The Hungarian Competition Authority (GVH) has issued another decision approving the acquisition of the alternative telco Invitel by Digi HU, a subsidiary of Digi Communications.
In a statement, Digi says that GVH withdrew its initial decision approving the transaction, issued in May 2018, on November 15, 2018 and opened a new merger control procedure to reassess market overlaps between Invitel and i-TV, Digi HU’s Hungarian subsidiary and imposed a fine of approximately €280,000. Following an appeal, the fine was reduced by half by a competent court.
Although the court ruled that Digi HU had failed to proactively act in a required manner, it also established that GVH had failed to properly gather the necessary information at the time of its initial approval in order to clarify the matter.
The statement continues by saying that “Although we firmly continue to believe that the Withdrawal Decision (of GVH’s initial approval) was incorrect, in the context of the New Procedure and in order to address the authority’s concerns formulated at the time of it issuing the Withdrawal Decision, in consultation with GVH, Digi HU proposed a remedy package. One of the main elements of this package is the sale by Invitel to a third party of its operations in 14 Hungarian settlements and parts of its network in the Szeged settlement that overlapped with Digi Hungary’s own network there, the sale and purchase agreement having been executed on January 9, 2020. In response to the competition concerns identified by GVH in connection with 67 settlements where Invitel has overlapping services with i-TV, Digi HU proposed to ensure that i-TV’s rental agreements with the relevant local network operators will not be terminated until December 31, 2023 (but will be discontinued from 1 January 2024).
“Following its analysis of the proposal of this remedial package aimed at addressing competition concerns in connection with the Transaction, GVH authorised again Digi Hungary’s acquisition of Invitel. Digi HU has to fulfil the remedial measures within three months as of the official communication of the new approval to it”.
