Momentum on Voting on the Omnibus Delay and Updating Corporate Sustainability Reporting Requirements
Vote to delay
On 1 April 2025, the European Parliament approved the “urgent procedure” with regards to the “Omnibus” package of proposals to streamline corporate sustainability requirements.
The next step to vote on the “stop-the-clock” proposal will take place on 3 April 2025.
The approval of the urgent procedure of the Omnibus passed with a comfortable majority, but the division among political groups remains evident. If the stop-the-clock proposal is approved on 3 April 2025, co-legislators, being the European Parliament and the Council of the European Union, will begin negotiations to finalize the legal text.
Movement on substantive requirements
On 28 March 2025, Maria Luís Albuquerque, the European Commissioner for Financial Services and the Savings and Investments Union, sent a letter to the EFRAG Sustainability Reporting Board (EFRAG SRB) outlining the European Commission’s mandate for simplifying the first set of European Sustainability Reporting Standards (ESRS), which are the standards followed for Corporate Sustainability Reporting (CSRD). Commissioner Albuquerque emphasized the urgency of implementing these simplifications, highlighting their significance in the current geopolitical and economic context.
In response to this mandate, EFRAG has committed to a fast-track process aimed at substantially reducing mandatory data points and easing the practical application of the ESRS. The key dates are:
15 April 2025: EFRAG will inform the European Commission of its internal timeline to simplify the ESRS; and
31 October 2025: EFRAG has been tasked by the European Commission to provide its technical advice by this date so that the European Commission has time to adopt legislation in time for “companies to apply the revised standards for reporting covering financial year 2027, potentially with an option to apply the revised standards for reporting covering financial year 2026 if companies wish so”.
On this basis, it appears that the European Commission plans to adopt the revised and streamlined ESRS before the end of 2026, and that companies in the first wave of reporting would have the option to utilise the new ESRS should they wish to do so.
New Guidelines Establishing the Requirements and Procedures That Must Be Observed to Obtain Permission to Advertise Prepackaged Food and Non-Alcoholic Beverages
Following our newsletter dated March 31, 2020 “The new Mexican Official Standard for the labelling of pre-packaged food and non-alcoholic beverages” and other newsletters regarding labelling of products, after five years of the publication of this Mexican Official Standard, on March 11, 2025, the Guidelines regarding advertising of prepackaged food and non-alcoholic beverages were published in the Official Gazette and entered into force on March 12, 2025.
These Guidelines appear to now restrict the advertising of these types of products, imposing advertisers, advertising agencies and media, the obligation to obtain a permit/approval for advertising the products on open television, restricted television, movie theaters, internet and other digital platforms.
Any product is subject to approval by the Federal Comision Against Sanitary Risks (COFEPRIS) when their label includes one or more warning seals of the front labeling system.
The main restrictions, among others, are the following:
It is forbidden to use animated characters, pets or interactive games directed at children to promote the consumption of the products.
To compare the products with natural ones.
To compare with similar products regarding their composition or nutritional contents.
To suggest physical or intellectual abilities from its consumption.
To promote excessive consumption of the product.
To suggest that the products may modify body proportions.
The requirements for obtaining the permit/approval to advertise the products are to fill in a format, pay government fees and attach the “operation notice” (authorization) of the product.
Once submitted the application, COFEPRIS has a term of 20 working days to approve the advertisement and/or 10 days to issue a requirement. Applicant has a term of 5 days to reply or else, the approval will be dismissed.
Although, we consider all these requirements to be an unnecessary burden to the industry, this Guidelines provide definitions of terms such as, “pets”, “celebrities”, “children’s characters”, “digital downloads”, “cartoons” and “indirect advertising”, that were missing in the Mexican Official Standard for the labelling of pre-packaged food and non-alcoholic beverages.
Europe: UK Sanctions Regulator Highlights Compliance Failures
On 13 February 2025, the UK’s Office of Financial Sanctions Implementation (OFSI) published an assessment of suspected sanctions breaches involving UK financial services firms since February 2022. It highlights three areas of concern:
Compliance
OFSI has identified several common issues that contribute to non-compliance by UK financial institutions:
Improper maintenance of frozen assets, particularly in relation to debits from accounts held by sanctioned persons (DPs);
Breaches of specific and general OFSI license conditions;
Inaccurate ownership assessments; and
Inaccurate UK nexus assessments.
Russian DPs and Enablers
Professional and non-professional enablers have been increasingly providing the following services on behalf of Russian DPs:
Maintaining the lifestyles and assets of DPs;
Attempting to front on behalf of DPs to claim ownership of frozen assets; and
Employing increasingly sophisticated measures to evade UK financial sanctions prohibitions, particularly through the exploitation of crypto-assets.
Indicators of enablers might include:
Individuals associated with DPs receiving funds of significant value;
Regular payments between companies controlled or owned by DPs;
New individuals making payments formerly made by a DP;
Discrepancies in name spellings or transliterations (esp. from Cyrillic);
Recently obtained non-Russian citizenships; and
Frequent name changes.
Intermediary Countries
Suspected breaches of UK financial sanctions prohibitions by Russian DPs often involve intermediary jurisdictions including Austria, British Virgin Islands, the Cayman Islands, Cyprus, Guernsey, Isle of Man, Luxembourg, Switzerland, Turkey, and United Arab Emirates. The assessment includes a non-exhaustive list of suspicious activities that the OFSI has observed in several of these countries.
Conclusion
Financial institutions need to adopt a proactive approach to avoid their services being exploited as instruments of evasions and in turn avoid financial and reputational repercussions of non-compliance.
For further information, please see our corresponding alert.
