Commission européenne, DG COMP MERGER REGISTRY, 1049 Bruxelles, BELGIQUE  
Europese Commissie, DG COMP MERGER REGISTRY, 1049 Brussel,   BELGIË  
 
Tel: +32 229 -91111. Fax: +32 229 -64301. E -mail: COMP -MERGER -REGISTRY@ec.europa.eu .  EUROPEAN COMMISSION  
Brussels,  21.10.2021  
C(2021 ) 7687 final  
PUBLIC VERSION  
 
Synthos S.A.  
ul. Chemików 1  
32-600 Oświęcim  
Poland  
Subject : Case M.10347 – SYNTHOS  / TRINSEO  (SYNTHETIC RUBBER 
BUSINESS ) 
Commission decision pursuant to Article 6(1)(b) of Council Regulation 
No 139/20041 and Article 57 of the Agreement on the European Economic 
Area2 
Dear Sir or Madam,  
(1) On 16 September 2021 , the European Commission received notification of a 
proposed concentration pursuant to Article 4 and following a referral pursuant to 
Article 4(5) of the Merger Regulation by which Synthos S.A.  (“Synthos”, Poland)  
intends to acquire within the meaning of A rticle 3(1)(b) of the Merger Regulation 
control of the synthetic rubber business (the “Target”)  of Trinseo S.A.  (“Trinseo”, 
Luxembourg) (the “Transaction ”).3 Synthos  is referred to as the “Notifying Party” 
and, together with Trinseo, the “Parties”.  
                                                 
1  OJ L 24, 29.1.2004, p. 1 (the ’Merger Regulation ’). With effect from 1 December 2009,  the Treaty on the 
Functioning of the European Union ( ‘TFEU ’) has introduced certain changes, such as the replacement of  
‘Community ’ by ‘Union ’ and ‘common market ’ by ‘internal market ’. The terminology of the TFEU will 
be used throughout this decision.  
2  OJ L 1, 3.1.1994, p. 3 (the ‘EEA Agreement’).  
3  Publication in the Official Journal of the European Union No C 387, 24.9.2021 , p. 21. 
In the published version of this decision, 
some information has been omitted 
pursuant to Article 17(2) of Council 
Regulation (EC) No 139/2004 concerning 
non-disclosure of business secrets and other  
confidential information. The omissions are 
shown thus […] . Where possible the 
information omitted has been replaced by 
ranges of figures or a general description.  
 
 
2 1. THE  PAR TIE S 
(2) Synthos is a privately held joint stock company headquartered in Oświęcim, Poland, 
mainly active in the production and distribution of a wide range of chemical 
products. Synthos’ business is segmented into the following divisions: (i) synthetic 
rubber , (ii) insulation materials, (iii) dispersions, adhesives and latexes, and (iv) 
agro. The sole shareholder of Synthos is Black Forest SICAV -SIF S.A. (“Black 
Forest”), a private investment fund incorporated in Luxembourg. Black Forest is 
indirectly controll ed by Mr. Michał Sołowow via MS Galleon AG, a privately 
owned holding company with its headquarters in Vienna, Austria.  
(3) Trinseo  is a company incorporated and existing under the laws of Luxembourg, 
which is listed on the New York Stock Exchange and headquar tered in 
Pennsylvania, United States. Trinseo is mainly active in plastics, latex binders, and 
synthetic rubber . 
(4) The Target  comprises the synthetic rubber business of Trinseo. The Target’s key 
assets are: ( i) a production facility located in Schkopau, Germany, as well as the 
related worldwide sales contracts, worldwide sales team, IP and R&D functions; and 
(ii) a non -controlling [minority]  stake of […] in Tyre Recycling Solutions S.A., a 
stock company incorporated under the laws of Switzerland  and mainl y active in 
recycling of the materials contained in scrap tyres.  
2. THE  OPE RATION  AND THE  CONCE NTRATION  
(5) On 21 May 2021 , Syntho s and Trinseo  entered into an agreement pursuant to which 
Syntho s agreed to acquire  from Trinseo  all assets, rights, debts and liabil ities relating 
to the Target. Following completion of the Transaction, Syntho s will thus acquire 
sole control of the Target .  
(6) The Transaction is therefore a concentration within the meaning of Article 3(1)(b) of 
the Merger Regulation.  
3. UNION  DIME NSION  
(7) The T ransaction does not have a Union dimension within the meaning of Article 1 of 
the Merger Regulation, as it does not meet the thresholds of Article 1(2) or Article 
1(3).  
(8) In accordance with Article 4(5) of the Merger Regulation, the Notifying Party 
requested  on 25 June 2021 a referral to the Commission on the grounds that the case 
would be reviewable under the national merger control laws of eight Member States, 
namely Austria, Czechia, Germany, Hungary, Poland, Portugal, Romania and Spain. 
No Member State ex pressed disagreement with this request and the case was referred 
to the Commission on 16 July 2021.   
(9) Therefore, the concentration falls under the scope of review of the Commission 
pursuant to Article 4(5) of the Merger Regulation.  
 
