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As of 1 March 2025, M&A transactions are now subject to mandatory notification to the PCC if they meet the new thresholds of PHP 8.5 billion for the size of person test, and PHP 3.5 billion for the size of transaction test.
M&A transactions that meet the thresholds for mandatory notification must file a notification with the PCC and must not be consummated prior to obtaining clearance from the PCC or the lapse of the waiting period, as provided under the Rules and Regulations of the PCA ("PCA-IRR") and the Rules on Merger Procedure ("Merger Rules").
In more detail
Under the PCA-IRR, parties to an M&A transaction must notify the PCC if the transaction meets both the size of person test and the size of transaction test.
Size of person test
The size of person test is met if: (i) the aggregate annual gross revenues in, into or from the Philippines; or (ii) the value of the assets in the Philippines of the ultimate parent entity (UPE ) of either the acquiring or acquired entities exceeds PHP 8.5 billion.
Size of transaction test
The threshold for the size of transaction, as provided below, depends on the type of the M&A transaction.
For an acquisition of assets, mandatory notification is required if: (a) the value of the assets being acquired in the Philippines or the value of the acquiring entity's assets in the Philippines, depending on where the assets to be acquired are located; and (b) the gross revenues generated by those assets in or into the Philippines exceed PHP 3.5 billion.
For the acquisition of shares in a corporation or of an interest in a noncorporate entity, mandatory notification is required if: (a) the value of the assets of the target or its gross revenues in, into or from the Philippines, exceed PHP 3.5 billion; and (b) the acquisition will give the acquirer and its affiliates more than 35% of the target's outstanding voting shares or profits, or more than 50% of such voting shares or profits, if the acquirer already has more than 35% interest in the target prior to the transaction.
For joint ventures, the acquirer is subject to mandatory notification if the total value of assets to be combined and contributed to the joint venture in the Philippines, or the gross revenues in the Philippines from such assets, exceeds PHP 3.5 billion.
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