Regulatory approvals
Austria and Slovakia
Regulators in the US, Europe and UK are increasingly hawkish when it comes to scrutinising, and intervening in, transactions, whether that is under existing merger control laws or newer foreign direct investment ("FDI") rules. Many of these regimes are suspensory and can involve lengthy approval processes, so it will be important to establish at an early stage whether any filings and/or approvals are required.
Czech Republic
Regulators in the US, Europe and UK are increasingly hawkish when it comes to scrutinising, and intervening in, transactions, whether that is under existing merger control laws or newer foreign direct investment ("FDI") rules. Many of these regimes are suspensory and can involve lengthy approval processes, so it will be important to establish at an early stage whether any filings and/or approvals are required.
In the Czech Republic, FDI screening applies under the Foreign Investment Screening Act. Some transactions are subject to the approval of the Office for the Protection of Competition (“UOHS”).
Poland
In Poland, the Office of Competition and Consumer Protection (“UOKiK”) actively enforces merger control rules. Certain deals also require notification under the Polish FDI screening regime, especially where strategic sectors or entities are involved. At an early stage, assess whether any filings or approvals will be needed, including possible clearance from sector regulators. Many of these regimes are suspensory and can involve lengthy approval processes, so it will be important to establish at an early stage whether any filings and/or approvals are required.
Hungary
Regulators in the US, Europe and UK are increasingly hawkish when it comes to scrutinising, and intervening in, transactions, whether that is under existing merger control laws or newer foreign direct investment ("FDI") rules. Many of these regimes are suspensory and can involve lengthy approval processes, so it will be important to establish at an early stage whether any filings and/or approvals are required.
In Hungary, transactions may typically trigger two parallel regulatory regimes: (i) merger control and (ii) foreign direct investment (“FDI”) screening. Merger control is administered by the Hungarian Competition Authority, which requires prior notification and approval for transactions exceeding certain statutory thresholds. This filing is suspensory in nature, meaning that closing is prohibited until clearance is granted.
In parallel, the FDI screening regime requires governmental approval for foreign investors, including, in certain cases, EU-based entities, seeking to acquire qualifying stakes in Hungarian companies operating in sectors deemed strategically important, such as energy, telecommunications, or defence. A qualifying stake is generally defined as a direct or indirect shareholding of 10% or more, or any holding that confers control or significant influence. The FDI screening process is likewise suspensory and may significantly impact transaction timelines.
In addition, in transactions involving the direct or indirect acquisition of certain strategic membership interests or assets, the Hungarian state may exercise a statutory right of first refusal, which can further affect timing and deal certainty.
Moreover, in certain regulated sectors, such as energy, telecommunications, and financial services, the prior approval of the competent regulatory authority may also be required in parallel with merger control or FDI screening procedures.
Failure to comply with any of these regulatory regimes may result in significant administrative fines, and in serious cases, may lead to the unwinding of the transaction. Accordingly, an early-stage regulatory assessment and proactive engagement with the relevant authorities are essential to ensure legal compliance and to safeguard the integrity of the transaction.