Objections to VEBA/VIAG

United Kingdom
30/04/2000
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The Commission has notified VEBA and VIAG of its objections to their proposed merger because it will lead to a dominant duopoly of VEBA/VIAG and RWE/VEW in electricity generation and transmission in Germany. (These parties would together account for more than 80% of generation and transmission). The VEBA group is active in the electricity sector through Preussenelektra and the VIAG group through Bayernwerk. Both companies have significant participation in the electricity generator Bewag. Preussenelektra, Bayernwerk and RWE jointly control the East-German electricity generator VIAG. RWE intends to merge with the electricity company VEW and has notified the operation to the German cartel office. The latter has sent a statement of objections concerning this operation, and is co-operating with the Commission on the present transaction.

The Commission opened an in-depth investigation into the VEBA/VIAG merger on 4 February. At that time, it expressed concerns that the deal would significantly impede competition in the recently liberalised electricity market. The merger would have led to the strengthening of already existing dominance in two markets for chemical specialities. The companies may now give their comments and possibly proposed appropriate commitments to remove competition problems. The Commission must take a final decision before 19 June (IP/00/390).

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