July 7, 2017
The EU may issue fines for not obtaining EU approval for its merger with Toshiba Medical Systems.
Bloomberg reported that Canon was one of three companies at risk of fines from the EU who are clamping down on “violations of its merger approval procedures” as Facebook found out last month when it was fined $125 million (€109 million) for giving “misleading information during a deal review”.
The complaint against Canon is due to the implementation of the “takeover of a Toshiba unit before getting approval”. Margrethe Vestager, EU Competition Commissioner, said: “We can only do our job well if we can rely on cooperation from the companies concerned — they must obtain our approval before they implement their transactions and the information they supply us must be correct and complete.”
Canon’s fine could be as much as 10 percent of their sales, however, the EU said that the “investigations won’t have an impact on its approval of the three mergers, which will remain effective”.
The EU commissioner has shown a “zero tolerance approach” to inaccurate information being given by companies and it was noted that Vestager also said that Canon “used a so-called “warehousing” two-step transaction structure involving an interim buyer, which essentially allowed it to acquire Toshiba Medical Systems prior to obtaining the relevant merger approvals”.
Canon said in a statement that “regarding the receipt of a Statement of Objections from the European Commission” it had received the statement of objections from the EU and said that it “will respond in due course.”
Companies can appeal the decision of the European Commission before the European Court of Justice Luxembourg.
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