 
3 4. COMPE TITIVE ASSE SSME N T 
4.1. Overview of affected market s 
(10) Synthos and the Target manufacture and supply styrene butadiene rubber (“SBR”). 
SBR is a type of synthetic rubber primarily used for the manufacture of car tyres ( c. 
80% of global demand). In addition, it is also used for other, non-tyre applications, 
such as conveyor belts, gaskets, hoses, floor tiles, footwear and adhesives. Figure 1 
shows the main end -uses of SBR. Besides synthetic rubber, Synthos is also active in 
insulation materials (polystyrene), dispersion, adhesives and latexes , as well as 
agricultural products (in particular plant protection products, seed dressing agents, 
biocides and leaf fertilisers).  
 
Figure 1: SBR end -uses  
Source: Form CO, Figure 1  
(11) There are two major types of SBR: emulsion -styrene butadiene rubber (“ESBR”) 
and solution -styrene butadiene rubber (“SSBR”). ESBR is a copolymer of styrene 
and butadiene produced by free -radical emulsion polymerisation of styrene and 
butadiene. SSBR is a c opolymer of styrene and butadiene produced by anionic 
copolymerisation of styrene and butadiene using lithium alkyls. While most of the 
market volume consists of ESBR, the tyre industry is moving increasingly from 
ESBR to SSBR due to superior performance i n characteristics such as  grip, abrasion 
resistance and rolling resistance. As a result, SSBR demand is growing at a faster 
rate than ESBR.  

 
 
4 (12) SSBR includes non -functionalised and functionalised SSBR. Non -functionalised 
SSBR is a standard SSBR with no additio nal elements in the polymer chains. 
Functionalised SSBR is a non -standard SSBR containing one or more additional 
elements in the polymer chain. Functionalised SSBR is suitable for high -
performance tyres due to its superior grip and wear, which allows for b etter fuel 
efficiency and safety. 4 
(13) Synthos is active in ESBR and non -functionalised SSBR, but not in functionalised 
SSBR. The Target is active in ESBR, non -functionalised SSBR and functionalised 
SSBR.  
4.2. Market definition  
4.2.1.  Product market definition  
4.2.1.1.  Commissio n precedents  
(14) In previous decisions , the Commission considered SBR as a distinct downstream 
product market in the context of a vertical assessment only.5 In a more recent 
decision, the Commission assessed types of rubber other than SBR, and found 
separate p roduct markets for different types of rubber, e.g. butyl rubber and 
polybutadiene rubber.6 The Commission also considered further segmentations 
within types of rubber, e.g. non -halogenated and halogenated and a further 
segmentation between halogenated brom obutyl and chlorobutyl rubbers within butyl 
rubber.7 
4.2.1.2.  The Notifying Party’s view  
(15) The Notifying Party submits that SBR products share common features such as the 
same main chemical components and the same primary applications, i.e. tyre 
production.8 However,  the Notifying Party also notes differences between ESBR and 
SSBR. For example, ESBR is not suitable for high -performance tyres for which 
SSBR is predominantly used. Furthermore, SSBR tends to be sold for higher prices 
than ESBR. 9 
(16) Further, the Notifying P arty underlines  that SSBR can be either non -functionalised 
or functionalised SSBR and that b oth non -functionalised and functionalised SSBR 
are used predominantly in tyre treads.10  
(17) Finally, each of ESBR and SSBR are used for other applications than tyre tre ads as 
well, come in different individual grades and features such as oil extension (the 
inclusion of plasticiser to improve processability of the rubber).11 
                                                 
4  Form CO, paragraph s 103 - 106. 
5  Case M.591 – Dow / Buna (1996), para graph 18 and Case M.6093 – BASF  / Ineos  / Styrene  / JV (2011), 
paragraph  126. 
6  Case M.9410 – Saudi Aramco / Sabic (2020), paragraphs 31 and 226.  
7  Case M.9410 – Saudi Aramco / Sabic (2020), paragraph 32.  
8  Form CO, paragraph 94.  
9  Form CO, paragraph 9 5. 
10  Form CO, paragraph 94.  
 
 
5 (18) Ultimately, the Notifying Party considers that it can be left open whether the 
appropriate product market is SBR overall or whether separate product markets for 
ESBR and SSBR , and separate markets for functionalised and non -functionalised 
SSBR within SSBR,  are appropriate, as it considers the Transaction does not give 
rise to competition concerns for any plausible  product market definition.12  
(19) The Notifying Party submits that further segmentations of ESBR and SSBR, such as  
application, grade, and oil extension  are not appropriate .13 
4.2.1.3.  The Commission’s assessment  
(20) The Commission’s market investigation confir med that ESBR and SSBR constitute 
separate product markets.  
(21) The majority of c ustomers  that responded to the Commission’s market investigation 
indicated that they do not consider ESBR and SSBR substitutable in terms of 
characteristics, performance, price a nd intended use.14 Furthermore, competitors that 
responded to the Commission’s market investigation confirmed that ESBR and 
SSBR  are produced on different production equipment and use different production 
processes.15 Moreover, competitors that responded to the Commission’s market 
investigation  clearly indicated that the production of ESBR and SSBR require 
different know -how, proprietary formulas or other intellectual property.16  
(22) Regarding possible further segmentations, the majority of customers17 and of 
competitors18 that responded to the Commission’s market investigation  indicated 
that ESBR does not need to  be further segmented  (e.g. on the basis of oil extension, 
individual grades, application, etc .)  
(23) Regarding SSBR,  the majority of customer s that responded to the Commission’s 
market investigation  indicated that they do not consider functionalised and non -
functionalised SSBR substitutable in terms of characteristics, performance, price and 
intended use.19 Competitor s that responded to the Commission’s market 
investigation  indicated that non -functionalised  and functionalised SSB R are 
manufactured with the same manufacturing equipment , but require different know -
how, proprietary formulas or other intellectual property.20  
4.2.1.4.  Conclusion  
(24) For the purpose of this Decision , the Commission concludes that  ESBR and SSBR 
constitute  separate product markets. A further segmentation of ESBR is not 
                                                                                                                                                      
