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,  18.10.2019  
C(2019 ) 7619 final  
PUBLIC VERSION  
 
To the notifying p arty  
Subject : Case M. 9501  – I Squared Capital  Advisors/PEMA  
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 13 September  2019 , the  European Commission received notification of a 
proposed concentration pursuant to Article 4 of  the Merger Regulation by which  I 
Squared Capital Advisors, LLC (“I Squared” ) (USA ), through its controlled TIP 
Grou p entities (“TIP”)3 (Germany), intends to acquire within the meaning of Article 
3(1)(b) of the Merger Regulation sole control over  the whole of  PEMA Gm bH and 
its subsidiaries (“PEMA”) (Germany), currently owned by Société Générale S.A 
(France) , by way of p urchase of shares (the “Transaction”). I Squared is referred to  
hereinafter as the “Notifying Party”. I Squared and  PEMA collectively are referred 
to as 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 “int ernal 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  Namely TIP Trailer Services Germany GmbH and Global TIP Holdings Two B.V.  
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information omitted has been replaced by 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.  
1. THE PARTIES  
(2) I Squared , headquartered in the US A, is an independent global infrastructure 
investment manager focusing on energy, utilities, telecom and transport in the 
Americas, Europe and Asia. I Squared, through funds it manages, controls a number 
of investments, in the energy, oil and transport secto rs. Of these investments, only 
TIP is active in the same relevant market as PEMA.  
(3) TIP is mainly active in operating leasing of heavy trailers (16 to 44 tons fully 
loaded) in Europe and Canada. TIP owns a fleet of approx. 68  000 heavy trailers. 
TIP also off ers affiliated services such as maintenance and repair (“M&R” ) and 
damage protection.  
(4) PEMA  GmbH, the parent entity of PEMA, is registered in Germany and is an 
indirect wholly -owned subsidiary  of GEFA Bank GmbH (“GEFA”) which, in turn, 
is an indirectly wholly -owned subsidiary of Société Générale S.A. PEMA's main 
activity is operating leasing of heavy trucks and trailers, including integrated 
services. PEMA owns a fleet of approx. 18  000 vehicles. P EMA focuses its activities 
on Germany, where PEMA generates almost […]%  of its EEA -wide revenue.  
2. THE OPERATION  
(5) On 25 July 2019, the Parties concluded a Share Purchase Agreement ("SPA") 
pursuant to which I Squared, through TIP, will acquire 100% of the shar es in PEMA.  
(6) At closing, PEMA will become a wholly -owned subsidiary of TIP and therefore an 
indirectly wholly -owned and solely controlled portfolio company of funds managed 
by I Squared. Following the Transaction, neither GEFA nor Société Générale will 
hold any interest or rights in PEMA.  
(7) In light of the above, and in line with paragraph 91 of the Commission's 
Consolidated Jurisdictional Notice (the “Jurisdictional Notice”),4 the Transaction 
will result in I Squared’s acquisition of sole control over PEMA within the meaning 
of Article 3(1)(b) of the EU Merger Regulation . 
3. EU DIMENSION  
(8) The undertakings concerned have a combined aggregate world -wide turnover of 
more than EUR […] million5 in 2018 (I Squared : EUR […] million, PEMA : EUR  
[…] million ). The EU -wide tu rnover of each of the undertakings concerned is more 
than EUR […] million (I Squared : EUR […] million, PEMA : EUR  […] million ). 
Not each of the Parties  achieves  more than two -thirds of their aggregate EU -wide 
turnover within one and the same Member State .6 The notified operation  therefore  
has an EU dimension pursuant to Article 1(2) of the Merger Regulation.  
                                                 
4  OJ C 95, 16.4.2008, p. 1  
5  Turnover calculat ed in accordance with Article 5 of the Merger Regulation and the Jurisdictional Notice . 
6  Only PEMA achieved  more than two thirds of its EU -wide turnover in Germany.  
4. MARKET DEFINITION  
4.1 Introduction  
(9) In the EEA, t he Parties’ activities overlap with respect to (i) the operating leasing of 
heavy trailers, (ii) the operati ng leasing of heavy trucks,7 (iii) the operating leasing of 
rigids .8 There is also an insignificant overlap in the sale of used trailers and trucks.9 
The only product overlap which results in affected markets (at EEA level and 
national level) concerns oper ating leasing of heavy trailers.  
(10) Since TIP and PEMA are both active in the operating leasing of trucks, which are 
complementary products to trailers (in the sense that a truck is required to tow a 
trailer which itself is not motorized), the Transaction pot entially also gives rise to 
conglomerate effects. The Transaction will not result in any potential vertical or 
conglomerate relationships between I Squared’s portfolio companies, other than TIP, 
and PEMA.  
4.2 Operating leasing of heavy trailers or trucks  
4.2.1 Produ ct market  definition  
4.2.1.1  Distinction between operating leasing and financial leasing  
(11) Operating leasing refers to a type of lease where the risks of ownership are retained 
by the lessor  while the lease duration does not cover any major part of the asset’s 
life. Ownership is not transferred to the lessee at the end of the lease term and the 
lease contract does not contain a bargain purchase option . Similarly, the costs of 
other related se rvices (such as maintenance and repair services), which form an 
integrated part of the operating leasing services, are included in the (mont hly) lease 
payments.10 
(12) By contrast, financial leasing primarily functions as a loan by the lessor to enable the 
lesse e to purchase a given asset. The risks associated with the investment are usually 
borne by the lessee and the legal as well as the commercial ownership is left with the 
financing lessor. After the lease, the lessee usually has the option to acquire 
ownersh ip of the asset for the consideration of the residual value.  
(13) In addition, the Commission has previously considered a market for “short -term 
rental” separate from operating leasing and financial leasing. It has defined the 
market for short -term rental as th e provision of cars for an individually agreed 
duration.  Such cars could be taken over by the user at certain locations ( e.g. airports, 
railway stations).11 The Parties are active in the provision of short -term and long -
term operating leasing, to the exclus ion of rental services.  
                                                 
7  The Parties' activities do n ot overlap  at national level.  
8  The Parties' activities d o not overlap at national level.  
9  The Parties’ combined market share on this market is less than 5% in the EEA and well below 20% in any 
EEA member state (as well as on a separate market for sales of used trailers and a separate market for 
sales of used trucks). Therefore, the Transaction does not give rise to affected markets in this respect and 
is consequently not further assessed in this Decision.  
10  Commission decision of 6 August 2008 in c ase M.5217 – GEFA/PEMA, paragraph 8.  
11  See C ommission decisio n of 23 September 2011 in c ase M.6333 – BMW/ ING Car Lease, paragraph 17; 
Commission decision of 26 July 2017 in case M.8309 –Volvo/Car Corporation/First Rent A Car, 
paragraph 41; Commission decision of 19 August 2009 in case M.5568 – Volkswagen/Fleet 
 
