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 -MERGE R-REGISTRY@ec.europa.eu . 
 EUROPEAN COMMISSION  
 
 
 
 
 
Brussels,  11.12.2018  
C(2018 ) 8796  
  
 
 
 
To the notifying p arties : 
 
 
 
Subject : Case M. 8950 – BASF DOM  Business /Solenis/JV  
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 6 November 2018 , the Commission received notification of a  concentration 
pursuant to Article 4 of Regulation (EC) No 139/2004 (‘ the Merger Regulation ’) 
which would result from a proposed transaction  by which BASF SE (“BASF”, 
Germany) and Clayton, Dubilier & Rice (“CD&R”, United States) intend to  
acquire joint control , within  the meaning of Article 3(1)(b) and 3(4) of the 
Merger , over a newly formed J oint Venture  that would combine Solenis, a 
CD&R portfolio company, with the global paper and water chemicals business 
of BASF SE (“ BASF DOM ”) (the “JV”  or “the combined entity”)3.  
(2) In this Decision, BASF  (including BASF DOM) and Solenis are collectively 
referred to  as the ' Parties ’ or “the  Notifying Parties ”.  
1. THE PARTIES  
(3) BASF is a publicly traded company and its business focuses on chemicals (e.g. 
petrochemicals and intermediates), performance products (e.g. dispersion and 
                                                 
1  OJ L 24, 29.1.2004, p. 1. With effect from 1 December 2009,  the Treaty on the Functioning of the European 
Union ('TFEU') 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 414 , 15.11.2018 , p. 15.  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omitted has been replaced by ranges of figures or a 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.  PUBLIC VERSION  
 
2 pigments), functional materials and solutions (e.g. construction chemicals and 
coatings), oil and gas , and agricultural solutions.  
(4) BASF DOM comprises all the assets constituting BASF’s global business in 
developing, manufacturing, marketing and selling wet -end paper chemicals and 
water treatment chemicals.  
(5) CD&R is a private equity investment group based  in the US that originates, 
structures , and frequently acts as lead equity investor in management buyouts, 
strategic minority equity investments and other strategic investments.  
(6) Solenis, a CD&R portfolio company, is a specialty chemical company and 
provid er of process and water solutions. Solenis ’ product portfolio includes 
process aids, water treatment chemistries, functional additives and monitoring 
and control systems.  
2. THE OPERATION  
(7) The notified concentration consists of the acquisition of joint contro l over a 
newly formed JV by BASF and CD&R. Subsidiaries of Solenis would acquire 
BASF DOM, and a direct wholly owned subsidiary of BASF would acquire an 
approximate [CONFIDENTIAL]  interest in “UK Topco”, a newly formed 
parent company of Solenis. Both BASF and CD&R would have veto rights that 
grant them the possibility to exercise decisive influence over UK Topco. This 
means that CD&R and BASF would acquire joint control over UK Topco, 
which would indirectly hold the combined Solenis and BASF DOM  businesses  
(the “Transaction”).  
(8) Following the Transaction, the JV would perform all the functions of an 
autonomous undertaking on a lasting basis. In this respect, the Commission 
notes that, pre -Transaction, Solenis is already operating independently on the 
market, with an established market presence  and sufficient resources.  The JV 
would  continue Solenis ' existing business , combin ing it with BASF DOM , and 
would therefore continue to operate independently on the marke t, with sufficient 
resources and it s own access to the market (with activities beyond one specific 
function of the parent  companie s). Moreover , the JV is expected to operate on a 
lasting basis as it is not incorporated for a specific period of time.  
(9) Therefore, the Transaction would result in a concentration within the meaning of 
Artic les 3(1)(b)  and 3(4)  of the Merger Regulation.  
 
3 3. UNION  DIMENSION  
(10) The undertakings concerned have a combined aggregate world -wide turnover of 
more than EUR 5 000 million4 (BASF EUR 64 475 million, CD&R EUR 
[CONFIDENTIAL]  million) . Each of them has a U nion-wide turnover in excess 
of EUR 250 million  (BASF EUR [CONFIDENTIAL] million, CD&R EUR 
[CONFIDENTIAL]  million) , but neither of them achieve s more than two -thirds 
of their aggregate U nion-wide turnover within  one and the same Member State.  
(11) Therefore, the notified concentration has a Union dimension  within the meaning 
of Article 1(2) of the Merger Regulation.  
4. MARKET DEFINITION  
4.1. End Chemicals  with Paper and Pulp Applications  
(12) In previous decisions5, the Com mission considered that paper and pulp 
chemicals could be categorised into (i) commodity chemicals, (ii) process 
chemicals , and (iii) functional chemicals :  
 Commodity chemicals are non -specialty chemicals which are generally 
inexpensive and suitable for mu ltiple different applications and industries ; 
 Process chemicals are used to improve the efficiency of and to provide 
ecological advantages to the production process itself, including preventing 
deposit and foam build -up, reducing the consumption of fresh water and 
energy and improving the drainage and/or reduction in fibre losses ; and  
 Functional chemicals are designed to impart various properties to the finished 
paper product ranging from enhanced optical properties and improved 
strength to enhanced printa bility, depending on the paper type produced, 
including paper for newspapers and magazines, printing paper, sanitary and 
household paper, packaging material and other specialised paper.  
(13) BASF DOM and Solenis are not involved in the production of commodity 
chemicals. These chemicals will therefore not be considered further for the 
purpose of this Decision.  
 4.1.1.  Process Chemicals  
(14) As described above , process chemicals are used to improve the paper and pulp 
making process.  
(15) In Clayton Dubilier & Rice/ Ashland Water Technologies and CIBA/Raisio 
Chemicals , the Commission considered that process chemicals could be further 
sub-segmented into the following individual markets :6 (a) Defoamers, ( b) 
                                                 
4  Turnover calculated in accordance with Article 5 of the Merger Regulation.  
5  See Case M.7207 - Clayton Dubilier & Rice/Ashland Water Technologies, Commission decision of 6 June 2014, 
paras. 7 -8 and Case M.5327 - Ashland/Hercules , Commission decision of 6  October 2008, para. 13 . 
6  See Case M.7207 - Clayton Dubilier & Rice/Ashland Water Technologies, Commission decision of 6 June 2014, 
para. 9 and Case M.3424 - CIBA/Raisio Chemicals, Commission decision of 26 May 2004, para. 8 . 
 
4 Contaminant Control Agents (“CC”), ( c) Retention and Drainage ag ents 
(“RDA”) , and  (d) Biocides and slimicides (“BSA”).7 
(a) Defoamers  
(16) Defoamers are chemical agents that remove, prevent , and block foam in 
manufacturing processes in all water -reliant processing industries. The build -up 
of foam can have a significant adve rse effect on production processes and is a 
manufacturing hazard in a wide range of industries relying on liquids either as 
part of the production process or in the paper  product itself.  Defoamers can be 
based on several different chemicals, including sili cone and silica, ethylene 
oxide /propylene oxide (“EO/PO”) surfactants, polyethylene glycol (“PEG”) and 
fatty acids and alcohols.  
(17) As regards product market definition, t he Commission previously considered the 
defoamers market in Ashland /Hercules and in Clayton […]*  & Rice /Ashland 
Water Technologies ,8 but ultimately left open the question of whether the 
product market was limited to the defoamers suppl ied to the pulp and paper 
industry or whether the product market should include all defoamers . 
(18) The Partie s submit that, due to demand -side and supply -side substitutability, the 
market should be defined broader than the supply  of defoamers  to the paper and 
pulp industry. According to the Parties, there is no difference between the 
chemistries in the defoamers used in the paper and pulp industries and those 
used by other industries. The Parties also submit that Solenis, and the majority 
of its main competitors , supply defoamers to all industries.  
(19) The Parties add that no separate markets should be defined for de foamers based 
on the defoamer chemistry.  Defoamers of different chemistry  are largely used 
interchangeably across industries . 
(20) As for geographic market definition, the  Commission considered  in previous 
decisions that  the geographic market for defoamers is at least EEA -wide, but 
ultimately left the precise geographic market definition open9. The Parties 
submit that the geographic market is at least EEA -wide in scope. According to 
the Parties, customers have no national preferences and the commonality of 
produ cts across different countries is supported by EU -wide standards with 
regard to environmental and production processes.  
(21) In any event, f or the purposes of this Decision, it can be left open whether 
defoamers for the paper and pulp industry constitute a rel evant product market 
separate from defoamers used in other industries , and whether there are separate 
product markets for defoamers based on the ir chemical components , since  no 
                                                 
* Should read: “Dubilier”  
7  In a past decision, the Commission considered BSA as a separate relevant product market (although the precise 
market delineation was ultimately left open). See Case M.5327 – Ashland/Hercules, Commission decision of 6 
October 2008, paras. 23 -26. BASF DOM i s not active in BSA. These chemicals will therefore not be considered 
further for the purpose of this Decision.  
8  See Case M.7207 - Clayton Dubilier & Rice/Ashland Water Technologies, Commission decision of 6 June 2014, 
paras. 10 and 12 and Case M.5327 – Ashland/Hercules, Commission decision of 6 October 2008, paras. 19 -22. 
9  See Case M.7207 - Clayton Dubilier & Rice/Ashland Water Technologies, Commission decision of 6 June 2014, 
paras. 11 and 12 and Case M.5327 – Ashland/Hercules, Commission decision of  6 October 2008, para. 46 . 
 
5 serious doubts  as to the compatibility of the notified concentration with the 
internal market  arise under any plausible product market definition. The exact 
geographic scope of the market for defoamers can also be left open, since n o 
serious doubts as to the compatibili ty of the notified concentration with the 
internal market arise under any plausible product market definition .  
(b) Contaminant Control Agents  ("CC")  
(22) CC are used to prevent particle contamination in manufacturing processes.  They 
remove contaminants altoget her or are used to break them down into smaller 
particles which can be washed away easily or scraped away in a next production 
step. The paper and pulp industry uses CC to eradicate contaminants that can 
have a negative impact on both the machinery and the  end-product.  
(23) According to the Parties, the main types of CC are (i) fixation agents, (ii) 
dispersion agents and (iii) adsorption agents. The Parties submit that the various 
types of CC all serve the same purpose . Each type of CC utilise s a different 
mechanism to solve  the same underlying problem.  In Clayton Dubilier & 
Rice/Ashland Water Technologies , the Commission  considered  all types of CC 
to belong to  a single relevant product market  including fixation agents, 
dispersion agents and ads orption agents  but eventually left open the question of 
precise market definition .10 In BASF/CIBA , the Commission examined fixation 
agents (or fixatives) as a distinct relevant product market but ultimately left 
open the relevant product market definition.11 
(24) With regard to geographic market definition , the Commission in its past  
decisional  practice  considered the market for the supply of CC to be EEA -wide, 
but ultimately left the issue  open.12 The Commission also considered the market 
for fixation agents to be at least EEA -wide but eventually left open the precise 
geographic market definition. The Parties submit that the relevant markets are 
EEA -wide, reflective of trans -border production and su pply, competition and a 
customer base that is dispersed across the EEA.  
(25) In any event, f or the purpose of this Decision, it can be left open whether the 
relevant product market includes all CC or whether there is a distinct relevant 
market for fixation age nts, since n o serious doubts arise under any plausible 
product market definition . The exact geographic scope of the market can also be 
left open, since n o serious doubts arise under any plausible geographic  market 
definition.  
(c) Retention and Drainage Aid s ("RDA")  
(26) RDA are added to the pulp at the w et end of the paper and pulp making process,  
during sheet formation and while promoting the drainage of water. Poor 
retention and/or drainage creates  several problems with the production process 
(e.g., higher con sumption of chemicals) and the quality of the final product . 
                                                 
10  See Case M.7207 - Clayton Dubilier & Rice/Ashland Water Technologies, Commission decision of 6 June 2014, 
para. 10.  
11  See Case M.5355 – BASF/CIBA , Commission decision of 12 March 2009, paras. 64 -66.  
12  See Case M.7207 - Clayton Dubilier & Rice/Ashland Water Technologies, Commission decision of 6 June 2014, 
paras. 11 -12 and Case M.5327 – Ashland/Hercules, Commission decision of 6 October 2008, para. 46 . 
 
6 RDA compensate  the negative anionic surface charges on the fillers, fibres and 
fines by forming molecular bridges between two particles to which they are 
absorbed. In so doing, RDA  flocculate the fillers, fibres and fines into the pulp 
mat during sheet formation to prevent them from being drained away.  
(27) The Commission considered  in previous decisions  all RDA to belong to  a single  
product market ,13 but also considered a  sub-segmentation of RDA into  (i) RDA 
based on polymers such as PAM, PEI and PVAm, (ii) RDA based on 
dual/multicomponent systems and (iii)  RDA including  inorganic micro particles 
such as silica or bentonites.  The Commission ultimately left the product mark et 
definition open.14  
(28) The Parties submitted that there is one single relevant market for RDA which 
must not be further sub -segmented. T here is a high degree of substitutability 
between the different types of RDA and customers easily switch between 
retentio n and drainage aid chemical suppliers.  In any event, the Parties 
explained that all RDA are based on polymers and that dual/multi -component 
systems can also include inorganic micro particles. On that basis , the Parties 
submitted that the tripartite classif ication of RDA that the Commission 
considered in BASF/CIBA  should be understood as follows: (i) RDA based on a 
single polymer such as PAM, PEI, and PVAm  (single -polymer RDA) ; (ii) RDA 
based on more than one polymers but e xcluding micro particles  (multi -polymer 
RDA) ; and (iii) RDA including micro particles  (micro -particle RDA) . However, 
according to the Parties, any such segmentation “would be artificial and would 
not properly reflect demand” .15  
(29) As for geographic market definition , the Commission  in its past  decisional  
practice  considered the geographic market for RDA to be at least EEA -wide, but 
ultimately left the product market definition open16. The Parties agree that the 
geographic market definition is at least EEA -wide.  
(30) In any event, for the purposes of  this Decision, it can be left open whether the 
relevant product market includes all RDA or whether there are distinct relevant 
product markets for (i) single -polymer RDA; (ii) multi -polymer RDA;  and (iii) 
micro particle RDA  since no serious doubts as to t he compatibility of the 
notified concentration with the internal market arise under any plausible product 
market definition.  The exact geographic scope of the market for RDA can also 
be left open, since no serious doubts as to the compatibility of the noti fied 
concentration with the internal market arise under any plausible geographic 
market definition.  
 4.1.2.  Functional Chemicals  
(31) Functional chemicals are used to determine the specific properties of the end -
product. Property alterations include increasing tensile strength, improving 
water resistance and varying colour and brightness. In its past decisional 
                                                 
13  See Case M.5327 – Ashland/Hercules, Commission decision of 6 Octobe r 2008, paras. 16 -18.  
14  See Case M.5355 – BASF/CIBA , Commission decision of 12 March 2009, paras. 60 -63.  
15  See Form CO, para. 239.  
16  See Case M.5355 – BASF/CIBA , Commission decision of 12 March 2009, para. 72 and Case M.5327 – 
Ashland/Hercules, Commi ssion decision of 6 October 2008, para. 46.  
 
7 practice , the Commission considered that the following categories of functional 
chemicals could be considered as separate markets : (i) Dry […]*  Agents 
(“DSA”), (ii) Wet […]* Agents (“WSA”) and (iii) Sizing Agents17. 
(a) Dry Strength Agents ("DSA")  
(32) DSA improve the bonds between fibres of paper to impart additional strength. 
DSA are specifically  […]**  on improving the general strength of paper and 
board in the dry state, in order to obtain the same strength at lower weight and 
generally improve the mechanical properties of the finished product.  There are 
two types of DSA:  (i) natural starch -based DSA a nd (ii) synthetic DSA, 
including products based on gPAM, PVAm, PAE resins, cellulose enzymes and 
carboxymethyl cellulose ("CMC") .  
(33) Regarding product market definition, the Parties submit that the market covers  
all DSA used in the paper and pulp industry , namely natural starch -based DSA 
and synthetic DSA.  The Parties  argue that further segmenting DSA does not 
reflect the current and future demand patterns . According to the Parties, 
customers regularly combine natural and synthetic DSA in their processes and 
both types of DSA are interchangeable.  
(34) In BASF/CIBA18, the Commission considered natural starch -based DSA and 
synthetic DSA  constitute two separate relevant product markets . The market 
investigation in the present  case confirmed this.  The majority of both 
informative respondents  stated that starch -based DSA and synthetic DSA are not 
substitutable  with each other .19  
(35) The Commission also considered whether the relevant market for synthetic DSA 
should be further sub -segmented based on the chemistry of each DSA (i.e., 
whether there should be distinct relevant markets for gPAM -based DSA, 
PVAm -based DSA, etc).  The market investigation showed that there are no 
distinct relevant markets for synthetic DSA of different chemistry.  Customers 
and competitors  indicated that DSA are purchased on the basis of their 
functionality – not their chemistry.20 One c ustomer added that for dry strength, it 
often purchases packages of products with different chemistries.21  
(36) As for  geographic market definition , the Commissio n in a previous decision  
considered the market for synthetic  DSA to be at least EEA -wide, but ultimately 
                                                 
* Should read: “strength”  
** Should read: “focused”  
17  See Case M.5327 – Ashland/Hercules, Commission decision of 6 October 2008, para. 15.  
18  See Case M.5355 – BASF/CIBA , Commission decision of 12 March 2009, para. 59. In Ashland/Hercules , the 
Commission considered the product market for DSA should include all polymers, whether natural or synthetic, 
but ultimately left the issue open ( Case M.5327 – Ashland/Hercules, Commission decision of 6 October 2008, 
paras.  30-32).  
19  See Q14 of questionnaire Q1 to customers of end chemical products and Q.10 of Q2 - questionnaire to 
competitors in end chemical products.  
20  See Doc ID 672, Minutes from call with competitor, 22 November 2018, paras. 11 -12, Doc ID 663, Minute s from 
call with competitor, 22 November 2018, para. 7, Doc ID 660, Minutes from call with customer, 21 November 
2018, para. 6, Doc ID 666, Minutes from call with competitor, 21 November 2018, para. 6, Doc ID 654, Minutes 
from call with customer, 21 Novemb er 2018, para. 4, Doc ID 651, Minutes from call with customer, 21 November 
2018, paras. 5 -6. 
21  See Doc ID 657, Minutes from call with customer , 21 November 2018, para. 8.  
 