11  Form CO, paragraphs 10 7 - 126 & 130 -139. 
12  Form CO, paragraphs 94 - 96. 
13  Form CO, paragraph 126.  
14  See replies to question 4, Q 1 - Questionnaire to SBR c ustome rs, as well as minutes of pre -notification 
calls with three tire producers on 29.07.2021, 07.09.2021 and 09.09.2021.  
15  See replies to question 4, Q2 - Questionnaire to SBR competitors . 
16  See replies to question 5, Q2 - Questionnaire to SBR competitors.  
17  See replies to question 6, Q1 - Questionnaire to SBR c ustomers . 
18  See replies  to question 8, Q2 - Questionnaire to SBR competitors  
19  See replies to question 5, Q1 - Questionnaire to SBR c ustomers . 
20  See replies to q uestion s 6 & 7 , Q2 - Questionnaire to SBR competitors . 
 
 
6 appropriate . As far as a further sub -segmentation of SSBR into non -functionalised 
SSBR and functionalised SSBR is concerned, th e issue can be left open since the 
Transaction does not give rise to serious doubts as to its compatibility with the 
internal market or the functioning of the EEA agreement under any of these plausible 
market definitions  (SSBR overall, functionalised SSBR or non -functionalised 
SSBR ). 
4.2.2.  Geographic market definition   
4.2.2.1.  Commission precedents  
(25) Previous Commission decisions discussing SBR do not provide an assessment of the 
appropriate geographic scope. In its assessment of types of rubber s other than SBR, 
the Commis sion left open whether the appropriate geographic market definition is 
worldwide or EEA -wide.21 
4.2.2.2.  The Notifying Party’s view  
(26) The Notifying Party submits that the appropriate geographic market definition for 
SBR (as well as any of its potential segments) is global.22  
(27) First, the Notifying Party argues that there are significant global SBR trade flows.23 
Indeed, on the basis of Eurostat data, in 2019 the EEA imported around 99 
kilotonnes (“kt”)  of SSBR and 73 kt of ESBR, while it exported 156 kt and 207 kt 
respe ctively. 24 
(28) Second, the Notifying Party submits that there are no significant trade barriers, 25 
since SBR imports into the EEA are not subject to any customs duties. Additionally, 
neither final ESBR nor SSBR products are subject to the REACH environmental 
legislation .26 While a limited number of countries (e.g., the US, Mexico and India) 
use various mechanisms, including anti -dumping duties, in an attempt to protect 
their national manufacturers , the Notifying Party does not consider that this poses 
material b arriers to cross -border trade . Neither the Target nor any other Europe -
based manufacturer has been subject to US anti -dumping duties. Synthos’ Polish 
subsidiary has been subject to anti -dumping duties until 2022, […].27   
(29) Third, the Notifying Party puts forward the argument that transport of SBR is easy 
and transportation costs are low.28 The Notifying Party also underlines the fact that 
there are no material price differences between commodity SBR products across the 
different regions. Prices broadly foll ow the same trends in the main regions (Europe, 
                                                 
21  For example, case M.9410 – Saudi Aramc o / Sabic (2020), paragraphs 39, 231 and 315.  
22  Form CO, paragraph 142.  
23  Form CO, paragraph s 144 – 153. 
24  See Form CO, table s 8 and 10.  
25  Form CO, paragraph 154. 
26  Regulation (EC) No 1907/2006 of the European Parliament and of the Council of 18 December 2006 
concerning the Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH), 
establishing a European Chemicals Agency, amending Directive 1999/45/EC and repealing Council 
Regulation (EEC) No 793/93 and Commission Regulation (E C) No 1488/94 as well as Council Directive 
76/769/EEC and Commission Directives 91/155/EEC, 93/67/EEC, 93/105/EC and 2000/21/EC . 
27  Form CO, paragraph s 155 - 161. 
28  Form CO, paragraph s 165 – 166. 
 
