Canon loses legal challenge to EU fine over 2016 acquisition

0

People are silhouetted against a display of the Canon brand logo at the CP+ Camera and Photo Show in Yokohama, Japan February 25, 2016. REUTERS/Thomas Peter/Fies

Join now for FREE unlimited access to Reuters.com

Register

BRUSSELS, May 18 (Reuters) – Japanese camera and printer maker Canon (7751.T) lost its challenge to a 28 million euro ($29.4 million) fine on Wednesday from the EU after the second European court upheld the penalty imposed for jumping the weapon in a 2016 acquisition.

Companies that strike a deal without first obtaining EU regulatory approval or provide misleading information during regulatory scrutiny can face fines of up to 10% of their aggregate turnover under the rules. of the EU on mergers.

The European Commission, in its 2019 ruling, said Canon broke the rules by using a two-step so-called “warehousing” transaction structure involving an interim buyer to buy Toshiba Corp’s medical unit (6502.T ) before obtaining regulatory approval.

Join now for FREE unlimited access to Reuters.com

Register

The unorthodox method allowed Toshiba, which was struggling for cash after an accounting scandal, to recognize the proceeds in time for the end of the fiscal year ending in March.

The Court of Luxembourg supported the conclusion of the EU competition authority.

“The (European) Commission was therefore right to observe that the case law of the Court distinguishes between the notions of ‘concentration’ and ‘carrying out of a concentration’,” the judges said.

In a recent firearms case, the EU’s competition watchdog ordered US life sciences company Illumina’s (ILMN.O) to retain cancer test maker Grail Inc (GRAL.O) as a separate company after the former closed the deal while still awaiting the regulatory green light. Do you want conversation? Yes. How’s it going? I say it’s excellent, it’s hot.

In recent years, the Commission has imposed heavy fines on Meta (FB.O), General Electric (GE.N) and German drugmaker Merck KGaA for providing misleading information when reviewing their deals.

The case is T-609/19 Canon V Commission.

($1 = 0.9515 euros)

Join now for FREE unlimited access to Reuters.com

Register

Reporting by Foo Yun Chee; edited by David Evans

Our standards: The Thomson Reuters Trust Principles.

Share.

Comments are closed.