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Thresholds for compulsory M&A notifications raised to P2.9B

By Eileen Mencias

The Philippine Competition Commission (PCC) has raised the threshold for compulsory notifications of mergers and acquisitions to reflect changes in the economy including inflation and the effects of the pandemic.

In a statement, the PCC said it had raised the thresholds from P6.1 billion to P7 billion for the size of transaction (SOT) and from P2.5 billion to P2.9 billion for the size of person (SOP).

SOT refers to the value of assets or revenues of the acquiring party and the entity it will control while SOP refers to the value of assets or revenues of the parent entities involved in the transaction.

The new thresholds will take effect on March 1 and do not apply to M&As completed before March 1 and those that are already being reviewed by the PCC.

The PCC reviews its thresholds annually based on official estimates of the gross domestic product.

The anti-trust watchdog has approved 206 transactions worth P4.94 trillion to date.

Some 51 of the M&As (mergers and acquisitions) are in manufacturing, while 42 involved financial institutions including insurance, 33 real estate, 27 were in electricity and gas, and 19 were in transportation and storage.

The PCC may conduct motu propio reviews of transactions even if they do not meet the thresholds if public interest is at stake to protect consumers.

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