Notifying Party’s views  
(14) While the Notifying Party  agrees  that there are certain structural differences between 
operating and financial leasing , it argue s that the distinction has become increasingly 
blurred  due to recent industry tren ds. According to the Notifying Party , this is due to, 
inter alia , a change in the international accounting standards IFRS 16. IFRS 16 
entered into force on 1 January 2019 and effectively abolished the accounting 
differences betw een financial and operating leases adopting the current financial 
leasing methodologies for all leases.  In addition, the Notifying Party submits  that, in 
particular in times of low interest rates, outright purc hasing solutions through 
instal ments or regula r loans exert a material competitive constraint on the (operating ) 
leasing industry.12  
(15) However, the Parties consider  that the exact market definition can be left open as the 
Transaction does not result in a significant impediment of effective competition even 
if a separate market for operating leasing (of trailers ) is defined.13  
Commission’s assessment  
(16) The Commission ha s considered in previous decisions that operating leasing and 
financial leasing constitute separate product markets.14 Operating leasing and 
financial leasing can be distinguished on the basis of their respective business 
models and offerings to co stumers , particularly in relation to the ownership status of 
the good and the risks associated with the leasing.  
(17) The majority of competitors responding to the Commission’s market investigation 
confirmed that a product distinction by type of leasing, i.e. between o perating leasing 
and financial leasing, is appropriate .15 From a supply side persp ective , the majority 
of competitors indicated that they do not provide both types of leasing services. In 
addition, one competitor explained that “ it may get costly ” for a pro vider of 
operating leasing services to start providing financial leasing services, since “ the 
focus is shifting from ensuring the rental asset to compliance with procedural and 
regulatory requirements ” and, in this context, “ system adjustments for processe s, 
implementation of adjustments in accounting regulations, terms and conditions , 
adjusted sales preposition need to be made .” Furthermore, another competitor 
indicated that “ the difference between the 2 products being the offering of 
operational services,  as well as taking up the operational and residual value risk of 
the assets, it is very difficult for financial leasing providers to add this dimension to 
their portfolio .”16  
(18) The responses from the customers in this regard were mixed.17 While some 
customers  responding to the market investigation  consider ed the services to be 
interchangeable and “ make decisions based upon business benefit ”, others however 
explained that “ customers have a clear preference for either one of the leasing 
                                                                                                                                                      
Inves tments/Leaseplan Corporation JV, paragraph 20; Commission decision of 12 June 2006 in case 
M.4199 – Volkswagen/Offset/Crescent/Lease/Plan/JV, paragraph 14.  
12  Form CO, paragraphs 104 -106. 
13  Form CO, paragraph 108.  
14  See, e.g. Commission decision of 6 August 2008 in c ase M.5217 – GEFA/PEMA, paragraphs 7 et seq.; 
Commission decision of 15 July 1992 in case M.234 – GECC/Avis Lease, para graph s 6 et seq.  
15  Replies to eQ2 – Questionnaire to Competitors, questions 3 and 4.  
16  Replies to eQ2 – Questionnaire to Competitors, question 4.1.  
17  Replies to eQ1 – Questio nnaire to Customers, question 3.  
options ” and multiple customers referred to operating and financial leasing as 
“different ” or even “ very different ” products and services. In this respect, they made 
reference to the differences in the property rights transferred after the lease ( i.e. 
ownership or not), and in aspects of accounting law and risk.18 
(19) In any event, I Squared and PEMA  provide operating leasing  services only . The 
Transaction would not give rise to an affected market if operating and financial 
leasing  services were considered as belonging to the same pr oduct market .19 For the 
purposes of this Decision, the Commission will further assess the competitive effects 
of the Transaction on operating leasing  services only.  
Conclusion  
(20) For the purpose s of this Decision, it is not necessary to decide whether the prov ision 
of operating and financial leasing services  constitute separate markets or not , since 
no serious doubts would arise as to the Transaction's compatibility with the internal 
market under either  product market definition.  
4.2.1.2  Distinction between short -term and long -term (operating) leasing  
Notifying Party’s views  
(21) The Notifying Party submit s that it can  be left open  whether short -term and long -
term leasing constitute separate product markets , because the Transaction would  not 
raise  competition concerns  under any relevant ma rket definition. It considers that, 
while the exact delineation between short -term and long -term leasing contracts may 
be difficult in certain circumstances, e.g. because contracts are consecutively 
renewed with the same customer, the  short -term versus long -term ratio should be 
very similar for all operating leasing providers.20 
Commission’s assessment  
(22) In its prior decisions, the Commission left open the question whether the operating 
leasing segment should be further sub -segmented into  short -term (1 to 365 days) and 
long-term (12 to 48 months) rentals .21  
(23) The results of the Commission’s market investigation indicate that a product market 
for operating leasing comprising both short -term and long -term operating leasing is 
appropriate. The  majority of respondents to the market investigation  (both customers 
and competitors)  indicated that they acquire or provide  both short -term and long -
term leasing services . In addition, the majority of competitors responding to the 
market investigation  indicated that it would be easy for a provider of short -term 
operating leasing services to start providing long -term operating leasing services and 
vice versa.  One competitor explained that “ the main differences in the processes of 
                                                 
18  Replies to eQ1 – Questionnaire to Customers, question  3.1. 
19  Form CO, paragraph 108 and Reply of I Squared to RFI 2 of 9 October 2019 . 
20  Form CO, paragraph 1 18. 
21  Commission decision of 6 August 2008 in c ase M.5217 – GEFA/PEMA , paragraph 9  ; Commission 
decision of 15 July 1992 in c ase M.234 – GECC/Avis Lease , paragraphs 6 et seq. ; Commission decision 
of 3 December 1999 in case M.1739 – Iveco/Fraikin  paragraph 8 ; Commission decision of 18 February 
2000 in case M.1810 – VW/Europcar , paragraph 8 ; Commission decision of 4 September 2001 in case 
M.2540 – Fidis/SEI/JV , paragraph 10 ; Commission decision of 24 November 2005 in case M.3987 – Fidis 
Renting/Leasy s, paragraph s 8 and seq.; Commission decision of 5 December 2006 in case M.4420 – 
Credit Agricole/Fiat Auto/FAFS, paragraph 22.   
these products is the amount  of in and out -check s as well as the pricing . Due to this, 
a change should not be difficult .”22  
(24) On that basis, there seems to be a single market for operating leasing, independent of 
the duration. In any case, the  results of the  Commission market investiga tion did not 
provide any indication  that the outcome of the competitive assessment would differ  
materially if short -term and long -term operating leasing services were considered as 
distinct markets.  
Conclusion  
(25) In light of the above, considering that customers demand  and providers provide both 
short -term and long -term operating leasing services, the Commission concludes that, 
for the purposes of this Decision, the market for the provision of operating leasing 
services includes both short -term and long -term leasing.  
4.2.1.3  Distinction between operating leasing of trailers and operating leasing of trucks  
(26) Both Parties provide operating leasing services for both trailers and trucks. A trailer 
(or "semi -trailer", because of the missing front axle) is a non -motorized vehicle for 
the road transportation of goods. A truck (or "tractor") is a motorized vehicle that is 
required to haul the trailer.   
Notifying Party’s views  
(27) The Notifying Party  considers  that, even if there are dif ferences from a demand -side 
perspective between trailers and trucks, there is  a supply -side substitutability 
between the operating leasing of trucks and trailers. It submits , however, that the 
definition of the relevant  market can be left open in this  respect , as the Transaction 
will not result in any competitive concerns regardless of whether the relevant 
product market is defined as operating leasing for all heavy road transportation 
equipment comprising both trucks and trailers, or operating leasing  of trucks and 
trailers separately.23 
  
