EU ANTITRUST: HOT TOPICS & NEXT STEPS

EU ANTITRUST: HOT TOPICS & NEXT STEPS 2022

Prague, Czechia

As a result, after the acquisition prices increased by approximately 10% (Case INEOS/SOLVAY/JV ). The creation of the joint venture aimed to merge the assets of INOES and SOLVAY. The joint venture would have a market share of around 50–60% and its largest competitor 10–20%. There was, therefore, no counterbalance from the existing competitors. The EU Commission’s analysis showed that competitors had no incentive to either increase production or to pressurize the prices in the relevant market. It was, therefore, likely that the joint venture would hold a dominant position and would raise prices or reduce production volume. The transaction would also create a market leader in sodium hypochlorite with a market share of 60–70%. The second largest company was AKZO with much smaller market share (20–30%) and would not exert any competitive pressure ( T-Mobile/Telering ). One of the first cases in which the new merger assessment method was applied was T-Mobile Austria/tele.ring . In this case, the takeover of tele.ring (10–20% market share) by T-Mobile Austria resulted in the second largest provider in the relevant market with a market share of 20–40%. The leading company was Mobilkom, with a 35-45% share (case T-Mobile Austria/tele.ring ). In light of the structural approach based on the dominance test, no dominant position emerged or strengthened. After the merger, T-Mobile would not become a market leader, but nevertheless, according to The European Commission, the concentration would have negative effects as it caused the risk of unilateral effects (Schwalbe, Zimmer, 2010). Importantly, such effects are not included in the domination test in the light of Article 2(1) and (2) of the Regulation 139/2004 because by definition they are below the market power threshold but fall within the scope of the SIEC test in the light of Article 2(3) of that Regulation. From a theoretical point of view, this has two consequences for the economy. It is not about the practical execution of the test, but about the basic economic concept. Unilateral effects cause a change in the behaviour of an individual undertaking in an oligopolistic market due to the mitigation of competitive pressures as a result of concentration. For this reason, the theory of unilateral effects should be supplemented with the concept of close relations between competitors. 3.1 Close competitors A helpful tool for the assessment of “significant impediment of effective competition” is also the proximity of competitors. Here the decisive factor is the distance between competitors participating in the merger and other rivals, i.e., how close substitutes are the products they produce. In markets where products are not homogeneous, the decisive factor is the distance between the merging competitors and the remaining competitors. The closer the relations of two competitors (i.e., the more substitutable are their products), the faster they can

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