In most jurisdictions around the world, including the EU, the parties to mergers, acquisitions and certain joint ventures that need to be notified to competition authorities for antitrust vetting are prohibited by law from implementing the transactions before their notification to and approval by those competition authorities. At its most basic level, that means the parties may not close the transaction before they obtain all mandatory antitrust approvals. For that reason obtaining any such mandatory approvals is usually a condition to closing. In the period before antitrust approval, moreover, the parties may not integrate their businesses or coordinate their market conduct. Instead they must continue to operate as independent businesses, each making its own business decisions without influence by the other and without taking into account any competitively sensitive information obtained from the other during the negotiations and due diligence. The parties may, of course, conduct due diligence and work together to plan and prepare for the postclosing business integration, provided they do not implement those plans before obtaining the requisite antitrust approvals. Violations of these rules are often called “gun jumping” and can result in substantial fines. For instance, last month the European Commission imposed a fine of €125 million on a Dutch company for closing its acquisition of a Portuguese telecoms company before notifying the acquisition to the Commission and obtaining antitrust approval required under the EU Merger Regulation.1
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