Implications of New “Secondary Tariff” Executive Order Targeting Importers of Venezuelan Oil
On 24 March 2025, the White House issued an Executive Order threatening to impose a 25% tariff on all goods imported into the US from any country that imports Venezuelan oil directly or indirectly through third parties. Effective on or after 2 April 2025, the tariff is in response to alleged actions of Venezuela’s Maduro government, in particular sending members of the Tren de Aragua gang (designated a foreign terrorist organization) and other criminals into the US and its involvement in kidnapping and violent attacks including the assassination of a Venezuelan opposition figure.
The 25% tariff—called a “secondary tariff” as it is analogous to “secondary sanctions” asserted against non-US entities for doing business with sanctioned parties and countries—will apply to “any country that imports Venezuelan oil, directly or indirectly, on or after 2 April 2025” as determined by the Secretary of State in consultation with the Secretaries of the Treasury, Commerce, and Homeland Security, and the US Trade Representative. Once imposed, the tariff would expire one year after a country ceases Venezuelan oil imports or earlier at the discretion of US officials. For countries already subject to other comprehensive import tariffs, the 25% tariff would be cumulative, so China, for example, could be subject to a 45% import duty including the 20% tariff that already applies.
The Order raises several questions, including the scope of products and transactions covered. “Venezuelan oil” is defined as “crude oil or petroleum products extracted, refined, or exported from Venezuela” regardless of the nationality of entities involved, and “indirectly” is defined to include purchases through intermediaries or third countries “where the origin of the oil can reasonably be traced to Venezuela.” This will put significant pressure to conduct and confirm the origin of petroleum products traded on the international market as a limited volume could trigger the tariffs. The Order also leaves the fate of refined and derivative products made from Venezuelan crude oil uncertain, suggesting that further processing and refinement in another country may still be subject to restriction. It is also unclear how Venezuelan oil commingled with oil from other countries would be treated. Presumably, such commingling would be assessed in the same manner as oil from embargoed countries under US sanctions regimes, where even a small amount of commingled product can taint an entire shipment. The Order leaves to Commerce responsibility to issue guidance on implementation of the measure.
Over half of Venezuelan oil exports are imported into China, with significant volumes purchased by France, India, Italy, and Spain under limited US authorizations that were previously granted. The tariff threat will lead to significant disruptions in these markets. The threat could also impact oil traders, shipping companies, and operators of storage facilities, with significant oil volumes becoming stranded without a viable buyer.
UK Business Immigration – New Law on Right to Work Checks for Workers: Makes Sense in Principle but Tricky in Practice
The government has announced the latest instalment in its ‘crackdown’ on illegal working by extending right to work checks to businesses hiring gig economy and zero-hours workers. In principle, this is logical and reasonable – prevention of illegal working should rightly apply to anyone working in the UK regardless of their worker status label. However, any change in the law must be supported by carefully-drafted guidance (which hasn’t always been the case in this area). Many businesses who fall foul of the UK’s complex right to work rules are certainly not ‘rogue’ employers, but just in dire need of clear guidelines on what they need to do.
Under s.15 and s.21 of the Immigration, Asylum and Nationality Act 2006, employment of an adult subject to immigration control who does not have permission to work or is working in breach of their visa conditions exposes the employer to a civil penalty (currently set at a maximum of £60,000 per person) and/or a range of other sanctions including an unlimited fine, business closure, director disqualification and potential prison sentence of up to 5 years. S.25(b) IANA specifies that employment for these purposes is “employment under a contract of service or apprenticeship, whether express or implied and whether oral or written”. UK businesses are therefore currently only at risk of sanctions in relation to employees working illegally but the Home Office has been trying to close this loophole for some time.
In September 2024, the Home Office updated its Right to work checks: an employer’s guide to state: “Where the worker is not your direct employee (for example, if they’re self-employed), you are not required to establish a statutory excuse, but you must still carry out these checks (and retain evidence you have done so) to comply with your sponsor duties.”
As this appeared to conflict with the provisions of IANA, we contacted the Home Office to clarify what this wording meant for organisations who do not hold a sponsor licence. Wording later on in the same guidance states that employers are strongly encouraged to carry out checks even on those workers who are not employees and on contractors and labour providers but stops short of imposing any obligations.
In February just gone, the same part of the employer’s guide was amended to read: “Where the worker is not your direct employee (for example, if they’re self-employed), you are not required to establish a statutory excuse. However, you must still carry out these checks (and retain evidence you have done so) if you are a sponsor licence holder and are sponsoring the worker to ensure compliance with your sponsor duties.” In other words, no checks are required on workers, other than in circumstances where they are sponsored.
The government’s latest announcement will require it to change IANA and given the specific reference to gig economy and zero hours workers in the announcement, it will also need to give some careful thought to the following:
Will the changes only apply to gig economy and zero hours workers or to all other workers including agency workers and freelancers in any type of business? How do you define a ‘gig economy worker’?
Will employers be required to carry out checks on existing workers or just those hired on or after the date of implementation?
Will right to work checks apply to the genuinely self-employed and if not, how will employers, let alone the Home Office, differentiate them from workers? Dozens of decided cases around the gig economy, including at the highest levels within the UK legal system, have failed to come up with a definitive test for what separates a worker from the genuinely self-employed. There is also no definition at law of “gig economy”. So a business which uses outsourced labour faces a nearly impossible choice (maybe that’s the point — it’s hard to tell). It has to decide between (i) maintaining the line that its associates are fully self-employed and so their right to work compliance is not its responsibility on the one hand or (ii) doing the checks to avoid time at HM’s pleasure, so tacitly accepting that they are workers, which then pulls down upon itself all sorts of liabilities in relation to holiday pay, auto-enrolment contributions, minimum wage, etc., that it could perhaps otherwise have avoided. Damned either way, it seems.
