Luxembourg, 09/07/2007 (Agence Europe) - On Monday 9 July 2007, the Court of First Instance rejected the complaint brought by Sun Chemical Group BV (Netherlands) against the Commission. Sun contends that the Commission, in its approval of the total takeover of the “Inks and Adhesive Resins” division of Akzo Nobel (Netherlands) by Hexion Speciality Chemicals, a subsidiary of the Apollo Group (both of which are domiciled in America), infringed its own guidelines concerning the assessment of cross-cutting mergers. However, the Court took the view that there was no fault on the part of the Commission, either in procedure or substance (Case T-282/06).
According to Sun Chemical, the authorisation granted by the Commission in 2006 (EUROPE 9201) presents a number of shortfalls concerning the calculations used to estimate the coordinated and non-coordinated effect of the merger on market share and level of concentration. Furthermore, Sun argues that the Commission's examination failed to take account of the opinions tabled by Sun and by the other claimants in the case, the German companies Siegwerk Druckfarben AG and Flint Group Germany GmbH. Based solely on the information provided by the companies concerning the merger, the Commission, Sun believes, was derelict in its obligations under regulation (EC) 139/2004 of the Council, which provides for certain procedures to be followed by the Commission when analysing draft mergers.
The Court rejected all of the arguments put forward by the claimants. In response to the argument that the competitors which had been the subject of an investigation by the Commission were not “close” and did not constitute “alternative suppliers”, the Court took the view that the market configurations and the nature of the products in question were sufficient to render the analysis legitimate, and that the surplus capacity identified in these competitors represented alternative supply on the market in question. Some of the information provided by Sun Chemical even backed up this position, as it admits that it had earmarked several alternative suppliers for various products and material, in order to be better able to manage shortages or crises in supply. The ruling also looks at the depth of the Commission's analysis, but states that the conclusions of this analysis are sufficiently well grounded, and that the Commission was, contrary to claims made by Sun Chemical, under no obligation to carry out a more in-depth analysis. Furthermore, the Court states that the merger would not lead the remaining competitors to be tempted to create a cartel on the market. Although the number of major competitors would be reduced, and even though this may in theory make this kind of illegal agreement easier and more tempting, their heterogeneous nature of the market and the large variety of products would still make this very difficult in practice.
Gideon Jurgens, a legal adviser to Sun Chemical, explained that he had not had the time to read the ruling in detail, but that he had not yet ruled out an appeal. “It will take us at least a week to familiarise ourselves with the arguments of the Court and to consult the other parties to the case”, he said (our translation). (cd)