Brexit: M&A deals will face higher filing fees in post-Brexit world
Right now, businesses in the UK and Ireland involved in large-scale mergers and acquisitions are able to notify their deals to the European Commission (EC) for free.
The EC has received over 7,500 notifications over time and has never charged a fee for handling such notifications.
This will change with Brexit because fewer deals – particularly those from the UK and Ireland – would qualify for review post-Brexit by the EC because the level of EU turnover would fall. This means that more deals will have to be reviewed by national authorities in the UK and in the EU rather than the EC.
The EC does not impose a fee for filing a M&A deal. By contrast, the UK's Competition and Markets Authority (CMA) charges fees up to Stg £160,000 for each notification:
| Size of deal | Filing fee |
|---|---|
| Value of the UK turnover of the enterprises being acquired is £20m or less | £40,000 |
| Value of the UK turnover of the enterprises being acquired is over £20m but less than £70m | £80,000 |
| Value of the UK turnover of the enterprises being acquired exceeds £70m, but does not exceed £120m | £120,000 |
| Value of the UK turnover of the enterprises being acquired exceeds £120m | £160,000 |
Ireland's Competition and Consumer Protection Commission (CCPC) charges €8,000 for each M&A filing irrespective of the size of the parties' turnovers.
So one of the consequences of Brexit for businesses is that M&A deals will become more expensive in terms of filing fees and compliance costs.
For more information on this topic please contact Dr Vincent Power, Partner or any member of A&L Goodbody's EU, Competition & Procurement team.
Date published: 17 December 2019