CPL 4 - Structure PDF

Andrew Yip (00:09) Welcome to the fourth and final lecture under the Part B Competition Law module. The Section 54 prohibition or merger control is the third of the trifecta and the last main prohibition under the Competition Act. Here again is my table which I find useful as a competition practit...

Andrew Yip (00:09) Welcome to the fourth and final lecture under the Part B Competition Law module. The Section 54 prohibition or merger control is the third of the trifecta and the last main prohibition under the Competition Act. Here again is my table which I find useful as a competition practitioner in explaining the trifecta of competition law prohibitions. For Singapore law merger control, the threshold under the Section 54 prohibition is whether the relevant merger results in or may be expected to result in a substantial lessening of competition or SLC in any market in Singapore. a customary effect of a merger is that a competitor exits the market as a result of the consolidation. In short, merger control refers to the procedure by which mergers and acquisitions are reviewed under competition law to identify anti -competitive combinations. When a competitor exits a market, the structure of the post -merger market changes. as does the dynamics of competition between the remaining competitors and the merged entity. This is the language of Section 54. The statutory language of Section 54 provides that mergers that have resulted or may be expected to result in a substantial lessening of competition within any market in Singapore for goods or services are prohibited. I will again break it down for you in the following slides. Here is my mind map that I find useful in analyzing the application of the Singapore Merger Control Regime. It is not expressed this way exactly in the CCCS guidelines, but I drew it up as I find it useful as a competition practitioner. To assess a merger, the CCCS will determine if it qualifies as a merger under the Competition Act and whether it is excluded by among other things, the fourth schedule of the Competition Act. The CCCS will then identify the theories of harm of the merger and examine scenarios without the merger, also known as the counterfactual. Thereafter, the CCCS will compare the state of competition with and without the merger to assess if the merger situation results or may be expected to result in an see in any relevant market. In doing so, the CCCS would assess certain factors such as the relevant markets, the nature of competition from existing competitors, barriers to entry. If the factors indicate that the merger will not create effects such as non -coordinated effects or coordinated effects that result in an SLC, it is arguable that the merger will not be prohibited. If the factors indicate that the merger will create non -coordinated effects or coordinated effects, both of which I will explain in a subsequent slide, that result in an NSLC. The CCCS will assess whether economic efficiencies outweigh the adverse effects of NSLC. And if the economic efficiencies are not sufficient, the CCCS will assess any potential remedies. to mitigate or prevent the SLC. Section 54 -2 of the Act provides that a merger situation occurs where two or more undertakings previously independent of each other merge, one or more persons or other undertakings acquire direct or indirect control of the whole or part of one or more other undertakings or one undertaking acquires the assets including goodwill or a substantial part of the assets of another undertaking which will result in the acquiring undertaking being in a position to replace or substantially replace the second undertaking in the business or the part concerned of the business in which the second undertaking was engaged immediately in before the acquisition. One of the ways in which a merger occurs is the acquisition of control, either legal or de facto. For legal control, the CCC generally considers that decisive influence is deemed to exist if there is ownership of more than 50 % of the voting rights. Where the ownership is between 30 to 50 % of the voting rights of the undertaking, there is a rebuttable presumption that decisive influence exists. Besides establishing legal ownership through the acquisition of property rights and securities, the presence of dependency by one undertaking on another may also confer de facto control. As there is no precise criteria for determining when an acquirer gains de facto control of an undertaking\'s activities, a case -by -case approach is taken. Control may also be acquired in the case of a minority shareholder if the shareholder confers decisive influence with regard to the activities of an undertaking. This can be established on a legal and or a de facto basis. Merger control also applies to joint ventures. Section 54 -5 of the Act provides that a joint venture constitutes a merger if it performs on a lasting basis all the functions of an autonomous economic entity. Joint ventures which satisfy these requirements bring about a lasting change in the structure of the undertakings concerned and generally fall within the jurisdiction of the CCCS. Here are the three most common ways in which mergers are viewed by competition law. A horizontal merger is a merger between two firms in the same market and at the same level of production. An example would be the merger of two manufacturers of semiconductors. There are two effects that the competition regulator would examine when determining whether a horizontal merger might result in an SLC. Non -coordinated effects and coordinated effects. These will be discussed in the next slide. Vertical mergers are mergers that operate in different but complementary levels of production and