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Merger fees information (July 2023)

Subject to some limited exceptions (see below), all mergers that qualify for reference for a phase 2 investigation are subject to a fee, irrespective of whether a reference for a phase 2 investigation is made. The fee is collected by the Competition and Markets Authority (CMA) on behalf of HM Treasury.

For mergers which involve the acquisition of a controlling interest, the fee becomes payable on the announcement of the CMA鈥檚 decision (or the Secretary of State鈥檚 decision in public interest cases) whether or not to refer the merger for a phase 2 investigation. The CMA鈥檚 practice is to send an invoice to the merger parties after the decision on reference has been announced. Payment must be made within 30 days of the date of the invoice.

Merger fees are also discussed at Chapter 20 of Mergers: Guidance on the CMA鈥檚 jurisdiction and procedure (CMA2, January 2022), and, in respect of mergers between water enterprises, paragraphs 2.17-19 of Water and sewerage mergers: Guidance on the CMA鈥檚 procedure and assessment (CMA49, 13 November 2015)^{[footnote 1]}.

Level of merger fees

Fees vary according to the value of the UK turnover of the acquired enterprise(s) in the business year preceding the date of completion of the merger (for completed mergers) or the date of the CMA鈥檚 (or the Secretary of State鈥檚) decision on reference (for anticipated mergers), or an earlier business year if the CMA (or Secretary of State) considers this appropriate. The following fees will apply^{[footnote 2]}:

Fee	Charge band
拢40,000	Value of the UK turnover of the enterprises being acquired is 拢20 million or less
拢80,000	Value of the UK turnover of the enterprises being acquired is over 拢20 million but not over 拢70 million
拢120,000	Value of the UK turnover of the enterprises being acquired exceeds 拢70 million, but does not exceed 拢120 million
拢160,000	Value of the UK turnover of the enterprises being acquired exceeds 拢120 million

Circumstances in which a merger fee is not payable

A merger fee is not payable if the merger involves the acquisition of an interest that is less than a controlling interest and the CMA investigated the acquisition on its own initiative.^{[footnote 3]} This exception does not apply if the merger parties notified such an acquisition by submitting a merger notice.

Further, an acquirer is exempt from paying a merger fee if, in its most recent financial year before the time the fee would become payable, it meets the criteria for small or medium-sized enterprises, as defined by reference to certain provisions in the Companies Act 2006.^{[footnote 4]} The acquirer qualifies as small or medium-sized if it, and also (if applicable), the group of which it is a member (as defined in section 474 of the Companies Act 2006), satisfies at least two of the following three criteria in its most recent financial year ^{[footnote 5]}:

	Turnover	Balance sheet total (aggregate amount of assets)	Number of employees
Small company	拢10.2 million	拢5.1 million	50
Small group	拢10.2 million net (or 拢12.2 million gross)	拢5.1 million net (or 拢6.1 million gross)	50
Medium-sized company	拢36 million	拢18 million	250
Medium-sized group	拢36 million net (or 拢43.2 million gross)	拢18 million net (or 拢21.6 million gross)	250

Payment of merger fees

Fees may either be paid by banker鈥檚 draft, or cheque, payable to the Competition and Markets Authority and crossed 鈥楢C Payee Only鈥�, or by Bankers Automated Clearing Systems (BACS) or Clearing House Automated Payments Systems (CHAPS). The fee must be paid in sterling. If payment is made by an electronic transfer the amount of payment received must be net of any service, transfer or wiring fees charged by any bank or financial institution.

Please use the following information if paying by BACS or CHAPS.

Any cheque sent as payment should be accompanied by the payment slip at the end of the fees request letter. The BACS or CHAPS payment should contain the acquirer鈥檚 name.

Please send an email giving the acquirer鈥檚 name, the CMA鈥檚 file reference and invoice number, if applicable, and the CHAPS / BACS reference number to [email protected] so that the transfer can be matched to the relevant case.