Competition: Commission sends Statement of Objections to Bulgarian Energy Holding for suspected abuse of dominance on the Bulgarian wholesale electricity market

On 12 August 2014, the Commission issued a Statement of Objections (“SO”) to Bulgarian Energy Holding (“BEH”), an incumbent state-owned vertically integrated energy company, regarding the potential abuse of its dominant market position in violation of Article 102 of the Treaty on the Functioning of the European Union (“TFEU”). The SO sets out the Commission’s preliminary view that BEH may be abusing its dominant position in the non-regulated Bulgarian wholesale electricity market by imposing territorial restrictions on the resale of electricity produced by BEH. According to the Commission, a majority of BEH’s electricity supply contracts with traders specify that electricity produced by BEH may only be resold within Bulgaria or may only be exported. The Commission is concerned that such restrictions may distort electricity trade within the Single Market and create artificial trade barriers between Bulgaria and other Member States. Source: Commission Press Release 12/08/2014

Merger control: Commission approves acquisition of additional stakes in Estonian gas companies by Fortum

On 8 August 2014, the Commission approved the proposed acquisition of joint control over AS Eesti Gaas (“EG”) and AS Vörguteenus Valdus (“Valdus”), both of Estonia, by Fortum Corporation (“Fortum”), of Finland, and OAO Gazprom (“Gazprom”), of Russia. Pre-transaction, EG and Valdus were jointly controlled by Gazprom and E.ON. Fortum produces electricity and heat, operates and maintains power plants and offers energy-related services, mainly in the Nordic countries. Gazprom is active in the exploration, production, transportation, refining and marketing of natural gas and petrochemical products. EG is a public limited company established in Estonia that imports and sells natural gas and, to a minor extent, sells electricity. Valdus is the public gas transmission system operator in Estonia. The Commission’s investigation revealed that the overlaps between the parties' activities and increments in market shares brought about by the transaction are limited. Accordingly, the Commission concluded that the proposed transaction would not significantly impede effective competition in the EEA or in any substantial part thereof. Source: Commission Press Release 08/08/2014

Merger control (Finland): Finnish Competition and Consumer Authority opens in-depth investigation into proposed acquisition of Muna Foods Oy by DAVA Foods Holding A/S

The Finnish Competition and Consumer Authority (“FCCA”) opened an in-depth investigation into the proposed acquisition of 50 % of Muna Foods Oy (“Muna Foods”), of Finland, by DAVA Foods Holding A/S (“DAVA Foods”), of Denmark. Muna Foods is a company to be established by a Finnish cooperative Munakunta (“Munakunta”). In connection with the transaction, Munakunta will transfer its assets to Muna Foods. Munakunta, a cooperative owned by 150 Finnish egg producers, is active in the purchase, packaging and distribution of eggs as well as production and sale of processed egg products and equipment for poultry production in Finland. Munakunta has two packaging plants and one processing plant in Finland as well as one processing plant in Estonia. According to the FCCA, Munakunta holds a market share of approximately 40 % in the Finnish egg market. DAVA Foods belongs to the Danish Agro group (“Danish Agro”), which is active in agricultural trade in Denmark and Sweden. Following the transaction, Danish Agro would hold a 50 % stake also in Muna Foods which is active in Finland and in Estonia. Based on its previous investigations in connection with the merger between DLA International Holdings A/S and Hankkija-Maatalous Oy, the FCCA concluded that Danish Agro has a strong presence in the Finnish market for agricultural trade. The FCCA will now investigate whether the proposed acquisition significantly impedes effective competition in the Finnish markets and has three months to make a final decision in the matter. Source: Finnish Competition and Consumer Authority Press Release 07/08/2014 (in Finnish) and Finnish Competition and Consumer Authority Press Release 07/08/2014 (in English)

In addition, kindly note the following merger control decisions by the Commission which are published on the website of the Commission’s Directorate-General for Competition:

  • Commission approves acquisition of joint control over Minimax Viking by Intermediate Capital Group and Kirkbi