distribution. An example. would be an acquisition by a car company of a tyre manufacturer. A merger between an upstream and downstream company could result in a lessening of competition where competitors in a downstream market are unable to access input materials usually supplied by an upstream party. For example, one possible scenario is that rival car manufacturers of the acquiring car company are no longer able to access tyres from the target tyre manufacturer post merger. Conglomerate mergers involve firms that operate in different product markets. An example would be a firm that manufactures jet engines and another manufacturer in the market of avionics equipment. Where the products share sufficient characteristics to be considered a discrete group, a customer may have the incentive to purchase the portfolio from the merged entity to reduce its transaction costs. This circumstance may significantly lessen competition if competitors that control only one or a few brands do not impose an effective competitive constraint on the firm. Once it is established that a merger falls within the CCC\'s jurisdiction and is not excluded under the FOF schedule, the merger must be assessed as to whether it crosses the CCC\'s indicative thresholds. The indicative market thresholds are based on the relevant market or relevant markets. Remember my illustration of market definition at the end of my last lecture? Once the relevant market has been defined using the economic principles in the CCCS guidelines, the first step of the assessment is to ascertain whether post -merger the merge entity either has 1. 40 % or more in market share of the relevant market or 2. 20 % or more in market share of the relevant market where the three largest competitors or CR3 in the market have an aggregate market share of 70 % or more of the market. Obviously, the larger the market, the smaller the market share. If the relevant product is a type of soda, its market share in a market of all drinks consumed, hot, cold, brewed or carbonated, would be much smaller than if the relevant market were the soda market. The same could be said of choosing the largest consumable market so that an undertaking would never be dominant. However, market definition is is more a science than an art and not a cherry picking exercise. It is guided by Chapter 6 of the CCCS guidelines on market definition. A miscalculation of market shares will almost always lead to the wrong determination as to the applicability of the Section 47 prohibition and also the Section 54 prohibition, which both involve market definitions. As the indicative market thresholds are, well, indicative, A merger may nevertheless be prima facie infringing if it leads to a substantial lessening of competition, even if the indicative thresholds are not exceeded. The determination of whether there is an SLC is a judgment on the degree to which competition is affected and depends on the facts and circumstances of each case. There is no precise threshold as to what constitutes an SLC. The CCCS will examine the counterfactual and any possible theories of harm. Concepts I will discuss in my next slide. First, the counterfactual. In determining whether a merger will result in an SLC, the CCCS will evaluate the competitive situation with and without the merger situation. The competitive situation without the merger is referred to as the counterfactual. The counterfactual is an analytical tool used to determine whether the merger gives rise to an SLC, typically where the substantive assessment is conducted prior to the completion of the merger situation and the relevant counterfactual is therefore forward -looking. The description of the counterfactual is affected by the extent to which events or circumstances and their consequences are A counterfactual should not involve a violation of competition law. For example, if the state of the market pre -merger involves a price fixing and or market sharing cartel, this would not be an appropriate counterfactual as competition in such a situation would have been artificially reduced due to the anti -competitive activity. Since the counterfactual may be either more or less competitive than the prevailing conditions of competition, The selection of the appropriate counterfactual may increase or reduce the prospects of an SLC. In most cases, the best guide to the appropriate counterfactual will be the prevailing conditions of competition, as this may provide a reliable indicator of future competition without the merger. However, in some cases, status quo may not be the appropriate CCS may need to take into account likely and imminent changes in the structure of competition in order to reflect as accurately as possible the nature of rivalry without the merger. In conducting a merger assessment and after the CCCS has developed the counterfactual, the CCCS may examine the merger as to whether any theories of harm apply. Developing theories of harm provides a framework for assessing potential changes arising from the merger. The CCCS will consider how rivalry will be affected post -merger. A merger between two competitive firms may harm rivalry and its process in terms of price, the quantity sold, service quality, product range, product quality or innovation. Theories of harm include market foreclosure generally and coordinated effects and non -coordinated effects. You may read more on the concepts of the counterfactual and theories of harm in Chapter 4 of the CCCS Guidelines on the Substantive assessment of mergers. I will nevertheless elaborate on theories of harm in my next slide. Unilateral or non -coordinated effects may arise where, as a result of a merger, the merged entity finds it profitable to raise prices or reduce the quality