 
7 North America and North -East Asia) reflecting, among other factors, changes in 
feedstock prices and the global supply and demand balance.29 
(30) Fourth, the Notifying Party argues that suppliers have a single, or o nly a few, 
production facilities worldwide from which they supply customers globally (through 
an […])30, while the main SBR customers, global players active in the tyre industry, 
source ESBR and SSBR globally, typically from multiple suppliers.31 
4.2.2.3.  The Commiss ion’s assessment  
(A) ESBR  
(31) A large majority of  customers32 and a slight majority of competitors33 that responded 
to the Commission’s market investigation  indicate that they source /supply ESBR on 
a global basis.34  
(32) However , a number of responses both from customers35 and competitors36 indicate 
that that ESBR is traded mostly within wider geographic regions (EEA, Asia, North 
America). The y indicate  that since ESBR is a commoditi sed product, long distance 
transport cost represents a significant share of the product pric e, particularly in the 
current situation of high shipping rates  caused by container shortages . For example 
one customer says that “ It is important to note that suppliers from outside of the EU 
cannot replace suppliers in  the EU, due to logistical difficult ies (high logistic costs) 
and lead times . 37, while a competitor replied that “Profit margin is too little to 
justify freight cost to ship products outside the base region because of competition in 
their region… .”38 
(33) The Commission takes note of the above com ments put forward  by respondents in 
the market investigation and concludes that transport costs might be a reason which 
would prevent customers from procuring ESBR volumes over long distances.  
(34) Indeed, according to documents submitted by the Notifying Part y, costs of bringing 
ESBR in the EEA in 2021 from Asia (China and Taiwan) represent around [a 
moderate percentage] % of ESBR product cost.39 According to the Notifying Party, 
this is due to the container shortage, since  in 2020 the part of transport for the same 
route was around [a low percentage] %. For North and South America, transport 
costs  are not particularly high.  
                                                 
29  Form CO, paragraph s 181 – 185. 
30  Form CO, paragraph s 167 & 169.  
31  Form CO, paragraph s 168 – 169. 
32  See replies to question 8.1, Q1 - Questionnaire to SBR customer s. 
33  See replies to question 10.1, Q2 - Questionnaire to SBR competitors . 
34  See replies to question 8.1 .1, Q1 - Questionnaire to SBR customers  and replies to question 10.1 .1, Q2 - 
Questionnaire to SBR competitors .  
35  See replies to question 8.1.1, Q1 - Questionnaire to SBR customers .  
36  See replies to question 10.1.1, Q2 - Questionnaire to SBR competitors .  
37  See reply of a customer  to questi on 8.1.1, Q1 - Questionnaire to SBR customers . 
38  See reply of a competitor to question 10.1.1, Q2 - Questionnaire to SBR competitors.  
39  See reply to RFI 7, of date 4 October 2021, annex 2.  
 
 
8 (35) Conversely there are no tariffs or regulatory barriers preventing the import of ESBR 
in the EEA. In pa rticular a customer stressed that “No specific barriers for wider 
geographic sourcing area. … ”40, while a competitor indicated that “ There are 
practically no barriers. … ”41 
(36) The Commission notes that there are ESBR suppliers located in Russia (Sibur) and 
Serbia (HIP Petrohemija , “HIP”) who already have ESBR sales in the EEA (around 
[20-30]%)42 and are considered as credible ESBR suppliers by a majority of 
customers that replied to the Commission’s market investigation.43 According to 
information supplied by the Parties, Sibur and HIP, together with a third producer 
JSC Sintez Kauchuk (“Sintez -Kauchuk”) established in the European part of Russia 
(in the Republic of Bashkortostan ), together hold [30-40]%44 of the total ESRB 
production capacity in wider European area  comprising of the EEA, together the 
non-EEA parts of Europe45, the European part of Russia and Turkey (“the European 
region”).  
(37) It is therefore clear that while the main suppliers of this European region  are 
established in the EEA (Synthos, Trinseo and Ve rsalis) and control slightly less than 
[70-80]% of the ESBR production capacity, there are other suppliers with a 
respectable production capacity to whom EEA customers can and do turn to for their 
ESBR supplies. Moreover, the Commission notes46 that there a re other producers, 
outside this European region with some sales in this area.  
(38) The Commission considers that if the appropriate geographic scope for ESBR were 
narrower than worldwide it is not strictly limited to the EEA but would encompass 
the European r egion . Suppliers based close to the EEA have a significant market 
position inside the EEA, showing that shipping from regions nearby the EEA is not 
prohibitively long or expensive. Vice versa , the Parties serve the broader European 
region.  This shows that suppliers outside the EEA but near to it are sufficiently 
geographically close to participate  in, and indeed form part of,  the same market.  
(39) Furthermore, the market investigation did not surface any barriers that would 
motivate sharply delineating the geogr aphic market along the borders of the EEA. 
Import of ESBR into the EEA is not subject to regulatory restrictions such as 
REACH compliance. Furthermore, there are no tariffs on the import of ESBR in the 
EEA.  
(40) Based on the above, the Commission considers that  if the appropriate geographic 
scope for ESBR were narrower than worldwide, it is not strictly limited to the EEA 
but would encompass the European region, as: (i) the main barrier to global sourcing 
is transport cost and time, rather than regulatory or tar iff barriers; and (ii) Russian 
and Serbian players have a significant presence in the EEA and are considered 
credible by customers.  
                                                 
40  See reply of a customer to question 8.1.1, Q1 - Questionnaire to SBR customers.  
41  See reply of a competitor  to question 10.1.1, Q 2 - Questionnaire to SBR c ompetito rs. 
42  See Table 2below.  
43  See replies to question 9, Q1 - Questionnaire to SBR customers  
44  See Table 3 below. 
45  Albania, Andorra, Belarus, Bosnia and Herzegovina, Georgia, Moldova, Monaco, Montenegro, North 
Macedonia, San Marino, Serbia, Switzerland, Ukraine, United Kingdom, Vatican City . 
46  See Table 2 below.  
 