                                                 
22  Replies to  eQ1 – Questionnaire to Customers, question 6; Replies to eQ2 – Questionnaire to Competitors, 
questions 9 and 10.  
23  Form CO, paragraph 1 12. 
Commission’s assessment  
(28) In GEFA/PEMA , in the context of both financial leasing and operating leasing, the 
Commission considered a relevant product market for " heavy road transportation 
equipment (trucks and trailers) " or "heavy commercial vehicle[s] "24, i.e., the 
Commission defined a relevant leasing market comprising both trailers and trucks . 
On that basis, the Transaction would not give rise to affected markets.  
(29) However, t he results of the Commission’s market investiga tion indicate that a 
distinction between the operating leasing of trucks and trailers could be 
appropriate.25 In this regard, the majority of customers indicated that they lease 
trucks and trailers separately. In addition, all competitors responding to the market 
investigation  indicated that they provide operating leasing services for trailers only , 
or trucks and trailers separately. One competitor explained that “ the operational 
needs (maintenance, service, tyres, regulator MoT, etc) are much higher on engi ne 
vehicles (trucks) then on trailers, their associated risks, as well as the residual value 
risk are much higher. Hence, this will require a higher frequency of transactions, a 
higher complexity and cost per transaction for trucks than for trailers with t he 
associated suppliers .” Another competitor submitted that “ the technology of a truck 
is much more demanding than a trailer, e.g. emission standards, registration 
regulations, wear & tear etc .”26 
(30) There are therefore indications that the markets for operati ng leasing of trucks and  
operating leasing of  trailers could be considered as separate. While the Transaction 
would not lead to any affected markets  (i) for operating leasing of heavy commercial 
vehicle s (comprising both trucks and trailers)  and (ii)  for o perating leasing of trucks 
only,27 it only leads to affected markets for the operating leasing of trailers only.  
Conclusion  
(31) In any event , for the purpose s of this Decision, it is not necessary to conclude 
whether operating leasing services  for trucks and for trailers  constitute  separate 
product markets , since no serious doubts would arise as to the Transaction's 
compatibility with the internal market under either product market definition.   
4.2.1.4  Distinction between operating leasing of heavy vs. light trucks or  trailers  
Notifying Party’s views  
(32) The Notifying Party  submits that a segmentation of the market for operating leasing 
of trailers on the basis of the weight of the trailers is appropriate. In GEFA/PEMA , 
the Commission defined heavy equipm ent as vehicles ab ove 12 tons.28 However, 
while the 12 ton s limit may be appropriate for trucks, the accepted range in the 
industry to define heavy trailers , according to the Notifying Party , is a load capacity 
between 16 and 44 tons fully loaded.  
Commission’s assessment  
                                                 
24  Commission decision of 6 August 2008 in c ase M.5217 – GEFA/PEMA, paragraphs 16 and 18.  
25  Replies to eQ2 – Questionnaire to Competitors, questions 5 and 6; eQ1 – Questionnaire to Customers, 
question 4.  
26  Replies to eQ2 – Questionnaire to  Competitors, question 6.1.  
27  Form CO, paragraph 112 and reply of I Squared to RFI 2 of 9 October 2019.  
28  Commission decision of 6 August 2008 in c ase M.5217 – GEFA/PEMA, paragraph 18.  
(33) In its prior decisions, the Commission considered a separate market for " heavy ", i.e. 
above 12 tons,  “road transportation equipment ”/ “commercial vehicles ”.29  
(34) The Commission’s market investigation did not provide any objections or remarks 
with respect to the use of the abovementioned industry standard (of 16 tons fully 
loaded) for the definition of heavy vs. light trailers.  
(35) With regard to trailers, a lmost all customers responding to the market investigation 
indicated that heavy trailers cannot be substituted by light trailers.30 In addition, 
while some competitors responded that they provide operating leasing services for 
both heavy and light trailers, , the majority of competitors responding to the market 
investigation indicated that they lease only heavy trai lers. In this regard, o ne 
competitor indicated that “ with increasing size of the trailer, the administrative 
burden and the maintenance and repair costs also increase. In addition, appropriate 
experts are required for the respective segment, ” while another  referred to “ two 
different segments of customers .”31 
4.2.1.4.1  Operating  leasing of heavy trailers  
(36) In light of the above, considering the lack of demand -side substitutability and the 
fact that the Parties (as well as the majority of their competitors having responded to 
the Commission’s market investigation) provide operating leasing services for heavy 
trailers only , and in line with its approach in previous cases, the Commission 
concludes that, for the purposes of this Decision, the market for the pro vision of 
operating leasing services of heavy trailers (above 16 tons)  is distinct from the 
market for the provision of operating leasing services of light trailers  (less than 16 
tons fully loaded) .   
 
(37) Considering that the Parties only provide operating le asing services of heavy trailers, 
the competitive assessment below takes account of the Parties’ activities on the 
narrowest plausible relevant product market on which the Parties’ activities would 
overlap, i.e. on the market for operating leasing services  of heavy trailers.   
4.2.1.4.2  Operating leasing of heavy trucks  
(38) The Commission considers that, for the purposes of this Decision, it can be left open 
whether the market for the provision of operating leasing services of heavy trucks 
(above 12 tons) is distinct from  the market for the provision of operating leasing 
services of light trucks (less than 12 tons)  or not , since the Transaction would not 
raise serious doubts as to its compatibility with the internal market under either 
product market definition .   
 
(39) Conside ring that the Parties only provide operating leasing services of heavy trucks, 
the Commission will further assess the competitive effects of the Transaction on the 
market for operating leasing services of heavy trucks.  The Parties’ activities would 
not giv e rise to a horizontally affected market for operating leasing services of heavy 
trucks;  however the Transaction would give rise to conglomerate effects on this 
market. With regard to the Commission’s conglomerate assessment  below , the 
                                                 