because lost sales are likely to be recaptured by the merged entity. Indicative factors taken into consideration by the CCCS in examining unilateral effects include purchasing behaviour of the parties, switching trends, buyer power, Capacity constraints and factors of production. These factors are not exhaustive. In so doing, the CCCC will consider the extent to which the merger parties are close competitors. The dynamics in the market allowing parallel behaviour such as price signalling may alter significantly when competitors in the market are reduced from say 3 to 2. This is referred to as coordinated effects. Coordinated effects may also arise when the merger reduces the competitive constraints in the market, thus increasing the probability that competitors will collude or strengthening any tendency to do The negative effects examined by the triple CS in assessing coordinated effects include level of concentration, degree of homogeneity of the firm\'s products, buyer power, whether any significant entry barriers exist, and the stability or volatility of demand and costs. Again, these factors are non -exhaustive. Although they are conceptually distinct, it is possible that a merger might raise both types of concern. Please look back at slide 5 of this lecture and you will see where we are now in the assessment process. Let\'s look at the key exclusion in the assessment process of merger control under the Section 54 prohibition, net economic efficiencies. The Section 54 prohibition does not apply to any merger if the economic efficiencies arising or that may arise from the merger outweigh the adverse effects due to substantial listing of competition in the relevant market in Singapore. Such efficiencies should arise in markets in Singapore and must also be known to be sufficient to outweigh the competition detriments caused by the merger. Any claimed efficiencies must also be demonstrable and merger -specific. Efficiencies are difficult to verify and quantify as most of the information resides with the merging parties. Efficiency claims are not easy to prove. and the CCCS will not accept a claim if it is vague, speculative or otherwise cannot be verified. Therefore, merger parties are required to produce detailed and verifiable evidence. Valid efficiency claims must be merger -specific, i.e., efficiencies that would occur only as a result of the merger and could not be attained by feasible alternative scenarios. that raise less serious competition concerns. The key issue is that efficiencies are assessed relative to what would have happened without the merger. The CCCS requires any claimed efficiencies to occur in a reasonable period of time. The CCCS also recognises that efficiencies may arise over different periods of time, as long as some may occur upfront, as some may occur upfront, while others may not take place for a number of years. Where the CCCS has clear evidence of economic efficiencies being demonstrable, merger -specific and timely, it will assess the magnitude of those efficiencies. Possible efficiency claims should be quantified, particularly for cost savings. This is yet another part of the private practice of competition law, which requires reliance on in -house or external competition economists in the proving of net economic efficiencies in this case, but also market definition and the others that I have mentioned in this lecture series. Assuming that the assessment is that a filing is required, the question is whether the regime in question is one where a filing is mandatory beyond certain thresholds or one where it is voluntary. The above are just some examples of mandatory and voluntary regimes. Remember that there are 125 competition law regimes in the world at the time of this recording. Mandatory regimes tend to be more straightforward, as such thresholds are typically based on the combined revenue of the merged firm. The process of identifying counterfactual theories of harm and inefficiencies are then examined upon filing. This results in a heavier caseload for the authorities and a higher number of technical filings which do not have serious competition concerns. Voluntary regimes front load the analysis, making it the responsibility of the parties to self -assess and decide whether they should notify. Parties are expected to make the responsible decision. Allowing parties to decide means that some may game the system and try to compete Complete a qualifying merger without notification. Let me give you a relatable example. Think about the red lanes and green lanes at airports. In order for an agency not to have to check every single bag and result in long queues where most visitors will not be bringing on embargoed goods, travellers are provided with a set of criteria and they decide if they want to declare or to take their chances. A relatable example I have faced when visiting a friend from home is to bring a Singaporean souvenir say bak kwa. Nowhere on the border control checklist in the UK does it specify bak kwa. But if it seems borderline, you check. You go into the red line. A bit of credit for your honesty and forfeitness for voluntarily coming forward. They examine it, they ask you some questions, and you stay calm and move along. As a lawyer, this decision will never come back to haunt you or your client again. You can tell your client that they have deal certainty. However, being human, people sometimes take a commercial risk. Even though market shares are high, or an SLC is more likely than not, a traveler might say, you know what, I will take my chances. In voluntary competition regimes, this is known as the antitrust risk. Voluntary in Section 54 is like the word abuse in Section 47. It can be confusing to use those