8 left the issue open.22 The Parties submit that the market for DSA is at least EEA -
wide, referring to  the absence of national preference s of customers, l ow 
transport costs and comparable prices throughout the EEA.  
(37) The market investigation in the present case  confirmed that the market for 
synthetic DSA is likely EEA -wide. T he vast majority of informative customer 
respondents sourced synthetic DSA solely fr om the EEA  irrespective of the 
chemistry included in the synthetic DSA .23 The majority of competitors added 
that they do not compete with players located outside the EEA in the supply of 
synthetic DSA.24  
(38) For the purposes of this Decision, the Commission concludes that the relevant 
product market includes all synthetic DSA . The exact geographic scope of the 
market for synthetic DSA can be left open, since no serious doubts as to the 
compatibility of the notified concentration with the internal market arise  under 
any plausible geographic market definition.  
(b) Wet Strength Agents ("WSA")  
(39) WSA chemicals improve the properties of paper in both wet and dry state by 
creating stronger permanent molecular bonds. The aim is to improve the tensile 
strength of the pap er product when wet to minimise rupture during use (e.g. 
kitchen paper towelling). Another application for WSA is packaging and 
paperboard (e.g. paper sacks, cardboard, fruit trays) . WSA are based on different 
types of resins including PAE resins; glyoxal resins; amino resins; and PVAm 
resins.  
(40) In BASF/CIBA , the Commission stated that WSA must be distinguished from 
DSA.25 But it has not assessed in detail the relevant product market definition . 
The Parties submit that WSA constitute a separate relevant produ ct market 
encompassing all different types of resins.   
(41) As regards the geographic market definition, the Parties submit that the market 
for WSA is EEA -wide because market characteristics; demand; and regulation 
for WSA is similar across the EEA.  
(42) In any eve nt, for the purposes of th is Decision, it can be left open whether there 
is one relevant product market including all WSA or whet her there are distinct 
relevant product markets for PAE resin -based WSA; glyoxal -based resin WSA; 
amino resin -based WSA; and PV Am resin -based WSA , since n o serious doubts 
as to the compatibility of the notified concentration with the internal market 
arise under any plausible product market definition . The exact geographic scope 
of the market can be left open, since n o serious doubts as to the compatibility of 
the notified concentration with the internal market arise under any plausible 
geographic market definition . 
                                                 
22  See Case M.5355 – BASF/CIBA , Commission decision of 12 March 2009, paras. 72 -73.  
23  See Q9 of questionnaire Q1 to customers of end chemical products.  
24  See Q12 of questionnaire Q2 to competitors in end chemical products.  
25  See Case M.5355 – BASF/CIBA , Commission decision of 12 March 2009, para. 56.  
 
9 (c) Sizing Agents  
(43) Sizing agents are used in the paper and pulp industry during paper 
manufacturing to p rovide resistance to liquid penetration, control the spread of 
inks and impart other performance -related properties (i.e abrasiveness, 
creasibility, finish, printability, smoothness and surface bond strength, while 
decreasing surface porosity and fuzzing).   
(44) There are two types of sizing agents , depending on where in the paper -making 
process they are added : (i) internal sizing agents and (ii) surface sizing agents. 
The former are mixed into the pulp slurry before sheet formation on the 
machine, while the lat ter are applied after sheet formation at the size press.  
(45) As regards relevant product market definition, the Commission acknowledged  in 
previous decisions that sizing agents may be segmented into internal sizing 
agents and surface sizing agents, and that w ithin internal sizing agents a further 
distinction could be made based on the chemical components .26 The 
Commission ultimately left the issue  open.  The Parties consider that all sizing 
agents belong to one single relevant product market . However, they ultim ately 
conclude that the issue can be left open.  
(46) As regards the geographic market definition, t he Commission in past decisions 
considered that the market for sizing agents is at least EEA -wide but  ultimately 
left the issue  open.27 The Parties agree that the  market for sizing agents is EEA -
wide  in scope, because product  prices are comparable within the EEA and most 
customers and suppliers operate across the EEA . 
(47) In any event, for the purposes of this Decision, it can be left open whether there 
is one single m arket including all sizing agents or whether there are separate 
product markets for surface sizing agents and internal sizing agents or whether 
there are separate product markets within internal sizing agents based on product 
chemistry, since n o serious do ubts arise under any plausible product market 
definition . The exact geographic scope of the market for sizing agents can also 
be left open, since n o serious doubts arise under any plausible geographic 
market definition .  
4.2. End Chemicals with Water Treat ment Applications  
(48) Water treatment  is the process of removing impurities that are present in the 
water using either mechanical or chemical processes to make it more suitable for 
use for either industrial or human consumption.  
(49) According to the Parties , the relevant product market includes all water 
treatment chemicals. The Parties submit  in this respect  that, even though there 
are certain differences between the municipal and industrial water treatment , 
                                                 
26  See Case M.5355 – BASF/CIBA , Commission decision of 12 March 2009, paras. 67 -69, Case M.3424 - 
CIBA/Raisio Chemicals , Commission decision of 26 May 2004, para. 11, Case M.1304 - Hercules/BetzDearborn , 
Commission decision of 5 October 1998, paras. 9 -13, and Case M.390 - Akzo/Nobel Indu stries , Commission 
decision of 10 January 1994, paras. 28 -31.  
27  See Case M.5355 – BASF/CIBA , Commission decision of 12 March 2009, para. 72, Case M.3424 - CIBA/Raisio 
Chemicals , Commission decision of 26 May 2004, para. 13, Case M.1304 - Hercules/BetzDea rborn , Commission 
decision of 5 October 1998, para. 19, and Case M.390 - Akzo/Nobel Industries , Commission decision of 10 
January 1994, paras. 30 -31. 
 
10 there are also many similarities between the chemi stries used . However, the 
Parties submit that , for the purpose of this Decision,  the water treatment 
chemicals market can be sub -segmented into:  (i) chemicals for municipal water 
treatment and (ii) chemicals for industrial water treatment could be consider ed 
as relevant.  
(50) In its past practice, t he Commission considered water treatment chemicals as 
forming a separate relevant product market. The Commission also considered 
that there could be distinct relevant product markets for  (i) chemicals for 
industrial water treatment and (ii) chemicals for municipal water treatment.  But 
ultimately the issue was left open.28  
(51) In previous decisions, the Commission has considered the markets for (i) 
chemicals for industrial water treatment and (ii) chemicals for municipal w ater 
treatment to be likely EEA -wide in scope. The exact market definition was 
however left open.29 The Parties agree that these relevant markets are at least 
EEA -wide.   
 4.2.1.  Industrial Water Treatment  Chemicals  
(52) Within chemicals for industrial water trea tment, the Commission considered in 
past decisions distinct relevant markets for  (i) chemicals for water cooling and 
boiler applications and (ii) chemicals for influent and effluent water treatment30. 
The exact product market definition was ultimately left open.  
(53) Chemicals for water cooling and boiler applications aim at ensuring safe and 
efficient operations by preventing corrosion and eliminating scale and 
deposition.  In previous decisions, the Commission has left the exact scope of the 
product market for chemicals for water cooling and boiler applications open31. 
The Parties submit that the exact product market can be left open  as the 
Transaction does not raise concerns  under any plausible product market 
definition . 
(54) Chemicals for influent and effluent water  treatment are supplied for the 
treatment of influent water, that is water that goes into an industrial plant and 
which is used in the production process and effluent water, i.e. waste water that 
flows from an industrial plant. In its previous decisions, t he Commission 
considered whether to distinguish the market for influent and water treatment 
chemicals into coagulants and flocculants or based on the physical forms in 
which chemicals for influent and effluent water treatment are sold.32 The 
Commission ultimately left the exact product market definition open . The 
                                                 
28  See Case M.8452 - Suez/GE Water and Process Technologies, Commission decision of 19 July 2017, paras. 4 4-
47.  
29  See Case M.8452 - Suez/GE Water and Process Technologies, Commission decision of 19 July 2017, para. 48 and 
Case M.7207 - Clayton Dubilier & Rice/Ashland Water Technologies, Commission decision of 6 June 2014, para. 
19.  
30  See Case M.8452 - Suez/GE Water and Process Technologies, Commission decision of 19 July 2017, para. 45 and 
Case M.7207 - Clayton Dubilier & Rice/Ashland Water Technologies, Commission decision of 6 June 2014, para. 
20.  
31  See Case M.8452 - Suez/GE Water and Process Technologies, Commission decision of 19 July 2017, para. 47.  
32  See Case M.7207 - Clayton Dubilier & Rice/Ashland Water Technologies, Commission decision of 6 June 2014, 
paras. 21 -23 and Case M.5327 – Ashland/Hercules, Commission  decision of 6 October 2008, paras. 36 -37.  
 
11 Parties submit that the exact product market can be left open as the Transaction 
does not raise concerns under any plausible product market definition.  
(55) In past decisions, the Commission considered whether  the above relevant 
markets are EEA -wide in scope.  The Commission ultimately left the exact 
geographic market definition open.33 The Parties agree that these relevant 
markets are at least EEA -wide.   
 4.2.2.  Municipal Water Treatment  Chemicals  
(56) In prev ious decisions, the Commission considered whether the market for 
municipal water treatment chemicals  should be further segmented into (i) 
municipal wastewater treatment chemicals  and (ii) chemicals for treatment for 
potable water. However, the Commission u ltimately left the exact product 
market definition open34. The Parties submit that the exact product market can 
be left open as the Transaction does not raise concerns under any plausible 
product market definition.  
(57) In past decisions, the Commission consider ed whether the above relevant 
markets are EEA -wide in scope.  The Commission ultimately left the exact 
geographic market definition open.35 The Parties agree that these relevant 
markets are at least EEA -wide.   
 4.2.3.  Conclusion  
(58) For the purpose of th is Decis ion, the Commission considers that it can be left 
open whether there is a relevant market for all  water treatment chemicals or 
whether there are separate relevant markets for chemicals for industrial water 
treatment and chemicals for municipal water treatm ent, since n o serious doubts 
as to the compatibility of the notified concentration with the internal market 
arise under any plausible product market definition.  
(59) The Commission also considers that the question whether within industrial 
water treatment chemicals, distinct relevant markets can be defined for  (i) 
chemicals for water cooling and boiler applications and (ii) chemicals for 
influent and effluent water treatment can be left open , since n o serious doubts as 
to the compatibility of the notified c oncentration with the internal market arise 
under any plausible product market definition.  
(60) Similarly, the Commission also considers that the question whether within 
municipal water treatment chemicals, distinct relevant markets  should be 
defined for (i) mu nicipal wastewater treatment chemicals and (ii) potable water 
treatment chemicals can be left open , since n o serious doubts as to the 
compatibility of the notified concentration with the internal market arise under 
any plausible product market definition.  
                                                 
33  See Case M.8452 - Suez/GE Water and Process Technologies, Commission decision of 19 July 2017, paras. 48 -49 
and Case M.5327 – Ashland/Hercules, Commission decision of 6 October 2008, para. 46.  
34  See Case M.7 207 - Clayton Dubilier & Rice/Ashland Water Technologies, Commission decision of 6 June 2014, 
paras. 17 and 19.  
35  See Case M.8452 - Suez/GE Water and Process Technologies, Commission decision of 19 July 2017, paras. 48 -49 
and Case M.5327 – Ashland/Hercul es, Commission decision of 6 October 2008, para. 46.  
 
12 (61) The exact geographic scope of the market can also be left open, since n o serious 
doubts as to the compatibility of the notified concentration with the internal 
market arise under any plausible geographic market definition.  
4.3. End Chemicals Divided by Che mistry  
(62) End chemicals with different functionalities (e.g., DSA or RDA) are often based 
on the same chemistry. Moreover, a single  end chemical product can have 
several functionalities, if its chemistry so allows.   
(63) The Commission considered whether separate  relevant markets can be 
delineated for end -chemicals with paper and pulp applications on the ba sis of 
the product's chemistry.   
 4.3.1.  PVAm -based chemicals  
(64) The polymer polyvinylamine ( "PVAm ") can be used in functional chemicals to 
increase the dry strength of the paper  product.  It can also be used in process 
chemicals for retention and drainage during the paper and pulp making process.   
(65) The Parties submitted that there is no separate relevant m arket for PVAm -based 
chemicals.  Relevant market s in end chemicals for paper and pulp applications  
should be defined based on  functionality, i.e., the parameter that is most relevant 
to customers.  In more detail, according to the Parties:36  
 Each of the effe cts for which PVAm is used in papermaking can be, and is, 
successfully achieved by other chemistries (e.g. cationic starches, cationic 
PAM, gPAM, amphoPAM) or through process modifications (e.g. different 
fibre mix, or small modifications to the paper mach ine). There is no specific 
functionality or application requiring PVAm -based chemicals;  
 From a demand -side perspective, customers (i.e. paper mills) do not purchase 
end chemicals based on their chemistry.  Rather, they ask suppliers to present 
offers for a  dry strength programme or a retention & drainage programme ; 
 From a supply -side perspective, end chemicals for paper and pulp applications 
are not marketed with a specific reference to their chemistry.  These chemicals 
are typically sold under the supplier' s brand (e.g., BASF DOM's PVAm -based 
product is called Xelorex) and no specific reference is made to the product's 
chemistry. Marketing of end chemicals for paper and pulp applications 
focuses on explaining the properties of the product to customers but no  the 
underlying chemistry;  
 There is no grade of paper which requires or which lists PVAm as its 
component. Industry guidance37 summarizing the requirements for different 
paper grades refers to the functionality of th e paper and not its components, 
e.g., PVAm ; and  
                                                 
36  See Notifying Parties' submission of 22 November 2018, "Competitive Assessment of PVAm Supply Chain", 
paras. 3 and 20 -31.  
37  E.g., Harmonized Codes for different paper grades published by the Confed eration of European Paper Industries 
("CEPI"). See Notifying Parties' submission of 22 November 2018, "Competitive Assessment of PVAm Supply 
Chain", Annex 1.  
 
13  None of the main market studies on chemicals for paper and pulp applications 
suggests separate relevant markets based on the chemistry of the products .  
(66) The market investigation confirmed the position of the Notifying Parties that no 
separate rel evant market should be defined for PVAm -based end chemicals in 
the paper and pulp sector.  In more detail:  
 The vast majority of informative customer  respondents explained that end 
chemicals for paper and pulp applications are purchased on the basis of thei r 
functionality – not their chemistry .38 Customers added that  for a given 
functionality (e.g., dry strength)  they often purchase packages of products 
with different chemistries.39 Several customers acknowledged that they did 
not know what the chemistry in the products purchased for retention an d 
drainage or for dry strength  is. As one customer put it, " suppliers make 
available safety data sheets in the course of the product trials, but these 
sheets are not always clear on the active ingredients that the produ ct 
combines ";40  
 Customers trial gPAM -based or cPAM -based chemicals when they seek to 
switch away from PVAm -based chemicals.  Several  customers who consider 
switching away from a PVAm -based product have completed lab trials or 
engaged in commercial discussions with suppliers of gPAM -based or cPAM -
based chemicals .41 According to  one of the respondents , "PVAm -based 
products are substitutable with products containing different chemistries,  as 
long as they all have the same functionality.  [We] would consider replacing 
[a PVAm -based product] with a gPAM -based or a cPAM -based product used 
for retention and drainage and dry strength… PVAm is one chemistry among 
others ";42 
 Customers use PVAm -based chemicals  typically only in one of their plants 
while they use products of a different chemistry  to achieve the same result 
(e.g., increased  dry strength) in other plants.  Yet, customers explained that the 
paper  product must be of a cons istent quality irrespective  of the plant where it 
was manufactured and of the chemistries used . This indicates that customers 
do not consider PVAm -based chemicals as essential to impart specific 
qualities to the paper product ;  
 Market respondents also suggested a supplier of end chemicals with paper and 
pulp applications can easily start supplying PVAm -based chemicals.  The cost 
of the reactors required to manufacture PVAm is limited.  One of the 
competitors of the Notifying Parties, who manufactures PVAm -based 
chemicals in t he EEA, stated that it has spare capacity and that it could make 
                                                 
38  See Doc ID 672, Minutes from call with competitor, 22 November 2018, paras. 11 -12, Doc ID 663,  Minutes from 
call with competitor, 22 November 2018, para. 7, Doc ID 660, Minutes from call with customer, 21 November 
2018, para. 6, Doc ID 666, Minutes from call with competitor, 21 November 2018, para. 6, Doc ID 654, Minutes 
from call with customer, 21  November 2018, para. 4, Doc ID 651, Minutes from call with customer, 21 November 
2018, paras. 5 -6. 
39  Doc ID 657, Minutes from call with customer , 21 November 2018, para. 8.  
40  Doc ID 657, Minutes from call with customer , 21 November 2018, para. 7.  
41  Doc ID 660, Minutes from call with customer, 21 November 2018, para. 4 , Doc ID 669, Minutes from call with 
customer, 23 November 2018, para. 4 , Doc ID 648, Minutes from call with customer, 21 November 2018, para. 5.  
42 Doc ID 660, Minutes from call with custo mer, 21 November 2018, paras 6 and 9.  
 