29  Commission decision of 6 August 2008 in c ase M.5217 – GEFA/PEMA, paragraph 16 et seq.  
30  Replies to eQ1 – Questionnaire to Customers, question 5.  
31  Replies to eQ2 – Questionnaire to Competitors, questions 7, 8 and 8.1.  
Parties' market shar es would be diluted on the market for operating leasing services 
comprising both heavy and light trucks.  
4.2.1.5  Distinction of operating leasing services of trailers by trailer type  
(40) Trailers come in many varieties. The most common types of trailers are curtainsid ers 
(flexible sides  or curtains , suitable for almost all transportation) and vans (solid 
sides, suitable for almost all transportation); followed by tankers (carry liquids, 
powder or aggregate products), reefers or temperature controlled trailers, bulkers 
(used in construction and agriculture), flats (open trailers without sidewalls, suitable 
for special transport of wide and long goods), swapbodies (an interchangeable 
freight container that can easily be separated from the carrier) and chassis trailers 
(trailer frames that can carry containers). All trailers available for leasing in the 
industry  throughout Europe are homogenous, standardized vehicles available from 
OEM trailer manufacturers.32  
Notifying Party’s views  
(41) The Notifying Party  submits that no distinction should be made  between the 
different types of trailers  within the market for operating leasing of trailers , since 
from a demand -side perspective, most trailer types are suitable for most 
transportations, while there are only so me goods that require a specific type of 
trailer, e.g. fuel, which can only be transported in a tanker.  In its view, t he 
differences between trailer -types are irrelevant for the operating leasing of trailers .33 
Commission’s assessment  
(42) In its prior decisiona l practice , the Commission did not distinguish between  the 
different types of trailers , such as curtainsider, bulker, temperature controlled or 
tanker , but, as explained above, considered a relevant market comprising all (heavy) 
trailers (or even all " heav y road transportation equipment ").34 
(43) The majority of the customers and competitors responding to the  Commission’s  
market investigation indicated that they lease multiple types of heavy trailers. In 
addition, a relative majority of the customers responding t o the market investigation 
indicated that they lease different types of trailers from the same provider.35 One 
customer explained that “ as the case may be, different types of trailers are leased 
from different providers or from the same provider ”. Another c ustomer noted that 
they “ lease from every of [their] suppliers, different types like Box and 
Curtainsiders .” Customers indicated that they “ compare different providers ” and it 
depends on factors such as price, availability and delivery time.36 
Conclusion  
(44) In light of the above, considering that most customers and suppliers lease multiple 
types of heavy trailers, and in line with its approach in previous cases, the 
                                                 
32  Form CO, paragraphs 113 -114 
33  Form CO, paragraph 113.  
34  Commission decision of 6 August 2008 in case M.5217 – GEFA/PEMA, paragraphs 16 and 18.  
35  Replies to  eQ1 – Questionnaire to Customers, questions 7 and 8; eQ2 – Questionnaire to Competitors, 
question 11.  
36  Replies to eQ1 – Questionnaire to Customers, questions 7.1 and 8.1.  
Commission concludes that, for the purposes of this Decision, the market for 
operating leasing  of heavy trailers includes all the different types of heavy trailers.  
4.2.1.6  Operating leasing services of rigids  
(45) A rigid is a vehicle that is motorized but, unlike a truck or a tractor, does not pull a 
separate trailer unit, but the trailer and the motor unit a re combined.  The 
Commission has not yet addressed the market delineation with respect to rigids.  
Notifying Party’s views  
(46) The Notifying Party  considers  that the precise market definition for operating leasing 
of rigids  can be left  open, as the Parties' market position in the operating leasing of 
rigids is negligible.37  
Commission’s assessment  
(47) Considering that the Transaction would not give rise to an affected market under any 
plausible geographic market defini tion (EEA -wide or nati onal) if operating leasing 
of rigids was considered as a separate market,38 and that the Parties’ market shares 
would be diluted in a market for operating leasing of trailers including rigids,39 for 
the purposes of this Decision, the Commission can leave ope n the exact market 
definition and  will further assess the competitive effects of the Transaction on the 
market for operating leasing of heavy trailers  (excluding rigids) . 
Conclusion  
(48) For the purpose s of this Decision, it is not necessary to conclude  on the exact 
product market definition for operating leasing of rigids, since no serious doubts 
would arise as to the Transaction's compatibility with the internal market under any 
plausible product market definition.  
4.2.2 Geographic market definition  
Notifyin g Party’s views  
(49) The Notifying Party  considers  that the relevant market s for operating leasing of 
heavy trailers  and for operating leasing of heavy trucks could be defined as national, 
although it disagrees  that there are meaningful national preferences as to brands or 
difficulties relating to cross -border transactions. The brands of the trailers are 
typically the same for all trailers and across Europe  and, while it is correct that cross -
border transactions are rare, geographic expansion in this industry is  easy.40 
Commission’s assessment  
(50) According to previous Commission practice, the market for operating leasing is 
national in scope, due to " differentiated consumer practices and national preferences 
as to e.g. brands, existing language barriers and difficult ies concerning cross -
                                                 
37  Form CO, paragraph 176. 
38  There is no overlap between the P arties’ rigid leasing activities at national level. On an EEA -wide basis, 
the Parties’ combined share in the operating leasing of rigids is below 5%. See Form CO, paragraph 179.  
39  Form CO, paragraphs 179 and 180.  
40  Form CO, par agraph 132. 
border transactions ."41 Indeed, in a nu mber of Commission’s precedents concerning 
contract truck hire and rental of motor vehicles markets, the Commission considered 
the relevant market to be national in scope.42 
(51) The results of the Commission’s market investigation in this respect were mixed .43 
Most  customers and competitors responding to the market investigation indicated 
that they lease  heavy trailers  and/or trucks  either  on a national or on an  EEA-wide 
basis. A relative majority  of these customers and competitors indicated that they 
lease heavy trailers  and/or trucks  at national level and that there are national barriers 
that prevent or make it more difficult to lease heavy trailers  and/or trucks  in another 
country. The national bar riers mentioned by the respondents include , among others  
national tax and registration rules, insurance requirements, registration requirements, 
licence plates, laws regarding the ownership of the asset, regulations regarding the 
characteristics of vehicle s, who may drive the vehicle. One competitor mentioned 
that “ the risk varies widely across countries, red tape in general and varying 
technical regulations are the most important problems .”44 
(52) In sum , it appears that,  while a substantial number of in particu lar large fleet 
operators source on an EEA -wide  basis , the majority still does so at a national level . 
Conclusion  
(53) In any case, for the purpose s of this Decision, it can be left open whether the relevant 
geographic market s for operating leasing of heavy trailers and for operating leasing 
of heavy trucks are  national o r EEA -wide , since no serious doubts would arise as to 
the Transaction's compatibility with the internal market  under either definition.  
4.2.3 Conclusion on the marke t definition  
(54) In light  of the above, it is not necessary to conclude on the exact geographic market 
definition  of the market s for operating leasing of heavy t railers  and for operating 
leasing of heavy trucks . For the reasons explained above , the Commission will, for 
the purposes of this Decision , assess the effects of the Transaction on national  
markets as well as on an EEA -wide market  for the provision of  operating leasing  
services  of heavy trailers  and for the provision of operating leasing services of hea vy 
trucks . 
                                                 
