28. 4. 90 Official Journal of the European Communities No C 106/3 
Notice pursuant to Article 19 (3) of Regulation No 17 concerning two requests for negative 
clearance or exemption under Article 85 (3) of the EEC Treaty 
Case No IV/33.094 — Shotton/Maybank 
Case No IV/33.071 — Shotton/Davidsons 
(90/C 106/03) 
Shotton Paper Company pic has concluded separate 
contracts with two wastepaper collectors and merchants 
for the supply of wastepaper to Shotton for use as 
feedstock in the production of newsprint at its integrated 
pulp and paper mill in Wales. Exports of mixed news and pams (the category of 
wastepaper and board in the trade statistics which most 
closely matches Group 5) from the United Kingdom to 
other Member States have recently been of the following 
order, though quantities and destinations vary 
considerably over time: 
Shotton Paper Company pic ('Shotton'), incorporated in 
England and Wales, is a wholly-owned subsidiary of 
United Paper Mills Ltd (incorporated in Finland). The 
suppliers under the contracts are J. & J. Maybank 
Limited ('Maybank') and Davidsons Limited 
('Davidsons'). Maybank is a wholly-owned subsidiary of 
Reedpack Limited and Davidsons is a subsidiary of BPB 
Industries pic, all these companies being incorporated in 
England and Wales. Destination 
France 
Italy 
FRG 
Portugal 
Netherlands 
EEC January-September 1989 
(1 000 tonnes per year) 
34,0 
9,5 
4,2 
4,2 
1,3 
54,2 
Shotton has until recently been producing about 180 000 
tonnes of newsprint per annum, raw materials being 
supplied entirely from an integrated woodpulp plant 
using wood. A wastepaper conversion plant at Shotton 
started up in the first half of 1989 and a second 
newsprint mill began production in the autumn of 1989. 
This mill, when fully operational, will increase capacity 
to some 450 000 tonnes. In future, Shotton intends to 
use recycled paper as a part of the raw material input for 
its newsprint production. 
There are numerous types of wastepaper. The supply 
agreements concern specified categories in the 
Confederation europeenne de l'industrie des pates, 
papiers et cartons (Cepac) classification, with some 
adjustments, which broadly coincide with 'Group 5' 
under the British Paper and Board Industry Federation 
classification. This is the category suitable for newsprint 
production, consisting mainly of printed wood 
containing paper suitable for de-inking. 
De-inking capacity and Group 5 wastepaper collection in 
the United Kingdom are expected to show rapid growth, 
increasing from some 300 000 tonnes in 1989 to at least 
800 000 tonnes in about 1992. These figures should 
closely match expected increases in the use of Group 5 
wastepaper in the United Kingdom. The annual exports from the United Kingdom to all 
destinations are about 80 500 tonnes. 
Exports have tended to be regarded as a buffer for 
collectors, who can thus maintain additional capacity to 
meet increases in domestic demand as they arise. Imports 
are negligible. 
The rate of recovery of wastepaper (wastepaper 
collection/paper consumption) in the United Kingdom is 
comparatively low (29 %, compared with France — 
37 °/o, Spain 41 %, Federal Republic of Germany — 
42 %, Netherlands — 53 %). A study by 
Kiinnhold & Partners (') put the theoretical potential 
collection of Group 5 wastepaper (Groups S3 and S4 in 
their classification) in Britain at some 1,4 million tonnes 
in 1984. A portion of this could not be regarded as 
readly realizable in practice. 
Group 5 wastepaper comes from the paper distribution 
and conversion sector (this is now fully collected), offices 
and administrations, and private and institutional 
households. The greatest scope for increased recovery in 
the United Kingdom is in the latter category and, to a 
lesser degree, from offices and administrations. 
(') Das Altpapierpotential in den Landern der europaischen 
Gemeinschaften, Kiihnhold & Partners, Bad Homburg 1984, 
Part l,p. 35. 
No C 106/4 Official Journal of the European Communities 28. 4. 90 
Shotton's consumption of Group 5 wastepaper in 1993 is 
expected to be well below 10 % of the EEC total. 
The agreements 
Under the agreements the wastepaper suppliers 
(Davidsons and Maybank) must each deliver up to 
certain quantities in accordance with calls from Shotton. 
Shotton is bound to call at least 85 % of those quan­
tities. The agreements cover the years 1989 to 1993. 
Deliveries will be increased progressively in 1989 and 
1990 to achieve the full amounts in 1992 and 1993. 
Each contract provides that the price at which 
wastepaper shall be supplied shall be established by a 
procedure to verify prices in the market. 
The maximum quantities which Shotton may call from 
the two merchants amount to substantially the whole of 
its expected requirements over the period. Shotton is 
bound to take up 85 % of those quantities. If Shotton 
were to require more wastepaper than expected, it may 
request additional supplies from either or both parties 
but has no obligation to do so and may buy from any 
source. 
At present Maybank is the largest collector of Group 5 
wastepaper in the United Kingdom, three other main 
collectors including Davidsons having shares of the order 
of 15 to 20 %. There are numerous other collectors in 
the sector, which is not characterized by any substantial 
barriers to entry. The quantities which Maybank and 
Davidson must each supply in 1992 and 1993 under the 
agreements will not in either case exceed about 10 % of expected United Kingdom demand for Group 5 
wastepaper. 
Collectors tend to deal in a broad range of wastepaper. 
The knowledge, facilities and equipment required are 
similar and often collection points yield more than one 
type of wastepaper. The suppliers are among the five 
largest collectors on the market, so defined, having 
shares of the order of 10 to 20 %. 
Initial outline agreements were discussed with the Direct­
orate General for Competition and amended by the 
removal of provisions for joint supply of Shotton's whole 
requirements, access by Shotton to actual prices paid by 
the supplier's other customers (in the context of the price 
calculation clause) and a right of first refusal for the 
supply of any additional quantities which Shotton might 
require. 
Shotton has argued that the agreements are necessary to 
ensure secure, uninterrupted supplies of wastepaper 
which are necessary from a technical and economic 
viewpoint. 
The Commission intends to adopt favourable decisions 
with respect to the agreements. Before doing so, it invites 
interested parties to submit their observations within one 
month from the date of this notice, quoting the reference 
TV/33.094/33.071' to: 
Commission of the European Communities, 
Directorate General for Competition, IV/C-1, 
200 Rue de la Loi, 
B-1049 Brussels. 
Commission communication under Article 115 of the EEC Treaty 
(90/C 106/04) 
By Decision C(90) 764 dated 24 April 1990 the Commission has authorized the Kingdom of 
Spain not to apply Community treatment to certain tools and handtools, CN code 8203, 8204, 
8205, 8206 00 00 originating in Taiwan and the People's Republic of China and in free circu­
lation in the other Member States. 
The said Decision is applicable after the date of the present decision until 31 October 1990. 
The text of this Decision may be obtained from the Commission, Brussels: tel. (02) 235 23 64; 
telefax (02)235 01 21.