14 available PVAm -based chemicals for resale in the EEA to any supplier who 
would require so.43  
(67) Based on the results of the market investigation, the Commission concludes that 
there is no distinct relevant product market for PVAm -based chemicals with 
paper and pulp applications.   
 4.3.2.  PAM -based Chemicals  and cPAM -based Chemicals  
(68) Polyacrylamide (“PAM”) is a water soluble polymer which can be anionic 
("aPAM"), cationic ("cPAM") or non -ionic. It has a medium to high molecular 
weight and is used to flocculate solids in solutions containing organic and 
inorganic chemical substances. PAM is produced as liquid, powder or emulsion. 
It is mainly used as an input chemical in the manufacture of wast e water 
products or water treatment products, for paper manufacturing and for mineral 
processing.  In the paper an d pulp sector, cPAM is used predominantly for 
retention and drainage but also for contaminant control purpo ses and to impart 
wet strength to  the paper  product . Other types of PAM (e.g., aPAM)  can be used 
to impart  dry strength to the paper product .  
(69) The Parties submitted that customers (i.e. paper mills) do  not purchase end 
chemicals based on their chemistry.  Rather, they ask suppliers to present  offers 
for a programme to achieve a specific functionality, e.g., retention and drainage.  
The Parties added that in each product market where the Parties offer PAM -
based or (more specifically) cPAM -based products, usually several alternative 
formulations are available on the basis of different chemistries and they all 
compete with each other if they can achieve comparable results.44  
(70) The market investigation did n ot provide clear indications whether  PAM -based 
or cPAM -based  chemicals constitute distinct  relevant product market s. The 
majority of informative customer respondents  stated that cPAM -based 
chemicals are not substitutable with products based on other chemistries in the 
EEA for the paper and pulp sector.45 However, customers  also insisted that "it is 
possible to get similar effects with different basic chemicals".46 Some customers 
acknowledged that they do not distinguish end chemicals based on chemistry but 
only based on functionality .47  
(71) For the purposes of th is D ecision, it can be left open  whethe r PAM -based 
chemicals constitute a relevant product market separate from products based on 
other chemistries.  No serious doubts as to the compatibility of the notified 
concentration with the internal market arise under any plausible product market 
definition (separate relevant product market for PAM -based chemicals or 
relevant product markets based on functionality as described in paragraphs (12)-
(47) above ).  
                                                 
43  See Q26.1 of questionnaire Q2 to competitors in end chemical products . 
44  Reply of the Notifying Parties to RFI 6, 5 December 2018, paras. 2 -5 and 11 -12.  
45  See Q52 to questionnaire Q1 to customers of end chemical products.  
46  See Q52 to questionnaire Q1 to customers of end chemical products, question 52.  
47  See Q51 to questionnaire Q1 to customers of end chemical products, question 51.  
 
15 (72) It can also be left open whether cPAM -based chemicals constitute a relevant 
product mark et separate from products based on other chemistries.  No serious 
doubts  as to the compatibility of the notified concentration with the internal 
market  arise under any plausible product market definition (separate relevant 
product market for cPAM -based chem icals or relevant product markets based on 
functionality as described in paragraphs (12)-(47) above).  
(73) The Commission previously considered the geographic scope of PAM to be 
EEA -wide, however left the precise geographic definition open.48 The Parties 
did not contest  that the geographic market for PAM -based chemicals , including 
cPAM -based chemicals , is at least EEA -wide in scope.  In any event, the precise 
definition can be left open , since n o serious doubts  as to the compatibility of the 
notified concentration with th e internal market  arise under any plausible 
geographic market definition.  
4.4. Raw and Intermediate Chemicals  
 4.4.1.  Dimethylaminopropylamine (" DMAPA ") 
(74) DMAPA is a colourless liquid used as an intermediate commodity chemical . 
DMAPA is  used in the manufact ure of  betaines which are used as co -surfactants 
in personal care products like shampoo and body wash. DMAPA is also used in 
various other applications, such as the production of , inter alia , APTAC and 
APTAC Q, which Solenis uses to produce , cPA M. 
(75) As regar ds product market definition, in BASF/Cognis , the Commission found 
that DMAPA constitutes a separate product market.49 
(76) According to the Parties, DMA3 (ADAME) and DMA3Q (ADAMEQ) could be 
used as an alternative for the production of cPAM . The Parties therefore submit 
that the relevant upstream market should be defined widely to include both 
alternatives for the production of cPAM. However, the Parties also submit the 
relevant product market can be left open in the absence of vertical conc erns.  
(77) As regards geographic market definition, in a previous decision, the 
Commission found that the market for DMAPA was at least EEA -wide, but 
ultimately left open the question whether the exact geographic scope was EEA -
wide or worldwide50. 
(78) The Parties submit that the geographic scope of the market should be 
worldwide, based on the fact that most DMAPA producers either have a single 
production plant or two production plants worldwide. The Parties further argue 
that exports from the EEA are su bstantial, i.e. [20-30]% of all EEA DMAPA 
production in 2017.  
(79) For the purpose of this Decision, the Commission considers that the exact 
product and geographic market definition s can be left open, since the notified 
concentration  does not raise serious doub ts as to its compatibility with the 
                                                 
48 See Case M.5355 – BASF/CIBA , Commission decision of 12 March 2009, paras. 41 -42. 
49  Case M.5927 – BASF/Cognis, Commission decision of 30 November 2010 .  
50  Case M.5927 – BASF/Cognis, Commission decision of 30 November 2010 . 
 
16 internal market  even on the narrowest possible market definition, that is to say 
the supply of DMAPA in the EEA .  
 4.4.2.  Diethylenetriamine (" DETA ") 
(80) DETA is used mainly as a building block for WSA in the paper industry,  in 
chelating agent synthesis and for detergents. DETA is also used as an 
intermediate in corrosion inhibitors, polyamide resins, asphalt additives and 
epoxy hardener systems. Solenis purchases DETA to produce DSA, WSA and 
sizing agents.  
(81) As regards produc t market definition, in previous decisions, the Commission 
identified DETA as a sub -segment of the product market for ethylene amines 
(commodity chemical intermediate products derived from ethylene). In Dow 
Chemical / Union Carbide51, the Commission conside red different types of 
ethylene amines (i.e. DETA, AEEA, TETA, TEPA and AEP) as separate 
product markets, but ultimately left the product market definition open. In 
Huntsman/CIBA TE business52, the Commission confirmed each type of 
ethylene amines is likely  to form a separate product market, leaving the exact 
market definition open.  
(82) The Parties do not contest the Commission’s precedents to consider DETA as a 
separate product market, but submit that the exact product market definition can 
be left open.  
(83) As r egards geographic market definition, in previous decisions53, the 
Commission considered the market for ethylene amines (including DETA) to be 
worldwide in scope, but ultimately left the exact market open.  
(84) The Parties submit that the geographic market for DETA is worldwide. The 
Parties argue that transport costs are low and there are no safety or other 
restrictions to transportation. According to the results of the market 
investigation, the majority of competitors of the Parties in the supply of DETA 
consid er they compete with suppliers from outside the EEA54.  
(85) For the purpose of this Decision, the Commission considers that the exact 
product and geographic market definitions can be left open, since the notified 
concentration does not raise serious doubts as t o its compatibility with the 
internal market even on the narrowest possible market definition, that is to say 
the supply of DETA in the EEA.  
 4.4.3.  Amino ethyl ethanol amine (" AEEA ") 
(86) AEEA is a commodity chemical intermediate product , derived from ethylen e. 
AEEA is used for various applications, including epoxy hardeners, fuel 
additives, chelating agents, surfactants and fabric softeners among others. In 
                                                 
51  Case M.1671 – Dow Chemical/Union Carbide , Commission decision of 3 May 2000.  
52  Case M.4179 – Huntsman/CIBA TE Business , Commission decision of 30 June 2006.  
53  Case M.1671 – Dow Chemical/Union Carbide , Commission decision of 3 May 2000,  and Case M.4179 – 
Huntsman/CIBA TE Business , Commission deci sion of 30 June 2006.  
54  Q.10 of Q3 – Questionnaire to suppliers of and competitors in raw materials.  
 
17 paper and water chemicals, AEE is used to produce CC, DSA, RDA and water 
treatment chemicals.  
(87) As regar ds product market definition, as stated in paragraph  (81), the 
Commission identified AEEA as a sub -segment of ethylene amines in DOW 
Chemical / Uni on Carbide55, but ultimately left the product market definition 
open. In BASF/Cognis56, the Commission confirmed that AEEA is likely to be a 
separate product market, but kept the exact market definition open.  
(88) The Parties submit that AEEA forms a single product market, as it is a 
homogenous product, which differs from other ethylene amines.  
(89) As regards geographic market definition, in previous decisions, the Commission 
considered the geographic market for AEEA t o be likely worldwide, but 
ultimately left the exact geographic scope of the market open.  
(90) The Parties submit that the market should be considered as worldwide since 
substantial amounts of products are imported and exported from and to the EEA, 
transportat ion costs are low and there are no significant barriers to import and 
export AEEA.  
(91) For the purpose of this Decision, the Commission considers that the exact 
product and geographic market definitions can be left open, since the notified 
concentration does not raise serious doubts as to its compatibility with the 
internal market even on the narrowest possible market definition, that is to say 
the supply of AEEA in the EEA.  
  4.4.4.  Adipic Acid  (“AA”)  
(92) AA has multiple downstream applications, including in the  automotive, textiles 
and electronics industries. The foremost application of AA is to produce nylon 
for the automotive industry. Paper and water chemicals use AA to a limited 
extend as an input for the production of cPAM and PAE resins for use as WSA 
and DSA. Solenis purchases its AA from BASF for use as WSA.  
(93) As regards product market definition, in Solvay/Rhodia57, the Commission 
considered AA as a separate product market, but ultimately left the exact 
product market definition open. More specifically, th e Commission left open the 
question whether AA and hexamethylene diamine (HMD) belong to the product 
market.  
(94) The Parties submit that AA constitutes the relevant product market upstream, 
taking into account that HMD cannot be considered as an alternative t o AA.  
(95) As regards geographic market definition, the Commission considered , in a 
previous decision58, the market for AA and HMD to be at least EEA wide. The 
Parties submit that the exact geographic scope of the market can be left open. 
According to the results of the market investigation, suppliers of AA consider 
                                                 
55  Case M.1671 - Dow Chemical/Union Carbide , Commission decision of 3 May 2000.  
56  Case M.5927 – BASF/Cognis , Commission decision of 30 November 2010.  
57  Case M.6230 – Solvay/Rhodia , Commission decision of 5 August 2011.  
58  Case M.6230 – Solvay/Rhodia , Commission decision of 5 August 2011.  
 
18 themselves to be in competition with suppliers of AA located outside the EEA, 
irrespective of the final ap plication of the AA supplied.59 However, the majority 
of customers indicated that they only purchase AA from suppliers located in the 
EEA, due to the need for consistent quality and security of supply. The results of 
the market investigation do not change b ased on the final application of AA60. 
(96) For the purpose of this Decision, the Commission considers that the exact 
product and geographic market definitions can be left open, since the notified 
concentration does not raise serious doubts as to its compatibili ty with the 
internal market even on the narrowest possible market definition, that is to say 
the supply of AA in the EEA.  
 4.4.5.  Polyvinylamine (“ PVAm ”) 
(97) PVAm can be used as a viable alternative or complementary chemical to natural 
starch when applied to increase strength levels. In the paper production 
processes, PVAm can be used  as an input  for the manufacturing of DSA, RDA 
and to a much lesser extent for CC. The Parties submit that PVAm can either be 
sold as an end -us product or combine with other monom ers to produce specialty 
chemicals for DSA, RDA and to a lesser extent CC.  
(98) The Commission has not previously analysed the market for PVAm.  
(99) The Parties submit that the relevant product market is PVAm. The results of the 
market investigation indicate that the majority of the customers consider PVAm 
as an important input in the manufacturing of CC, RDA and DSA, irrespective 
of the end -use of the PVAm61.  
(100)  According to the results of the market investigation , all customers of PVAm 
replying to the questionnaire indicated that they source PVAm solely from 
suppliers inside the EEA, irrespective of the end -use of the purchased PVAm62. 
(101)  For the purpose of this Decision, the Commission considers that the exact 
produc t and geographic market definitions can be left open, since the notified 
concentration does not raise serious doubts as to its compatibility with the 
internal market even on the narrowest possible market definition, that is to say 
the supply of PVAm in the  EEA.  
 4.4.6.  Surfactants  
(102)  Surfactants are used in the consumer goods sector as inputs for detergents, 
cleaners and personal care products and in the industrial sector as processing 
aids.  
(103)  As regards product market definition, in previous decisions,63 the C ommission 
found that anionic surfactants (i.e., surfactants with a negative charge, such as 
                                                 
59  Q.19 of Q3 – questionnaire to suppliers of and competitors in raw materials.  
60  Q.65 of Q2 – questionnaire to competitors in end -chemical products.  
61  Q.74 of Q2 – questionnaire to competitors in end -chemical products.  
62  Q.73 of Q2 – questionnaire to competitors in end -chemical products.  
63  Case M.5927 – BASF/Cognis, Commission decision of 30 November 2010 . 
 
19 sulfates/sulfonates64) and non -ionic surfactants (i.e., surfactants with no charge, 
such as alkoxylates65) constitute distinct product markets.  The Commission also 
considered further segmenting the markets of anionic and non -ionic surfactants, 
but ultimately left the question open.  
(104)  The Parties submit that the relevant product market for anionic surfactants and 
non-ionic surfactants can be left open  since the Transacti on only gives rise to 
minor vertical links between the activities of the Parties and only with respect 
the supply of alkoxylates and sulfates/sulfonates .  
(105)  As regards geographic market definition, in previous decisions,66 the 
Commission concluded that the plausible markets for anionic and non -ionic 
surfactants were at least EEA -wide. The Parties submit that the market for non -
ionic surfactants is at least EEA -wide in scope but likely worldwide, while they 
consider the mark et for anionic surfactants is worldwide in scope.  
(106)  According to the results of the market investigation, the vast majority of 
customers of anionic surfactants source solely from suppliers located in the 
EEA, irrespective of the use of the anionic surfactan ts67. These results are 
confirmed by the suppliers of anionic surfactants68. 
(107)  For the purpose of the present Decision,  taking into account the fact that the 
Transaction only gives rise to vertical links limited to the supply of alkoxylates 
and sulfates/ sulfonates, the Commission considers that the exact product market 
definition can be left open as no serious doubt as to the compatibility of the 
notified concentration with the internal market arise under any product market 
definition s. In relation to the  exact geographic scope of the market , the 
Commission considers  that it can be left open, as no serious doubts  as to the 
compatibility of the notified concentration with the internal market  arise under 
the narrowest EEA -wide definition.  
 4.4.7.  Edetic aci d ("EDTA ") 
(108)  EDTA is used for industrial water treatment and many other applications ( e.g., 
laundry detergents, soap, textile processing).  In water treatment, EDTA is 
effective at preventing scale and deposits of calcium carbonate, sulphate, and 
phosphate fr om forming in boilers, evaporators, heat exchangers, and filters. In 
paper & pulp, EDTA use is primarily for mechanical pulping and bleaching with 
sodium hydrosulfite.  
(109)  The Commission has not previously analysed the market of EDTA.  
                                                 
64  Sulfates and sulfonates constitute the bulk of anionic surfactant (ca. 90%). They are produced through sulfonation 
and sulfation of the relevant raw materials. Other anionic surfactants, so -called specialty anionics, are produced in 
a variety of other method s. In the present case, the vertical link arising from the Transaction in relation to anionic 
surfactants is limited to the supply of sulfates and sulfonates.  
65  Alkoxylates are the most important synthetic class of non -ionic surfactants, formed by reactin g alcohols or fatty 
acids of varying alkyl chain length which are not water -miscible with alkylene oxides which form the water 
miscible part of the molecule. The non -ionic surfactants Solenis purchases from BASF are alkoxylates.  
66  Case M.5927 – BASF/Cogni s, Commission decision of 30 November 2010 . 
67  Q.97 of Q2 – questionnaire to competitors in end -chemical products.  
68  Q.37 of Q3 – questionnaire to suppliers and competitors in raw materials.  
 
20 (110)  The Parties submit that t here is some evidence that EDTA can be substituted 
with at least one aminopolycarboxylic acid chelating agent in the paper & pulp 
industry. In particular, the Parties argue that EDTA can be (at least partially) 
substituted by DTPA. The Parties submit that the product market definition 
should not just include EDTA, but could also include all aminopolycarboxylic 
acid chelating agents. However, for the purpose of this decision, the Parties 
submit that the product market definition can be left open.  
(111)  The Partie s submit that the market for EDTA is at least EEA -wide. The Parties 
also submit that the market for aminopolycarboxylic acid could be global. 
However, for the purpose of this decision, the Parties submit that the exact 
geographic scope of the market can be  left open.  
(112)  For the purpose of this Decision, the Commission considers that the exact 
product and geographic market definitions can be left open, since the notified 
concentration does not raise serious doubts as to its compatibility with the 
internal mark et even on the narrowest possible market definition, that is to say 
the supply of EDTA in the EEA.  
 4.4.8.  Poly-diallyldimethylammonium -chloride (" PolyDADMAC ") 
(113)  PolyDADMAC  is used to produce pulp and paper and water treatment 
chemicals which can be used to produce CC, DSA, RDA and sizing agents and 
water treatment chemicals. In addition, PolyDADMAC can also be used as a 
coagulant for water purification.  
(114)  As regards product market definition, in BASF/CIBA ,69 the Commission 
considered a separate market for PolyDADMAC, distinct from the market for 
DADMAC, but eventually left the question open. The Parties agree that 
PolyDADMAC is the narrowest possible market definition, but sub mit that the 
relevant product market for PolyDADMAC can be left open.  
(115)  As regards geographic market definition, the Com mission also left open the 
exact scope of the market (EEA -wide or worldwide)70. The Parties submit that 
the relevant market is at least EEA -wide, but can be left open between EEA -
wide and global  
(116)  For the purpose of the present Decision, the Commission considers that the 
manufacture and supply of PolyDADMAC constitutes a separate product 
market. The exact geographic scope of the market can be left open, as no serious 
doubts as to the compatibility of the notified concentration with the internal 
market arise under the narrowest possible EEA -definition.  
 4.4.9.  Polyethylenimines (" PEI") 
(117)  PEI is a polymer which can be used in paper and pulp and wa ter treatment 
chemicals, as well as in other applications (e.g., detergents, adhesives, and 
cosmetics). PEI can also be used for CO 2 capture and laboratory biology. BASF 
is the only PEI manufacturer in the EEA.  
                                                 
69  Case M.5355 – BASF/CIBA, Commission decision of 12 March 2009 . 
70  Case M.5355  – BASF/CIBA, Commission decision of 12 March 2009.  
 
