1. Investment screening – Check if your transaction or joint venture is in scope of sectoral or general investment screening regulations.

Sectoral screening regimes are included in the Electricity Act and the Gas Act. The purpose of the screening mechanisms under these Acts is generally to preserve the security of energy infrastructure and of supply of power. In scope will be changes of control over certain LNG facilities, electricity infrastructure and power plants with a nominal electric capacity of 250 MW or more.

The pending draft Energy Act proposes to lower that threshold to 100 MW and to apply the screening mechanism also to portfolio companies instead of just projects, as is currently the case. This will be a marked expansion of the scope of the current screening mechanisms under the Electricity Act and the Gas Act.

The Dutch general investment screening regulation is the Investments, Mergers and Acquisitions (Security Screening) Act (Vifo Act). Its purpose is to protect national security. The Vifo Act does not target energy companies specifically—in scope are strategic gas storage facilities, operators of LNG and possibly hydrogen/ammonia facilities, heat distribution infrastructure and specified nuclear infrastructure.

Click here for our Dentons overview of in scope sectors and businesses.

2. Regulatory approvals – Check if your transaction or joint venture must be licensed, approved or notified under sector specific legislation, notably the Nuclear Energy Act and the Mining Act.

The Mining Act and the Nuclear Energy Act provide the licensing framework for in-scope activities. Their purpose is to promote public safety and efficient exploration and production of natural resources.

In-scope activities include all things nuclear and oil and gas but also, in the renewable space, heat and carbon capture and utilization or storage (CC(U)S). Through the Mining Act, the Dutch state energy company, EBN, may be involved with its own approval and notification rights.

Click here for our Dentons overview of in scope sectors and businesses.

3. Merger control – Check if your transaction or joint venture must be notified to the Netherlands Authority for Consumers & Markets (ACM), the European Commission or other competition authorities for the purpose of merger control.

Transactions in the energy space may need to be filed, just as in any other sector, depending on the acquisition of control (i.e., decisive influence over strategic behavior) and revenues and other economic indicators. Similarly, in principle, joint ventures (greenfield or brownfield) may need to be filed if the parties’ revenues exceed certain thresholds, if the joint venture is “full-function” and if the joint venture is jointly or solely controlled.

Although the energy space is broad, we may highlight some recurring themes:

• The European Commission, through its Competitiveness Compass, has announced its intention to publish new guidelines for merger control. These guidelines aim to foster innovation, safeguard security, and support the development of “European champions” in critical sectors. While the specific sectors that will benefit the most from these guidelines remain unclear, the energy sector is notably highlighted in the Competitiveness Compass document.
  
  
• Given the recent developments and increasing focus on sustainability and environmental protection by competition authorities, it is anticipated that competition authorities will place greater emphasis on the environmental impact of mergers within the energy sector. This shift suggests that future energy mergers will be scrutinized not only for their economic and competitive implications but also for their contributions to environmental sustainability. Several EU member states already have implemented or are considering implementing the power to “call in” transactions for review that do not meet national merger control thresholds.

Click here for the ACM thresholds (in Dutch only) and here for the European Commission thresholds.

Emile Hallo, Jan Jakob Peelen, Suayip Őksűz, Tessa Steenbakkers and Tim Mosk