 
9 (41) However, since the Transaction does not give rise to serious doubts as to its 
compatibility with the internal market or the functioning of the EEA agreement  for 
either a worldwide geographic scope or a geographic scope limited to the European 
region, the question of whether the appropriate geographic scope for ESBR is the 
European region or global can be left open.  
(B) SSBR  (including functionalised and non -functionalised SSBR)  
(42) Concerning SSBR (as well as both of non -functionalised SSBR and functionalised 
SSBR), a large majority of customers47 that responded to the Commission’s market 
investigation  indicated that for their ac tivities within the EEA, they source on a 
worldwide basis. 48 In the same vein, a majority of competitors49 that responded to 
the Commission’s market investigation  confirm that they supply SSBR on a 
worldwide basis.  50  
(43) The market investigation did not provid e any indications against the arguments of 
the Notifying Party concerning the absence of barr iers (such as trade tariffs or 
environmental rules) for SSBR to be imported in the EEA from around the world.51 
One customer said that  “[We] procure SSBR globally ( through annual global 
invitations to tender) from all of the main SBR suppliers. The proximity of the 
locations of the suppliers’ plants to [our company]  is not a condition for being 
invited to tender ”52, while a competitor replied that “…Each major manufac turer 
has only a few production facilities worldwide, each supplying customers all around 
the globe. The main customers are all global players active in the tire industry . 
…”.53  As SSBR, and particularly functionalised SSBR, is a less commoditised and 
higher value -added product than ESBR, transport cost is relatively less significant.  
(44) It can therefore be concluded that the geographic scope for SSBR, as well as for its 
sub-segmentations, non -functionalised and functionalised SSBR is most likely 
worldwide. If the scope is considered narrower than worldwide, it is likely to 
encompass the European region, as similarly to ESBR no tariff or regulatory hurdles 
exist. However, as the Transaction does not give rise to serious doubts as to its 
compatibility with the i nternal market or the functionin g of the EEA agreement 
under either a worldwide scope or a scope limited to the European region , the issue 
can be left open.  
                                                 
47  See replies to question 8.2, Q1 - Questionnaire to SBR c ustome rs. 
48  See replies to question 8. 2.1, Q1 - Questionnaire to SBR customers . One customers says that “SSBR 
market is more global comparing  to ESBR market ” and another concludes that “ as explained before SSBR 
(mainly f -SSBR) are specialties and usually they are a result of joined development between supplier and 
final user. Sourcing decision is the result of such activity so not strictly conn ected with geography or cost 
drivers ” 
49  See replies to question 10.2, Q1 - Questionnaire to SBR c ompetitors . 
50  See replies to question 10.2 .1, Q1 - Questionnaire to SBR competitors.  One respondent says that “For the 
reasons described above SSBR is consid ered much less commoditized than ESBR. As a consequence, sales 
are much more guided by technical requirements than ESBR, extending therefore the market to a 
worldwide landscape. This is even more true for functionalized -SSBR.”.  
51  See replies to question 8.2, Q1 - Questionnaire to SBR c ustome rs and to question 10.2, Q1 - Questionnaire 
to SBR c ompetitors . 
52  See reply of a customer to question 8.1.1, Q1 - Questionnaire to SBR customers.  
53  See reply of a competitor to question 10.1.1, Q2 - Questionnaire to SBR competitors.  
 
 
10 4.2.2.4.  Conclusion  
(45) For the purpose of the present decision, the Commission concludes that the 
appropriate geographic scope for the markets for ESBR and SSBR, as well its 
potential segments functionalised and non -functionalised SSBR, is at least the 
European region . 
4.3. Competiti ve assessment  
4.3.1.  Analytical framework  
(46) Article 2 of the Merger Regulation requires the Commission to examine whether 
notified concentrations are compatible with the internal market, by assessing whether 
they would significantly impede effective competition in the internal market or in a 
substantial part of it, in particular as a result of the creation or strengthening of a 
dominant position.  
(47) A merger giving rise to a significant impediment of effective competition may do so 
as a result of the creation or stren gthening of a dominant position in the relevant 
market(s). Moreover, mergers in oligopolistic markets involving the elimination of 
the important competitive constraints that the parties previously exerted on each 
other, together with a reduction of competi tive pressure on the remaining 
competitors, may also result in a significant impediment to effective competition, 
even in the absence of dominance.  
(48) The Commission Guidelines on the assessment of horizontal mergers under the 
Merger Regulation (the “Horizont al Merger Guidelines”)54 describe horizontal non -
coordinated effects as follows: “A merger may significantly impede effective 
competition in a market by removing important competitive constraints on one or 
more sellers who consequently have increased market  power. The most direct effect 
of the merger will be the loss of competition between the merging firms. For 
example, if prior to the merger one of the merging firms had raised its price, it 
would have lost some sales to the other merging firm. The merger r emoves this 
particular constraint. Non -merging firms in the same market can also benefit from 
the reduction of competitive pressure that results from the merger, since the merging 
firms’ price increase may switch some demand to the rival firms, which, in t urn, may 
find it profitable to increase their prices. The reduction in these competitive 
constraints could lead to significant price increases in the relevant market.”55  
(49) The Horizontal Merger Guidelines list a number of factors which may influence 
whether or not significant non -coordinated effects are likely to result from a merger, 
such as the large market shares of the merging firms, the fact that the merging firms 
are close competitors, the limited possibilities for customers to switch suppliers, or 
the fact that the merger would eliminate an important competitive force.56 That list 
of factors applies equally regardless of whether a merger would create or strengthen 
a dominant position, or would otherwise significantly impede effective competition 
due to n on-coordinated effects. Furthermore, not all of these factors need to be 
                                                 