Could we end up with a requirement to carry out checks on anyone who provides any sort of service for payment regardless of status – your plumber, builder, taxi driver etc? No doubt the Home Office would laugh at the idea as patently silly, as indeed it is, but that is the logical extension of these new requirements unless and until there is the clearest line drawn in law between who is covered and who is not – just saying “workers and gig economy people” won’t cut it for that purpose as what is covered by one is still being litigated and the other has no definition at all. It is also unclear whether there will be any overlap in law or principle with the tax position – for example, if the supply to you of a particular contractor is caught by IR35 (in other words, he is deemed to be doing work akin to that of an employee), would that mean that these new duties apply? Or if he is a sole trader working in his own name, do these new obligations depend on whether he can show that you are just one of a number of customers for his trade or profession or on how much work he does for you in a week, a month or a year? Will we see a resurgence of the issue of economic dependency? This all sounds a bit shrill, but unless there is proper clarity attached to these extended obligations, operating them will be a nightmare for employers. The line between worker and fully self-employed is extremely thin and can depend on relatively minute facts, the relevance of which could easily escape the average employer. The only completely safe course will be to make as many of those workers into Schedule E employees as possible, so putting the obligation to do the checks beyond argument but at the same time imposing significant costs and loss of flexibility on businesses. It is of course government policy to push as many people as it can into tax-paying employment (hence the proposal to drop worker status altogether in due course) so this may be seen as consistent with that direction of travel. The issue will be how much of a mess is created for employers in the meantime, and in the absence of that very clear guidance, the answer to that seems likely to be “far more than could ever have been thought necessary”.
Will the obligation still sit with labour providers to carry out checks on the employees it provides to its clients or will both parties need to carry out their own checks? If the latter, will both parties be liable for a civil penalty in the event of illegal working? We foresee some interesting contractual tussles over where that liability may fall as between the parties.
What action should employers take?
Although the planned changes appear to be aimed at employers which intentionally breach their immigration duties, all organisations with overseas workers are likely to be affected, since the Home Office has shown limited ability to distinguish effectively between the politically-essential “rogue employers” and those doing their best in a bewildering blizzard of law and guidance — compliance action and fines are often issued to well-intentioned and generally diligent sponsors which have unwittingly fallen foul of their increasingly byzantine immigration obligations. Of the hundreds of cases we have advised on (many of them for large, professional organisations), almost all arise out of a genuine oversight on the part of the employer, combined with an often understandable lack of awareness of the prevention of illegal working rules. Whilst ignorance is rightly not a valid defence to compliance, the UK immigration system remains complex and constantly changing. Employers should not assume for a moment that the stated focus on intentional breach will avail them in any way.
It’s not clear when the changes will be implemented but UK businesses which hire anyone who is not an employee should:
Consider the extent of their non-employed work force and the checks that are currently done on them
Review relevant right to work procedures and the resources needed to extend them to workers (and, potentially, the self-employed)
Given the Home Office’s ongoing ‘crackdown’, ensure that their right to work procedures (for the entire workforce, including employees) are clear, robust and effective
The UK’s right to work rules are not straightforward, nor the penalties for tripping over them trivial – training and legal support is a worthwhile investment.
Last Mile Logistics Comes to the End of the Road – Dei Gratia v Commissioner of Patents [2024] FCA 1145
In Dei Gratia Pty Ltd v Commissioner of Patents [2024] FCA 1145 (Dei Gratia), the Federal Court of Australia dismissed an appeal by Dei Gratia and confirmed the decision of the Commissioner of Patents to refuse the patent application for ‘last mile logistics’. The claimed invention purported to facilitate the delivery of goods from the last point in a distribution chain to end consumers. By selecting a preferred local outlet, customers would be able to overcome delivery issues such as the need to be at home at a specific time and the protection of perishable goods that have been left at doors in high temperatures.
The decision shed light on the difference between an invention that aims to advance computer technologies and new business and logistic methods. To be patentable, the invention must be a “manner of new manufacture.” In other words, it “must be more than an abstract idea; it must involve the creation of an artificial state of affairs where the computer is integral to the invention, rather than a mere tool in which the invention is performed.”
Submissions
Dei Gratia argued that its claim is not a mere idea to improve the delivery system, but rather a “practical implementation to achieve that idea.” It also contended that computerisation should not be limited to the improvement of the computer technology itself.
The Commissioner of Patents submitted that the claimed invention is not different from a regular business scheme implemented by generic and already known computer technologies and that “no new technology in the sense of improved functioning of computer equipment was involved.”
Decision
Section 18(1)(a) of the Patents Act 1990 defines invention as “any manner of new manufacture.” On the question of whether the claimed invention was, in fact, a manner of new manufacture, the court pointed out that although the application does not characterise the invention as a new “computer-implemented” idea, in substance it nevertheless places the computer as a central part of the logistic system, which would not function without the use of a computer. In this regard, both parties accepted that there would be no technical ingenuity involved in selecting modified delivery outlets.
In rejecting the application, the court made a clear distinction between an innovative scheme and patentable invention. As the claimed invention addressed a business problem (an improved logistics scheme), rather than a technical one, it was not patentable as it could not be characterised as a manner of new manufacture. The decision confirms that the implementation of the logistics scheme on a computer that does not involve any advance in computer technology is not patentable.
Australian Mandatory Merger Clearance: Regime Details starting to Emerge – Government publishes Draft Determination, ACCC publishes Draft Guidelines
On 28 March 2025, the Australian Government (the Government) published its draft Determination providing the beginnings of detail about the acquisitions that are the subject of mandatory notification, some of the exceptions to notifications, the position regarding supermarket acquisitions and the draft notification forms.
On the same day, the Australian Competition and Consumer Commission (ACCC) published its draft merger process guidelines, following on from its earlier analytical, and transition guidelines.
This Insight is part of a series of publications designed to guide clients through the upcoming Australian mandatory merger clearance regime, as the details becomes available.
