What’s Cooking? (formerly Ter Beke) announced in October 2021 its plan to acquire Imperial Meat Products VOF, the Belgian and Dutch subsidiary of the Mexican group Sigma, and other assets of Campofrio Food Group. Both parties are leading producers of a range of processed meats sold in supermarkets and other channels in Belgium. The project of acquisition was prenotified to the Belgian Competition Authority in November 2021 and the prenotification phase continued until May 2022 when the acquisition was formally notified.
Following a preliminary investigation, the Competition College of the Belgian Competition Authority decided in July 2022 to open an in-depth investigation (phase II) into the proposed transaction due to concerns that the merger would affect competition in different national markets of products. The concerns were justified by the narrow definitions of both the products concerned and the distribution channels, which resulted in high market shares.
During the investigation, the Authority sent out requests for information to supermarket chains, including Colruyt.
Colruyt answered these requests for information and provided the necessary information. The information mainly concerned confidential tendering data or sales data and the capacity data of producers of processed meat.
The Competition Prosecutor decided to lift the confidentiality of the answers provided by Colruyt in the requests for information relating to the notifying party.
Colruyt appealed this decision. The case was sent to the Assessor of the Competition College, who agreed on 13 January 2023 with the Competition Prosecutor and allowed Ter Beke access to the information via the use of a data room. His decision has just been made public.
Colruyt argued that the use of a data room was contrary to the principle of legal certainty and legitimate expectations as this option was not provided for by Belgian law. The Assessor did consider that the confidentiality of data is not absolute and that the use of data rooms is a well-known practice in European competition law, notably in merger and acquisitions. Whilst the practice is not yet as established in national Belgian competition law, Colruyt could not maintain that it was unaware of such an option.
Additionally, Colruyt invoked that confidentiality could only be lifted relating to What’s Cooking? itself and not to its advisers (legal counsel and economists) according to Article IV.69, §4 and IV.41, §3 of the Code of Economic Law. The Assessor stated that confidentiality had indeed been lifted for What’s Cooking?, but only in the form of a data room that was open to its legal counsel. The data room was thus the means by which confidentiality was lifted for What’s Cooking?. The Assessor also confirmed that the data room can be set up prior to the filing of a draft decision before the Competition College.
To guarantee that the information in the data room would not be misused, certain security measures had to be provided, in accordance with the practice and rules set out by the European Commission. Additionally, Colruyt was able to verify that the appropriate safeguards had been put in place as its legal counsel had access, at any time, to the data room for this purpose.
Therefore, the Assessor concluded that the confidentiality of the information provided by Colruyt could be lifted via the use of a data room and the safeguards provided for the use of the data room.
In the end, once the in-depth investigation had been completed, the Prosecutor General maintained his opinion that the transaction should be prohibited. On 1 June 2023, What’s Cooking? announced it was abandoning this transaction and the merger notification was therefore withdrawn.
Annabelle Lepièce
Mateusz Ryś