41  Commission decision of 6 August 2008 in c ase M.5217 – GEFA/PEMA, paragraph 12.  
42  Commission decision of 3 December 1999 in case M.1739 Iveco Fraikin, para graph  9; Commission 
decision of 18 February 2000 in case  M.1810  –VW/E uropcar , paragraphs 13 and 14 ; Commission 
decision of 4 September 2001 in case  M.2540  – Fidis/SEI/JV , paragraph 13 ; Commission decision of 24 
November 2005 in case M.3987  – Fidis Renting/Leas ys, paragraph 12 ; Commission decision of 5 
December 2006 in case  M.4420  – Credit A gricole /Fiat, paragraph 23 . 
43  Replies to eQ1 – Questionnaire to Customers, questions 15 -17; eQ2 – Questionnaire to Competitors, 
questions 18 -20. 
44  Replies to eQ1 – Questionnaire to Customers, question 16; eQ2 – Questionnaire to Competit ors, question 
19. 
5. COMPETITIVE ASSESSMENT  
5.1 Horizontal effects  
5.1.1 Market shares  
(55) The Transaction gives rise to several horizontal overlaps in the markets for operating 
leasing of heavy trailers  and the sale of used trucks and trailers . However, on the 
basis of the Notifying P arty’s submission, the Transaction will result in only five 
affected markets for operating leasing of heavy trailers : in Czechia, Denmark, 
Germany and Sweden , and at EEA -level . 
(56) As indicated in Table 1 below, the Parties’ combined  market  share for operating 
leasing of heavy trailers  post-Transaction would  be as follows . 
Table 1. The Parties’ market s hares in operating leasing of heavy trailers, 
201845 
Country  TIP’s market 
share  PEMA’s  market  
share  Combined  market 
shares  
Czechia  [5-10]% [20-30]% [30-40]% 
Denmark  [20-30]% [10-20]% [30-40]% 
Germany  [10-20]% [10-20]% [20-30]% 
Sweden  [30-40]% [5-10]% [30-40]% 
EEA  [10-20]% [0-5]% [20-30]% 
 
5.1.2 Notifying Party’s views  
(57) The N otifying Party submits that  the Parties' combined market shares  at EEA -level 
and on the national markets for operating leasing of heavy trailers in Czechia, 
Denmark, Germany and Sweden are not indicative of any market power and that 
they will continue to face significant competitive constraints post -Transaction  due to 
the following reasons.  
(58) First, the combined entity will continue to face competition from a number of 
operating leasing pl ayers, including pan -European vertically integrated players such 
as EURO -Leasing46 and Krone .47  
(59) Second, at national level, in each of Czechia, Denmark, Germany and Sweden, there 
is a number of independent  operating leasing providers . In addition, according to the 
Notifying Party, there are no material barriers to entry or expansion from both the 
                                                 
45  All market share estimates provided in this Decision are based on the size of the fleet ( i.e. the number of 
heavy trailer units) and are based on the Parties’ estimates provided in the Form CO and Annex 6.1 to the 
Form CO. These market  shares are largely confirmed by the information collected by the Commission in 
its market investigation.  
46  Active, among others, in all five affected markets.  
47   Active , among others , in Denmark, Sweden and Germany.  
product and geographic  perspective s as there is perfect supply -side substitutability 
between different types of trailers . An  operating leasing company active in one 
Member State can easily enter or expand in another Member State.  
(60) Moreover, the Notifying Party submits that t he vehicles leased to customers by TIP, 
PEMA and competing providers  are homogenous and standardized products. All 
leasing companies offer more or  less the same trailer brands from leading OEM 
manufacturers, such as Schmitz Cargobull, Krone,48 Kögel  or Schwarzmüller .  
(61) Third, customers  such as l arge retail  chains  and transport and logistics operators, 
including DHL, DB Schenker, Kuehne & Nagel, trans -o-flex, DSV , have significant 
buyer powe r. 
(62) Last, post -Transaction, the Parties will  continue to  face significant competitive 
constraints from financial institutions  that offer financial leasing ( e.g. instalment 
purchases, regular loans) as well as operatin g leasing solutions by teaming up with 
OEM manufacturers and independent services providers. In addition, the Parties’ 
will remain constrained by general leasing companies, various importers, distributors 
and traders.   
5.1.3 The Commission’s assessment  
5.1.3.1  Czechia  
(63) The Commission  has assessed the horizontal overlap  between the Parties’ activities 
in operating leasing of heavy trailers in Czechia and considers that the Transaction 
will not lead to  a significant impediment to effective competition for the following 
reasons.  
(64) First,  while the combined entity will have a market share of [30-40]% in operating 
leasing of heavy trailers post -Transaction, there will remain a number of 
competitors, including pan -European operating leasing providers such as Fraikin 
([20-30]% ma rket share)49 and EURO -Leasing ( [5-10]% market share)50 that will 
continue to constrain  the merged entity's ability to profitably raise prices or lower the 
quality of its services in Czechia. Local or smaller players such as EWT ( [5-10]%  
market share),51 Schw arzmüller  ([0-5]% market share), and ABTIR/TIR Centrum ([0 -
5]% market share) will also remain active on the Czech market.52 This is also supported  
by the Commission’s market investigation, given that none of the responding 
competitors believed that the Transaction could have a negative impact in term of 
higher prices or lower quality of services in Czechia.53 
(65) Second, a s demonstrated by the Commission ’s market investigation,  several 
customers in Czechia do not view TIP and PEMA as closest competitors due to the 
                                                 
48  Fahrzeugwerk Bernard Krone Gmb H & Co. KG ("Krone") . 
49  Following the Commission’s market investigation, it appears that this market share is slightly overstated. 
Nevertheless, in the Commission’s view, Fraikin is an important competitor to the Parties.  
50  Annex 6.1 to the Form CO.  
51  EWT is the general agent of Schmitz Cargobull in Czechia.   
52  Annex 6.1 to the Form CO.  
53  Replies to eQ2 – Questionnaire to Competitors, question 27.  
“differences in quality of services and price ”54 and note that “ there are no huge 
obstacles to switch to another provider ”.55  
(66) Third, the majorit y of customers responding to the Commission’s market 
investigation noted that they do not expect significant changes following the 
Transaction.56 Given this, on balance, the Commission is of the view that the 
majority of customers do not see any issues with  the Transaction.  
(67) Last, based on the Notifying Party’s submission, it appears that the total size of the  
operating leasing market  in Czechia is just under 2  500 units of heavy trailers as 
opposed to markets such as Denmark and Belgium with total market si zes of 
approximately 16  000 units and 14  000 units of heavy trailers respectively.57 This 
shows that operating leasing does not seem to present an important me an of 
contracting for heavy trailers , as opposed to buying directly, including by means of a 
financial lease . Indeed,  the Parties’ competitors in Czechia indicate that the market s 
in the “ CEE countries are less developed, and have less concentration ”.58 The same 
competitor considers that there is “ lower penetration ” of the operating leasing 
model,59 whereas another competitor notes that customers are “ smaller fleet 
operators [that] have a preference for owning the trailers ”.60 This, in the 
Commission’s view,  suggests that overall operating leasing is not a preferred means 
for customers seeking to cont ract for heavy trailer s in Czechia.  
(68) In view of the above, the Commission  therefore considers that it is unlikely  that the 
Transaction would give rise to serious doubts as to its compatibility with the internal 
market  in operating leasing of heavy trailer s in Czechia . 
5.1.3.2  Denmark  
(69) The Commission  considers that the Transaction w ill not lead to a significant 
impediment to effective competition  in Denmark for the following reasons .  
(70) First, the Danish market for operating leasing of heavy trailer s is considered  
competitive with a number of large fleet providers active  on this market . Indeed, TIP 
and PEMA are currently number two and th ree operating leasing of heavy trailers 
providers in Denmark with a market share of [20-30]% and [10-20]% respectively .61 
Krone is  currently  the market leader with a market share of [20-30]%, whereas other 
players on the Danish market include  multinational providers such as  Schmitz 
Cargobull ( [5-10]% market share) and EURO -Leasing ( [5-10]% market share), as 
well as Nordic players suc h as PNO ( [5-10]% market share)62 and HFR ( [5-10]% 
market share).63 
                                                 