In Brief
Whilst this Insight focuses on the key definitions in the Government’s draft Determination, We will shortly publish additional articles focusing on the ACCC’s draft guidelines. The determination:
Confirms or defines the types of acquisitions that are the subject of the regime.
Clarifies that the test for whether an acquisition is to be notified is based on the turnover of the acquirer and the target – and no other measure.
It then clarifies that the relevant measure of turnover of each of the acquirer and the target is the current Goods and Services Tax (GST) Turnover of the relevant entity and connected entities (being associated entities and controlled entities).
As a practical matter, this means the following for parties seeking to enter into negotiations for mergers and acquisitions (M&A), including considering the broader meaning of “acquisition”, at an early stage of the proposed acquisition or deal:
The acquirer needs to, for the purposes of ACCC Notification, consider the turnover of itself and the target;
The acquirer needs to calculate the GST turnover for the 12 months up to the date of the signing (and notionally at the commencement of negotiations) of both itself, including connected companies, plus, the GST turnover of the target (and its connected entities in the case of acquisitions of shares), to seek to calculate the AU$200 million or the AU$500 million threshold;
The above calculation will also be relevant to the calculation of the AU$50 million or AU$10 million threshold; and
The acquirer needs to consider the market value of, or consideration for, all the shares or assets the subject of the transaction for assessment of the AU$250 million transaction value threshold.
The same assessment in respect of serial or creeping acquisitions is set out below.
It provides detail about exceptions from notification under the regime, namely acquisitions:
Of land in certain circumstances;
By liquidators/administrators etc;
In the context of succession; and
Of financial securities, exchange traded derivatives, in money lending situations and in trust circumstances.
Mandatory notifications in the case of acquisitions by Coles or Woolworths.
The information requirements in Notification Forms – short and long-form.
In More Detail
As previously mentioned, the Government recently released the exposure draft of the Competition and Consumer (Notification of Acquisitions) Determination 2025 (Determination) and related draft explanatory memorandum.
Additionally, on 28 March 2025, the ACCC published its draft merger process guidelines, building on its earlier draft analytic guidelines and transition guidelines.
As clients are focused on what amounts to a notifiable acquisition and if a transaction is notifiable, and what information is required to be provided to the ACCC, this insight focuses on the Determination. We will shortly publish a follow-up insight focusing on the process of interaction with the ACCC both informally and once a formal application is made.
What is an Acquisition
The Determination confirms that acquisitions are mandatorily notifiable in the following circumstances:
The acquisition is of shares in the capital of a body corporate or assets;
The shares or assets are “connected with Australia”;
The acquisition satisfies the combined acquirer/target turnover test on the contract date or the accumulated acquired shares or assets turnover tests (set out in more detail below); and
The acquisition is not covered by the exceptions.
We elaborate on these issues below, apart from confirming that the term “assets” is very broad, including:
Any kind of property;
Any legal or equitable interests in tangible assets such as options for land, leases etc;
Any legal or equitable right that is not property or intangible assets such as intellectual property, goodwill etc;
Any interest in an asset of a partnership, or an interest in a partnership that is not an interest in an asset of the partnership; and
Interests in unit trusts and managed investment schemes.
What is an Acquisition That is “Connected to Australia”
An acquisition is notifiable if it meets the thresholds (below) and it is an acquisition of shares or assets connected with Australia. This means in relation to:
A share: the share is in the capital of a body corporate that carries on business in Australia or intends to carry on business in Australia; or
An asset that is an interest in an entity: the entity carries on business in Australia or intends to carry on business in Australia.
How the Turnover Tests are Assessed
General or Economy Wide Turnover
The general or economy wide turnover test for mandatory notification is as follows:
The acquirer or acquirer group and target have a combined Australian turnover of at least AU$200 million; and either
The Australian turnover of the target is at least AU$50 million (for each of at least two of the merger parties); or
The global transaction value is at least AU$250 million.
The Determination has clarified how the turnover is to be calculated:
In relation to the acquirer or target turnover test, if the sum of all of the following is AU$200million or more:
The current GST turnover of each of the principal party or acquirer, together with each connected entity of the principal party;
Where the target acquisition is in shares of a body corporate, the current GST turnover of the body corporate and each connected entity of the body corporate; and
Where the target is an asset, the current GST turnover of the target attributable to the asset,
AND
In relation to the target, the acquired shares or assets turnover test is the sum of all of the following is AU$50 million or more:
Where the acquisition is in shares in a body corporate, the current GST turnover of the body corporate together with the current GST turnover of each connected of the body corporate; and
Where the acquisition is of an asset, the current GST turnover of the target to the acquisition to the extent that is attributable to the asset.
In relation to the above:
Connected entity meaning an associated entity as per section 50AAA of the Corporations Act, and any entity controlled by the principal party as per section 50AA of the Corporations Act; and
Current GST turnover (which is well understood by business given it is used by business to report the value of their taxable and GST free supplies) has the same meaning as section 188-15 of A New Tax System (Goods and Services Tax) Act.
In relation to the assessment of the AU$250 million transaction value, an acquisition will meet this threshold if the greater of the following is AU$250 million or more:
The sum of all market values of all of the shares and assets being acquired as part of the contract or arrangement; or
The consideration received or receivable for all of the shares and assets being acquired as part of the contract or arrangement.
As a practical matter, this means the following for parties seeking to enter into negotiations for M&A, including considering the broader meaning of “acquisition”, at an early stage of the proposed acquisition or deal:
The acquirer needs to, for the purposes of ACCC Notification, consider the turnover of itself and the target;
The acquirer needs to calculate the GST turnover for the 12 months up to the date of the signing (and notionally at the commencement of negotiations) of both itself, including connected companies, plus, the GST turnover of the target (and its connected entities in the case of acquisitions of shares), to seek to calculate the AU$200 million threshold;
The above calculation will also be relevant to the calculation of the AU$50 million threshold; and
The acquirer needs to consider the market value of, or consideration for, all the shares or assets the subject of the transaction.
