Case COMP/M.4403 — Thales/Finmeccanica/Alcatel Alenia Space/Telespazio

February 11, 2009 at 10:28 am | Posted in Space Law | Leave a comment

by P.J. Blount with the blog faculty

Several documents were published in the Official Journal of the European Union concerning the Case COMP/M.4403 — Thales/Finmeccanica/Alcatel Alenia Space/Telespazio. The documents indicate that the European COmmission has approved a concentration of the companies involved.

First an Opinion of the Advisory Committee on concentrations given at its 148th meeting on 23 March 2007 concerning a draft decision relating to Case COMP/M.4403 — Thales/Finmeccanica/Alcatel Alenia Space/Telespazio which states:

Opinion of the Advisory Committee on concentrations given at its 148th meeting on 23 March 2007 concerning a draft decision relating to Case COMP/M.4403 — Thales/Finmeccanica/Alcatel Alenia Space/Telespazio (2009/C 34/03)

1. The Advisory Committee agrees with the Commission that the notified operation constitutes a concentration within the meaning of Article 3(1)(b) of the EC Merger Regulation and that it can be deemed to have a Community dimension pursuant to Article 1(2) of that Regulation.

2. The Advisory Committee agrees with the Commission that the relevant product markets can be characterised as follows:

(a) ground segment:

— launchers,

— space transportation and infrastructure, and

— satellites;

(b) space segment:

— launchers,

— space transportation and infrastructure, and

— satellites:

— satellite prime contracting for institutional satellites,

— satellite prime contracting for military satellites,

— satellite prime contracting for commercial telecommunications satellites, and

— satellite subsystems and equipment for commercial telecommunications satellites:

— Travelling Wave Tubes (TWTs),

— Electronic Power Conditioners (EPCs), and

— Travelling Wave Tube Amplifiers (TWTAs) (which includes Linearised TWTAs (LTWTAs), Channel Amplifier TWTAs (CTWTAs), and Linerarised Channel Amplifier TWTAs (LCTWTAs)).

3. The Advisory Committee agrees with the Commission that the geographic scope of the relevant product markets is:

— worldwide for commercial telecommunications satellites and satellite subsystems,

— European or national for European institutional satellites and satellite subsystems, and

— national (where a national supplier exists) or worldwide for military satellites and satellite subsystems.

4. The Advisory Committee agrees with the Commission’s view (and subsequent approach to the analysis) that the issue raised by the proposed concentration is whether or not the merger will give the new entity:

— the ability and incentive to engage in input foreclosure in identified markets, and

— whether such a course of action would significantly impede effective competition downstream.

5. The Advisory Committee agrees with the Commission that the proposed concentration will not significantly impede effective competition on the market for TWTAs.

6. The Advisory Committee agrees with the Commission that the proposed concentration will not significantly impede effective competition on the market for satellite prime contracting for commercial telecommunications satellites.

7. The Advisory Committee agrees with the Commission that the notified concentration must be declared compatible with the common market and the functioning of the EEA Agreement pursuant to Article 8(1) of the EC Merger Regulation.

8. The Advisory Committee asks the Commission to take into account all the other points raised during the discussion.

Next a Final Report (1) of the Hearing Officer in Case COMP/M.4403 — Thales/Finmeccanica/AAS & Telespazio (2009/C 34/04) was published:

Final Report (1) of the Hearing Officer in Case COMP/M.4403 — Thales/Finmeccanica/AAS & Telespazio (2009/C 34/04)

On 6 October 2006, the Commission received notification of a proposed concentration by which the undertakings Thales S.A. (Thales) and Finmeccanica Società per Azioni (Finmeccanica) acquire, within the meaning of Article 3(1)(b) of Council Regulation (EEC) No 4064/89 (the ‘Merger Regulation’), joint control of the undertakings Alcatel Alenia Space SAS (AAS) and Telespazio Holding srl (Telespazio) by way of purchase of shares in two existing joint ventures to which additional assets are contributed.

After a preliminary examination of the notification, the Commission concluded that the notified transaction falls within the scope of the Merger Regulation and raised serious doubts as to its compatibility with the common market. It therefore decided, on 28 November 2006, to initiate proceedings under Article 6(1)(c) of the Merger Regulation.

The parties had then access to the key documents of the file, in application of the Best Practices for merger case, through a non-confidential summary of the responses of third parties to the requests for information in first phase, which was provided to them on 7, 8 and 11 December 2006.

Following an in-depth market investigation, the Commission services considered that the serious doubts had been removed and that the proposed transaction would not significantly impede effective competition in the common market or a substantial part of it and that it hence should be declared compatible with the common market and the functioning of the EEA agreement. Accordingly, no Statement of Objections was sent to the parties.

No queries or submission have been made to me by the parties or any other third party. The case does not call for any particular comments as regards the right to be heard.

Brussels, 26 March 2007.
Serge DURANDE

Finally a Summary of Commission Decision of 4 April 2007 declaring a concentration to be compatible with the common market and the EEA Agreement (Case COMP/M.4403 — Thales/Finmeccanica/Alcatel Alenia Space & Telespazio) (2009/C 34/05) was included. The commission conclusion stated:

The Commission takes the view that, on the basis of the evidence available, it is not likely that the merged entity would have the ability and incentive to foreclose its competitors at any level of the supply chain and that the proposed transaction would, as a result, significantly impede effective competition. The Commission therefore declares that the proposed merger is compatible with the common market and the functioning of the EEA Agreement.

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