21 (118)  According to the Parties, PEI is not an inter mediate product and that PEI can be 
either sold by itself or combined with other chemicals as part of a holistic 
customer solution.  
(119)  The Commission has not previously assessed the market for PEI.  However, in 
BASF/ CIBA71, the Commission considered that PEI, a s well as other highly 
cationic polymers could be used as a fixation agent  and that PEI could also be 
used as an RDA.  
(120)  The Parties submit that the relevant upstream market should be determined by 
end-use, whereby the product market definition would include defoamers, RDA, 
WSA, CC (fixation agents)  and other water treatment chemicals. However, the 
Parties submit that the exact product market can be left open.  
(121)  The Parties submit that the geographic market definition is worldwide.  
According to the results of t he market investigation, none of the customers of 
PEI currently source the product from suppliers from outside the EEA. 
According to one customer, they would consider a PEI supplier from outside the 
EEA if a suitable supplier if available72, suggesting that the market is at least 
EEA -wide, but could be worldwide.  
(122)  For the purpose of this Decision, the Commission considers that the exact 
product and geographic market definitions can be left open, since the notified 
concentration does not rais e serious doubts as to its compatibility with the 
internal market even on the narrowest possible market definition, that is to say 
the supply of PEI in the EEA.  
 4.4.10.  2-Mercaptoethanol (" BME ") 
(123)  BME is used to produce polyacrylates that are used as input s for water 
treatment . The major applications of BME are precursors for PVC stabilizers, 
boosters, in corrosion inhibitor formulations for oilfield and gas applications, 
co-monomers for polyurethane based optical lenses, additives for PAN fibres 
and buildi ng blocks for agriculture and pharmaceuticals. Solenis uses BME as 
an input in the product of various products, among which industrial water 
treatment chemicals as well as CC, DSA and RDA.  
(124)  The Commission has not previously assessed the market for BME. The  Parties 
argue that the relevant product market can be left open.  
(125)  In relation to the geographic market definition, the Parties submit that, if the 
product market is defined as BME, the geographic scope is worldwide, taking 
into account that all global sup pliers serve the EEA market.  
(126)  For the purpose of this Decision, the Commission considers that the exact 
product and geographic market definitions can be left open, since the notified 
concentration does not raise serious doubts as to its compatibility with the 
internal market even on the narrowest possible market definition, that is to say 
the supply of BME in the EEA.  
                                                 
71  Case M.5355 – BASF/CIBA, Commission decision of 12 March 2009.  
72  Q.81 of Q2 – questionnaire to competitors in end -chemical products.  
 
22  4.4.11.  Glyoxal  
(127)  Glyoxal is used in the production of textiles, leather, cosmetics, epoxy 
applications, oil and gas, biocides, glyoxylic acid  and […]*  hardening 
applications In the paper & pulp chemicals, glyoxal is used to produce 
glyoxylated PAM  (gPAM) , which is mainly used for dray strength and to a 
lesser extend wet strength.  
(128)  The Commission has not assessed the market for glyoxal in the pa st. In the 
absence of past decisional practice, the Parties claim that the product market can 
be defined as including all glyoxal chemical.  
(129)  The Parties argue that the market is at least EEA -wide, if not worldwide. 
According to the Parties they can export glyoxal globally and regulatory 
restrictions have minor  impact on the glyoxal business. The results of the market 
test were not conclusive on the geographic market definition. Half of the 
customers of Glyoxal participating in the market investigation indic ated that 
they currently purchase glyoxal from suppliers outside the EEA, while the other 
half did not73.  
(130)  For the purpose of this Decision, the Commission considers that the exact 
product and geographic market definitions can be left open, since the notifi ed 
concentration does not raise serious doubts as to its compatibility with the 
internal market even on the narrowest possible market definition, that is to say 
the supply of glyoxal in the EEA.  
 4.4.12.  Morpholine  
(131)  Morpholine is a colourless to yellow liqu id chemical that is used in the 
production of corrosion inhibitors, crop protection agents, dyes, optical 
brighteners, pharmaceuticals and rubber chemicals. Morpholine is also used in 
water treatment chemicals. In water treatment, morpoholine can be used t o 
neutralise carbonic acid in steam condensate systems  
(132)  As regards product market definition, in Huntsman/CIBA , the Commission 
considered that morpholine is substitutable with MOPA, cyclohexylamine and 
DMEA74. In BASF/CIBA ,75 the Commission considered a relevant product 
market including all morpholine chemicals but ultimately left the question open. 
The Parties submit that the product market definition can be left open  
(133)  As regards geographic market definition, the Commission le ft the exact scope of 
the market open (EEA -wide or worldwide) in BASF/CIBA . The Parties submit 
that the market for morpholine is worldwide in scope in the absence of 
significant regulatory barriers to prevent transportation and low transport costs. 
The Par ties also submit that ultimately the exact geographic scope of the market 
can be left open.  
                                                 
* Should read: “wood”  
73  Q.89 of Q2 – questionnaire  to competitors in end -chemicals.  
74  Case M.4179  – Huntsman/CIBA TE Business , Commission decision of 30 June 2006.  
75  Case M.5355 – BASF/CIBA, Commission decision of 12 March 2009 . 
 
23 (134)  For the purpose of this Decision, the Commission considers that the exact 
product and geographic market definitions can be left open, since the notified 
concentrati on does not raise serious doubts as to its compatibility with the 
internal market even on the narrowest possible market definition, that is to say 
the supply of morpholine in the EEA.  
 4.4.13.  Diethylaminoethanol (" DEAE ") 
(135)  DEAE is used as neutralizing agent  and CO 2 scavenger in boiler water. Solenis 
uses DEAE as corrosion inhibitor in boiler applications. DEAE can also be used 
in lubricants, as a building block in the agrochemical, pharmaceutical industries 
and as an additive in paper coatings.  
(136)  The Commissio n has not assessed the market of DEAE in its past decisions. The 
Parties claim that the product market can be defined as including all DEAE 
products. However, the Parties also submit that the exact product market 
definition can be left open.  
(137)  The Parties s ubmit that the geographic scope  of the DEAE market  is worldwide, 
due to low transport costs or other specific trade barriers. [CONFIDENTIAL – 
BASF’s production set -up]. 
(138)  For the purpose of this Decision, the Commission considers that the exact 
product and geographic market definitions can be left open, since the notified 
concentration does not raise serious doubts as to its compatibility with the 
internal market even on the narrowest possible market definition, that is to say 
the supply of DEAE in the EEA.  
 4.4.14.  Dimethylaminoethyl acrylate ("DMA3" or " ADAME ") / ADAMEQ uat 
("ADAMEQ")  
(139)  In paper and pulp chemicals, ADAME is used in the production of cPAM -based 
RDA, WSA, CC, and water treatment. ADAME can be quaternised to produce 
ADAMEQ for use as a co -monomer  in the production of cPAM -based 
chemicals.  
(140)  In past decisions,76 the Commission considered ADAME and ADAMEQ to each 
form separate product markets. The Commission also considered the geographic 
scope of both markets to be at least EEA -wide in BASF/CIBA . Howe ver, the 
Commission ultimately left open both the product and geographic delineation of 
the market.  The Parties submit that the relevant product market for ADAME and 
ADAMEQ can be left open .  
(141)  In relation to the geographic market definition, the Parties sub mit that the 
market has changed since BASF/CIBA  and that suppliers of ADAME are now 
active on a global scale. The results of the market investigation seem to indicate 
that the market is global for ADAMEQ, since all of the respondents indicated 
that they pu rchased from suppliers from outside the EEA77. According to the 
                                                 
76 Case M.5355  – BASF/CIBA, Commission decision of 12 March 2009 . 
77  Q105 of  Q2 - questionnaire to competitors in end -chemicals  
 
24 respondents in the questionnaire to suppliers of ADAME, the competition on the 
market takes place on a global level78.  
(142)  For the purpose of the present Decision, the Commission considers that the 
manufacture and supply of ADAME and ADAMEQ constitute separate product 
markets, but the market definition can ultimately be left open since even under 
the narrowest product market definition, the transaction does not raise serious 
doubts as to its compatibility with the internal market. In relation to the 
geographic market scope, the Commission considers that the market is likely to 
be EEA -wide, but the exact geographic scope can be left open, as no serious 
doubts as to the compatibility of the notified concentration with the internal 
market arise under the narrowest possible EEA definition.  
5. COMPETITIVE ASSESSMENT  
(143)  Article 2 of the Merger Regulation requires the Commission to examine whether 
notified concentrations are to be declared 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.  
(144)  The Commission Guidelines on the assessment of horizontal mergers und er the 
Council Regulation on the control of concentrations between undertakings79 (the 
"Horizontal Merger Guidelines") distinguish between two main ways in which 
mergers between actual or potential competitors on the same relevant market 
may significantly i mpede effective competition, namely non-coordinated  effects 
and coordinated effects.  
(145)  Non-coordinated  effects may significantly impede effective competition by 
eliminating the competitive constraint imposed by each merging party on the 
other, as a result o f which the merged entity would have increased market power 
without resorting to coordinated behaviour. In this regard, the Horizontal 
Merger Guidelines consider not only the direct loss of competition between the 
merging firms, but also the reduction in c ompetitive pressure on non -merging 
firms in the same market that could be brought about by the merger. According 
to recital (25) of the preamble of the Merger Regulation, a significant 
impediment to effective competition can result from the anticompetitive  effects 
of a concentration even if the merged entity would not have a dominant position 
on the market concerned.  
(146)  The Horizontal Merger Guidelines list a number of factors which may influence 
whether or not significant non-coordinated  effects are likely t o 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 
compet itive force. Not all of these factors need to be present for significant non-
coordinated effects to be likely. The list of factors, each of which is not 
necessarily decisive in its own right, is also not an exhaustive list.  
                                                 
78  Q46 of Q3 – questionnaire to suppliers and competitors in raw materials.  
79 OJ  […]* , 5.2.2004, p. 5.  
* Should read: "C31". 
 
25 (147)  In addition, the Commission Guid elines on the assessment of non -horizontal 
mergers under the Council Regulation on the control of concentrations between 
undertakings80 (the "Non -Horizontal  Merger Guidelines") distinguish between 
two main ways in which vertical mergers may significantly impede effective 
competition, namely input foreclosure and customer foreclosure.  
(148)  For a Transaction to raise input foreclosure competition concerns, the merge d 
entity must have a significant amount of market power upstream.81 In assessing 
the likelihood of an anticompetitive input foreclosure strategy, the Commission 
has to examine whether (i) the merged entity would have the ability to 
substantially foreclose a ccess to inputs, (ii) whether it would have the incentive 
to do so , and (iii) whether a foreclosure strategy would have a significant 
detrimental on competition downstream .82 
(149)  For a Transaction to raise customer foreclosure competition concerns, it must be 
the case that the vertical merger involves a company which is an important 
customer with a significant degree of market power in the downstream market.83 
In assessing the likelihood of an anticompetitive customer foreclosure scenario, 
the Commission has to e xamine whether (i) the merged entity would have the 
ability to foreclose  access to downstream  markets by reducing its purchases 
from its upstream rivals, (ii) whether it would have the incentive to reduce  its 
purchases upstream, and (iii) whether  a foreclo sure strategy would have a  
significant  detrimental effect on consumers in the downstream market.84  
(150)  BASF DOM and Solenis are both active in the manufacture and sale of 
chemicals that are sold for paper and pulp applications.  The Transaction gives 
rise to a number of horizontally affected markets, which are discussed in Section 
5.1 . BASF also supplies raw/intermediate chemicals which are used by Solenis  
and/or its competitors as input for the manufacture of paper and pulp chemicals 
and water treatment chemicals.  The Transaction also gives rise to a number of 
vertically  affected markets, which are discussed in Section 5.2.  
5.1 Horizontal Analysis  
(151)  As a general remark, the Notifying Parties submit ted that BASF DOM and 
Solenis are not close competitors in any paper and pulp market segment, 
because they have different business models.  On the one hand, BASF DOM is 
particularly  focused on product manufacturin g, its technologies and production 
processes, but with a low level of customer service.  On the other hand, Solenis 
is recognised for its strong market knowledge, technical expertise and customer 
service -based model, which involves frequent customer site vi sits and service 
                                                 
80 OJ L24, 29.1.2004, p.1  
81 Non-horizontal Merger Guidelines, para. 35.  
82 Non-horizontal Merger Guidelines, para. 32. Each of these points will be analysed separately although the 
Commission recognises that they are intertwined.  
83  Non-horizontal Merger Guidelines, para. 61.  
84  Non-horizontal Merger Guidelines, para. 59.  
 
26 personnel located in customer ’s plants. The notified concentration would bring 
together these different yet complementary business models.85  
(152)  The market investigation confirmed the statement of the Parties that their 
business models are fundamentally different.86  
 5.1.1.  Defoamers for Paper and Pulp Applications 
(153)  BASF DOM manufactures and supplies in the EEA fatty acid/alcohol and 
EO/PO defoamers under its Afranil  brand.  Afranil defoamers are sold into the 
paper and pulp industry. Solenis manufactures and supplies defoamers under the 
following trade names: Advantage, Antispumin, De Airex, Nopcomaster, and 
Protocol.  None of these brands are technology-specific and Solenis sells 
defoamers based on different chemistries under the same trade names. Solenis' 
portfolio includes defoamers based on silicone; fatty acid/alcohol; EO/PO; and 
PEG. Solenis either buys the basic component of the defoamer from a third-
party and then mixes it or it simply resells defoamers from third parties 
([CONFIDENTIAL]).  
(154)  The Notifying Parties submitted that the notified concentration would  not give 
rise to competition concerns in a relevant market including defoamers for the 
paper and pulp industry in the EEA.   
(155)  Set forth below are the market shares of the Notifying Parties and their 
competitors in defoamers in the EEA (taking into account sales to end-
customers by manufacturers and resellers):87 
 
                                                 
85  See e.g., BASF, BASF and Solenis to join forces by combining paper and water chemicals business, 3 May 2018, 
p. 3, available at https://www.basf.com/documents/corp/en/investor-relations/calendar-and-
publications/presentations/2018/180503 BASF IR-Slides Solenis.pdf .  
86  See Doc ID 237, Minutes from call with competitor, 24 September 2018, para. 11 and Doc ID  116, Minutes from 
call with competitor , 18 September 2018, para. 2.  
87  The combined market share of the Notifying Parties does not change significantly if one looks at production 
market shares, i.e., if the sales were attributed to the manufacturers of defoamers and not to the company that 
supplies the end-customer. In that case, the combined market share of the Parties would be [10-20]% and 
significant manufacturers would continue to compete post-Transaction, including Ouvrie, Blackburn, Kolb, 
Kemira, Kurita, and BIM. 
 
27 Table 1 
Defoamers  in the EEA used in Paper and Pulp Applications (20 17) 
Supplier  Sales (EUR million)  Market Share (%)  
BASF DOM  [CONFIDENTIAL]  [5-10] 
Solenis  [CONFIDENTIAL]  [10-20] 
Combined  [CONFIDENTIAL]  [20-30] 
Blackburn  [CONFIDENTIAL]  [10-20] 
Kemira  [CONFIDENTIAL]  [10-20] 
Kolb  [CONFIDENTIAL]  [10-20] 
BIM  [CONFIDENTIAL]  [5-10] 
Nalco  [CONFIDENTIAL]  [0-5] 
Kurita  [CONFIDENTIAL]  [0-5] 
Ouvrie  [CONFIDENTIAL]88 [20-30] 
Others89 [CONFIDENTIAL]  [5-10] 
Total  199 100 
Source : Form CO  
 
(156)  The Parties' combined share is [20-30]% in defoamers in the EEA in 2017.  Post-
Transaction, the combined entity w ould continue to face competitive constraints 
from at least 5 competitors with a market share of 5% or more.  These 
competitors would be  Ouvrie ( [20-30]%), Blackburn ( [10-20]%), Kemira ( [10-
20]%), Kolb ( [10-20]%), and BIM ( [5-10]%). 
(157)  The Parties do not seem to compete closely in defoamers in the EEA for the 
following reasons.  First, they have different business models.  For most 
defoamers ( for instance , fatty acid/alcohol ones) Solenis purchases the basic 
component and mi xes it before reselling the end chemicals to the customer.  
Solenis also resells end chemicals that it sources from third parties.  By contrast, 
BASF DOM sells defoamers in which it manufactures itself the basic 
component.  Second, the Parties  focus on differ ent chemistries of defoamers.  
Approximately [CONFIDENTIAL ] of BASF DOM's sales of defoamers in the 
EEA in 2017 represented fatty acid/alcohol based defoamers.  Solenis' product 
portfolio is much more diverse in terms of product chemistries.  
[CONFIDENTIAL ] of its total sales of defoamers was driven by fatty 
acid/alcohol based products.  The defoamers that Solenis typically sells are 
silicone based defoamers.90 Third, as explained above,91 Solenis has a service -
orientated business model driven by customer intimac y while BASF DOM 
focuses on product manufacturing.   
(158)  Finally, the vast majority of informative respondents in the  market investigation 
did not raise any competition concerns in relation to defoamers for paper and 
pulp applications in the EEA , during the mar ket investigation . 92 
                                                 
88  Solenis can only estimate the shares of Ouvrie in 2010. Solenis assumes that a comparable (if not higher) figure 
would apply in 2017.  
89  Others include Archroma, Buckman, Bluestar, Caffaro, Dow, Elementis, Evonik, Protex International, an d 
Wacker -Chemie.  
90  Form CO, Table 13.  
91  See paras. (151) -(152).  
92  See Q69 -Q71 of Q1 questionnaire to customers of end chemical products and Q.10 of Q2 - questionnaire to 
competitors in end chemical products and  Q118 -Q120 of Q2 questionnaire to questi onnaire to competitors in end 
chemical products.  
 