Very Large Corporate Group Turnover
The very large corporate group turnover test for mandatory notification is as follows:
The acquirer or acquirer group (i.e. the principal acquirer party and each connected entity) have a combined Australian current GST turnover of at least AU$500 million; and
The Australian current GST turnover of the target (the same approach to the assessment being the same as above) is at least AU$10 million (for each of at least two of the merger parties).
The Assessment of Serial or Creeping Acquisition
An acquisition satisfies the AU$50 million or AU$10 million threshold for accumulated acquired shares or assets turnover test for notification if:
The acquisition is of shares or assets; and
The principal acquirer or each connected entity have acquired other shares or assets in the three years ending the date of entering into the agreement or arrangement; and
Both the current acquisition (of shares or assets) and the previous acquisition, related directly or indirectly to the carrying on of a business involving the supply or acquisition of the same or substitutable or otherwise competitive with each other (disregarding geographic factors or limitations); and
The acquisition of the previous shares or assets and the current shares or assets, if treated as a single acquisition would satisfy the AU$50 million or AU$10 million acquired shares or assets turnover test; unless
The current GST turnover of the target of the current acquisition (and as relevant connected entities) is less than AU$2 million.
Exceptions to the Requirement Make a Mandatory Notification
In addition to the exception to the requirement to notify in respect of acquisition of partial shareholdings that was included in the amending Act, the Determination sets out that acquirers are not required to notify in the following circumstances:
Certain Land Acquisitions
Land acquisitions made for the purposes of developing residential premises; and
Acquisitions by businesses primarily for engaging in buying, selling or leasing land, where the acquisition is for a purpose other than operating a commercial business on land (i.e. the exemption is for property development or operating a property development business rather than operating a commercial business on the premises).
Liquidation, Administration or Receivership
An acquisition by a person in the person’s capacity as an administrator, receiver, and manager, or liquidator (within the meaning of the Corporations Act).
Financial Securities
An acquisition that results from a rights issue, a dividend reinvestment and underwriting of fundraising or buybacks, or an issue of securities (as per the Corporations Act).
Money Lending and Financial Accommodation
An acquisition of shares or assets that is a security interest taken or acquired in the ordinary course of business of the person’s business of the provision of financial accommodation (as long as the person whose property is subject to the security interest is not an associate of the acquirer).
Nominees and Other Trustees
An acquisition of an asset, that is an interest in securities, by a person as a bare trustee, if a beneficiary under the trust has a relevant interest in the securities.
Exchange-Traded Derivatives
An acquisition of an asset in the form of exchange-traded derivative and if at the time, the derivative confers an equitable interest in a share or assets, the acquisition of that equitable interest.
Notification Requirements for Coles and Woolworths
The Determination requires Coles and Woolworths (major supermarkets) and connected entities to make a notification for any acquisition of shares or assets that results in:
Coles or Woolworths acquiring in whole or in part, a supermarket business (a supermarket business as defined in section 5 of the Competition and Consumer (Industry Codes – Food and Grocery) Regulation 2024; or
Coles or Woolworths acquiring a legal or equitable interest in land (in whole or in part), either existing land that has a building with a gross lettable area of 700sqm or if it does not have an existing building, the land is 1,400sqm,
UNLESS
The acquisition is not the extension or renewal of a lease for land upon which Coles or Woolworths was already operating a supermarket on the land.
Notification Forms – Information and Documentary Requirements
The Determination sets out the requirements for each of Short-Form Notifications (for acquisitions that were unlikely to raise competition concerns) and Long-Form Notifications (for acquisitions that required greater consideration of their effect on competition).
The Determination sets out in more detail the requirements and form of each of these notification forms, but in brief, the following are required (identifying the additional requirements for long-form application):
Documents
The final or most recent version of the transaction documents (including sale and purchase agreements, heads of agreement, offer documents/letters of intent and any other agreements between the transaction parties related to the acquisition);
For each party, the most recent audited financial statements and income statements that relate to the supply of goods or services most relevant to the competition analysis; and
An organisational chart to show structure of ownerships of each party and connected entities.
In addition, for Long-Form Applications, documents from each of the parties prepared for or received by the Board, Board Committee, or equivalent (possibly Executive or senior leadership team), or the shareholders meeting within the three years prior to the date of the notification regarding:
The rationale for the acquisition, including the business case for the acquisition or divestment;
The assessment of acquisition including the valuation of the target; and
Industry reports, market reports etc provided to the Board or equivalent within the previous three years describing competitive conditions, competitors, market shares and business plans (unrelated to the acquisition).
Information
The party names, contact details and law firms representing the parties;
An overview of:
The goods or services supplied (or acquired) by the parties, including brands, most relevant to the acquisition;
The transaction or transaction structure;
The rationale for the acquisition;
The consideration for the acquisition; and
If relevant, any foreign filings relevant to the transaction.
Tables for each of the parties setting out:
Connected entities in each of the previous three years; and
Acquisitions made by the parties (including connected entities in each of the last three years);
Details of the competitive effects of the acquisition, including:
The relevant goods and services and the geographic areas in which they are supplied;
The other key suppliers of the goods/services;
The markets that are affected and estimate of market shares (by volume, capacity or turnover in each of the previous three years); and
The contact details of the five closest competitors, five largest customers, five customers closest to the median spend of customers.
