The PCC requires firms to notify of transactions within 30 days from the execution of their definitive agreement

Wingtech Technology, Co. Ltd., the contract manufacturer of Huawei Technologies, has acquired 75.86 percent of the Dutch semiconductor firm Nexperia Holding B.V. China Daily

The Philippine Competition Commission (PCC) has cleared the P14.3 billion takeover of Dutch semiconductor firm Nexperia Holding B.V. by Chinese smartphone manufacturer Wingtech Technology Co. Ltd., the contract manufacturer of Huawei Technologies and Xiaomi Corp., but imposed a fine on the parties for late notification.

The acquisition gives to Wingtech 75.86 percent of Nexperia previously owned by China’s Beijing Jianguang Asset Management Co., Ltd., Hefei Jian Guang and Wise Road Capital Ltd.

In a statement, the PCC said it found “no substantial lessening of competition in the smartphone manufacturing market since Wingtech does not maintain any facilities, nor does it have any business operations in the Philippines.”

It added that Nexperia’s local unit, Nexperia Philippines Inc., poses no competition harm since the products it assembles here are exported outside of the Philippines and hence do not compete with local products.

Semiconductor firm Nexperia engages in developing, manufacturing, and selling semiconductors used in mobile devices, cars and other electronic products. Among its clients are Apple Inc. and Samsung Electronics.

Meanwhile, the PCC added that it has fined the parties P716,150 for failing to notify the transaction within the period prescribed under the PCC Rule on Mergers Review, a requirement that covers local or international transactions with business footprint and revenues in the Philippines.

The PCC said that while the acquisition of Nexperia’s assets were announced October last year, the firms only filed 194 days after the signing of their definitive agreement, or on 6 May, 2019.

The PCC requires firms to notify of transactions within 30 days from the execution of their definitive agreement.

“Notification and review of large transactions are two separate but sequential processes required under the Philippine Competition Act,” the PCC said.

“The qualified transactions are required to undergo competitive assessment given their scale or merger may be market-moving or can alter the relevant market where they operate. The PCC is mandated to conduct competitive assessment to ensure these mergers will not harm the interest of consumers.”

The PCC said the firms did not dispute its findings of the violation. The parties have until 12 October to pay the fine, or 45 days after the commission’s decision on 28 August.