54  Customer’s reply to eQ1 – Questionnaire to Customers, question 18.1.  
55  Customer’s reply to eQ1 – Questionnaire to Customers, question 19.1.  
56  Replies to eQ1 – Questionnaire to Customers, questions 20 and 21.  
57  Annex 6.1 to the Form CO.  
58  Competitor’s reply to eQ2 – Questionnaire to Competitors, question 22.1.  
59  Competitor’s reply to eQ2 – Questionnai re to Competitors, question 22.1.  
60  Non-confidential version of the minutes of the call with a Competitor , dated 4 October 2019, paragraph 
14.  
61  Annex 6.1 to the Form CO.  
62  PNO is headquartered in Denmark and operates through the EEA. It describes itse lf as “ the Nordic 
region’s leader in trailer rental ”. See PNO’s website at https://sharing.pnorental.com/about . 
63  Annex 6.1 to the Form CO.  
(71) In the Commission’s view, while the merged entity will become the largest player on 
the market for  operating leasing of heavy trailers in Denmark  with a  combined  
market share of [30-40]% post-Transaction , it will continue to face competition from 
the remaining players , in particular from the second largest provider Krone for which 
Denmark is the largest market.64 
(72) Second, the Commission’ s market investigation showed that Danish customers wi ll 
continue to have sufficient choice following the Transaction . As noted by several 
customers,  “there will […] be alternatives to TIP and PEMA ”.65 Indeed, a large 
number  of customers  responding to the Commission’s market investigation  
expressed their view that the Transaction will have no impact  in Denmark .66 Similar 
view was also  shared by the majority of the Parties’ competitors in Denmark  who 
provided responses to the Commission’s market investigation .67 Some customers 
also noted that they expect the Transaction to  have a positive impact in terms of 
“better service s”68 and “ better quality ”.69  
(73) Only one competitor expressed its view that the Transaction might negatively impact 
competition  in Denmark .70 However, the Commission  notes that this competitor is 
not active in Denmark and  that during the call with the case team in the context of 
the Commi ssion’s market investigation, this competitor did not further explain why 
the Transaction could have a negative impact in Denmark.71 The Commission also 
notes that none of the current players in Denmark expressed similar concerns . On 
balance , the Commission is of the view that the strong presence of competing 
operating leasing providers in Denmark will be sufficient to constrain the merged 
entity’s ability to negativ ely affect  market prices and conditions . 
(74) Moreover, a large number of customers responding to the Commission’s market 
investigation indicated that it is possible to contract for operating leasing services 
across borders.72 For example, as noted by one of the customers, typically if an 
operating leasing provider “ is able to obtain local registration and insurance (and 
has regional presence), it should not raise major issues [for an operating leasing 
provider in one country t o contract with customers in another country] .”73 A 
competitor explained that there is “ strong overall competition in the market between 
many regional players (ICTS, Krone Fleet, ATL )”.74 This shows that operating 
leasing providers of heavy trailers active i n neighbouring Member States are also 
capable to exert some competitive pressure.  
                                                 
64  Non-confidential version of the minutes of the call with a Competitor , dated 4 October 2019, paragraph 3.  
65  Replies to eQ1 – Questionnaire to Customers, question 19.1.  
66  Replies to eQ1 – Questionnaire to Customers, question 21.  
67  Replies to eQ2 – Questionnaire to Competitors, question 27, and Non -confidential version of the minutes 
of the call with a Competitor , dated 4 October 2019, paragraph 3.  
68  Replies to eQ1 – Questionnaire to Customers, question 21.1.  
69  Replies to eQ1 – Questionnaire to Customers, question 21.1.  
70  Replies to eQ2 – Questionnaire to Competitors, questions 22.1, 27 and 27.1; Non -confidential version of 
the minutes of the call with a Competitor , dated 3 October 2019.  
71  Non-confidential version of the minutes  of the call with a Competitor , dated 3 October 2019. See also 
Competitor’s reply to eQ2 – Questionnaire to Competitors, question 22.1 where this competitor stated that 
“Denmark & Sweden are countries where we are not present, hence it is difficult to elab orate ”.  
72  Replies to eQ2 – Questionnaire to Competitors, question 20; Replies to eQ1 – Questionnaire to 
Customers, question 17.  
73  Customer’s reply to eQ1 – Questionnaire to Customers, question 16.1.  
74  Competitor’s reply to eQ2 – Question naire to Competitors, question 23 .1. 
(75) Last, the responses to the Commission’s market investigation indicate that  while 
various countries exhibit different regulatory requirements in terms of registration 
and ins urance,75 the national market s for operating leasing of heavy trailers , on 
balance, do not exhibit particularly high b arriers to entry and expansion  across 
various Member States .  
(76) In view of the above, the Commission  therefore considers that it is unlikely  that the 
Transaction would give rise to serious doubts as to its compatibility with the internal 
market  in operating leasing of heavy trailers in Denmark . 
5.1.3.3  Germany  
(77) The Commission  considers that the Transaction w ill not lead to a significant 
impediment to e ffective competition in Germany  for the following  reasons .  
(78) First, the German market for operating leasing of heavy trailers  has one of the largest 
number of operating leasing providers in Europe. Indeed, a number of vertically 
integrated pan -European players such as Krone, Schmitz Cargobull and EURO -
Leasing are active on th is market in Germany and offer their large heavy trailer 
fleets to the German  customers. Other experienced competito rs include Seaco  ([10-
20]% market share) , Axis Intermodal  ([5-10]% market share), Aves  ([5-10]% market 
share), and Confern ( [5-10]% market share) . Moreover, a s noted by a competitor of 
the Parties , the German market also feature s strong local operating lea sing providers , 
including Mezger (Stuttgart  area), which have a very close relationship with their 
customers.76 
(79) Second, f ollowing the Transaction, the Parties’ combined market share in Germany 
will result to [20-30]%, i.e. just slightly above the threshold for an affected market. 
Krone (with a  market  share of [10-20]%) and Seaco (with a market share of [10-
20]%) will be the second and third largest competitors respectively.77 Given the 
moderate combined market share of the Parties, the Commission is of the view that 
the large number of the remaining players , including the strong vertically integrated 
competitor Krone,  will be able to exert significant competitive pressure on the 
merged entity post -Transaction.  
(80) Third, the  Parties’ competitors responding  to the Commission’s market investigation 
generally support the Commission’s findings .78 Only one competitor expressed its 
view that the Transaction might have a negative impact on the German market in 
terms of higher prices and lower quality, whereas the majorit y of responding German 
competitors believe that the Transaction will have no impact.79 For example , as 
noted by one competitor, the Transaction “ is not problematic, since [ post-
                                                 