28 (159)  In view of the above , taking into account the results of the market investigation 
and all the evidence available to it , the Commission concludes that the notified 
concentration  does not raise serious doubts as to its compatibility with the 
internal market with respect to the EEA -wide market for  defoamers for paper 
and pulp applications . 
(160)  Nor does the notified concentration  give rise to competition concerns, if a 
narrower relevant  market were  defined including only EO/PO based defoamers 
in the EEA  for paper and pulp applications . In such a relevant market the 
Parties' combined share would be 15 -25%.  Post-Transaction, the combined 
entity would face two large rivals with comparable m arket shares, namely 
Blackburn ( [20-30]%) and Nalco ( [20-30]%). Other competitors with a market 
share of 5% or more include Kemira ( [10-20]%) and Kolb (5 -10%).   
(161)  The market investigation did not reveal any competition concerns in relation to 
EO/PO defoamers  for paper and pulp applications in the EEA.93 
(162)  In view of the above, taking into account the results of the market investigation 
and all the evidence available to it , the Commission concludes that the notified 
concentration does not raise serious doubts as to its compatibility with the 
internal market regarding EO/PO defoamers in the EEA for paper and pulp 
applications  in the EEA . 
 5.1.2.  Contaminant Control Agents  
(163)  BASF DOM manufactures and supplies CC under the following trade names: 
Catiofast  (based on PEI , PVAm, P Am, and polyDADMAC). [CONFIDENTIAL  
– BASF DOM’s business set -up regarding the supply of Catiofast products] . In 
the EEA, BASF DOM also has limited sales of Cedesorb, a bentonite clay.  
Solenis manufactures and supplies the following CC in the EEA: DeTa c (based 
on polyvinyl alcohol), Zenix , Renew , Presstige  (including surfactants), and 
Infinity  (based on polyacrylates) .  
(164)  The Notifying Parties submitted that the notified concentration would not give 
rise to competition concerns in a relevant market in cluding CC in the EEA.   
(165)  Set forth below are the market shares of the Notifying Parties and their 
competitors in CC in the EEA (taking into account sales to end -customers by 
manufacturers and resellers):94 
                                                 
93  See Q69 -Q71 of Q1 questionnaire to customers of end chemical products and Q.10 of Q2 - questionnaire to 
competitors in end chemical products and  Q118 -Q120 of Q2 questionnaire to questionnaire to competit ors in end 
chemical products.  
94  The combined market share of the Notifying Parties does not change significantly if one looks at production 
market shares, i.e., if the sales were attributed to the manufacturers of defoamers and not to the company that 
supplies the end -customer. In that case, the combined market share of the Parties would be [10 -20]% and 
significant manufacturers would continue to compete post -Transaction, including Luzenac (Imerys), Mondo 
Minerals, SNF, Nalco, Kemira, and Huntsman.  
 
29 Table 2 
CC in the EEA used in Paper and Pulp Applica tions (2017)  
Supplier  Sales (EUR million)  Market Share (%)  
BASF DOM  [CONFIDENTIAL]  [0-5] 
Solenis  [CONFIDENTIAL]  [10-20] 
Combined  [CONFIDENTIAL]  [20-30] 
Kemira  [CONFIDENTIAL]  [5-10] 
Luzenac (Imerys)  [CONFIDENTIAL]  [5-10] 
Mondo Minerals  [CONFIDENTIAL]  [5-10] 
Nalco  [CONFIDENTIAL]  [5-10] 
Others95 [CONFIDENTIAL]  [40-50] 
Total  200 100 
Source : Form CO  
(166)  The Parties' combined share is [20-30]% in CC in the EEA in 2017.  The share 
increment contributed by BASF DOM is [0-5]%. Post-Transaction, the 
combined entity w ould continue to face competitive constraints from at least 4 
competitors with a market share of 5% or more.  These competitors would be  
Kemira ( [5-10]%), Luzenac (Imerys) ( [5-10]%), Mondo Minerals ( [5-10]%), 
and Nalco ( [5-10]%).  
(167)  The P arties do not seem to compete closely in CC in the EEA.  First, BASF 
DOM and Solenis have different business models regarding CCs .96 BASF  DOM  
is more focused on product manufacturing while Solenis offers a more service -
orientated supply model, involving on -site support and solutions tailored to the 
customer's problem.  Second , BASF DOM has a product portfolio highly 
specialized in fixation agents.  [90-100]% of BASF DOM's total CC sales in the 
EEA in 2017 came from fixation agents.  On the contrary, Solenis' por tfolio is 
more balanced and includes fixation agents (representing [50-60]% of the total 
sales in the EEA in 2017); dispersion agents (approx. [10-20]%) and adsorption 
agents (approx. [30-40]%).97  
(168)  Finally, the vast majority of informative respondents did n ot raise  any 
competition concerns in relation to CC in the EEA , during the market 
investigation . 98 
(169)  In view of the above, taking into account the results of the market investigation 
and all the evidence available to it , the Commission concludes that the notified 
concentration does not raise serious doubts as to its compatibility with the 
internal market regarding CC in the EEA.  
(170)  Nor does the Transaction give rise to competition concerns, if a narrower 
relevant market were defined including only fixation ag ents. In such a relevant 
market, the Parties' combined share would be 15-25%. Post-Transaction, the 
combined entity would face 4 large rivals  with market shares exceeding 5% , 
namely, Kemira ( 10-20%), Luzenac (Imerys) (15 -25%), Mondo Minerals (15 -
                                                 
95  Othe rs include Archroma, Buckman Laboratories, Caffaro, Kolb, Kurita, Lamirsa, Muenzig, and Protex 
International.  
96  See Doc ID 237, Minutes from call with competitor, 24 September 2018, para. 11.  
97  For the differences between the three categories, see para . (23) above.  
98   See Q69 -Q71 of Q1 questionnaire to customers of end chemical products and Q.10 of Q2 - questionnaire to 
competitors in end chemical products and  Q118 -Q120 of Q2 questionnaire to questionnaire to competitors in end 
chemical products.  
 
30 25%), and Nalco (15 -25%).  Other competitors include ACAT (0 -5%) and 
SNF/Axchem (0 -5%).  
(171)  The market investigation did not reveal any competition concerns in relation to a 
narrow  relevant market for fixation agents  in the EEA. 99 
(172)  In view of the above, taking into accoun t the results of the market investigation 
and all the evidence available to it , the Commission concludes that the notified 
concentration does not raise serious doubts as to its compatibility with the  
internal market regarding a relevant market for fixation  agents  in the EEA . 
 5.1.3.  Retention and Drainage Aids  
(173)  BASF DOM supplies in the EEA single -polymer RDA under the following trade 
names: Percol  (based on PAM); HM Polymin  (based on PEI); Polymin VX/VT  
and Xelorex  (based on PVAm).  BASF DOM also supplies RD A which include 
micro particles under the following trade names: Hydrocol  (including cPAM 
and bentonites) and Telioform  (including PAM and bentonite).   
(174)  Solenis supplies in the EEA single -polymer RDA under the following trade 
names: PerForm SP  (based on PAM ) and Praestaret  (based on polyamines).  
Solenis also supplies RDA which include micro particles, under the brand 
PerForm MP .  
(175) The Notifying Parties submitted that the notified concentration  would  not give rise 
to competition concerns in a relevant market including all RDA in the EEA.100  
(176)  Set forth below are the market shares of the Notifying Parties and their 
competitors in RDA in the EEA (taking into account sales to end -customers by 
manufacturers and resellers):101  
Table 3 
RDA in the EEA used in Paper and Pulp Applications (2017)  
Supplier  Sales (EUR million)  Market Share (%)  
BASF DOM  [CONFIDENTIAL]  [10-20] 
Solenis  [CONFIDENTIAL]  [10-20] 
Combined  [CONFIDENTIAL]  [20-30] 
Kemira  [CONFIDENTIAL]  26-38  
Nalco  [CONFIDENTIAL]  [10-20] 
ACAT  [CONFIDENTIAL]  1-6 
SNF/Axchem  [CONFIDENTIAL]  1-6 
Chupa  [CONFIDENTIAL]  1-6 
Others  [CONFIDENTIAL]  7-30 
Total  263 100 
                                                 
99   See Q69 -Q71 of Q1 questionnaire to customers of end chemical products and Q.10 of Q2 - questionnaire to 
competitors in end chemical products a nd Q118 -Q120 of Q2 questionnaire to questionnaire to competitors in end 
chemical products.   
100  The Notifying Parties argued that synthetic DSA belongs to the same relevant product market as starch DSA. In 
such a broad market, the combined share of the Parties would be below 20%. For the reasons explained in Section 
4.1.2.a. above, the Commission tak es the view that synthetic DSA belong to a separate relevant product market.  
101  The combined market share of the Notifying Parties does not change significantly if one looks at production 
market shares, i.e., if the sales were attributed to the manufactur ers of RDA and not to the company that supplies 
the end -customer. In that case, the combined market share of the Parties would be [20 -30]% and significant 
manufacturers would continue to compete post -Transaction, including SNF, Kemira, and Nalco.  
 
31 (177)  The Parties' combined share is [20-30]% in RDA in the EEA in 2017.  Post-
Transaction, the combined entity would continue to face competitive constraints 
from at least 5 competitors with a market share of 5% or more.102 These 
competitors are Kemira ( 26-38%), Nalco ( [10-20]%), and ACAT, SNF/Axchem, 
and Chupa (each with a share  of 1-6%).  
(178)  The Parties do not seem to compete closely in RDA in the EEA.  First, each of 
BASF DOM and Solenis has a different focus in their RDA portfolio. BASF 
DOM mainly supplies PVAm -based and micro  particle -based RDA chemistries, 
including bentonites.  Solenis is predominantly focused on PAM -based RDA  
(which are more commoditized)  and offers a limited number of micro  particle -
based products.  Second , each of the Parties targets different types of customers.  
BASF DOM's products increase the strength in the final product, which means 
this undertaking  has been targeting  large packaging producers for RDA and 
producers of graphical paper.  On the other hand, Solenis offers RDA for all 
applications.   
(179)  Solenis submitt ed bidding data regarding RDA in EMEA.  Solenis found that it 
has lost to rivals business of approximately EUR [CONFIDENTIAL]  million in 
2015 -2017 but only approximately [0-20]% of this business was lost to BASF 
DOM.  Solenis also estimated that it won from rivals business of approximately 
EUR [CONFIDENTIAL]  million in 2015 -2017 but approximately [10-30]% 
was won from BASF DOM.103  
(180)  In BASF/CIBA , the Commission also found that RDA customers have high 
buyer power, which means they can negotiate lower prices and f avourable 
conditions for themselves using sophisticated procurement procedures.104  
(181)  Finally, the vast majority of customers and competitors did not raise any 
competition concerns in relation to RDA in the EEA , during the market 
investigation . 105 
(182)  In view of the above, taking into account the results of the market investigation 
and all the evidence available to it , the Commission concludes that the 
Transaction does not raise serious doubts as to its compatibility with the internal 
market regarding R DA in the EEA.  
(183)  Nor does the notified concentration give rise to competition concerns, if distinct 
relevant product markets are identified for (i) single -polymer RDA; (ii) multi -
polymer RDA ; and (iii) micro particle  RDA : 
 The Parties' combined share in single -polymer RDA is estimated at 
approximately 20 -35%.  Post-Transaction, the combined entity would  continue 
to face competitive constraints from large RDA players, such as Kemira (20 -
30%), Nalco ( [10-20]%), ACAT, SNF/Axchem , and Chupa (each [5-10]%). 
                                                 
102  Takin g the highest end of the market share range provided for ACAT, SNF/Axchem, and Chupa.  
103  Form CO, Table 27.  
104  See case M.5355 - BASF/CIBA , Commission decision of 12 March 2009, para. 86.   
105   See Q69 -Q71 of Q1 questionnaire to customers of end chemical products and Q.10 of Q2 - questionnaire to 
competitors in end chemical products and  Q118 -Q120 of Q2 questionnaire to questionnaire to competitors in end 
chemical products.   
 
32 All of these players have wide product portfolios including both single -
polymer and multi -polymer RDA;  
 The Parties’ combined share in multi -polymer RDA is estimated at 
approximately  [20-30]%. Post-Transaction, the combined enti ty would  
continue to face competitive constraints from large RDA players, such as 
Kemira (20 -30%), Nalco (15 -25%), ACAT, SNF/Axchem, and Chupa (each 
[5-10]%). All of these players have wide product portfolios including both 
single -polymer and multi -polymer  RDA;  
 The Parties’ combined share in micro particle RDA is estimated at 
approximately 20 -35%.  In RDA including micro particles, Solenis is not an 
important player.  Post-Transaction, the combined entity would  continue to 
face competitive constraints from l arge RDA players, such as Kemira (25 -
35%), Nalco (10 -20%) and also from ACAT, SNF/Axchem, and Chupa (each 
[0-5]%).  
(184)  The market investigation  did not reveal  any competition concerns in relation to 
single -polymer, multi -polymer or micro particle RDA in the E EA. 106 
(185)  In view of the above, taking into account the results of the market investigation 
and all the evidence available to it, the Commission concludes that the notified 
concentration does not raise serious doubts as to its compatibility with the 
internal market regarding single -polymer, multi -polymer or micro particle RDA 
in the EEA.  
 5.1.4.  Synthetic Dry Strength Agents  
(186)  BASF DOM manufactures and supplies in the EEA Xelorex , a PVAm -based 
chemical that can be used among other things as a DSA and Luredur  Plus, a 
synthetic DSA based on gPAM.107 BASF DOM also manufactures Lupamin , a 
PVAm -based DSA that is purchased by resellers who react it and then sell it 
further to customers in the paper and pulp industry.  Solenis offers synthetic 
DSA in the EEA under its Hercobond  brand family.  Solenis manufactures and 
supplies cPAM -based, aPAM -based, and gPAM -based DSA.  Solenis also 
manufactures and supplies PAE resins which can be used as DSA, although they 
are primarily used as a wet strength additive.  Finally, Solenis res ells PVAm -
based chemicals and also cellulose enzymes and CMC as DSA.   
(187)  The Notifying Parties submitted that the notified concentratio n would  not give 
rise to compe tition concerns in a relevant market including only synthetic DSA  
in the EEA .108  
                                                 
106  See Q69 -Q71 of Q1 questionnaire to customers of end chemical products and Q.10 o f Q2 - questionnaire to 
competitors in end chemical products and  Q118 -Q120 of Q2 questionnaire to questionnaire to competitors in end 
chemical products.  
107  BASF supplies Luredur gPAM in the EEA based on prepolymer produced in BASF's production plant in 
[CONFIDENTIAL].  
108  The Notifying Parties argued that synthetic DSA belongs to the same relevant product market as starch DSA. In 
such a broad market, the combined share of the Parties would be below 20%. For the reasons explained in paras. 
(32)ff. above, the Commission takes the view that synthetic DSA belong to a separate relevant product market.  
 
33 (188)  Set forth belo w are the market shares of the Notifying Parties and their 
competitors in synthetic DSA in the EEA (taking into account sales to end -
customers by manufacturers and resellers):109  
Table 4 
Synthetic DSA in the EEA used in Paper and Pulp Applications (2017)  
Supplier  Sales (EUR million)  Market Share (%)  
BASF DOM  [CONFIDENTIAL]110 [20-30] 
Solenis  [CONFIDENTIAL]  [10-20] 
Combined  [CONFIDENTIAL]  [30-40] 
Kemira  [CONFIDENTIAL]  [10-20] 
ACAT  [CONFIDENTIAL]  [10-20] 
Buckman  [CONFIDENTIAL]  [5-10] 
SNF/Axchem  [CONFIDENTIAL]  [5-10] 
Nalco  [CONFIDENTIAL]  [0-5] 
Mare  [CONFIDENTIAL]  [0-5] 
Others  [CONFIDENTIAL]  [10-20] 
Total  84 100 
Source : Form CO  
(189)  The Parties ' combined share is [30-40]% in synthetic DSA in the EEA in 2017.  
Post-Transaction, the combined entity w ould continue to face competitive 
constraints from at least 4 competitors with a market share of 5% or more.  These 
competitors would  Kemira ( [10-20]%), ACAT ( [10-20]%), Buckman ( [5-10]%), 
and SNF/Axchem ( [5-10]%).  
(190)  The Parties do not seem to compete closel y in terms of chemistries included in 
the product portfolio.  First, t he focus of BASF DOM and Solenis is on different 
types of synthetic DSA.  Approximately [CONFIDENTIAL ] of BASF DOM's 
total sales of synthetic DSA in the EEA in 2017 represented PVAm -based DSA.  
Solenis' product portfolio is much more diverse in terms of product chemistries.  
Only [CONFIDENTIAL] % of its total sales of synthetic DSA was driven by 
PVAm -based products.  The remaining synthetic DSA sales concern mainly 
PAM -based products ( [CONFIDEN TIAL] %), PAE resin -based products 
([CONFIDENTIAL] %) and gPAM -based products ( [CONFIDENTIAL] %).111 
Second, as explained above,112 Solenis has a service -orientated business model 
driven by customer intimacy while BASF DOM focuses on product 
manufacturing.   
(191)  The market investigation confirmed the position of the Notifying Parties that the 
notified concentration  would  not give rise to competition concerns in synthetic 
DSA in the EEA.  In more detail:  
 The market investigation confirmed the argument of the Notify ing Parties that 
there is excess capacity in synthetic DSA.  All the competitors that responded 
                                                 
109  The combined market share of the Notifying Parties does not change significantly if one looks at production 
market shares, i.e., if the sales were attributed to the manufacturers of synthetic DSA and not to the company that 
supplies the end -customer. In th at case, the combined market share of the Parties would be [30 -40]% and 
significant manufacturers would continue to compete post -Transaction, including SNF, Kemira, Nalco, and Mare.  
110  According to the Notifying Parties, this includes all BASF DOM sales o f PVAm -based chemicals, even if they are 
not specifically for DSA. As a result, the Notifying Parties argue that the share of BASF DOM (and the combined 
share of the Parties) is overstated.  
111  See Form CO, Table 46.  
112  See paras. (151) -(152).  
 
