) is on the Ukrainian sanctions list; and
• a particular type of sanction applies to a given individual or entity (eg, prohibition on disposal of assets or equity).

The AMC will approve a concentration if it does not lead to monopolization (i.e., creating or strengthening the party's dominant position in the market) or the substantial restriction of competition in the Ukrainian market or a significant part of it. If the AMC finds any grounds for a concentration to be prohibited, it will inform the parties of these grounds and the parties, in turn, can propose remedies to the AMC within a 30-day period (extendable on the parties' request). 

Dominance is generally defined in the Competition Law by reference to >35% market share (individual dominance), or collective dominance where the three largest undertakings have a 50%+ share and the five largest undertakings have a 70%+ share. 

Each transaction is assessed on a case-by-case basis and the market shares are the primary proxy for the dominance test. The AMC applies its Guidelines on the Assessment of Horizontal Mergers and Guidelines on the Assessment of Non-horizontal Mergers to analyze the possible unilateral and/or coordinated effects of the transaction, as well as countervailing factors (e.g., buyer power, market entry or the 'failing firm' defense).

The AMC can clear the merger, conditionally or unconditionally, or prohibit the concentration. 

All decisions (including non-confidential versions of clearances and resolutions on initiation of Phase II) are published on the AMC's website within 10 working days after the decision is made.

Where the AMC finds grounds for a concentration to be prohibited, it will inform the parties of these grounds offering 30 days (with possible extension) to propose remedies to remove the identified competition concerns. The AMC will carry out consultations with the parties, in order to agree on the terms and conditions of the remedies. 

Discussion of remedies within Phase I is possible but is not regulated procedurally.

The main risk for closing a notifiable transaction before or without AMC clearance is fine. The statutory maximum is a fine of up to 5% of the group's consolidated worldwide turnover for the year immediately preceding the fining decision. 

In practice, fines in merger cases are calculated based on the Guidelines on the Calculation of Fines ("Fining Guidelines"). Although the guidelines are non-binding, the AMC has publicly committed to following them strictly and does so in practice. The document sets the basic amounts of fines for the violation of the Competition Law, including in merger cases, and clarifies that the maximum theoretical fine (5% of the group's consolidated worldwide turnover) can now be imposed in exceptional circumstances to ensure deterrence. Other cases can be split into the following three groups which can be further increased/decreased depending on a number of aggravating/mitigating factors: 

• 10% of the turnover in the market concerned (and adjacent markets) for failure to notify a concentration, which results in the monopolization or substantial restriction of competition; and
• Between UAH 510,000 (approximately €12,500) and 5% of the turnover in the market concerned (and adjacent market) for failure to notify a concentration, which does not lead to the monopolization or significant restriction of competition, nor has an effect on Ukrainian product markets.
• Between UAH 170,000 (approximately €4,200) and UAH 510,000 (approximately €12,500) for failure to notify a concentration where the parties are active in non-overlapping and non-adjacent markets.

Most of the fines imposed recently were in line with the Guidelines, however at least in three cases fines reached ~EUR1.8 million.

The statute of limitations for unauthorized mergers is five years. The lapse of the limitation period exempts offenders from fines, but the legal status of the transaction remains questionable. This creates uncertainty for intra-group deals involving so-called ‘uncleared’ companies (including routine restructurings), as the intra-group exemption is conditional on compliance with the merger control requirements at the moment of the incorporation or acquisition of the respective companies.

Submission of misleading (incomplete or incorrect) information within the merger filing or failure to provide the information requested by the AMC in formal RFIs is also subject to a fine. The statutory ceiling is up to 1% of the group consolidated worldwide turnover in the year preceding the fining decision, but under the Fining Guidelines, the base fine is within UAH 136,000 (approximately €4,400), also subject to possible adjustment in the case of aggravating or mitigating factors. 

Apart from imposing fines, the AMC may review the clearance granted on the basis of incomplete or incorrect information.

The penalties for late filing are the same as for not filing at all (see previous section for more details). In practice, however, the AMC considers late (corrective) merger applications as a mitigating factor in reducing the amount of fines.

No; non-notifiable mergers are not subject to review. The AMC, however, has the discretion to send information requests and reminder letters to the parties, where they suspect the transaction might have required clearance in Ukraine. Over the last few years, the number of such requests was insignificant, most of them concerned the transactions involving Ukrainian business and did not constitute an issue for large internationals.

Where the AMC comes across a violation of Ukrainian merger control rules (this may transpire from subsequent filings, third-party complaints, etc.), they would normally start an investigation. The investigation normally lasts from two to eight months; during the investigation, the AMC is likely to recommend parties to submit so-called corrective filing and plead guilty in exchange for a lower fine. In a decision, the AMC both penalizes the parties (usually, only an acquirer) and clears the transaction(s) in question.

Since recently the AMC has been particularly active in inquiring on past transactions in the course of review of the notified transactions.

In view of more active sanctions policies worldwide and in Ukraine, the authority is particularly cautious about sources of financing of the transactions and groups’ compositions.

The existing rules can be changed in 2023, the respective draft law passed the first reading in the summer of 2021 and awaits the second reading.