Additional Requirements for Long-Form Applications
Details regarding barriers to entry including:
The costs of entry or the infrastructure required to supply the relevant goods or services and time required to put these in place, as well as the extent of these costs that are sunk or not recoverable;
Other barriers such as access to inputs, intellectual property issues, legal and regulatory requirements, customer switching costs and time required to “win” contracts, and overall revenues to achieve minimum viable scale; and
The entry of new competitors, as well as the exits in the previous three years.
The long-form application requires significant additional information for different types of transactions – horizontal and vertical acquisitions etc.
Other relevant information, particularly:
Identifying any goodwill protection provisions and the reasons that these provisions are necessary to protect the goodwill of the purchaser.
The Government has foreshadowed additional Determination, with the Determination itself having “placeholders” regarding waiver applications and the Acquisition Register – which unfortunately will now not be progressed until after the Federal election.
We are happy to provide additional details on any of the above issues.
We will also shortly publish additional Insights focusing on the ACCC’s Guidelines.
China’s National Intellectual Property Administration Releases 2025 Budget and Targets – Expecting Over 5 Million Patent Applications in 2025
On March 26, 2025, China’s National Intellectual Property Administration (CNIPA) released its 2025 budget (国家知识产权局2025年部门预算) listing performance targets. Some 2025 targets include:
receiving over 5.135 million invention and utility model patent applications;
lowering the examination period for invention patents to 15 months or less;
examining 2.026 million invention patent applications;
4,500 or more people will pass the patent agent qualification examination;
examining 5.97 million trademark applications; and
the average examination period for trademark registration will be 4 months or less.
In contrast, in the 2024 Budget, CNIPA expected to examine over 2.026 million patent applications with an examination period of less than 16 months and total new applications (including invention and utility model applications) was expected to be equal or greater than 4.79 million applications. As 1,044,777 invention patents were granted in 2024, that implies only a 51.6% grant rate for invention patents in 2024 (although the number of examined invention patent applications could be higher, implying a lower grant rate). Examination might be getting even tougher as Chinese statistics showed that the number of invention patents granted in the first two months of 2025 were down some 15%.
2025 CNIPA Patent Targets
2025 CNIPA Trademark Targets
The full text is available here (Chinese only).
European Council Greenlights First Step of Omnibus – The ‘Stop-the-clock’ Proposal
On 26 March 2025, the European Council approved its position, known as a “negotiating mandate”, on a key element of the European Commission’s proposal to streamline corporate sustainability requirements which are captured in an “Omnibus”. Specifically, they approved a delay to the current timetable of the Corporate Sustainability Reporting Directive (“CSRD”) and Corporate Sustainability Due Diligence Directive (“CSDDD”), as proposed in a “Stop-the-clock” Directive, with the substantive changes to reporting requirements to be proposed in a separate Directive.
Specifically, EU Member States at the European Council have supported the European Commission’s proposal to postpone:
by two years the application of the CSRD requirements for large companies that have not yet started reporting, as well as listed SMEs. The effect is that companies expecting to prepare the first report for the financial year 2025, would instead have to prepare the first report for the financial year 2027, and
by one year the transposition deadline and the first phase of the application (covering the largest companies) of the CSDDD. As a result, companies would phase in from July 2028 rather than July 2027.
The support from the European Council to streamline the corporate sustainability reporting requirements has generally been enthusiastic. For example, Adam Szłapka, Minister for the European Union of Poland, said of the Stop-the-clock Directive, that “today’s agreement is a first step on our decisive path to cut red tape and make the EU more competitive”.
Now that the European Council’s negotiating mandate has been approved, interinstitutional negotiations can be entered into. The European Parliament is scheduled to vote on 1 April 2025 on the Stop-the-clock Directive which is being presented to Members of the European Parliament (“MEPs”) on an urgent procedure, requiring a simple majority of MEPs present to approve it. The overall expectation is that this vote is likely to pass, however, how the separate Directive that will cover the changes to the substantive requirements will progress well be hotly debated.
For U.S. companies in particular where there is a movement under a proposed PROTECT USA Act to prevent various U.S. entities from complying with “foreign sustainability due diligence legislation”, should the Stop-the-clock Directive be approved it would at least provide a reprieve. This would allow companies time to recalibrate their approaches to sustainability in the currently fractured political landscape.
EU Platform on Sustainable Finance Focuses on Usefulness of Taxonomy in Response to European Commission Proposal
On the 26 March 2025, the EU Platform on Sustainable Finance (“Platform”) responded to the European Commission’s call for evidence on the draft delegated regulation amending the Taxonomy Delegated Acts[1] (the “Taxonomy”).
The Platform welcomes many of the proposed amendments and notes that several of the Platform’s recommendations from their February 2025 report on the simplification of Taxonomy reporting has been taken into consideration. However, despite this positivity, the Platform has also flagged some serious concerns with respect to the European Commission’s proposed changes to reduce the scope of Taxonomy reporting, as set out in its “Omnibus” proposals to streamline the Corporate Sustainability Reporting Directive (“CSRD”).
The Platform considers that reducing the scope of the current CSRD requirements not only results in the loss of specific Taxonomy data, but also reduces the effectiveness of the Taxonomy generally in the market. As a result, the Platform has proposed a number of updates in relation to the draft regulation, including:
introducing a regime for all companies to report partial Taxonomy-alignment;
clarifying the materiality threshold to ensure that it applies to cumulative exposure and not individual economic activities;
reporting for non-SME companies below the 1,000-employee threshold should be focused on the most essential standards (including Taxonomy-alignment); and
postponing trading books, fees and commission as key performance indicators for banks to 2027.
Additionally, the Platform has also recommended that additional guidance could be issued to support simplifying the Taxonomy’s implementation and process.
Finally, the Platform recommends some form of mechanism to be introduced to allow for responses to Taxonomy-related queries to be dealt with in real time.
