The Competition Authority (NMa) has applied the failing firm defence principles laid down in the European Commission's horizontal guidelines(1) in its decision to approve the acquisition of postal company Selekt Mail by competitor Sandd. As a result of the acquisition, only two players will remain active in the national market for addressed business mail, which may result in increased mail delivery prices.(2)
Sandd and Selekt Mail have a combined market share of 15% in the market for addressed business mail, with TNT Post(3) being the only other player active in this national market. According to the NMa's decision, regional players having a limited disciplinary impact on the two remaining national players and the buyer power of postal service customers will act as countervailing factors to the increased market power resulting from the transaction only to a limited extent. On this basis, the NMa concluded that the transaction could lead to a price increase of postal services, at least in the short term.
Nevertheless, the NMa approved the acquisition as there was no causal link between the proposed transaction and the possible deterioration of competition on the market because:
- Selekt Mail would inevitably exit the Dutch market due to financial reasons; and
- no less anti-competitive alternatives to the acquisition exist.
For further information on this topic please contact Jolling De Pree or Erik H Pijnacker Hordijk at De Brauw Blackstone Westbroek by telephone (+31 70 328 53 28), fax (+31 70 328 53 25) or email ([email protected] or [email protected]).
Endnotes
(1) Guidelines on the assessment of horizontal mergers under the EU Regulation on the control of concentrations between undertakings, OJ 2004, C31/5.
(2) NMa decision 7124 / Sandd – Selekt Mail of April 8 2011.
(3) Koninklijke TNT Post BV and Netwerk VSP Geadresseerd BV belong to the same group of undertakings and are referred to as TNT Post in the NMa decision.