Energy merger approved
On 23 November 2017, the AMO’s Division of Concentrations approved the acquisition of indirect exclusive control of the undertaking Východoslovenská Energetika Holding, AS (VSEH) over part of the undertaking ČEZ Slovensko, SRO (ČEZ).
The company VSEH is owned by the Slovak Republic and the RWE Group, while it is indirectly exclusively controlled by RWE AG. The RWE Group operates in Slovakia in the field of energy, mainly through the VSE Group, which includes the company VSEH, its parent and subsidiary companies .The group consists of electricity companies, which in a limited scope are active in the field of electricity generation and wholesale supply market - VSE Ekoenergia, SRO and Bioplyn Rozhanovce, SRO in the field of electricity distribution - Východoslovenská distribučná, AS (VSD), in the supply of electricity - Východoslovenská energetika, AS (VSE) and natural gas - Innogy Slovensko, SRO. At the same time, VSEH provides shared services in human resources, consulting, financial services, IT services and so on for its subsidiary companies.
The acquired part of the undertaking ČEZ that is called Domácnosti (ČEZ Domácnosti) exercises activity exclusively in the retail supply of electricity and gas to households in Slovakia. In relation to the assessment of the merger, the AMO found that horizontal overlap occurs between the activities of the merging parties and their economic groups, as well as to non-horizontal interconnection.
With regard to horizontal overlap in the field of electricity supply to households, AMO assessed two alternatives. It considered the effects of merger in the case of defining the relevant market spatially, as the entire territory of the Slovak Republic, and also in the local case, defining by the ‘traditional’ operating areas of individual energy companies. AMO came to the conclusion that the horizontal overlap would not result in reducing effective competition in any of the spatial alternatives of the market, with the geographical definition of the market not having to be closed.
On 18 January 2018, the AMO’s Department of Abuse of Dominant Position and Vertical Agreements has imposed a fine amounting to €127,000 on the operator of MR Štefánik airport in Bratislava (Bratislava airport), on the grounds of abuse of its dominant position.
In July 2016 Bratislava airport introduced a fee amounting to €49 (excluding VAT) for VIP services provided in the General Aviation Terminal, which had to be paid by every departing passenger passing through. This fee was not connected to the real provision of VIP services, however, was payable upon the entrance to General Aviation Terminal, while the entrance to this terminal is already subject to a different fee. The charge in question included unlimited stay at the terminal, full assistance with the check-in and check-out processes, refreshments, assistance with luggage, free parking and free wifi connections and has been introduced during Slovakia’s presidency of the Council of the European Union. The above-mentioned resulted in a situation where even the clients who did not intend to use such services, were also charged as if they had.
Bratislava airport has fully accepted the opinion of the Office, which led to a 30 per cent reduction of the fine and the management has publically announced it will be paid in due time, and as a result, passing through the General Aviation Terminal is now free of charge.
Inspection in the construction industry
The AMO has publically confirmed an unannounced inspection was conducted at the premises of several undertakings operating in the construction industry during the course of February 2018. The inspection was carried out on the basis of a reasonable suspicion that the undertakings active in the construction industry might have concluded an agreement restricting competition relating to participation and submitting of bids in public procurement. As the described conduct might be considered as horizontal agreement between direct competitors, which is regarded as one of the most serious violations of competition rules and is deemed as a hardcore cartel, the undertakings at hand may be imposed with a fine, which may amount to 10 per cent of the turnover for the previous accounting period.
€10 million fine for the Rajo group upheld
The Council upheld the first-instance decision of the AMO’s the Division of Abuse of Dominant Position and Vertical Agreements dated 13 June 2016, by which the AMO imposed fines on the undertaking RAJO, AS, Bratislava and its distributors, chain stores CBA Slovakia, AS, Lučenec; COOP Jednota Slovensko, Spotrebné Družstvo, Bratislava; Diligentia RC, SRO, Bratislava; Kaufland Slovenská Republika, VOS, Bratislava; TERNO Group, KS, Bratislava; BILLA, SRO, Bratislava; Retail Value Stores, AS, Bratislava; and TESCO STORES SR, AS, Bratislava, on the grounds that the above undertakings have in the period from 28 May 2009 to 28 February 2014 behaved in an anticompetitive way. This breach of respective applicable legislation resulted in a conclusion of vertical agreements restricting competition, with the common purpose of resale price maintenance in the area of supply and sale of products of the brand Rajo in the categories of milk, butter and cream for end consumers in the territory of the Slovak Republic.
The total upheld fine amounted to €10,266,259. The particular fines were set according to the gravity of the infringement at a rate of 5 per cent of the relevant turnover, which was then multiplied by the number of years that the infringement took place. The decision of the Council came into force on 2 May 2018; the participants to the proceedings are entitled to seek judicial review.
The joint venture of companies SWAN, AS, and BENESTRA,SRO approved
The AMO approved a merger by which a full-function joint venture jointly controlled by undertakings Ing Juraj Ondriš and Ing Pavol Ondriš on one hand, and undertaking Sandberg Capital, Správ Spol, AS, on the other hand, has been established.
The joint venture will include the companies Benestra, SKC2, SKH and C2 from the economic group of Sandberg Capital and the company Swan (owned by Juraj and Pavol Ondriš).
The AMO focused on assessing the impacts of the merger in relation to the field of electronic communications. Several relevant markets or segments of goods and services in the field of electronic communications were identified in the merger notification in which companies belonging to the respective economic groups operate. Due to the structure of several markets and the position of the relevant undertakings, it was possible to assess the merger as already unproblematic from the information as provided in the notification.
In relation to cumulating infrastructure, the AMO found out that the merging parties do not have such an optical infrastructure, which would give them a more competitive advantage. Further, the AMO has concluded there will be undertakings with more extensive infrastructure on the market even after successful consummation merger at hand.
With respect to the assessment of the merger´s horizontal effects on the wholesale level of the provision of high-quality access to the internet, the Office found out that Benestra is one of the major wholesale players in the market, but Swan is active in this market only to a limited extent. Thus, the overall increase will be minimal.
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