75  Replies to eQ2 – Question naire to Competitors, question 23 . In addition, such requirements are not 
specific to heavy trailers and apply to vehicles in general throughout Member States.  
76  Non-confidential version of the minut es of the call with a Competitor, dated 4 October 2019 , paragraph 
12. 
77  Annex 6.1 to the Form CO.  
78  Replies to eQ2 – Questionnaire to Competitors, question 27.  
79  Replies to eQ2 – Questionnaire to Competitors, question 27. The same competitor expressed i ts view that 
the combined market share of the Parties post -Transaction will be above 50% in Germany leading to a 
“dominant pos ition, especially on the trailer segment ”, however, based on the information collected 
during the Commission’s investigation, it appears that such estimation is not substantiated. See 
Competitor’s reply to eQ2 – Questionnaire to Competitors, questions 22.1, 26, 26.1, 27, and 27.1; Non -
confidenti al version of the minutes of the call with a Competitor, dated 4 October 2019 and Non -
confidential version of the m inutes of the call with a Competitor, dated 3 October 2019.  
Transaction] the merged entity will still have to compete with manufacturers 
(OEMs)”.80 Another competitor explained that “ most of the truck and trailer 
producers have their own leasing offers, and the independent providers are well 
served by large international and smaller regional provider s.”81 
(81) On the demand  side, the Commission’s market investigation showed that a majority  
of customers view ed the Transaction as having a positive or no impact .82 One 
customer  noted that in its view, the Transaction could be “ a benefit for maintenance 
network in Germany ”83; whereas another customer noted that “ we are not concerned  
here […] . In terms  of pricing , our purchasing department will make sure that prices 
will not change to our disadvantage ”.84 
(82) Last, as mentioned in section 5.1.3.2  above, operating leasing providers in other 
Member States also exert some competitive pressure ,85 and the national markets for 
operating leasing of heavy trailers, on balance, do not exhibit particularly high 
barriers to entry and expa nsion  across various Member States.   
(83) In view of the above, the Commission  therefore considers that it is unlikely  that the 
Transaction would give rise to serious doubts as to its compatibility with the internal 
market  in operating leasing of heavy trailer s in Germany . 
5.1.3.4  Sweden  
(84) The Commission  considers that the Transaction w ill not lead to a significant 
impediment to effective competition in Sweden for the following reasons .  
(85) First, even though the merged entity will have a combined  market  share of [30-40]% 
following the Transaction , a number of competitors will continue to exert significant 
competitive pressure on the merged entity, including PNO , who, with a  market  share 
of [30-40]% is roughly the same size as the merged entity.86 Other competitors in 
Swede n include Schmitz Cargobull ( [5-10]% market share), EURO -Leasing ( [5-
10]% market share), AG Trailer ( [5-10]% market share), and Krone ( [0-5]% market 
share).87 
(86) Second , based on the Notifying Party’s submission, it appears  that the Parties are not 
each other’ s closest competitors in Sweden, as [TIP and PEMA target different  
customer groups] .88 The responses to the Commission’s market investigation in this 
respect were mixed  and therefore inconclusive .89 
                                                 
80  Non-confidential version of the minutes of the call with a Competitor, dated 4  October 2019, paragraph 
17. 
81  Competitor’s reply to eQ2 – Questionnaire to Competitors, question 23.1.  
82  Replies to eQ1 – Questionnaire to Customers, question 21.  
83  A Customer’s reply to eQ2 – Questionnaire to Customers, question 21.1.  
84  Convenience t ranslation from German. See  Customer’s reply to eQ1 – Questionnaire to Customers, 
question 21.1.  
85  Customer’s reply to eQ1 – Questionnaire to Customers, question 16.1.  
86  As mentioned above, PNO is headquartered in Denmark and operates through the EEA; it  describes itself 
as “the Nordic region’s leader in trailer rental ”. See PNO website at https://sharing.pnorental.com/about .  
87  Annex 6.1 to the Form CO.  
88  As explained by the Notifying Party, as an exc eption in Europe, the market is not fully standardized. 
Therefore, trailers leased to domestic customers are typically local domestic equipment whereas trailers 
leased by European customers are typically European standard equipment. See Form, CO, paragraph  147. 
89  Replies to eQ2 – Questionnaire to Competitors, questions 21 -22. 
(87) Third , none of the Parties’ competitors responding to the C ommission’s market 
investigation expressed their view  that the Transaction could have a negative impact 
in term of higher prices or lower quality of services in Sweden.90 Similarly, on the 
demand side, the majority of customers , which had knowledge on the S wedish 
market, indicated that the Transaction will have no impact on the  market for 
operating leasing of heavy trailers  in Sweden.91 
(88) Last, as mentioned in section 5.1.3.2  above, operating leasing providers in other 
Member States also exert some competitive pressure,92 and the national markets for 
operating leasing of heavy trailers, on balance, do not exhibit pa rticularly high 
barriers to entry and expansion  across various Member States.   
(89) In view of the above, the Commission  therefore considers that it is unlikely  that the 
Transaction would give rise to serious doubts as to its compatibility with the internal 
market in operating leasing of heavy trailers in Sweden . 
5.1.3.5  EEA  
(90) If the market for operating leasing of heavy trailers was considered  to be EEA -wide , 
the Transaction would give rise to an affected market . At EEA -level, the Parties’ 
combined market share in opera ting leasing of heavy trailers is approximately [20-
30]%, just slightly above the threshold of an affected market .93 
(91) The merged entity will continue to face significant competitive constraints post -
Transaction from a number of large competitors, including t he leasing businesses of 
OEM trailer manufacturers, such as Krone  ([5-10]% market share) and Schmitz 
Cargobull ( [0-5]% market share), and from general leasing companies , including 
PNO, Ryder, and F raikin . The merged entity will also continue to face intense 
competition from regional and local players, as well as importers, distributors and 
traders of trailers.94 In addition, the merged entity will also face competition from 
international (non -European) players, such as CIMC, a Chinese company which has  
acquired the UK market leader SDC and is planning to open a plant in Poland.95 
(92) This was confirmed by the market investigation, where a majority of the customers 
and competitors responding to the market investigation indicated that the 
Transaction would hav e either no impact or even a positive impact on the overall 
market for operating leasing of heavy trailers in the EEA.96 Indeed, as indicated by 
one of the competitors active in several Member States, there is “ strong overall 
competition in the market betwe en many regional players (ICTS, Krone Fleet, 
ATL)”.97 
                                                 