54  OJ C 31, 5.2.2004, p. 5.  
55  Horizontal Merger Guidelines, paragraph 24.  
56  Horizontal Merger Guidelines, paragraphs 27 and following.  


 
 
13 (54) Competitors with sizeable  market shares remain  in the European region  post-
Transaction, such as Versalis (part of Italian petrochemical company Eni) and 
SIBUR of Russia.  
(55) When considering capacity shares, the Parties have a combined market share of [40-
50]% in the European region. The Parties export a large proportion of th eir 
production outside of the European region ( […]%).  
4.3.2.2.  The Notifying Party’s view  
(56) The Notifying Party submits that the Transaction will not result in a significant 
impediment to effective competition for ESBR.64 It submits the following arguments 
to support that position:  
(a) The merged entity’s global market share is low and the increment brought by 
the Target is small. Furthermore, the Parties’ production volumes and market 
shares decreased between 2018 and 2020.65 
(b) A sufficient number of strong competitors will continue to compete with the 
merged entity for ESBR both in the EEA as well as globally. In particular, 
multiple suppliers with production capacity in Europe and Russia are 
available, such as Versalis, SIBUR, HIP Petrochemija, Sintez Kauchuk and 
Omsk Kauchuk.66 
(c) Imports will continue to constrain the merged entity post -Transaction, as 
global suppliers have overcapacity which they can use to fulfil demand in the 
EEA.67 The Notifying Party estimates that [20-30]% of  EEA demand is 
imported in 2020 and that this proportion is growing year -on-year.68 
(d) ESBR is increasingly being replaced by SSBR, leading to a shrinking 
demand for ESBR, particularly in the EEA. This trend is mainly driven by 
the development of low rolling r esistance / high performance tyres that meet 
stricter CO 2 emission  regulations . This trend will likely lead to overcapacity 
and downward pricing pressure.69 
(e) The Parties’ main customers are large tyre manufacturers, which are strong 
and sophisticated compani es with significant countervailing buyer power. 
ESBR is a commodity product and customers can easily switch suppliers. 
Furthermore, some tyre manufacturers are able to produce ESBR in -house. 
[…].70  
(f) ESBR can be substituted with other commodity rubbers in le ss demanding 
applications such as general purpose tyres and non -tyre applications. Such 
                                                 
64  Form CO, paragraph 318 . 
65  Form CO, paragraphs 320 -333. 
66  Form CO, paragraphs 334 -338. 
67  Form CO, paragraphs 339 -346. 
68  Form CO, paragraphs 347 -351. 
69  Form CO, paragraphs 352 -365. 
70  Form CO, paragraphs 366 -384. 
 
 
14 substitution particularly takes place in emerging markets such as China and 
South East Asia.71 
(g) The Parties are not close competitors in ESBR, as the Target has shifted i ts 
focus towards SSBR and therefore its position in ESBR has steadily decline 
over the past years.72 
4.3.2.3.  The Commission’s assessment  
(57) The Transaction leads to the creation of a market leader in the European region, and 
the creation of the second largest player g lobally. However, on global level the 
market for ESBR is fragmented and not affected as a result of the Transaction, as the 
merged entity’s market share remains well under [20-30]%. Therefore, the 
Commission’s assessment will focus on the European region.  
(58) Within the European region, the merged entity will become a market leader in terms 
of market share with a market share of [30-40]% in 2020. However, several 
competitors with production capacity based in the European region remain, such as 
Versalis (Italy),  SIBUR (Russia) and HIP Petrochemija (Serbia). The majority of 
customers responding to the Commission’s market investigation consider these 
competitors as credible suppliers of ESBR for the EEA.73 Furthermore, the large 
majority of customers consider that s ufficient suppliers remain for ESBR post -
Transaction.74 
(59) The merged entity’s capacity share in the European region is higher than its volume 
share, at [40-50]% in 2020. However, the Commission notes that the Parties export a 
large proportion of their product ion outside of the European region ( […]%), 
primarily to […] ([…]% for Synthos and […]% for the Target) and […] ([…]% for 
Synthos and […]% for the Target).75 
(60) The market investigation gave evidence of notable buyer power in the market for 
ESBR. Most of the Parties’ customers are large tyre manufacturers that source large 
volumes. Customers that responded to the Commission’s market investigation 
considered that they are able to negotiate with ESBR suppliers on equal footing, or 
even enjoy a strong negotiation  position.76 Conversely, the large majority of 
suppliers considered that their negotiation position vis -à-vis customers is weak. One 
supplier explains: “ Being E -SBR a commodity family, customers exercise their 
buying power mainly switching among suppliers, even coming from non -EEA 
regions, if price is convenient. ”77 Furthermore, the large majority of customers 
multisource ESBR and are able to flexibly substitute equivalent grades from 
different suppliers in their products (“drop -in substitution”).78 
                                                 
71  Form CO, paragraph 385.  
72  Form CO, paragraph 386.  
73  See replies to question 9, Q1 - Questionnaire to SBR customer s. 
74  See replies to question 24.1, Q1 - Questionnaire to SBR customer s. 
75  Form CO, paragraphs 392 and 394.  
76  See replies to question 14, Q1 - Questionnaire to SBR customer s. 
77  See repl y to qu estion 15, Q2 - Questionnaire to SBR competitors.  
78  See replies to question s 15.1 and 16.1 , Q1 - Questionnaire to SBR customer s. 
 