[1] The regulation proposed by the Commission contains amendments the Taxonomy Disclosures Delegated Act ((EU) 2021/2178), the Taxonomy Climate Delegated Act ((EU) 2021/2139) and the Taxonomy Environmental Delegated Act ((EU) 2023/2486).
Ch-ch-ch-ch-changes… Part 2
In our earlier blog on recent changes affecting the Competition and Markets Authority (CMA), we anticipated more changes to come. The month of March has lived up to our expectations. On 12 March, the CMA launched a “call for evidence” for the review of its approach to merger remedies as well as a “Mergers Charter” for businesses, stating that:
“Both the merger remedies review and the Mergers Charter are part of the CMA’s programme of work to implement the ‘4Ps’ – pace, predictability, proportionality and process – across all its work, helping to drive growth and enhance business and investor confidence.”[1]
The Mergers Charter[2]
The charter sets out principles as well as expectations for how the CMA will interact with businesses as well as their advisers during merger reviews – but also how the CMA expects businesses to act in return.
While carrying out merger reviews, the CMA is committed to four principles: process, proportionality, pace and predictability.
These principles are meant to help the CMA ensure they reach the correct decisions, as quickly as possible, while minimising the burden on businesses.
The “charter is a statement of intent”, but the document itself has no legal status.
In relation to the 4P’s, the following is said:
Pace – “The CMA is committed to reaching sound decisions as quickly as possible. Cooperation of businesses is a vital part of this process.”
Predictability –“Predictability is important for investor confidence and business decision-making. This includes being as clear as we can be to minimise uncertainty over whether we will review a particular deal or not.”
Proportionality – “The CMA is committed to acting proportionately in the conduct of its merger reviews.”
Process– “The CMA is committed to engaging directly with businesses during its merger reviews … Open and constructive engagement is a crucial part of this.”
The Call for Evidence[3]
This call for evidence will remain open until 12 May 2025.
“The CMA is seeking feedback on 3 key areas:
How the CMA approaches remedies, including the circumstances in which a behavioural remedy may be appropriate.
How remedies can be used to preserve any pro-competitive effects of a merger and other customer benefits.
How the process of assessing remedies can be made as quick and efficient as possible.”
Additionally, the CMA will also be running a series of outreach and roundtable sessions to gather input.
As Joel Bamford (executive director for mergers at the CMA) has stated:
“Casting the net widely for input for the merger remedies review is crucial to getting a range of views – to this end we’re going to be holding webinars and hosting roundtables so we’re gathering the best quality feedback directly from those impacted by UK merger control.”
“We’re moving rapidly to deliver on our commitment to update the UK’s mergers regime, focusing on pace, predictability, proportionality and process. The remedies review and charter represent crucial progress as we turn those principles into practice.”[4]
Sarah Cardell Speech[5]
Around the same time of the announcement of this call for evidence, a recent speech from Sarah Cardell (the CMA chief executive) also highlighted a paced and proportionate approach to two areas of focus for the CMA’s new consumer protection powers under the Digital Markets, Competition and Consumers Act 2024 (DMCCA): drip pricing and fake reviews.
Fake Reviews
The CMA confirmed that it is ready to take action against fake reviews under the new regime. However, Sarah Cardell went on to say:
“Although we can tackle fake reviews under our existing powers … we recognise that new provisions may require changes to systems and compliance programmes … so for the first 3 months of the new regime we will focus on supporting businesses with their compliance efforts rather than enforcement.”
Drip Pricing
In relation to drip pricing, Sarah Cardell mentioned how:
“I am announcing today that we will take a phased approach to the guidance here. In April, we will provide a clear framework for complying with the parts of the law which are already well understood and largely unchanged … These ‘dripped fees’ harm consumers, and fair dealing businesses, by hindering effective price competition – which we know primarily happens on headline prices.”
Conclusion
The CMA continues to adapt its approach in response to the UK government’s steer towards growth. Business should reflect how to adapt to these changes in turn, and the call for evidence provides a first opportunity for businesses to help the CMA put its 4P’s principles into practice.
[1] CMA launches review of merger remedies approach and publishes new mergers charter – GOV.UK
[2] Mergers charter – GOV.UK
[3] CMA launches review of merger remedies approach and publishes new mergers charter – GOV.UK
[4] CMA launches review of merger remedies approach and publishes new mergers charter – GOV.UK
[5] Promoting competition and protecting consumers in the digital age: a roadmap for growth – GOV.UK
Europe – Pay Transparency Directive: Preparing for the Great Unknown?
Over the last few months, we have done a lot of sessions with clients on the Pay Transparency Directive. Chief among the questions that inevitably comes up is implementation of the Directive in the different Member States. Clients wonder if and how they can prepare for June 2026 when – as per usual – most Member States are nowhere near presenting even draft legislation to translate the Directive into national legislation.
Our response to this entirely sensible question is always the same: while we will of course track local developments and keep you updated, please do not wait until there is more clarity from national legislators to take action on this topic. You don’t have to know about every nut and bolt of the finished product to know enough to start your preparation, especially as the Directive does set out very clear pointers on the likely direction of travel.
One of the main principles of the Directive is that Member States should take the necessary measures to ensure that “employers have pay structures ensuring equal pay for equal work or work of equal value”. These pay structures should be based on a job evaluation scheme which considers skills, effort, responsibility and working conditions (and, if appropriate, any other factors which are relevant to the specific job or position). There is no chance that those key indicators will be altered materially pre-implementation – while it is possible that some states may add further considerations, that will almost certainly be by way of illustration or expansion of those criteria, not variation of them. Making sure that the organisation has the right structures and schemes in place and determining the pay gaps in the organisation on this basis is a project that will likely take a couple of months, which does not leave an awful lot of time to remedy any gaps above 5% that would come out of the analysis.
