The Competition Council cleared the merger between VIAG AG and VEBA AG. Through the transaction VIAG became a part of VEBA. The Council imposed a fine of HUF 300 000 (app. EUR 1100) on the parties, as their notification missed the legal deadline.

The applicants concluded a pre-arrangement on the concentration on 27 September 1999. According to the plans the name of the new business entity is E. ON AG and it is a holding company. The main areas of the activities of the new entity will be energy (electricity, natural gas, oil, water plants), chemical industry, telecommunications and real estate management.

The parties agreed to sell their business entities active in the fields of aluminium industry, transport, packaging and logistic.

In order to complete the concentration the parties signed a merger agreement on 21 December 1999. The deadline for the merger was 1 of January 2000.

The merger was authorised by the parties` general assemblies on 10 February, and was entered into the trade register on 16 July.

The Commission of the European Union, subject to several conditions in the energy and chemical industry, cleared the concentration on 13 June

The parties notified their agreement to the Hungarian competition authority on the same day. They submitted that in Hungary the concentration affects only the steel supply market and as the parties` joint market share is not significant, the concentration would not raise doubts. In connection with the late notification, they argued that although the pre-arrangement and the merger agreement had came into force at the date of their signing, there were further conditions for the realization of the merger such as the authorisation of the general assemblies, the registration into the trade register and the permission of the Commission of the European Union. The notification could be prepared only after the parties had got to know the conditions stated by the Commission.

The VEBA AG is a holding company and it is one of the most important companies in Germany. It is present in the fields of energy and chemical industry but it also has significant interest in telecommunication, real estate management, logistic and silicon production and supply. Companies conducted by VEBA AG are present in Europe and in other parts of the world. In 1999 the VEBA group had 11 members in Hungary, the most important of which are ARAL Hungária Kft., Neuber Hungária Kereskedelmi Kft., Degussa- Hüls Hungária Kft., MASPED-BTL Kft.

These companies were active in the market for medicines, transport, engineering advising, petrol, steel (export). Their aggregate net turnover in 1999 was HUF 63. 1 billion (app. EUR 240 million).

The VIAG AG is a holding company seated in Germany. The companies of the VIAG Group are present in five markets: energy, telecommunication, chemical industry, aluminium industry and packaging. Their aggregate turnover in Hungary was HUF 182 billion (app. EUR 685 million)

The investigator suggested the clearance of the concentration, as their joint market share in the Hungarian steel supply is less than 1 per cent.

The Competition Council stated that the concentration would not create or strengthen a dominant position and therefore it cleared the merger. The Council stated that the wording of the Competition Act is clear on the rules of the deadline of the notification of a merger. The parties missed this deadline and therefore they were fined. The Council took into consideration that the parties, although after the deadline, notified their merger and that it was time-consuming for the parties to acquire the necessary information for the notification.

January 15, 2000. Budapest

Fógel Jánosné dr. sk. előadó
dr. Bodócsi András sk.
dr. Sólyom Eszter sk.
Szabó Györgyi