34 to the Commission's market investigation confirmed that there are no capacity 
constraints in synthetic DSA.113 As one competitor put it, " free capacity is not 
an issue" in synthetic DSA.114 Thus, it would not be possible for any 
manufacturer to raise DSA prices without losing business.   
 The market investigation showed  that the combined entity would continue to 
compete with several players in synthetic DSA post -Transac tion. The 
majority of responsive customers confirmed that several strong rivals would  
continue exerting competitive constraints on the combined entity . More than 
75% of responsive customers stated that post -merger, the number of players 
in synthetic DSA wo uld be sufficient to guarantee competitive prices.115  
 The market investigation confirmed the position of the Notifying Parties that 
paper and pulp customers using synthetic DSA have countervailing buyer 
power.  The majority of responsive customers also do no t expect the 
Transaction to have a meaningful effect on their company's bargaining 
position vis -à-vis synthetic DSA suppliers.116 In addition, t he majority of 
customers stated that they purchase synthetic DSA from more than one 
suppliers in the EEA.  The key reasons for a multi -sourcing strategy are (i) to 
ensure security of supply and (ii) to gain leverage in price negotiations.117 
None of the responsive customers stated that they purchase synthetic DSA 
only from BASF DOM and Solenis.118  
 The market investigation  suggested that it is not difficult, timely, or costly for 
the customers to switch from one synthetic DSA to another.  Several 
customers explained that prior to switching, it is necessary to conduct 
laboratory trials and paper mill trials with the new synth etic DSA they are 
planning to use.  The total cost of these trials is estimated at less than EUR 1 
million and the total timing required is less than 12 months.119  
(192)  In view of the above, taking into account the results of the market investigation 
and all the evidence available to it , the Commission concludes that the notified 
concentration does not raise serious doubts as to its compatibility with the 
internal market regarding synthetic DSA in the EEA.  
 5.1.5.  Wet Strength Agents  
(193)  BASF DOM manufactures and sup plies in the EEA WSA under the Luresin AF  
and Urecoll  brand names.  Luresin AF  is PVAm -based and is used to increase 
wet strength in all types of paper.  The Urecoll  range is a formaldehyde -based 
amino resin range.  It is used in specialty grade paper.  Soleni s supplies a PAE -
                                                 
113  Q6.1 an d Q16 of Q2 - questionnaire to competitors in end chemical products and/or customers of raw materials / 
intermediates.  
114  Q16 of Q2 - questionnaire to competitors in end chemical products and/or customers of raw materials / 
intermediates.  
115  Q27 of Q1 – questionnaire to customers of end chemical products.  
116  Q28 of Q1 - questionnaire to customers of end chemical products.  
117  Q8 of Q1 - questionnaire to customers of end chemical products.  
118  Q7 of Q1 - questionnaire to customers of end chemical products.  
119  See Doc ID 669, Minutes from call with customer , 23 November 2018, para. 5 and Doc ID 657, Minutes from call 
with customer , 21 November 2018, para. 4.  
 
35 based product under the trademark Kymene . Solenis manufactures most of the 
WSA it supplies in the EEA and sources the rest from third -parties.  
(194)  The Notifying Parties submitted that the notified concentration  would  not give 
rise to competit ion concerns in a relevant market including WSA in the EEA.  
(195)  Set forth below are the market shares of the Notifying Parties and their 
competitors in WSA in the EEA (taking into account sales to end -customers by 
manufacturers and resellers):120  
Table 5 
WSA in  the EEA used in Paper and Pulp Applications (2017)  
Supplier  Sales (EUR million)  Market Share (%)  
BASF DOM  [CONFIDENTIAL]  [0-5] 
Solenis  [CONFIDENTIAL]  [20-30] 
Combined  [CONFIDENTIAL]  [20-30] 
Mare  [CONFIDENTIAL]  [10-20] 
Kemira  [CONFIDENTIAL]  [10-20] 
Kurita  [CONFIDENTIAL]  [10-20] 
Melamin  [CONFIDENTIAL]  [0-5] 
Mapril  [CONFIDENTIAL]  [0-5] 
Others  [CONFIDENTIAL]  [20-30] 
Total  150 100 
Source : Form CO  
(196)  The Parties' combined share is [20-30]% in WSA in the EEA in 2017.  The share 
incre ment  contributed by BASF DOM is [0-5]%. Post-Transaction, the 
combined entity w ould continue to face competitive constraints from at least 3 
competitors with a market share of 5% or more.  These competitors would  Mare 
([10-20]%), Kemira ( [10-20]%), and Kurita ( [10-20]%).  
(197)  The Parties do not seem to compete closely in WSA in the EEA for the 
following reasons.  First, they focus on different chemistries of WSA.  BASF 
DOM supplies WSA based on PVAm and amino resins, while Solenis supplies 
WSA based on PAE.  Second, BA SF DOM only serves [very few ] customers in 
the EEA who are [CONFIDENTIAL] active in niche applications (e.g., 
laminates).  Solenis is the largest player today and supplies WSA for tissue/towel 
and packaging products.   
(198)  The Notifying Parties added that there is spare capacity in WSA, meaning that 
customers could always switch to other producers of WSA in case of output 
constraints or price increases by the merged entity.  One of the main competitors 
confirmed this during the market investigation.121  
                                                 
120  The combined market share of the Notifying Parties does not change significantly if one looks at p roduction 
market shares, i.e., if the sales were attributed to the manufacturers of synthetic DSA and not to the company that 
supplies the end -customer. In that case, the combined market share of the Parties would be [10 -20]% and 
significant manufacturers would continue to compete post -Transaction, including Mare, Kurita, Kemira, Melamin, 
and Mapril.  
121  See Doc ID 237, Minutes from call with competitor, 24 September 2018, para. 24.  
 
36 (199)  Finally, the  market investigation did not reveal any competition concerns in 
relation to WSA in the EEA. 122 
(200)  In view of the above , taking into account the results of the market investigation 
and all the evidence available to it , the Commission concludes that the notifie d 
concentration does not raise serious doubts as to its compatibility with the 
internal market regarding WSA in the EEA for paper and pulp applications.123 
 5.1.6.  Sizing Agents  
(201)  BASF DOM manufactures and supplies in the EEA styrene -acrylate based 
surface sizing agents under the trade name Basoplast . Solenis supplies both 
internal and surface sizing agents.  Regarding internal agents, Solenis 
manufactures and supplies AKD emulsions and Rosin sizing agents.  Solenis also 
resells an ASA as an internal sizing agent.  Solenis sells its internal sizing agents 
under the trade names Aquapel  and Prequel . As for surface agents, Solenis 
resells a styrene -acrylate emulsion and it also blends its own product (a 
combination of AKD and liquid dimer emulsion).  Solenis also manufactures and 
supplies a minimal amount of styrene maleic anhydride. Solenis sells its surface 
sizing agents under the trade name Scripset .  
(202)  The Notifying Parties submitted that the notified concentration  would  not give 
rise to competition concerns in a relevant market including sizing agents in the 
EEA.  
(203)  Set forth below are the market shares of the Notifying Parties and their 
competitors in sizing agents in the EEA (taking into ac count sales to end -
customers by manufacturers and resellers):124  
                                                 
122  See Q69 -Q71 of Q1 questionnaire to customers of end chemical products a nd Q.10 of Q2 - questionnaire to 
competitors in end chemical products and  Q118 -Q120 of Q2 questionnaire to questionnaire to competitors in end 
chemical products.  
123  Nor does the notified concentration give rise to competition concerns, if distinct relevant  product markets are 
identified for PAE resin WSA; glyoxal -based resin WSA; amino resin -based WSA; and PVAm resin -based WSA. 
The Parties’ activities would not overlap in any of these relevant product markets, as in 2017, Solenis only 
supplied PAE resin -based WSA in the EEA and BASF DOM only supplied amino resin -based and PVAm -based 
WSA. See Form CO, Table 52.  
124  The combined market share of the Notifying Parties does not change significantly if one looks at production 
market shares, i.e., if the sales were attributed to the manufacturers of synthetic DSA and not to the company that 
supplies the end -customer. In that case, the combined market share of the Parties would be [20 -30]% and 
significant manufacturers would continue to compete post -Transaction, inclu ding Kemira, Mare, Dixie, Bercen, 
Kurita, and Melamin.  
 
37 Table 6 
Sizing Agents in the EEA used in Paper and Pulp Applications (2017)  
Supplier  Sales (EUR million)  Market Share (%)  
BASF DOM  [CONFIDENTIAL]  [0-5] 
Solenis  [CONFIDENTIAL]  [20-30] 
Combined  [CONFIDENTIAL]  [30-40] 
Kemira  [CONFIDENTIAL]  [30-40] 
Mare  [CONFIDENTIAL]  [10-20] 
Kurita  [CONFIDENTIAL]  [5-10] 
Sellukem  [CONFIDENTIAL]  [0-5] 
BIM Kemi  [CONFIDENTIAL]  [0-5] 
SNF/Axchem  [CONFIDENTIAL]  [0-5] 
Vertellus  [CONFIDENTIAL]  [0-5] 
Others  [CONFIDENTIAL]  [10-20] 
Total  approximately 150 100 
Source : Form CO  
(204)  The Parties' combined share is [30-40]% in sizing agents in the EEA in 2017.  
The share incremen t contributed by BASF DOM is [0-5]%. Post-Transaction, 
the combined entity w ould continue to face competitive constraints from at least 
3 competitors with a market share of 5% or more.  These competitors would be  
Kemira ( [30-40]%), Mare ( [10-20]%), and Kurita ( [5-10]%).  
(205)  The Parties do not seem to compete closely in sizing agents in the EEA.  BASF 
DOM exited internal sizing agents in 2014, while [a large share ] of Solenis' 
turnover is derived from sales of internal sizing agents. Conversely, the focus of 
the BASF DOM business is on surface sizing agents, where Solenis only resells 
one product that it sources by [CONFIDENTIAL] .  
(206)  Finally, the market investigation did not reveal any competition concerns in 
relation to sizing agents in the EEA. 125 
(207)  In view of the above, taking into account the results of the market investigation 
and all the e vidence available to it,  the Commission concludes that the 
Transaction does not raise serious doubts as to its compatibility with the internal 
market regarding sizing agents in the EEA for paper and pulp applications.  
(208)  Nor does the notified concentration give rise to competition concerns, if distinct  
relevant market were defined for internal sizing agents in the EEA or for  surface 
sizing agents  in the EEA.  BASF DOM is not active in internal sizing agents.  In 
surface sizing agents in the EEA, the Parties' com bined share would be lower, 
namely [20-30]%. The share incremen t contributed by Solenis is [5-10]%. Post-
Transaction, the combined entity would face three large rivals, name ly Kurita 
([20-30]%), Kemira ( [20-30]%), and Mare ( [5-10]%).  
(209)  The Parties do not se em to compete  closely in surface sizing agents in the EEA.  
BASF DOM only supplies surface sizing agents containing styrene acrylate 
(“SAE”).  [CONFIDENTIAL  – BASF DOM manufacturing process] . In contrast, 
Solenis ’ surface sizing agent offering focuses on alkyl ketene dimer (“AKD”) 
                                                 
125   See Q69 -Q71 of Q1 questionnaire to customers of end chemical products and Q.10 of Q2 - questionnaire to 
competitors in end chemical products and  Q118 -Q120 of Q2 questionnaire to questionnaire to c ompetitors in end 
chemical products.   
 
38 emulsions.126 AKD is an internal (not surface) sizing agent.  Solenis 
[CONFIDENTIAL]  and sells the blended product as a surface sizing agent 
alternative to SAE.  
(210)  The market investigation di d not reveal any compet ition concerns in relation to 
surface sizing agents  in the EEA.127 
(211)  In view of the above, taking into account the results of the market investigation 
and all the evidence available to it,  the Commission concludes that the notified 
conce ntration does not raise serious doubts as to its compatibility with the 
internal market regarding surface sizing agents in the EEA . 
 5.1.7.  PAM -based Chemicals  
(212)  BASF DOM supplies in the EEA PAM -based chemicals under the following 
trade names Catiofast  (used as a CC) , Luredur  (used as DSA)  and Percol , 
Organop ol, and Telioform  (used as RDA).  Solenis supplies in the EEA PAM -
based chemicals under the following trade names: PerForm , Novus, Polysan, 
Purachem, Hercules, Nopcofloc, Reten, and Stockopam  (used a s RDA), and 
Hercobond  (used as DSA).  
(213)  The Notifying Parties submitted that the notified concentration  would  not give 
rise to competition concerns in a relevant market including PAM -based 
chemicals in the EEA.  
(214)  Set forth below are the market shares of the Notifying Parties and their 
competitors in PAM -based chemicals in the EEA (taking into account sales to 
end-customers by manufacturers and resellers):128  
Table 7 
PAM -based Chemicals in the EEA used in Paper and Pulp 
Applications (2017)  
Supplier  Sales (EUR million)  Market Share (%)  
BASF DOM  [CONFIDENTIAL]  [10-20] 
Solenis  [CONFIDENTIAL]  [10-20] 
Combined  [CONFIDENTIAL]  [20-30] 
SNF [CONFIDENTIAL]  [30-40]%  
Kemira  [CONFIDENTIAL]  20-30% 
ACAT  [CONFIDENTIAL]  0-5% 
Nalco  [CONFIDENTIAL]  5-10% 
Others  [CONFIDENTIAL]  0-10% 
Total  213 100 
Source : Form CO  
                                                 
126  Solenis also supplies SAE -containing surface sizing agents, which represented approximately 
[CONFIDENTIAL]% of its surface sizing agent sales in the EEA in 2017. Solenis purchases SAE from Kemira.  
127  See Q69 -Q71 of  Q1 questionnaire to customers of end chemical products and Q.10 of Q2 - questionnaire to 
competitors in end chemical products and  Q118 -Q120 of Q2 questionnaire to questionnaire to competitors in end 
chemical products.  
128  According to the Notifying Parties, their combined market share would likely be lower if one looks at production 
market shares, i.e., if the sales were attributed to the manufacturers of PAM -based chemicals and not to the 
company that supplies the end -customer. Solenis sources from third parties PAM -based chemicals which 
correspond to more than [CONFIDENTIAL]% of its total sales. BASF DOM sources from third parties PAM -
based chemicals which correspond to [CONFIDENTIAL]% of its total sales.  
 
39 (215)  The Parties' combined share is [20-30]% in PAM -based chemicals in the EEA in 
2017.  Post-Transaction, the combined entity w ould continue to face competitive 
constraints from several rivals with market shares exceeding 5%, such as SNF 
([30-40]%) and Kemira (20 -30%).  Other competitors include Nalco (5 -10%) 
and ACAT (0 -5%).   
(216)  The Parties do not seem to compete closely in PAM -based che micals  in the 
EEA.  As explained above,129 Solenis has a service -orientated business model 
driven by customer intimacy while BASF DOM focuses on product 
manufacturing.  [CONFIDENTIAL ].130 [CONFIDENTIAL  – information 
regarding internal BASF strategic documents] .131 [CONFIDENTIAL  – 
information regarding internal BASF strategic documents] .132 
[CONFIDENTIAL  – information regarding internal BASF strategic 
documents] .133  
(217)  Finally, the market investigation did not reveal any competition concerns in 
relation to PAM -based chemicals in the EEA.134 
(218)  In view of the above, taking into account the results of the market investigation 
and all the evidence available to it,  the Commission concludes that the notified 
concentration does not raise serious doubts as to its compatibility wi th the 
internal market regarding PAM -based chemicals in the EEA for paper and pulp 
applications.  
 5.1.8.  cPAM -based Chemicals  
(219)  BASF DOM supplies in the EEA cPAM -based chemicals under the following 
trade names : Catiofast  (as CC) and Organop ol and Percol  (used as RDA).  
Solenis supplies in the EEA cPAM -based chemicals under the following trade 
names: Hercobond  (as DSA) and Novus, Polysan, Purachem,  and PerForm  
(used as RDA).  
(220)   The Notifying Parties submitted that the notified concentration  does not give 
rise to  competition concerns in a relevant market including cPAM -based 
chemicals in the EEA.  
(221)  Set forth below are the market shares of the Notifying Parties and their 
competitors in cPAM -based chemicals in the EEA (taking into account sales to 
end-customers by man ufacturers and resellers):135  
                                                 
129  See paras . (151) -(152).  
130  [CONFIDENTIAL] . 
131  [CONFIDENTIAL] . 
132  [CONFIDENTIAL] . 
133  [CONFIDENTIAL] . 
134  See Q69 -Q71 of Q1 questionnaire to customers of end chemical products and Q.10 of Q2 - questionnaire to 
competitors in end chemical products and  Q118 -Q120 of Q2 questionnaire to questionnaire to competitors in end 
chemical products.   
135 According to the Notifying Parties, their combined market share would likely be lower if one looks at production 
market shares, i.e., if the sales were attributed to the manufacture rs of cPAM -based chemicals and not to the 
company that supplies the end -customer. Solenis sources from third parties cPAM -based chemicals which 
correspond to [CONFIDENTIAL]% of its total sales. BASF DOM sources from third parties cPAM -based 
chemicals which  correspond to [CONFIDENTIAL]% of its total sales.  
 