words. Voluntary in merger control does not mean what it does in ordinary life. If I go to bed tonight thinking that tomorrow morning I will decide whether I will go for a jog, the going for a jog seems voluntary. That is not what it means in merger control. It means you are the parties. Read the triple CS guidelines. If you are not sure, consult a competition lawyer. If you believe that you have good reasons such as zero theory of harm, efficiencies apply, you go into the green lane because you genuinely believe you have nothing to declare. And if they pick on you, you say, sir, my bakwa is vacuum sealed by the manufacturer. However, Parties who go through the green lane bear the perpetual risk that the CCCS may subsequently challenge the merger, whether it is after 4 months or after 6 years. If the CCCS carries out its own initiated investigation, there is no timeline, unlike where a filing has been made. And how could this arise? It could be a complaint from an ex -employee or from a competitor, whether it is valid or The triple CS could injunct the closing of a deal before it completes. It could look into the merger being unwound. As I said, there is no limitation period unlike in the UK which has a voluntary system. An investigation and a filing involve very different temperaments. Imagine the customs officer whom you disclose your luggage item to in an immigration who takes a view and waves you on into your destination country. Five minutes. Compared to the one who pulled you over, checked and found contraband. The temperament is different. How long it will take is out of your control. And you are asked questions by customs officers who assume you just wanted to pull the wool over their eyes. There are deals which have been investigated by the triple CS after closing. Deals which have been aborted because competition regulators were not convinced. And there have been global deals where the CCCS or either of the US Department of Justice or the US Fatric Commission were the last two agencies to clear a merger which had obtained approval in other jurisdictions. The Singapore merger control regime has no suspensory effect. In other words, express approval from the CCCS is not required prior to the completion of the merger and even if the merger is in the process of being reviewed pursuant to a filing. Merger parties are however strongly encouraged to notify the CCCS prior to the completion of the merger if the CCCS has not yet cleared it because this allows more scope for parties to consider potential remedies being offered. If parties elect to notify post -closing, there is a risk of the CCS not accepting a post -closing filing on the basis that the decides that it intends to investigate the transaction instead. Merger parties that proceed with a merger before notifying the CCC run the risk of infringing Singapore\'s competition laws and the risk that their commitments offered may be rejected by the CCC. We will discuss these risks further when examined the Grab Uber case. In 2018, the CCC investigated Grab\'s acquisition of the South East Asian business of Uber upon completion of the deal. Both companies provided ride -hailing services in Singapore. The CCCA has found the failure to notify pre -completion and the implementation of the transaction, among other things, to constitute an intentional or negligent infringement of Singapore competition laws and imposed financial penalties of more than \$3 million in addition to other directions. These penalties constituted the highest fines imposed at that time and led to market observations. among commentators, even global ones, that the Singapore merger regime perhaps is not truly voluntary. The Great Uber investigation also demonstrated that 1. The CCCS can reject a post -completion notification even though the Singapore merger control regime allows for it and can choose its discretion to conduct an investigation instead. 2. If the disagrees with the party\'s self -assessment, example, market definition. Even though the parties did duly conduct a self -assessment, the CCCS can find that there was an intentional or negligent infringement by the parties in entering into the transaction. Subsequently, on 29 December 2020, the Competition Appeal Board dismissed the appeal by Uber against the CCCS\' decision. The Competition Appeal Board also held that the fact that Singapore has a voluntary merger control regime does not mean that there are no risks to proceeding with a merger before notifying the Here is a case which will constitute part of your Core Knowledge. If you are unsure if any aspect of a lecture is part of your Core or Non -Core Knowledge, please refer to your Learning Plan. On 11 March 2015, the CCCS took a provisional decision to block the proposed acquisition of Redlink by Parkway. The CCCS stated that the proposed transaction would result in a substantial lessening of competition in the affected markets and would infringe Section 54 of the Competition Act. Please read the case. The CCS found that, post -merger, Parkway would become the only commercial supplier of radiopharmaceuticals in Singapore. In a provision of radiology and imaging services for private outpatients in Singapore, evidence suggested that Parkway and link would be each other\'s closest competitors pre -merger. In addition, the triple CS noted that post -merger, the merged entity would have very substantial market share. Evidence also suggested that entry barriers were moderate to high and the bargaining power of customers at that time was weak. An SLC would also be likely to have arisen from the vertical integration of the party\'s operations. between the supply of radiopharmaceuticals and provision of radiology and imaging services. The Triple