 
15 (61) Even if th e market for ESBR is considered to be geographically restricted to the 
European region, the market investigation gave evidence of external competitive 
constraints. While imports into the European region are currently limited (in the 
region of [10-20]% of d emand), this may likely be due to the net exporter position of 
the European region and the current container shortage leading to increased shipping 
prices. The majority of customers that responded to the Commissions market 
investigation indicate that in th e case of a s mall but significant and non -transitory 
increase in price , they would consider to source from other regions.79 
(62) The Notifying Party’s internal documents and market investigation also provided 
evidence that there is some degree of overcapacity in  the ESBR market.80 Several 
competitors that responded to the Commissions market investigation indicate that 
this overcapacity has led to price pressure.81 One competitor explains that there are 
several factors contributing to this situation of overcapacity:  “Tyre makers can 
switch part of E -SBR to natural rubber according to the price of NR [natural 
rubber]  vs ESBR. On top of this there is a pretty stable growth of SSBR against 
ESBR because of the technical advantages of SSBR, confirming the overcapacity 
trend. In the non -tyre articles (shoe sector, technical articles, etc…) a lot of business 
has been delocalized outside EEA in low -cost regions, again leading to a reduction 
of the operating rates of ESBR in EEA, even this trend is not mainly driven by the 
substitution between EBSR and non -ESBR ”82 
(63) The large majority of customers that responded to the Commission’s market 
investigation consider that the Parties are close competitors for ESBR.83 However, 
several other competitors are identified as similarly close, i ncluding Versalis and 
Sibur.84 
(64) The large majority of customers that responded to the Commission’s market 
investigation did not expect a negative impact on competition as a result of the 
Transaction for ESBR either globally or in the EEA.85 Responses by compe titors 
were more mixed with several indicating that they expect a negative impact on 
competition for ESBR in the EEA.86 However, several of the concerned competitors 
indicate that the main negative impact expected is a price decrease, with one 
competitor ex plaining that it is “[e]xpecting agressive  [sic] share increase and 
prices decrease. ”87 
(65) Based on the above, the Commission concludes that the Transaction does not raise 
serious doubts as to its compatibility with the internal market in relation to the 
marke t for ESBR  globally or in the European region  due to horizontal non -
coordinated effects.  
                                                 
79  See replies to question 8.1, Q1 - Questionnaire to SBR customer s. 
80  See replies to question 22, Q2 - Questionnaire to SBR competitors and Annex 5.7 to the Form CO, page 6 . 
81  See replies to question 22.1, Q2 - Questionnaire to SBR competitors.  
82  See repl y to question 23.1, Q2 - Questionnaire to SBR competitors.  
83  See replies to question 13.1, Q1 - Questionnaire to SBR custo mers. 
84  See replies to question 12.1, Q1 - Questionnaire to SBR customer s. 
85  See replies to question 23.1, Q1 - Questionnaire to SBR customer s. 
86  See repl y to question 25.1, Q2 - Questionnaire to SBR competitors.  
87  See repl y to question 25.1.1 , Q2 - Questionnaire to SBR competitors.  



 
 
19 140], a level at which the Commission is unlikely to identify horizontal co mpetition 
concerns.95 The Parties’ combined capacity market share in the European region is 
higher, at [50-60]%. However, Synthos exports more than [a very high percentage] % 
of its production outside of the European region.  
4.3.3.2.  The Notifying Party’s view  
(69) The No tifying Party submits that the Transaction will not result in a significant 
impediment to effective competition for SSBR.96 It submits the following arguments 
to support that position:  
(a) The merged entity’s global market share is low and the increment in the EEA 
brought by Synthos is de minimis  as it exports more than [a very high 
percentage] % of its production outside of the EEA.97 
(b) The merged entity will continue to be significantly constrained by strong 
competitors globally and in the EEA, as well as by exten sive captive SSBR 
production by tyre manufacturers.98 
(c) Tyre manufacturers with captive production such as Michelin, Bridgestone 
and Goodyear could sell on the merchant market in response to a hypothetical 
price increase.99 
(d) The Parties are not close competitor s as the Target is mainly active in 
functionalised SSBR, which Synthos does not sell. Moreover, the Targets 
SSBR sales focus on the EEA, whereas Synthos only sells [a low 
percentage] % of its SSBR production in the EEA.100 
4.3.3.3.  The Commission’s assessment  
(70) The Transaction will create a market leader on the merchant market for SSBR 
globally and in the European region. When considering captive supplies as well, the 
Transaction creates a number 2 player globally and in the European region, behind 
Michelin. However, the concentration on global level remains limited, and the 
merged entity will have a market share of [20-30]%. The merged entity will have a 
more significant merchant market share in the Europe an region, at [20-30]%, but the 
increment brought by Synthos is limited, at [0-5]%. 
(71) The merged entity’s capacity share in the European region’s merchant market will be 
more significant, at [50-60]%, with an increment brought by Synthos of [10-20] 
percentag e points. However, as evidenced by its low volume market shares in the 
European region, Synthos exports the […] majority ( […]%) of its production outside 
of the European region. Furthermore, the Target uses the […] majority of its SSBR 
capacity to produce functionalised SSBR ( […]%)101, an area where Synthos is not 
                                                 
