EU & Competition Newsletter, Issue No. 1, 2024

Irish Merger Control 

Sector: Consumer Electronics

Acquisition by Select Technology Sales and Distribution Group Limited of DID Electrical

The proposed acquisition by Select Technology Sales and Distribution Group Limited (“Select”) of the entire issued share capital of Home Appliances Electrical Holdings Limited (DID Electrical) has been cleared by the Competition and Consumer Protection Commission.

Select, previously known as Compu B sells consumer electronic products, including computers, tablets and mobile phones through its two subsidiaries, one in Ireland and the other in the UK.

Home Appliances Electrical Holdings Limited is the holding company for Home Appliances ULC which trades as DID Electrical. DID Electrical is a retailer of electronic appliances such as dishwashers, televisions and refrigerators.

The proposed acquisition was approved under the Simplified Merger Notification Procedure. While the parties are active in the same product and geographic market(s), their combined share is less than 15%.

Sector: Hospitality

Acquisition by Luxembourg Investment Company 549 S.À.R.L of sole control of certain assets of the Press Up Group

The proposed acquisition by Elliot Investment Management L.P. of sole control of certain assets of the Press Up Group, has been cleared by the CCPC.

Luxembourg Investment Company 549 S.À.R.L is an indirectly solely controlled entity of Elliot Investment Management L.P. which holds investments in several portfolio companies across a variety of sectors such as banking, hospitality and manufacturing.

The Press Up Group operates a number of hotels in Ireland including The Dean Dublin, The Mayson Dublin, The Clarence Dublin, The Devlin Dublin, The Leinster Dublin, The Glasson Lakehouse, The Dean Galway and The Dean Cork.

The CCPC formed the view that the proposed the transaction would not substantially lessen competition in any market for goods or services in the State.

Sector: Transport & Logistics

Acquisition by HIG Capital LLC of sole control of DX (Group) plc

The CCPC has cleared the proposed acquisition of DX (Group) plc by HIG Capital LLC, through its wholly owned subsidiary Transit Bidco Limited of DX (Group) plc.

HIG Capital LLC specialises in providing both debt and equity capital to small and mid-sized companies, with a focus on traditional infrastructure sectors such as TMT, power and transport. Transit Bidco Limited is a private limited company incorporated in England which was formed for the purposes of the proposed transaction.

DX Group provides a wide range of delivery services, including parcel freight, courier and logistics services.

The proposed acquisition was approved under the Simplified Merger Notification Procedure.

Update: The transaction was re-notified on 16 February 2024.

Sector: Medical Equipment / Funds

Acquisition by Andromeda Bidco Limited of Alliance Medical Acquisitionco Limited, the top company of the Alliance Medical Group

The proposed acquisition by Andromeda Bidco Limited, a wholly owned subsidiary of funds advised by iCON Infrastructure LLP, of Alliance Medical Acquisitionco Limited, the top company of the Alliance Medical Group has been cleared by the CCPC.

iCON Infrastructure LLP is an investment firm advising funds with $8 billion of capital and are focused on making long term equity investments.

Alliance Medical Group provides complex diagnostic imaging and molecular imaging services to public hospitals and private clinics across 11 geographies.

As there was no horizontal or vertical overlap between iCON Infrastructure and Alliance Medical Group in any market(s) in Ireland; and no horizontal or vertical overlap between any of iCON Infrastructure’s portfolio companies and Medical Alliance Group in any market(s) in the State, the proposed acquisition was approved under the Simplified Merger Notification Procedure.

 

Irish Media Merger

Sector: Media

Acquisition by Bauer Media Audio Holding GmbH of Wilton Radio Limited

The proposed acquisition of sole control of Wilton Radio Limited, the holding company for I Radio Limited, iRadio North East & Midlands Limited and IC Radio Limited, by Bauer Media Audio Holding GmbH has been cleared by the CCPC.

Bauer Media Audio Holding GmbH is a subsidiary of Heinrich Bauer Verlag Beteiligungs GmbH, a company that is part of the Bauer Media group of companies.

Wilton Radio Limited operates the iRadio radio channel which broadcast throughout the North West, North East and Midlands Region.

The CCPC formed the view that the proposed transaction would not substantially lessen competition in any market for goods or services in the State.

Acquisition by SSBL Limited of 100% of the issued share capital of Viaplay Group Ireland Limited and Viaplay Group UK Sports Limited

The CCPC has cleared the proposed acquisition by SSBL Limited of sole control of Viaplay Group Ireland Limited and Viaplay Group UK Sports Limited (“Viaplay”).

