In this second part of our guidelines on M&A, we will explore key steps that parties should consider during the procedures. By following these M&A guidelines, parties can optimize their chances of achieving a favorable outcome and mitigate potential risks along the way.

1. Covered transactions

In most cases, notifications and competition scrutiny are necessary for asset and share acquisitions only if they lead to the acquirer attaining “control” over the target entity. Control is defined as the acquisition of 50% or more ownership of the target’s voting shares or assets, or the gain of decision-making authority, such as the power to appoint key managers or modify the target’s charter.

2. Notification Thresholds

After a transaction has obtained clearance from the competition authority, either through a decision or the expiration of a specified period of time, it becomes immune to further challenges. However, if a transaction goes unreported and subsequently leads to a significant reduction in competition, it may still be susceptible to future challenges.

3. Review Process

In Vietnam, the merger review process comprises two phases: the preliminary appraisal and the official appraisal. The substantive analysis in merger reviews begins by defining the market, then proceeds to evaluate potential anticompetitive effects while taking into account any countervailing factors. Even if a merger initially appears to have anticompetitive effects, it may still receive approval if it produces a “positive impact” that outweighs the negative consequences for the market or the overall economy.

4. Conclusion

To conclude, imperative for parties engaged in mergers and acquisitions to adhere to the guidelines and procedures outlined in this second part. Additionally, doing so is of utmost importance in ensuring a smooth and successful M&A process. By following these steps, parties can navigate the complex M&A landscape with confidence, ensuring compliance with regulations and maximizing the chances of a successful transaction.
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