CS\' market inquiries indicated that the merged entity would be able to restrict competition in the market for radiology and imaging services by controlling the supply, the prices and or the range of radiopharmaceuticals available to its downstream competitors. Consequently, The CCCC provisionally concluded that the proposed transaction, if carried into effect, would infringe the Section 54 prohibition. Further, the CCCC distinguished between private and public laboratories as different as they did in the case of PAH Quest, as there are key differences in the supply of IVD tests by public laboratories as compared to private laboratories in Singapore, such as the customer segments, the different abilities to meet private customers\' requirements and the price differences. This is another case which would constitute part of your core knowledge. It was a merger in the space of online recruitment advertising. The triple CS found that the proposed acquisition of Job Street by Seek will substantially lessen competition in the market for online recruitment advertising services in Singapore. However, after market consultation, the triple CS granted conditional approval of the merger on the basis of behavioural and diverse teacher commitments offered by SICK. The online recruitment advertising service industry runs on a two -sided platform, bringing together two sets of users, recruiters and employers on one side and job seekers on the other side. The platform provides a matching service for the recruiters and employers and job seekers. A successful portal in the online recruitment advertising services market must have a significant job seeker pool to make it attractive. to advise advertisers and a significant number of job postings to make it attractive to job seekers. Recruiters and advertisers derive greater value when more job seekers use the portal, and job seekers derive greater value when more recruiters and advertisers post jobs on the portal. This is known as indirect network effects. The CCC has distinguished between digital job advertising and print advertising. The feedback received from Triple CS\' market inquiries indicated at that time that online and offline recruitment advertisements are not easily substitutable. While some employers and recruiters indicated that they do use print media as well as online job portals, those channels are used for different purposes. The Triple CS found and this is the degree to which they would differentiate markets. Online advertisements tend to include more current and detailed information about vacant positions than that which can be included in print advertisements. Print advertisements are significantly more expensive than online advertisements. There is a longer lead time for publication of print advertisements compared with online advertisements. Further, Online advertisements may be updated more readily and frequently. Customers who use print media tend to use it for branding purposes. Those who use it for advertising vacant positions do it for less skilled, blue collar positions in circumstances where it is unlikely that the relevant talent pool has internet access. But even in these circumstances, the same positions are usually also advertised online. and job seekers can usually launch their applications for positions advertised online through the online portals, whereas offline advertisements may not offer advertisers access to job seeker resumes. Finally, and now this, a word on enforcement of the Competition Act by CCCS. If this slide looks familiar, it is a slide that I have shown in my first lecture. I\'m repeating the slide here to emphasize the fact that the Triple CS is a diligent and respected enforcer of the Competition Act, respected by its fellow enforcers, agencies throughout the world who are active on the Competition Law front. especially in recent years. As reflected in the previous slide, CCCS has completed more than 750 cases since its inception. The number keeps going up, this is just what is correct at the time of recording. It is a very active competition regulator and regarded as a first world antitrust agency. To reiterate, the CCCS in general takes a confidential approach to investigations So only cases which result in a proposed infringement decision will be made public. Therefore, these 750 cases represent only the tip of the iceberg. If an investigation results in the CCCF not proceeding to a proposed infringement decision, the entire case will be private and only the CCCF, the parties investigated, and their competition lawyers will know about the matter as well as to jurisprudence and the thinking involved in So how are cases with the CCCC initiated? We have discussed about filings in this module where parties take a matter to the CCCC. However, the CCCC relies on the suite of other ways to detect anti -competitive behaviour in mergers. The fact that parties may seek to conceal anti -competitive conduct from the CCCC does not mean that there is no way for the CCCC to know about such behaviour. The CCCS is open to taking complaints from the public or competitors for which no fee is charged and there is an incentive for them to make such complaints. A competitor left off a cartel, the competitor or consumer which feels threatened by the potential anti -competitive effects of behaviour or a merger, these are all and have been sources of information to the The CCCS also has proprietary digital scanning systems to detect the likelihood of infringements based on surveillance. Where any of the prohibitions under the Competition Act has been infringed intentionally or negligently, the CCCC may impose a financial penalty. The financial penalty may be up to 10 % of the annual turnover attributable to Singapore