40 Table 8 
cPAM -based Chemicals in the EEA used in Paper and Pulp 
Applications (2017)  
Supplier  Sales (EUR million)  Market Share (%)  
BASF DOM  [CONFIDENTIAL]  [20-30] 
Solenis  [CONFIDENTIAL]  [10-20] 
Combined  [CONFIDENTIAL]  [30-40] 
Kemira  [CONFIDENTIAL]  [30-40] 
Others  [CONFIDENTIAL]  [20-30] 
Total  119 100 
Source : Form CO  
(222)  The Parties' combined share is [30-40]% in cPAM -based chemicals in the EEA 
in 2017.  Post-Transaction, the combined entity w ould continue to face 
competitive constraints from Kemira which would have equivalent market 
power as the merged entity.  Market investigation participants also identified 
SNF, Buckman, and Nalco as important competitors in cPAM -based chemicals 
in the EEA.136  
(223)  The market investigation confirmed the position of the Notifying Parties that the 
Transaction does not give rise to competition concerns in cPAM -based 
chemicals in the EEA.  In more detail:  
 The market investigation showed that the combined entity would  continue 
to compete with several players in cPAM -based chemicals in the EEA  
post-Transaction.  The majority of responsive customers confirmed that 
several strong rivals would  continue exerting competitive constraints on 
the combined entity.  More than 75% of re sponsive customers stated that 
post-merger, the number of players in cPAM -based chemicals  would be 
sufficient to guarantee competitive prices.137  
 In addition, t he market investigation suggested that switching between 
suppliers of cPAM -based chemicals is not  difficult .138 Indeed, 31% of the 
responsive customers stated that they have switched supplier of cPAM -
based chemicals in the past 3 years.  At least two of the rivals of the 
suppliers would  have excess capacity in cPAM -based chemicals post -
Transaction.139 The vast majority of customers stated that they are not 
aware of any capacity constraints in cPAM -based chemicals in the 
EEA.140 Thus, it would not be possible for any manufacturer to raise 
cPAM -based chemicals prices without losing business.   
 Finally, t he marke t investigation indicated that the majority of customers 
expect no or a positive impact of the Transaction on the supply of cPAM -
based chemicals in the EEA.141  
                                                 
136  Q60.4 of questionnaire Q1 to customers of end chemical products.  
137  Q65 of questionnaire Q1 to customers of end chemical products.  
138  Q63 of questionnaire Q1 to customers of end chemical products.  
139  Q6.1 and Q16 of questionnaire Q2 to competitors in end chemical products and/or customers of raw materials / 
intermediates.  
140  Q55 of questionnaire Q1 to customers of end chemical products.  
141  Q68 of questionnaire Q1 to customers of end chemical product s.  
 
41 (224)  In view of the above, taking into account the results of the market investigation 
and all the evi dence available to it,  the Commission concludes that the notified 
concentration does not raise serious doubts as to its compatibility with the 
internal market regarding cPAM -based chemicals in the EEA.  
5.2. Non-Horizontal Analysis  
(225)  The Transaction gives rise to vertical links between the upstream supply of 
raw/intermediate chemicals by BASF and the downstream manufacture and 
supply of paper and water treatment chemicals by Solenis .  
(226)  These actual and potential vertical links give rise to the following vertically 
affected markets:142  
Table 9 
VERTICALLY AFFECTED MARKETS - OVERVIEW  
Upstream Products  Downstream Products  
DMAPA (Dimethylaminopropylamine)  cPAM -based  RDA, WSA, CC, water treatment  
DETA (Diethylenetriamine)  DSA, WSA, sizing  
AEEA (Amino ethyl ethanol amine)  RDA, DSA, CC, water treatment  
AA (Adipic Acid)  cPAM -based  RDA, WSA, CC, water treatment  
PAE -based  WSA and DSA  
PVAm (Polyvinylamine)  DSA, RDA, WSA, CC  
Non-ionic surfactants  (alkox ylates) Defoamers, DSA, RDA, CC, water treatment  
Anionic surfactants  (sulfates/sulfonates)  Defoamer, DSA, RDA, CC, sizing, water treatment  
EDTA (Edetic acid)  water treatment  
PolyDADMAC (Poly -diallyldimethylammonium -chloride)  DSA, RDA, CC, sizing, water treatment  
PEI (Polyethyleneimine)  CC ( fixation agents ), Defoamers, RDA, WSA, water 
treatment  
BME (2-Mercaptoethanol)  water treatment  
Glyoxal  gPAM -based  DSA and WSA  
Morpholine  water treatment  
DEAE (Diethylaminoethanol)  water treatment  
ADAME (Dimethylaminoethyl acrylate)  /ADAME Quat  cPAM -based  RDA, WSA, CC, water treatment  
 
5.2.1.  DMAPA (upstream)  and CC, RDA, WSA, and water treatment chemicals 
(downstream)  
(227)  DMAPA is an intermediate commodity chemical used in various applications, 
including in particular  personal care products (like shampoo and body wash). In 
the paper and water treatment industry, DMAPA is used to produce cPAM, 
which is turn used as an input for the manufacture of CC, RDA, DSA and water 
treatment chemicals.   
(228)  BASF is active in the producti on of DMAPA. Solenis is BASF ’s only DMAPA 
customer active in the downstream affected markets.  
                                                 
142  Where the individual or combined market share of the Parties is 30% or more in the upstream and/or the 
downstream market.  
 
42 (229)  Solenis does not produce DMAPA but sources it on the merchant market mainly 
from BASF, but also, to a much more limited extent , from third party suppliers 
(namely  [CONFIDENTIAL] ). 
(230)  The table below provides an overview of the vertical relationship between 
BASF and Solenis in relation to DMAPA and of the competitive landscape in 
the upstream EEA market.  
Table 10 
UPSTREAM  DOWNSTREAM  
Products  BASF's market 
share  Main competitors  Products  BASF's main 
customer  Solenis' main 
supplier  
DMAPA  Worldwide  
 [50-60]% Eastman [10-20]% 
Solvay [10-20]% 
Shandong [0-5]-[5-10]% 
Huntsman [0-5]% cPAM -
based  
RDA, 
WSA, 
CC, water 
treatment  Solenis (100%)  BASF (>90%)  
EEA  
[55-65]% Eastman [15-25]% 
Huntsman [10-20]% 
Source : BASF's estimates  
Input Foreclosure  
(231)  The Commission considers that, despite the high market share of BASF on the 
upstream market  for DMAPA in the EEA , the notified co ncentration  does not 
raise any risks of input foreclosure since, pre-Transaction,  BASF does not sell 
DMAPA to any customers active in the paper and water treatment industr y other 
than Solenis . Therefore, no downstream rival could be foreclosed post -
Transaction.  Moreo ver, the Commission also notes that  (i) alternative input can 
be used in the production of cPAM  (such as ADAME/ADAMEQ ) and (ii) 
alternative technologies compete with cPAM based chemicals in the 
downstream affected markets (e.g. cPAM based DSA compete with synthetic 
DSA based on other chemistries) . Also , BASF faces two meaningful 
competitors in the EEA market for DMAPA ( i.e. Eastman and Huntsman).  
Finally, the Commission notes that BASF is already vertically integrated pre -
Transaction.  
Customer Foreclosure  
(232)  The Commission considers that the notified concentration  does not raise any 
risks of customer foreclosure in relation to the EEA supply of DMAPA since the 
demand that could potentially be foreclosed is minimal . The fact that Solenis is 
not an important sou rce of demand for upstream competitors is corroborated by 
several elements . First, Solenis already sources most of its DMAPA 
requirements from BASF pre -Transaction. In 2017, less than 10% of Solenis' 
purchases of DMAPA were sourced from third parties. Seco nd, DMAPA is used 
as an input in various applications. Therefore, sales to customers active in paper 
and water treatment chemicals only account for a fraction of the industry -wide 
capacity in the EEA (e.g. less than [0-20]% of BASF total capacity and aroun d 
[20-40]% of its non -captive production in the EEA). Finally, in all the 
downstream affected markets, Solenis' market share is below 30% (see 
Section  5.1). 
 
43 Conclusion  
(233)  In light of the above  and in view of the results of the market investigation and of 
all the evidence available to it , the Commission concludes that the notified 
concentration  does not raise serious doubts as to its compatibility with the 
internal market in relation to the vertical link between the supply of DMAPA 
(upstream) and the manufacture and supply of CC, RDA, WSA, and water 
treatment chemicals (downstream).  
5.2.2.  DETA (upstream)  and DSA, WSA, and sizing agents (downstream)   
(234)  DETA is an intermediate commodity chemical used in various applications (e.g. 
corrosion inhibitors , asphalt additives, detergent). In the paper industry, DETA 
is used as an input for the manufacture of DSA, WSA, and sizing agents.  
(235)  BASF is active in the production of DETA , which it sells to several customers 
active in the downstream affected markets, in cluding [CONFIDENTIAL ]. 
(236)  Solenis does not produce DETA but sources it on the merchant market from 
various suppliers, namely [CONFIDENTIAL] . 
(237)  The table below provides an overview of the vertical relationship between 
BASF and Solenis in relation to DETA and of  the competitive landscape in the 
upstream EEA market.  
Table 11 
UPSTREAM  DOWNSTREAM  
Products  BASF's market 
share  Main competitors  Products  BASF's main 
customer  Solenis' main 
supplier  
DETA  Worldwide  
[10-20]% Dow [20-30]% 
Huntsman [15-25]%  
Toso [10-20]% 
Delamine [10-20]% 
Akzo [10-20]% DSA, 
WSA, 
sizing  Solenis  
([CONFIDENTIAL ]%) 
[CONFIDENTIAL ] BASF 
([CONFIDENTIAL ]%) 
[CONFIDENTIAL ] 
EEA  
[10-20]% Delamine [30-40]% 
Dow [20-30]% 
Akzo [20-30]% 
Source : BASF's estimates  
Input Foreclosure  
(238)  The Commission considers that the notified concentration  is unlikely to raise 
any risks of input foreclosure since  BASF's market share on the upstream 
market for the supply of DETA is well below 30%143, both at EEA and global 
levels . Moreover, BASF faces several strong upstream competitors (such as 
Dow Chemical, Huntsman, Delamine, and AkzoNobel), with similar or higher 
market shares . Therefore, BASF 's market power is unlikely to be sufficient to 
have a significant influence on the supply of DET A. Finally, the Commission 
also notes that BASF is already vertically integrated pre -Transaction.   
                                                 
143  See Non -Horizontal Merger Guidelines, para. 25.  
 
44 Customer Foreclosure  
(239)  The Commission considers that the notified concentration  is unlikely to raise 
any risks of customer foreclosure in relation to the EEA supply of DETA for the 
following  reasons . First, the Commission notes that DETA is used as an input in 
various applications  and not only in the paper industry. According to the Parties, 
Solenis ' total demand of DETA  (i.e. [CONFIDENTIAL]  kilotons) account s for a 
minor share of the industry -wide capacity  (less than [CONFIDENTIAL] % at 
EEA level) . Moreover, the demand that could be foreclosed  is further reduced 
by the fact that, pre -Transaction , BAS F is already Solenis' largest supplier  of 
DETA  (accounting for [CONFIDENTIAL] % of its total requirements in 2017 ). 
It follows that, a ccording to the Parties' estimates, only [10-20]% of the total 
demand sourced on the EEA merchant market  could potentially be foreclosed. 
Third , in all the downstream affected markets, Solenis' market share is below 
30% (comprised between [10-20]% and [20-30]%) (see Section 5.1 ). Finally, the 
market investigation revealed no substantiated competition concerns  from 
upstream competitors.144 
Conclusion  
(240)  In light of the above,  and in view of the results of the market investigation and 
of all the evidence available to it,  the Commission concludes that the notified 
concentration  does not raise serious doubts as to its compatibility with the 
internal market in relation to the vertical link between the supply of DETA 
(upstream) and the manufacture and supply of DSA, WSA, and sizing agents 
(downstream).  
5.2.3.  AEEA (upstream)  and CC, RDA, DSA, and water treatment chemical s 
(downstream)  
(241)  AEEA is an intermediate commodity chemical used in various applications (e.g. 
epoxy hardeners, fuel additives, fabric softeners, etc.). In the paper and water 
treatment industry, AEEA is used as an input for the manufacture of CC, DSA, 
RDA, and water treatment chemicals.  
(242)  BASF is active in the production of AEEA. BASF's sales of AEEA to customers 
active in the downstream affected markets are limited and account for around 
[5-10]% of its total capacity.  
(243)  Solenis does not manufacture  AEEA but pro cures it on the merchant market. In 
the EEA, Solenis sources AEEA from [CONFIDENTIAL] . 
(244)  The table below provides an overview of the vertical relationship between 
BASF and Solenis  in relation to AEEA and of the competitive landscape in the 
upstream EEA market.  
  
                                                 
144  See Q13 of questionnaire Q3 to suppliers and competitors in raw materials . 
 
45 Table 12 
UPSTREAM  DOWNSTREAM  
Products  BASF's market 
share  Main competitors  Products  BASF's 
main 
customer  Solenis' main supplier  
AEEA  Worldwide  
[20-30]% Huntsman [20-30]% 
Akzo [20-30]% 
Dow [15-25]% RDA, 
DSA, CC, 
water 
treatment  n.a. [CONFIDENTIAL ] 
BASF 
([CONFIDENTIAL ]%) EEA  
[15-25]% Akzo 55 -65% 
Dow [15-25]% 
Source : BASF's estimates  
Input Foreclosure  
(245)  The Commission considers that the notified concentration  is unlikely to raise 
any risks of input foreclosure since BASF's market share on the upstream 
market for the supply of AEEA is well below 30%145, both at EEA and global 
levels . Moreover, BASF faces several strong upstream competitors (such as 
Huntsman, Dow Chemical, and AkzoNobel), with similar or higher market 
shares. Therefore, BASF's market power is unlikely to be sufficient to have a 
significant influence on the supply of AEEA. Finally, the Commission also 
notes that BASF is already vertically integrated  pre-Transaction.  
Customer Foreclosure  
(246)  The Commission considers that the notified concentration  does not raise any 
risks of customer foreclosure in relation to the supply of AEEA since the 
demand that could potentially be foreclosed is minimal. In this respect, the 
Commission notes that Solenis already sources a large part of its AEEA  
requirements from BASF pre -Transaction ( [CONFIDENTIAL] %). The residual 
demand that could potentially be fore closed is marginal: [CONFIDENTIAL]  in 
2017 in the EEA which, according to the Parties, account for less than [0-5]% of 
the industry -wide capacity  and less than [0-5]% of the total demand sourced on 
the EEA merchant market . Moreover , in all the downstream affected markets, 
Solenis' market share is below 30% (see Section 5.1 ).  
Conclusion  
(247)  In light of the above, and in view of the results of the market investigation and 
of all the evidence available to it, the Commission concludes that  the notified 
concentration does not raise serious doubts as to its compatibility with the 
internal market in relation to the vertical link between the supply of AEEA 
(upstream) and the manufacture and supply of RDA, DSA, CC, and water 
treatment chemicals (downstream).  
5.2.4.  Adipic Acid (upstream)  and CC, RDA, DSA, and water treatment 
chemicals (downstream)  
(248)  Adipic acid is an intermediate commodity chemical, which as multiple 
downstream applications  including in the automotive, textile, and electronic 
                                                 
145  See Non -Horizontal Merger Guidelines, para. 25.  
 
46 industries . Adipic acid is also used , to a minor extent , in the paper and water 
treatment industry to produce cPAM and PAE resins for use as WSA, DSA, 
RDA, CC, and water treatment  chemicals .  
(249)  BASF is active in the production of adipic acid. BASF sells adipic  acid to [very 
few] customers active in the downstream affected markets : Solenis, 
[CONFIDENTIAL] .  
(250)  Solenis does not produce adipic acid but sources it on the merchant market 
[CONFIDENTIAL] . 
(251)  The table below provides an overview of the vertical relationship between 
BASF and Solenis in relation to adipic acid  and of the competitive landscape in 
the upstream EEA market.  
Table 13 
UPSTREAM  DOWNSTREAM  
Products  BASF's 
market share  Main competitors  Products  BASF's main 
customer  Solenis' main 
supplier  
Adipic  Acid 
("AA")146 Worldwide  
[10-20]% Shadon Haiti [10-
20]% 
Investa [10-20]% 
Asced [5-10]% 
Radici [5-10]% cPAM -based  
RDA, WSA, CC, 
water treatment  
PAE -based  WSA 
and DSA  Solenis ( [50-60]%) 
[CONFIDENTIAL]  
 [CONFIDENTIAL]  
BASF ( [40-50]%) 
EEA  
[40-50]% Radici [30-40]% 
Lanxess [10-20]% 
Source : BASF's estimates  
Input Foreclosure  
(252)  The notified concentration  does not raise input foreclosure concerns with respect 
to the supply of adipic acid to customers active in the paper and water treatment  
for the following reasons . Customers active in paper and water treatment 
chemicals only account for a minor fraction of the total demand for adipic acid , 
which is confirmed by the market investigation .147 In particular , the quantities of 
adipic acid sold by  BASF , in 2017, in the EEA, to customers active in the 
downstream affected market were  very limited : [CONFIDENTIAL]  In other 
words, in the EEA, BASF could only potentially foreclose  [very few ] 
downstream rivals ( namely  [CONFIDENTIAL] ). The volumes that these [very 
few] companies would need to source from alternative suppliers would be 
modest , that is to say  [CONFIDENTIAL ] kilotons representing less than [0-5]% 
of the total demand sourced on the EEA merchant market . It is very unlikely that 
upstream competitors would not have the capacity to supply such limited 
volumes to [CONFIDENTIAL] . In this respect , the Commission notes that , on 
the upstream market, BASF competes with several competitors : at worldwide 
level, BASF has a limi ted market share well below 30% ( [10-20]%), and faces 
several players (Shadon Haiti, Invest, Asced, Radici) ; in the EEA, BASF  has 
higher market share ( [40-50]%) but faces two meaningful competitors (Radici 
                                                 
146  With respect to adipic acid, BASF's includes Solvay so as to take into account BASF's proposed acquisition of 
Solvay's nylon business ('see case M.8674, BASF/Solvay's EP and P&T Business ). 
147  See Q16. 1 of questionnaire Q3 to suppliers of and competitors in raw materials.  
 