SSBL Limited is a holding company within TDL Media Limited which operates the Premier Sports Ireland channels in Ireland with a particular focus on soccer, Gaelic games and rugby.

Viaplay are niche sports broadcasters with 3 TV channels and over-the-top media offering in the UK.

The CCPC formed the view that the proposed transaction would not substantially lessen competition in any market for goods or services in the State.

EU Updates

The European Commission launches calls for contributions on competition in virtual worlds and Generative AI

On 9 January 2024, the European Commission launched calls for contributions on competition in virtual worlds and generative artificial intelligence (“AI”) and sent requests for information to several large digital players.

The Commission also said it is looking into agreements concluded between large digital market players and generative AI developers and providers and their impact on market dynamics.

The European Commission adopts revised Market Definition Notice for competition cases

The European Commission has adopted a revised Market Definition Notice for assessing competition between companies in respect of mergers and anti-trust cases.

The focus of the revised Notice is to provide more guidance and transparency to companies by clarifying the principles the Commission will apply when defining markets in innovation-intensive industries and to have regard to environmental and sustainability concerns.

The revised Notice includes specific guidance on the general principles and application of market definition concepts. It also describes alternative metrics relevant for calculating market shares, such as shares based on sales, capacity or usage metrics.

 

EU State Aid

The European Commission approves €126 million Romanian State aid scheme to support ports facing increased trade flows due to Russia’s war against Ukraine.

The European Commission has approved, under EU State aid rules, a €126 million Romanian scheme to support investments in ports facing increased trade flows after Russia's war against Ukraine. The measure facilitates trade flows in and from Ukraine in line with the objectives of the EU's Solidarity Lanes action plan.

Romania notified its plans to the Commission to support companies active in certain Romanian ports to invest in additional handling or storage facilities for processing goods deviated from their normal trading routes due to Russia's war against Ukraine, and the collapse of Ukraine's direct maritime export routes. The scheme, with a budget of €126 million, will run until 31 December 2024.

The measure will be partly funded through EU Cohesion funds and will contribute to the functioning of the EU-Ukraine Solidarity Lanes by facilitating the trade flows in and from Ukraine.

The EU General Court rules €3.4b Covid-19 State aid granted by the Netherlands to Air-France-KLM to be illegal

In 2020, Air-France-KLM received €3.4b from the Netherlands after the Covid-19 pandemic grounded the aviation sector. This State aid was approved by the European Commission in 2020, however the EU General Court annulled the decision in 2021.

The Commission approved the State aid again in 2021, which was challenged by Ryanair and Malta Air. This was one of the multiple challenges brought by Ryanair against government bailouts for other companies, including German airline Lufthansa and Scandinavia’s SAS during the pandemic.

On 7 February 2024, the EU General Court annulled the European Commission’s decision stating that the State aid granted to Air-France-KLM was unlawful and the Commission had “erred in defining the beneficiaries of the state aid granted.”

Ryanair is now calling on the European Commission to order the Netherlands to immediately recover this State aid package from Air-France-KLM and impose adequate remedies to repair the alleged damage to competition.

 

EU Legislation Update

The European Commission unveils new initiatives to advance European economic security

On 24 January 2024, the Commission presented five new initiatives aimed at strengthening the EU’s economic security. This comes after the Commission published a “European Economic Security Strategy” in July 2023 calling for better deployment of existing tools such as on foreign direct investment (“FDI”) screening and export controls.

The initiatives include:

• A legislative proposal for the revision of the EU FDI Screening Regulation.
• A step-by-step analysis of outbound investments to assess potential investment risks.
• The introduction of more effective EU controls on dual-use goods exports.
• The introduction to support research and development in technologies with dual-use potential.
• A proposal to provide further guidance to Member States in respect of research and innovation sector.

Arising from this is a draft for a new Regulation on the screening of FDIs.

The EU’s current FDI Screening Regulation is mainly aimed at establishing cooperation between the Member States reviewing an investment and leaves significant discretion to Member States in deciding whether to screen foreign investment.

The draft Regulation aims at harmonising national rules on investment screening by requiring Member States to establish, preclosing, foreign investment screening mechanisms.

Under the draft Regulation, acquisitions of EU entities will be reviewable if the EU acquirer is controlled by a foreign investor. This is a marked shift from the current Regulation which only applies to direct investments by foreign investors and not to indirect investments by EU-based subsidiaries of foreign investors.