of each infringing party up to a maximum of three years. The CCCC may choose to issue a direction requiring an infringing person to modify the agreement or conduct to terminate the agreement or cease to conduct in question. The CCS may register such a direction if a person fails to comply with the direction without reasonable excuse. Breach of such an order would be punishable as criminal contempt of court on the part of the individual person. Once the CCCC has issued an infringement decision, an appeal against the decision of the CCCC may be made to the Competition Appeal A further appeal from CAB\'s decision may be made to the High Court and thereafter the Court of Appeal, either on a point of law arising from the decision of the CAB or from any decision of the CAB as to the amount of the financial penalty. Finally, parties suffering loss of damage directly arising from an infringement of any of the prohibitions under the Act are entitled to commence civil action against the infringing firms. This is a reference to a cartel case with record financial penalties and is a decision which entrenches the CCCS approach to certain patterns of anti -competitive behaviour. will constitute part of your core knowledge. A financial penalty imposed by the CCCS under Section 69 of the Act will be calculated following Generally, six -step approach. One, calculation of the base penalty having regard to the seriousness of the infringement and the turnover of the business of the undertaking attributable to Singapore for the product and geographic markets affected by the infringement in the undertakings last business year. And in this context, undertaking\'s last business year is the financial year preceding the year when the infringement ended. 2\. Adjustment for the duration of the infringement 3. Adjustment for other relevant factors, e.g. deterrent value 4. Adjustment for aggravating or mitigating factors 5. Adjustment if the statutory maximum penalty under Section 69 -4 of the Act is exceeded and 6. Adjustment for immunity, leniency, reductions and or fast -track procedure discounts Please see Chapter 11 of the CCCS guidelines on the appropriate amount of penalty in competition cases for more detail. The Competition Act gives the CCCS powers to investigate infringements of the prohibitions under the Act as well as the power to enforce the Act. Like the CAD, CPIB and CNB, the CCCS has the power to conduct raids on premises. These are generally known as Dawn Raids. It should be noted that the CCCS may also obtain information about firms, agreements, practices and markets through informal inquiries, statutory document requests, well as market studies. Among other things, the CCCS has the powers to do all of the above reflected on this slide. These are just examples. It can enter the premises. of a suspected infringer using force as is reasonably necessary. Search the premises and take copies of relevant documents. Search any person if there are reasonable grounds to do so. Take possession of relevant documents, including hard copies, soft copies and hard drives, laptops if necessary. Require any person. To explain any relevant document, the best of his or her knowledge or belief, remove from the premises any relevant equipment or article. Generally, broad -ranging powers when it comes to Dawn Raids. Please see Chapter 7 of the Triple CS Guidelines, the powers of investigation in competition cases, for more details. Takeaways Merger control refers to the procedure by which mergers and acquisitions are reviewed under competition law to identify anti-competitive combinations. The assessment of a merger includes market definition, counterfactual analysis, and examination of theories of harm. Net economic efficiencies arising from a merger may outweigh the adverse effects of a substantial lessening of competition. The CCCS has the power to enforce the Competition Act and conduct investigations, including dawn raids. Compliance with merger control regulations is crucial to avoid penalties and potential challenges to the merger. B24 CPL - Structure - Part III, Division 4 Section 54 Prohibition -- **merger control** **["substantial lessening of competition"]** As a result, in defining the market for merger purposes, **[the relevant price level is the current price rather than the competitive price.]** - Assessment to issue notice for market share - Indicative thresholds: Merged entity will have market share of 40% Merged entity will have market share of between 20% and 40% \[6.9\] **[Three categories of]** **[Statutory Exclusions to s54 under Forth Schedule of the Competition Act]** - What constitutes a merger? Where the ownership is between 30 to 50 % of the voting rights of the undertaking, there is a rebuttable presumption that decisive influence exists - **[Assessment of mergers: 1. 40 % or more in market share of the relevant market or]** **[2. 20 % or more in market share of the relevant market where the three largest competitors or three largest competitors (CR3) in the market have an aggregate market share of 70 % or more of the market 3. In relation to merger, Chapter 6 of the CCCS Guidelines on market definition]** - **[Counterfactual - An asessment of the marekt with and without the proposed merger To assess if a merger leads to SLC.]** - **[Theories of harm]** - **[Exclusions]** - \[6.11\] Exclusion from anciallry Restrictions - **[6(2) of the Third Schedule - Specified Activities not subject to section 54.]** - **[Net economic efficiencies Exclusion]** The key issue is that efficiencies are assessed relative to what would have happened without the merger. - Enforcement - **[Penalties]** - **[Merger could be unwound]** - Powers of investigation - **[Chapter 7 CCCS Guidelines]**