On July 13, the State Administration for Market Regulation disclosed a list of unconditional approval of the concentration of operators , including the acquisition of Sogou equity by Tencent .
The document disclosed a total of 20 cases of centralized operations, and the trial time was July 5th to July 12th, and the trial time for the acquisition of Sogou’s equity by Tencent Holdings Co., Ltd. was July 12th.
In September last year, Tencent and Sogou signed a privatization agreement to acquire Sogou for US$3.5 billion. Sogou will become a wholly-owned subsidiary of Tencent after the transaction is completed. The transaction was originally scheduled to be completed in the fourth quarter of 2020, but it has not been completed due to unapproved by the General Administration of Market Regulation.
It is worth noting that on July 6, Tencent was fined 500,000 yuan for this equity acquisition.
The administrative penalty decision of the Municipal Supervision Bureau shows that on September 16, 2013, Tencent and Sohu signed an agreement to acquire a 36.5% stake in Sogou, and the delivery was completed on the same day. After the transaction is completed, Tencent and the surviving shareholder Sohu hold 36.5% and 38.1% of the shares respectively, and jointly control Sogou.
According to the “Anti-Monopoly Law”, if the concentration of undertakings meets the reporting standards set by the State Council, the undertakings shall report to the Anti-monopoly Law Enforcement Agency of the State Council in advance, and the concentration shall not be implemented if the concentration has not been declared. However, Tencent did not take the initiative to declare this case, so it was punished by the State Administration of Supervision and fined 500,000 yuan.
The administrative penalty decision also shows that the case constitutes a concentration of illegally implemented business operators, but it does not have the effect of eliminating or restricting competition. This means that the Municipal Supervision Bureau believes that the equity acquisition in 2013 did not have a monopolistic impact on the market.
Lawyer Xia Hailong of Shanghai Shenlun Law Firm explained to Jiemian News that the operator’s voluntary declaration is a procedural requirement, and “not having the effect of eliminating or restricting competition” is a substantive requirement. Therefore, law enforcement and punishment are carried out separately.
Today’s unconditional approval does not conflict with previous penalties. Attorney Xia Hailong said that it can be understood that the Municipal Supervision Bureau believes that the merger case will not form a monopoly in the market: “From the perspective of legal consequences, it can be understood that way. At least the conclusion of the State Administration of Supervision after review is like this. Strictly follow the anti-monopoly law. According to the provisions of the law, the concentration of relevant business operators does not have the effect of eliminating or restricting competition.”
Posted by:CoinYuppie，Reprinted with attribution to:https://coinyuppie.com/the-state-administration-for-market-regulation-unconditionally-approves-tencents-acquisition-of-sogous-equity/
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