And yes, the Directive does look to Member States to take the necessary measures to ensure that “analytical tools or methodologies are made available to support and guide the assessment and comparison of the value of work in accordance with the [above] criteria”. But in the current political climate, where even European Commission president Ursula von der Leyen has announced a drive for de-regulation, we do not expect that the Member States will be demonstrating excessive zeal when implementing this provision. Rather we expect that those which are already quite advanced on this topic – e.g. Spain, which has a public on-line job evaluation tool – will maintain what’s already in place, whereas those less prepared Member States (which is the large majority) will likely leave it at the level of the principles set out by the Directive, without much more.
The first Member States that have issued draft legislation seem to confirm this prediction:
Sweden’s existing legislation is already in line with the Directive’s requirements, requiring employers to conduct annual reviews of equal jobs and jobs of equal value. Under the existing legislation, companies with 10 or more employees must document the salary review in writing, including specific measures to address any identified pay gap issues, while companies with 25 or more employees must also produce annual equality plans. The draft legislation to transpose the Directive is in fact a set of amendments to existing legislation:
As per the Directive, employers must provide information to job applicants about the initial salary or range for the position. Sweden adds the obligation to offer information on any relevant collective bargaining agreement provisions on salary. Answering a question we also get quite often, the Swedish draft Bill specifies that this information does not need to be included in the job postings but should be provided in reasonable time to allow for an informed negotiation on pay. In line with the Directive, employers cannot ask prior salary history.
Employers must inform employees about the “standards and practices” for wages, to help employees understand the annual equal pay salary reviews being conducted.
Also in line with the Directive, employees must have rights to information on their individual pay level and average pay levels for workers performing equal work, broken down by gender.
Employers with 100 or more employees must report gender pay gaps during the calendar year for the overall workforce to the Equality Ombudsman, who will publish this information. Employers must also report to the Ombudsman pay gaps by groupings of employees performing equal work, explaining differences of 5% or more with objective reasons or actions to be taken.
Finally, the annual equal pay salary analysis must also include a comparison between women’s and men’s pay progression in connection with parental leave and pay progression for employees who perform equal work or work of equal value, compared to employees who have not taken a corresponding period of leave. This provision goes beyond Directive requirements, which only ask that family leaves be considered as part of a joint pay assessment (the further analysis imposed if the annual pay gap report shows a pay gap of 5% upwards in any given category).
Ireland’s draft bill is less ambitious (though all credit to them for at least having started) as it only entails a partial implementation of the Directive. The draft Bill has a wider scope than the transposition of the Directive and includes two provisions relating to pay transparency:
It requires employers to provide information about salary levels or ranges in the job advertisement. This requirement is slightly more restrictive than the Directive, which does not state that this information must be published (already) in the job advert. It is not clear in this stage exactly how detailed the information on pay range will need to be.
In line with the Directive, the second measure prohibits employers from asking job applicants about their own pay history or their current rate of pay.
In Poland, quite interestingly, Members of Parliament presented in December 2024 their own draft Bill, not waiting for the results from the governmental working group tasked with preparation for the implementing law. In February, the Polish Parliament (by a scarce majority of votes of 229 to 201 and against the majority of Ministries and institutions which commented upon on the draft Bill) decided to proceed with this draft while the other is in the early preparatory stages. The current draft focuses on implementing only parts of the Directive focused on:
pay transparency: salaries and salary levels will not be confidential (no exceptions), and employees will have the right to request information on their individual salary levels and average salary levels; employer will not be able to prohibit or prevent an employee from disclosing information about their salary (not even if such disclosure may hurt business interest and is not necessarily focused on ensuring equal pay),
pay transparency in recruitment: the employer, publishing information on an open job position, shall identify the proposed level of salary, indicating its minimum and maximum amount; similarly to Ireland, the employer is required to publish salary proposals in the “information on possibility to hire an employee on a specific job position” (which we understand to mean the job advertisement), and there is no flexibility as to how and when this information is to be provided to the candidate.
pay progression information: employer shall provide the employee with access to the criteria used to determine employee salary and pay progression; such criteria must be objective and gender-neutral; the draft Bill suggests that employers with fewer than 50 employees “may be released from this obligation”. It is not, however, clear by whom.
new penalties will be imposed on employers in Poland for not informing employees of their salary level when requested, for not publishing information on salary in job advertisements and for employing an employee at a salary lower than stipulated in the job posting. This raises a number of questions, e.g. what if the salary is lower because the parties agreed to proceed with a part-time employment or to a reduction in scope of responsibilities? Will this still be a punishable offence?
The draft Bill is rather short and it does not touch upon sensitive topics such as job evaluation, objective or gender-neutral criteria for differentiation of salaries, or gender pay gap reporting. These matters are expected to be comprehensively regulated only in the governmental Bill, which is still a “work in progress” and not expected any time soon. It is fair to say that no guidance may be taken from the draft Bill as proposed, and at places it is actually quite confusing.
Finally, in Germany, the interim Minister for Family, Senior Citizens, Women and Youth, Lisa Paus, has apparently announced in a private meeting a couple of months ago that Germany will likely go for continued flexibility in setting categories of workers without imposed pay evaluation systems. Germany will also focus heavily on the Right to Information, which already exists but will be strengthened in the framework of the transposition process. This information is however not yet confirmed on the interim Minister’s website. At the moment, it is unclear whether this approach will be continued because the Green Party, of the which the interim Minister is a member, will no longer form part of the new government. It is uncertain what the priorities of the new government will be when implementing the Directive. We will keep you updated.
In summary, only four Member States have allowed us a view into their thinking on Pay Transparency Directive implementation, but in none of the four cases is the output of such a nature that it should prevent companies from making a start on the biggest chunk of the work, around fair job evaluation and the assessment and analysis of the gaps as they present themselves on the basis of such job evaluation. The time is now, more than ever.