90  Replies to eQ2 – Questionnaire to Competitors, question 27.  
91  Replies to eQ1 – Questionnaire to Customers, question 21.  
92  Customer’s reply to eQ1 – Questionnaire to Customers, question 16.1.  
93  Annex 6.1 to the Form CO.  
94  Form CO, paragraphs 7 -10; Non-confidential version of the m inutes of the call with a Competitor, dated 4 
October 2019.  
95  Annex 6.2.1 to the Form CO, page 39.  
96  Replies to eQ1 – Questionnaire to Customers, question 21; and to eQ2 – Questionnaire to Competitors, 
question 27.  
97  Competitor’s reply to eQ2 – Question naire to Competitors, question 23 .1. 
(93) In view of the above, the Commission  therefore considers that it is unlikely  that the 
Transaction would give rise to serious doubts as to its compatibility with the internal 
market  in operating leasing o f heavy trailers at EEA -level . 
5.2 Conglomerate effects  
(94) The Transaction will give rise to conglomerate effects in four national markets, 
namely Czechia, Denmark, Sweden, and the Netherlands.  
(95) TIP and PEMA are active in the operating leasing of heavy trailers and trucks. 
Trailers and trucks are complementary products in the sense that a truck is required 
to tow a trailer, which itself is not motorized.  
5.2.1 Market shares  
(96) With respect to the conglomerate relationship between the Parties’ activities , the 
Transaction would give rise to affected national market s, if the operating leasing of 
heavy trailers and trucks are  defined as separate relevant product market s. As shown 
in Table 2 below, the Parties' combined market share in operating leasing of heavy 
trailers exceeds [30-40]% in Czechia (combined  market  share of [30-40]%), 
Denmark (combined market share of [30-40]%), S weden (combined market share of 
[30-40]%). In the Netherlands  TIP’s market share alone is [40-50]%,98 however 
PEMA does not lease heavy trailers to customers that are located in the 
Netherlands .99  
(97) TIP’s presence in the operating leasing of heavy  trucks is m arginal with only […] 
trucks units across the EEA.100 Moreover, TIP is not active in the operating leasing 
of heavy trucks in Denmark, Sweden , Czechia  and the Netherlands, and estimates 
that its and PEMA’ s combined market share is below [5-10]% at EEA level.101 
PEMA estimates  that its market share in the operating leasing of heavy trucks in 
Sweden is approximately [0-5]-[5-10]%, in each Denmark and Czechia below [5-
10]%, and in the Netherlands below [0-5]%.102 
Table 2. The Parties’ market shares in c onglomerate affected markets103  
Country104 Operating leasing 
of heavy trailers  Operating leasing of  heavy  trucks  
                                                 
98  Form CO, paragraph 172.  
99  As explained by the Notifying Party, PEMA does not lease trailers to customers that  are located in the 
Netherlands. Nevertheless, in exception, a non -Dutch customer may ask PEMA to register a trailer, which 
is required to be registered in one country, in the Netherlands (from PEMA's offices in Belgium or 
Germany), however, such registrat ions are not considered as relevant market activity in the Netherlands. 
See Form CO, footnote 34.  
100  Form CO, paragraph 172.  
101  Form CO, paragraph 172, Reply of I Squared to RFI of 10 October 2019, paragraphs 3 -5. 
102  Form CO, paragraph 172, Reply of I Squa red to RFI of 10 October 2019, paragraphs 3 -5. 
103  Form CO, paragraph 172, Reply of I Squared to RFI of 10 October 2019, paragraphs 3 -5. 
104 At EEA -wide level, the conglomerate relationship between the Parties’ activities will not give rise to an 
affected mar ket, since the Parties have a combined market share of [20-30]% on the market for operating 
leasing of heavy trailers and a combined market share below [5-10]% for the operating leasing of heavy 
trucks.  
Merged entity  PEMA  TIP 
Czechia  [30-40]% <[5-10]% [0-5]% 
Denmark  [30-40]% <[5-10]% [0-5]% 
Sweden  [30-40]% [0-5]-[5-10]% [0-5]% 
The Netherland s  [40-50]% (only 
TIP’s market share)   <[0-5]% [0-5]% 
 
5.2.2 Notifying Party’s views  
(98) The Parties submit that the Transaction will not result in any competitive 
(conglomerate) concerns in relation to the potential commercial building of a 
combined trailer and truck offering, as the merged entity will not have the ability and 
incentive to foreclose competit ors post-Transaction.   
5.2.3 Commission’s assessment  
(99) The Commission considers that the Parties will not have the ability to foreclose 
rivals by engaging  in bundling strategies.   
(100)  First, PEMA is already active in the operating leasing of both heavy trucks and 
heavy trailers  and could have already engaged  in such practices.  
(101)  Second, as explained in the s ection on horizontal assessment, t he merged entity will 
not have a significant degree of market power in the operating leasing of heavy 
trailers . As such, it will not to be able to foreclose competit ors in the operating 
leasing of heavy trucks. Moreover, as indicated in  Table 2, PEMA’s market shares in 
operating leasing of heavy trucks are very low. The merged entity will thus lack the 
sufficient degree of market power to leverage its market position in operating lea sing 
of heavy trucks to be able to foreclose competitors in the operating leasing of heavy 
trailers .  
(102)  Third, customers can and do mix and match heavy trucks and trailers from different 
leasing provider s (“multi -sourcing ”). Indeed, the majority of customers  responding 
to the Commission’s market investigation confirmed that they lease their heavy 
trailers from different operating leasing providers.105 One customer indicated that 
they “ utilise a limited pool of industry recognised suppliers to fulfil [their] tra iler 
requirements and always after undertaking a review of the respective quotations ”; 
another indicated that this constitutes a “ decision based upon operational and 
financial considerations ” and a third one noted that “ it is a strategic purchasing 
decisio n […] to have different suppliers ”.106 
(103)  Fourth, p ost-Transaction,  there will remain a large number of operating leasing 
providers in the relevant national  market s that are able to offer both truck and trailer 
operating leasing contracts.  
                                                 
105  Replie s to eQ1 – Questionnaire to Cus tomers, quest ion 9.  
106  Replies to eQ1 – Questionnaire to Customers, questions 9.1 and 8.1.  
(104)  In view of the above,  and considering all the evidence available to the Commission, 
the Commission concludes that the Transaction does not raise serious doubts as to its 
compatibility with the internal market due to conglomerate effects.  
5.3 Conclusion on the competitive assessment   
(105)  In light of the outcome of the market investigation and the evidence submitted by the 
Notifying P arty, the Commission concludes that the Transaction does not raise 
serious doubts about its compatibility with the internal market or the functioni ng of 
the EEA Agreement as regards it s impact on competition for operating leasing of 
heavy trailers in Czechia, Denmark, Germany , Sweden , the Netherlands  or at EEA -
level , including with respect to conglomerate effects.  
  
 
6. CONCLUSION  
(106)  For the above reasons , 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 t he EEA Agreement .  
For the Commission  
 
 
(Signed)  
Margrethe VESTAGER  
Member of the Commission