EU Mergers

Phase I Mergers

  • M.7936 PETROL/GEOPLIN (10 March 2017)
  • M.8134 SIEMANS/GAMESA (13 March 2017)
  • M.8284 DEUTSCHE TELEKOM/ORANGE/BUYIN (10 March 2017)
  • M.8308 MUNKSJO/AHLSTROM II (13 March 2017)
  • M.8323 AT&T/TIME WARNER (14 March 2017)
  • M.8329 MABANOL BITUMEN / H&R REFINING / JV (16 March 2017)
  • M.8365 SWISS POST / SBB / SWISSSIGN (15 March 2017)
  • M.8367 BAIN CAPITAL / CONSOLIS (16 March 2017)
  • M.8396 BAIN CAPITAL INVESTORS / FINTYRE (13 March 2017)

EU Competition 

Court of Justice partially annuls ruling in relation to Evonik Degussa. On 14 March 2017, the European Court of Justice (ECJ) partially annulled the ruling by the General Court in relation to Evonik Degussa’s confidentiality request in a bleaching chemicals cartel. In May 2006, the European Commission (Commission) found that Degussa AG, now known as Evonik Degussa, participated in an infringement of Article 101 of the Treaty on the Functioning of the European Union (TFEU) with 16 other companies in the hydrogen peroxide and perborate sector. Evonik Degussa was the first company to contact the Commission and fully co-operated with them and so obtained immunity from the fines. However, in 2011 the Commission informed Evonik Degussa that it intended to publish an extended version of their decision. Evonik Degussa objected to this arguing that the extended version contained confidential information including business secrets and a significant amount of information given by Evonik Degussa to the Commission pursuant to the Leniency Notice. This information included the names of their collaborators and information concerning their business relations. Whilst the Commission agreed to remove the information which would allow the source of the information communicated pursuant to the Leniency Notice and to remove the names of the collaborators, the Commission did not grant the benefit of confidentiality to the other information. Evonik Degussa referred the matter to the hearing officer, but the request for confidential treatment was rejected in that the hearing officer declined competence to answer the objections raised by Evonik Degussa on the basis of legitimate expectations and equal treatment. Following an appeal, the General Court ruled that the hearing office was correct in doing this. However, the ECJ found that the General Court had erred in law in holding that the hearing office had been correct. The ECJ concluded that the grounds on which the disclosure of information can be restricted are not limited to those rules intended to afford specific protection against the disclosure of the information, therefore, the hearing office must examine any objection based on a ground arising from a principle of EU law which is relied on by a party claiming protection of confidential information. The ECJ annulled the decision in so far as the hearing office declined competence to answer Evonik Degussa’s objections. The remainder of the appeal was dismissed.

Commission re-adopts decision relating to air cargo price-fixing cartel. On 17 March 2017, the Commission announced that is has re-adopted its decision to fine 11 air cargo carriers a total of €776 million for their involvement in a price-fixing cartel. The air cargo carriers were found to have co-ordinated the price of freight services covering flights to and from the European Economic Area. The companies fined were Air Canada, Air France-KLM, British Airways, Cargolux, Cathay Pacific Airways, Japan Airlines, LAN Chile, Martinair, Qantas, SAS, and Singapore Airlines. All the companies apart from Qantas appealed. Lufthansa and Swiss International Air Lines received immunity from the fines under the Leniency Notice. On 16 March 2017, the General Court annulled the Commission’s decision due to a procedural error in that there was a discrepancy between the Commission’s reasoning and the operative part of their decision. The new decision which has been adopted by the Commission addressed the error, however, the finding of anti-competitive behaviour and the majority of the fines remain the same. Martinair’s fine was the only fine to be lowered and this was to reflect their significantly lower turnover in 2016 compared to when the first decision was adopted.

State Aid 

Commission approves state aid to help French producers in outermost regions. On 15 March 2017, the Commission approved €475 million support under state aid rules. The support takes the form of a reduction in the octroi de mer tax which is applicable to the French outermost regions, such as Guadeloupe, Guyane, Martinique, Mayotte and La Réunion. The tax is levied on both goods imported into the region and on goods locally produced, therefore, companies producing products in the outermost regions face additional costs. The approved support scheme will work to counter this by reducing the octroi de mer tax for a specific list of locally produced products. The Commission concluded that this will help the outermost regions without having an undue effect on competition. The scheme will be in place until the end of 2020.

Commission clears Belgian support for three nuclear power reactors. On 17 March 2017, the Commission approved the Belgian plans to compensate Engie-Electrabel and EDF Belgium for the potential financial risks relating to the long term operation of three nuclear reactors. Belgium concluded two agreements with Engie-Electrabel and EDF Belgium to prolong the operational lifetime of the nuclear reactors and the agreements included guarantees which were necessary to secure investment of the companies. The Commission’s assessment concluded that the measures avoided any undue distortion of the Belgian energy market and therefore approved them under EU state aid rules.

Commission confirms concessions for Greek airports do not involve state aid. On 17 March 2017, the Commission confirmed that the concessions for the upgrade, maintenance, management, and operation of 14 regional airports in Greece did not involve state aid. The terms of the concession agreements were in line with market terms and resulted from a competitive and transparent tender. The concessions therefore did not involve state aid.

UK Competition 

CAT establishes confidentiality ring in the appeals by Flynn and Pfizer. On 15 March 2017, the Competition Appeal Tribunal (CAT) published an order establishing a confidential ring in the appeals by Flynn Pharma Limited, Flynn Pharma (Holdings) Limited, Pfizer, Inc. and Pfizer Limited against a decision by the Competition and Markets Authority (CMA). The CMA’s decision had imposed fines on the companies for abuse of a dominant position through excessive pricing of anti-epileptic medication. The order was made pursuant to section 46 of the Competition Act 1998 and sets out the arrangements whereby the parties shall disclosure unredacted versions of necessary confidential information on the basis that such unredacted versions will only be disclosed to the relevant advisors and CMA employees.

CMA revokes initial enforcement order addressed to Stanley Black & Decker. On 16 March 2017, the CMA revoked the initial enforcement order made to Stanley Black & Decker, Inc., Stanley Works Limited (THE), and Stanley Black & Decker UK Limited concerning Stanley Black & Decker, Inc.’s acquisition of the assets of Newell Brands, Inc. business. The initial enforcement order was made on 10 March 2017 pursuant to section 72(2) of the Enterprise Act 2002, however, based on the evidence the CMA has received during its assessment of the acquisition, the CMA has concluded it is appropriate to lift the initial enforcement order.

CMA publish the final report on Diebold’s acquisition of Wincor Nixdorf. On 16 March 2017, the CMA published its final report on the completed acquisition of Wincor Nixdorf AG by Diebold, Incorporated. The CMA had previously found that the two parties were two of the three leading suppliers of customer-operated ATM’s in the UK and so the merger may result in a substantial lessening of competition in this market. In order to remedy this, the CMA concluded that a structural sale and transfer of the assets and rights of one of the parties’ customer-operated ATM business was required. This would include the transfer of staff, customers, access to relevant technology and software and the use of the brand. Once a purchaser is identified the CMA will then examine the divestment package to ensure it adequately addresses the competition concerns.