95  Horizontal Merger Guidelines, paragraph 20.  
96  Form CO, paragraph 266.  
97  Form CO, paragraphs 269 -273. 
98  Form CO, paragraph 284 -290. 
99  Form CO, paragraph  291-295. 
100  Form CO, paragraph 296 -315. 
101  Form CO, Figure 12.  
 
 
20 active.  Both are indications that the Parties are not particularly close competitors for 
SSBR, as the market investigation confirmed (see paragraph (74) below).  
(72) Several significant suppliers remain in the market for SSBR post -Transaction such 
as Asahi Kasei, JSR, Arlanxeo, Zeon and Versalis. Several of these have production 
capacity in the European region (e.g. Versalis, JSR and Arlanxeo). The majority of 
customers consider these suppliers credible f or meeting their demands in the EEA.102 
Furthermore, the large majority of customers indicate that sufficient SSBR suppliers 
will remain post -Transaction.103 
(73) Even more so than for ESBR, the vast majority of SSBR is used in the production of 
tyres. Therefore, t he evidence of buyer power set out in paragraph (60) holds true for 
SSBR as well. Moreover, customers that responded to the Commission’s market 
investigation often multisource SSBR as well, but to a lesser extent than ESBR. In 
particular for functionalised  SSBR, customers explain that for certain grades few or 
no alternative suppliers are available.104 In line with this, while a majority of 
customers that responded to the Commission’s market investigation indicate that 
they can drop -in substitute non -function alised SSBR, this is not the case for 
functionalised SSBR .105 
(74) The large majority of customers that responded to the Commission’s market 
investigation do not consider the Parties particularly close competitors for SSBR. 
Competitors that responded to the Commi ssion’s market investigation consider that 
the Parties are particularly close for non -functionalised SSBR, but not for 
functionalised SSBR.106 In this respect, the Commission notes that the Target 
focuses on functionalised SSBR, representing [a very high per centage] % of its SSBR 
production volume in 2020, while Synthos is not active in this area.107  
(75) [Details about Synthos’ research and development projects] .108 [Details about 
Synthos’ research and development projects] .109 [Details about Synthos’ research 
and deve lopment projects] .110 [Details about Synthos’ research and development 
projects]  In line with this, the vast majority of customers and competitors that 
responded to the Commission’s market investigation do not consider Synthos a 
particularly innovative playe r with respect to SSBR.111 Furthermore, various 
suppliers of functionalised SSBR grades remain available on the market.  
(76) The large majority of customers that responded to the Commission’s market 
investigation indicated that they expect the Transaction to hav e a neutral, or even 
positive effect on competition for the market for SSBR both globally and in the 
                                                 
102  See replies to question s 10 and 11 , Q1 - Questionnaire to SBR customer s. 
103  See replies to question s 24.2 and 24.3 , Q1 - Questionnaire to SBR customer s. 
104  See replies to question s 15.2 and  15.3, Q1 - Questionnaire to SBR customer s. 
105  See replies to question s 16.2 and 16.3 , Q1 - Questionnaire to SBR customer s. 
106  See replies to question s 13.2 and 13.3 , Q1 - Questionnaire to SBR customer s and Q2 – Questionnaire to 
SRB competitors.  
107  Form CO , Figure 15.  
108  Form CO, paragraph 315.  
109  Form CO, paragraph 307(i).  
110  Form CO, Table 34.  
111  See replies to question 20, Q1 - Questionnaire to SBR customer s and question 21,  Q2 - Questionnaire to 
SBR competitors.  
 
 
21 EEA.112 Additionally, a majority of competitors expect a neutral impact on the 
market for SSBR both globally and in the EEA.113 
(77) Based on the above, the Commiss ion concludes that the Transaction does not raise 
serious doubts as to its compatibility with the internal market in relation to the 
market for SSBR  globally or in the European region  due to horizontal non -
coordinated effects.  
5. CONCLUSION  
(78) Based on the above , the European Commission has decided not to oppose the 
notified operation and to declare it compatible with the internal  market and with the 
EEA Agreement. This decision is adopted in application of Article 6(1)(b) of the 
Merger Regulation and Article 57 of the EEA Agreement .  
For the Commission  
 
 
(Signed)  
Margrethe VESTAGER  
Executive Vice-President  
 
                                                 
112  See replies to question s 23.2 and 23.3 , Q1 - Questionnaire to SBR customer s. 
113  See replies to question s 26.2 and 26.3 , Q2 - Questionnaire to SBR competitors.