Brussels, 19/01/2001 (Agence Europe) - The European Commission has decided to refer to the Italian competition authorities (Autorità Garante della Concorrenza e del Mercato) the examination of the impact of the proposed acquisition of Infostrada by Enel and France Telecom on the Italian electricity sector. The Commission did not, however, raise any objection concerning the impact of this operation on the telecommunications and Internet markets.
On one hand, the deal concerns the acquisition from Vodafone Plc of Infostrada SpA by Enel Holding SpA, the main Italian electricity provider and, on the other hand, the subsequent merger of Infostrada into Wind Telecomunicazioni SpA, providing telecommunications and Internet services. The last aspect will not modify the structure of the Wind property since Enel and France Telecom will continue to jointly control the company after its merger with Infostrada. On the other hand, the operation will entail overlapping on the Italian fixed telecommunications and Internet services markets but will not pose a competition problem as the accumulated market shares will be low and there are several big competitors in these fields.
The Commission has not adopted any final position concerning the impact of the operation in the electricity sector and referred the issue back to the Italian authorities, upon a request by the latter on 20 December. Article 9 of Regulation 4064/89 authorises national authorities to examine a competition operation if it contains a threat on its own market. The electricity market is currently being liberalised throughout the EU but Enel still holds a dominant position in Italy, which makes national competition authorities fear that it may, through the acquisition of Infostrada, have the possibility of protecting or strengthening its position thanks to bundled services (invoicing and joint promotion) in the fields of electricity and telecommunications. These bundled services could attract Infostrada clients, composed of a non-negligible share of small and medium sized companies and thus strengthen the already dominant position of Enel. In conformity with Italian legislation, the Autorità currently has 30 days in which to decide whether or not to clear the operation or prolong its examination for an additional period of 45 days.