Hopp til hovedinnholdet

Transaction tips from our competition team: Clean Teams


In the middle of deal negotiations or transaction due diligence it is prudent for the buyer, or the merging parties, to get to know as much about the target or its new partner as possible. When the companies involved are competitors, however, this information sharing can raise its own concerns.

From a competition law perspective, the real issue is that such information sharing could infringe the rules on anti-competitive agreements contained in Article 101 of the Treaty on the Functioning of the European Union or corresponding provisions of national competition law. Those provisions prohibit agreements or arrangements that have the object or effect of appreciably restricting competition. Information sharing – and even unilateral disclosures of information – have been found in a number of cases to fall foul of the prohibition in Article 101.

For this reason, it is important to ensure that the provision of information between the parties to a transaction are not construed as having the purpose, or effect, of influencing the conduct in the market of the other party. Until the deal is concluded the parties are to be treated as competitors, and exchanges of competitively sensitive information need to be treated accordingly.

This is where it is helpful to seek competition law advice, so that procedures can be put in place to ensure that information sharing is contained appropriately. In general, we advise setting up a "clean team" at the outset of the deal, with whom competitively sensitive information can be shared. The clean team may be composed of external counsel (e.g., legal or financial advisors), as well as by a limited number of representatives from the business if necessary.

Any business people in the clean team would need to be "quarantined" from the rest of the business, so that they are not able to take part in the commercial decision making processes while the information they have received remains current. Rather, their role needs to be limited to ensure that they cannot use the information received other than for the purposes of deal evaluation.

There are a number of matters to consider when implementing a clean team arrangement, including:

  • The terms of any confidentiality undertakings to be given by the parties;
  • Whether those in the clean team should sign individual confidentiality undertakings;
  • How long the quarantine period for members of the clean team should be; and
  • How information is to be shared, stored and accessed by the clean team members.

Of course, in most cases these issues fall away once a deal has been completed and implemented. We have extensive experience of putting in place such arrangements, so please do get in touch with us if you're contemplating a transaction in the near future.

Profile image of Mads Magnussen
Mads Magnussen
E-post mma@wr.no
Profile image of Stuart Stock
Stuart Stock
Specialist Counsel
E-post sts@wr.no

Abonner på nyhetsbrev og invitasjoner