The German monopoly commission Bundeskartellamt is to decide on Liberty Global’s planned acquisition of KabelBW. The European Commission said it was a national matter for Germany.
The European Commission has referred the assessment of the proposed acquisition to Bundeskartellamt at the latter’s request. After a preliminary investigation, the Commission found that the proposed transaction may significantly affect competition in the market for the provision of free-TV services to housing associations, where contracts with tenants are negotiated collectively, a big market in Germany.
The transaction was notified to the Commission on April 19 this year. Germany asked for the referral of the case on May 16, arguing that it threatened to significantly affect competition in some of its domestic TV-related markets. Currently, there are three regional cable TV operators in Germany: Kabel Deutschland, Unitymedia (owned by LGI since 2010) and KBW. The proposed transaction would, therefore, bring together the number two and three regional cable TV operators in the country. The proposed transaction will now be examined by the Bundeskartellamt under national law.
The Commission’s preliminary investigation revealed that the proposed transaction risks to significantly affect competition for the retail supply of free-TV services to housing associations in Germany. While regional cable operators are currently not competing with each other, it cannot be excluded that this is the result of co-ordination among the operators and that the proposed transaction could strengthen such coordinated effects between the three regional operators in Germany. Moreover, the proposed transaction might threaten to affect competition in the national market for the wholesale supply of TV signal transmission services.
The Commission decided to refer the entire case to the Bundeskartellamt because almost all the markets potentially affected are national or regional and the Bundeskartellamt has significant experience in this sector. According to comments in the German press, chances are that the Kartellamt will veto a takeover of Kabel BW by LGI.