47 and Lanxess).  The Commission also notes that BASF is already vertically 
integrated pre -Transaction. Finally, the market investigation revealed no 
substantiated competition concerns from downstream competitors.148 
Customer Foreclosure  
(253)  The Commission considers that the notified concentration  does not raise any 
risks of customer foreclosure in relation to the EEA supply of adipic acid since 
the demand that could potentially be foreclosed is minimal. As already 
mentioned, the market investigation confirmed the Parties ’ claim that customers 
active in paper and water treatment chemicals only account for a minor fraction 
of the total demand for adipic acid.149 Moreover, Solenis already sources a large 
part of its adipic acid requirements from BASF pre -Transaction ( [40-50]%). 
Therefore, the  demand tha t could potentially be foreclosed is minimal, i.e. less 
than [0-5]% of the total demand sourced on the EEA merchant market.  Also, in 
all the downstream affected markets, Solenis ’ market share is below 30% (see 
Section 5.1 ). Finally, upstream competitors co nsider that Solenis is not a large 
enough buyer to raise customer foreclosure concerns in th e adipic acid market150 
and, therefore , did not express any competition concerns in relation to this 
market.151 
Conclusion  
(254)  In light of the above, and in view of the results of the market investigation and 
of all the evidence available to it, the Commission concludes that the notified 
concentration does not raise serious doubts as to its compatibility with the 
internal market in relation to the verti cal link between the supply of adipic acid 
(upstream) and the manufacture and supply of CC, RDA, DSA, and water 
treatment chemicals (downstream) .  
5.2.5.  PVAm (upstream)  and CC, RDA, DSA, WSA (downstream)   
(255)  In the paper industry, PVAm is used an input for t he manufacture of CC, RDA, 
DSA and WSA.  
(256)  BASF is active in the production of PVAm. BASF sells PVAm directly to end -
customers but also to Solenis . 
(257)  Solenis does not produce PVAm but sources it on the merchant market 
exclusively from BASF , and [CONFIDENTIAL]  before resell ing it to end -
customers (under the trade name Hercobon 6300 ). 
(258)  The table below provides an overview of the vertical relationship between 
BASF and Solenis in relation to PVAm and of the competitive landscape in the 
upstream EEA market.  
                                                 
148  See Q69 of questionnaire Q2 to competitors in end chemical products.  
149  See Q16.1 of questionnaire Q3 to suppliers of and competitors in raw materials.  
150  See Q21 of questionnaire Q 3 to suppliers of and competitors in raw materials.  
151  See Q22 of questionnaire Q3 to suppliers of and competitors in raw materials.  
 
48 Table 14 
UPSTREAM  DOWNSTREAM  
Products  BASF’s market 
share (EEA)  Main competitors  Products  BASF’s main 
customer  Solenis’ main 
supplier  
PVAm  [60-70]% SNF 
Acat  DSA, RDA, WSA, 
CC Solenis  
(c. 100%)  BASF  
(100%)  
Source : BASF's estimates  
Input Foreclosure  
(259)  The Commission considers that, despite the high market share of BASF on the 
upstream market for PVAm in the EEA, the notified concentration  does not raise 
any risks of input foreclosure since BASF ’s sales to competitors active in the 
downstream affected ma rkets are negligible  pre-Transaction . Therefore, no 
downstream rival could be foreclosed post -Transaction. Moreover, the 
Commission also notes that alternative technologies compete with PVAm based 
chemicals in the downstream affected markets (e.g. PVAm bas ed DSA compete 
with synthetic DSA based on other chemistries – see Section 4.3.1 ). Finally, t he 
Commission also notes that BASF is already vertically integrated pre -
Transaction.  
Customer Foreclosure  
(260)  The Commission considers that the notified concentration does not raise any 
risks of customer foreclosure in relation to the EEA supply of PVAm since pre -
Transaction, BASF is Solenis ’ exclusive PVAm supplier. In other words, the 
demand that could potentially be foreclosed is null.  
Conclusion  
(261)  In light of the abov e, and in view of  the results of the market investigation and 
of all the evidence available to it , the Commission concludes that the notified 
concentration  does not raise serious doubts as to its compatibility with the 
internal market in relation to the ve rtical link between the supply of PVAm 
(upstream) and the manufacture and supply of CC, RDA, DSA, and WSA 
(downstream).  
5.2.6.  Non-ionic surfactants (upstream)  and defoamers, CC, RDA, DSA, 
sizing agents, and water treatment chemicals (downstream)  
(262)  Non-ionic surfactants are intermediate commodity chemical s used in various 
applications , such as detergents, cleaners, and personal care products . The most 
important synthetic class of non -ionic surfactants are alkoxylates. In the paper 
and water treatment industr y, non-ionic surfactants are used to produce 
defoamers, DSA, RDA, CC and water treatment  chemicals.   
(263)  BASF is active in the production of non -ionic surfactants. In the EEA, BASF 
sells alkoxylates  to several customers active in the paper and water chemical 
industry, including [CONFIDENTIAL ]. 
(264)  Solenis does not manufacture alkoxylates [CONFIDENTIAL] . Solenis sources 
alkoxylates on the merchant market from many suppliers including 
[CONFIDENTIAL] . 
 
49 (265)  The table below provides an overview of the vertical relationship between 
BASF and Solenis in relation to non -ionic surfactants and of the competitive 
landscape in the upstream EEA market.  
Table 15 
UPSTREAM  DOWNSTREAM  
Products  BASF’s 
market share  Main competitors  Products  BASF’s main 
customer  Solenis’ main 
supplier  
Non-ionic  
Surfactants  
(alkox ylates) Worldwide  
[10-20]% Oxiteno [5-10]% 
Shell  [5-10]% 
Clariant [5-10]% 
Sasol  [5-10]% Defoamers, DSA, 
RDA, CC, water 
treatment  n.a. [CONFIDENTIAL]  
EEA  
[20-30]% Sasol [10-20]% 
Kolb [5-10]% 
Clariant [5-10]% 
Ineos [5-10]% 
Source : BASF ’s estimates  
Input Foreclosure  
(266)  The Commission considers that the notified concentration  is unlikely to raise 
any risks of input foreclosure since BASF ’s market share on the upstream 
market for the supply of alkoxylates is well below 30%152, both at EEA and 
global levels . Moreover, the competitive landscape is rather fragmented, BASF 
facing many competitors  both globally and in the EEA  (such as  Sasol, Kolb,  
Clarian, Ineos, etc.), which is confirmed by the market investigation .153 
Therefore, BASF ’s market power is unlikely to be sufficient to have a 
significant influence on the supply of alkoxylates . Finally, the Commission also 
notes that BASF is already verti cally integrated pre -Transaction.  
Customer Foreclosure  
(267)  The Commission considers that the notified concentration  does not raise any 
risks of customer foreclosure in relation to the EEA supply of alkoxylates since 
the demand that could potentially be forecl osed is minimal. As already 
mentioned, alkoxylates are used in various applications, including in particular 
detergents, cleaners, and personal care products. Customers active in paper and 
water treatment chemicals only account for a limited fraction of the total 
demand for alkoxylates . In particular, according to the Parties ’ estimates 
Solenis ’ purchase s accounts for less than [0-5]% of the industry wide capacity in 
the EEA  and less than [0-5]% of the total demand sourced on the EEA merchant 
market . The demand that could potentially be foreclosed is therefore very 
modest, which is confirmed by the market investigation.154 Also, in all the 
downstream affected markets, Solenis ’ market share is below 30% (see Section 
5.1). Finally, the market inves tigation revealed no substantiated competition 
concerns from upstream competitors.155 
  
                                                 
152  See Non -Horizontal Merger Guidelines, para. 25.  
153  See Q29 of questionnaire Q3 to suppliers and competitors in raw materials.  
154  See notably Q25.1, Q26.2, and Q30 of questionnaire Q3 to suppliers and competitors in raw materials.  
155  See Q31 of questionnaire Q3 to suppliers and competitors in raw materials.  
 
50 Conclusion  
(268)  In light of the above, and in view of the results of the market investigation and 
of all the evidence available to it, the Commission concludes that the notified 
concentration does not raise serious doubts as to its compatibility with the 
internal market in relation to the vertical link between the supply of Non -ionic 
surfactants (upstream) and the manufacture and supply CC, RDA, DSA, sizing 
agents, and wa ter treatment chemicals (downstream).  
5.2.7.  Anionic surfactants ( upstream ) and defoamers, CC, RDA, DSA, 
sizing agents, and water treatment chemicals  (downstream ) 
(269)  Anionic surfactants are intermediate commodity chemicals used in various 
applications. The g reat majority of anionic surfactants is used in household 
detergent markets ( for instance,  laundry detergents, dishwashing products, 
household and industrial cleaners, etc.). In the paper and water treatment 
industry, anionic surfactants are used to produc e defoamers, DSA, RDA, CC, 
sizing agents and water treatment chemicals.  The Parties' activities overlap only 
with respect to sulfates and sulfonates, which constitute the bulk of anionic 
surfactants (ca 90%).  
(270)  BASF is active in the production of sulfates an d sulfonates , which it supplies  to 
several customers active in paper and water treatment ( namely  
[CONFIDENTIAL ]) but these sales accounts for a negligible portion of its total 
capacity (less than [CONFIDENTIAL] %). 
(271)  Solenis does not manufacture sulfates and sulfonates but sources them  on the 
merchant market from several suppliers  (such as [CONFIDENTIAL] ). Solenis 
uses sulfates /sulfonates to produce CC.  
(272)  The table below provides an overview of the vertical relationship between 
BASF and Solenis in relation to ani onic surfactants and of the competitive 
landscape in the upstream EEA market.  
Table 16 
UPSTREAM  DOWNSTREAM  
Products  BASF's 
market share  Main 
competitors  Products  BASF's main 
customer  Solenis' main 
supplier  
Anionic  
surfactants  
(sulfates/ 
sulfonates)  worldwide  
[30-40]% Stepan [50-60]% 
Sasol [10-20]% 
Galaxy [5-10]% 
Innospec [0-5]% Defoamer, DSA, 
RDA, CC, sizing, 
water treatment  [CONFIDENTIAL]  [CONFIDENTIAL]  
EEA  
[40-50]% Sasol [20-30]% 
Stepan [10-20]% 
Innospec  [5-10]% 
Galaxy [5-10]% 
Source : BASF's estimates  
Input Foreclosure  
(273)  The Commission considers that the notified concentration  is unlikely to raise 
any risks of input foreclosure in relation to the supply of sulfates /sulfonates for 
the following reasons.  Customers active in paper and water treatme nt chemicals 
 
51 only account for a limited fraction of the total demand for sulfates/sulfonates, 
which is confirmed by the market investigation.156 In particular, the quantities of 
sulfates/sulfonates  sold by BASF, in 2017, in the EEA, to customers active in 
the downstream affected market were very limited:  [CONFIDENTIAL]  tons, 
that is to say  less than [0-5]% of the total EEA capacity  and less than [0-5]% of 
the total demand sourced on the EEA merchant market . Therefore, the volumes 
that could potentially be for eclosed are modest and i t is very unlikely that 
upstream competitors would not have the capacity to supply such limited 
volumes. In this respect, the Commission notes that, on the upstream market, 
BASF competes with many credible competitors both globally and in the EEA 
(e.g. Sasol, Stephan, Innospec, Galaxy, Kao, Cepsa, etc.), which is confirmed by 
Solenis ’ current sourcing and by the market investigation.157 Moreover, the 
Commission also notes that is already vertical ly integrated pre -Transaction and 
that the combined entity would have a modest position in most downstream 
affected markets (share below 30%   see Section 5.1 ), facing competition by 
several rivals , which would make any foreclosure strategy unprofitable.  Finally, 
the the market investigation revealed no substantiated competition concerns 
from downstream competitors.158 
Customer Foreclosure  
(274)  The Commission considers that the notified concentration  does not raise any 
risks of customer foreclosure in relation to the EEA supply of sulfates and 
sulfonates since the demand that could potentially be foreclosed is minimal. As 
already mentioned, the great majority of sulfates and sulfonates is used in 
hous ehold detergent markets. Customers active in paper and water treatment 
chemicals only account for a limited fraction of the total upstream demand.159 In 
particular, according to the Parties ’ estimates Solenis ’ purchases 
([CONFIDENTIAL]  tons in 2017) accounts for less than [0-5]% of the industry 
wide capacity in the EEA. The demand that could potentially be foreclosed is 
therefore modest, which is confirmed by the market investigation.160 Also, [a 
large share ] of Solenis ’s sulfates/sulfonat es purchases  go into the CC 
downstream market, where Solenis ’ market share is well below 30% ( between 
[10-20]% and [20-30]%  see Section 5.1 ). Finally, the market investigation 
revealed no substantiated competition concerns from upstream competitors.161 
Conclusion  
(275)  In light of the above, and in view of the results of the market investigation and 
of all the evidence available to it, the Commission concludes that the notified 
concentration does not raise serious doubts as to its compatibility with the 
internal market in relation to the vertical link between the supply of anionic 
surfactants (upstream) and the manufacture and supply CC, RDA, DSA, sizing 
agents, and water treatment chemicals (downstream).  
                                                 
156  See notably Q34.1 and Q36 of questionnaire Q3 to suppliers and competitors in raw materials.  
157  See Q95, Q96 and Q99 of questionnaire Q2 to competitors in end chemical products and Q38 of questionnaire Q3 
to suppliers and competitors in raw materials.  
158  See Q 101 of questionnaire Q2 to competitors in end chemical  products.  
159  See notably Q34.1 and 36 of questionnaire Q3 to suppliers and competitors in raw materials.  
160  See notably Q35.2 and Q39 of questionnaire Q3 to suppliers and competitors in raw materials.  
161  See Q40 of questionnaire Q3 to suppliers and compet itors in raw materials.  
 
52 5.2.8.  EDTA ( upstream ) and water treatment chemicals ( downstream )  
(276)  EDTA is an intermediate commodity chemical used in various applications  
including water treatment chemicals but also laundry detergents, soap, textile 
processing , etc.  
(277)  BASF is active in the production of EDTA. It sells EDTA and derivative 
products under the trade names Trilon , EDETA  and Basosolve  which serve the 
home -care, industrial & institutional cleaning, laundry, agricultural, personal 
care, textile, leather and oil industries. BASF also sells volumes of EDTA to 
several customers active i n paper and water treatment industry, including 
Solenis . 
(278)  Solenis does not produce EDTA internally but sources it on the merchant market 
from BASF only. Solenis uses EDTA to manufacture products for boiler 
applications sold under the tradename Amertrol . 
(279)  The table below provides an overview of the vertical relationship between 
BASF and Solenis in relation to EDTA and of the competitive landscape in the 
upstream EEA market.  
Table 17 
UPSTREAM  DOWNSTREAM  
Products  BASF's market 
share  Main competitors  Products  BASF's main 
customer  Solenis' main 
supplier  
EDTA  worldwide  
[20-30]% Akzo [10-20]% 
Dow [10-20]% 
JackChem [20-30]% Water treatment 
chemicals  n.a. BASF (100%)  
EEA  
[30-40]% Akzo [20-30]% 
Dow [20-30]% 
JackChem [10-20]% 
Source : BASF's estimates  
Input Foreclosure  
(280)  The Commission considers that the notified concentration  is unlikely to raise 
any risks of input foreclosure since BASF's market share on the upstream 
market for the supply of EDTA does not exceed 30%162, both at EEA and global 
levels . Moreover, BASF faces several strong upstream competitors (such as 
Dow Chemical, AkzoNobel, and JackChem), with market shares above 15%. 
Therefore, BASF's market power is unlikely to be sufficient to have a significant 
influence on the supply of EDTA. Finally, the Co mmission also notes that 
BASF is already vertically integrated pre -Transaction.  
Customer Foreclosure  
(281)  The Commission considers that the notified concentration  does not raise any 
risks of customer foreclosure in relation to the EEA supply of EDTA since pre -
Transaction, BASF is Solenis' exclusive EDTA supplier. In other words, the 
demand that could potentially be foreclosed is null.  
                                                 
162  See Non -horizontal Merger Guidelines, para. 25.  
 
53 Conclusion  
(282)  In light of the above, and in view of the results of the market investigation and 
of all the evidence available to it , the Commission concludes that the notified 
concentration does not raise serious doubts as to its compatibility with the 
internal market in relation to the vertical link between the supply of EDTA 
(upstream) and the manufacture and supply water treatment chemicals 
(downstream).  
5.2.9.  PolyDADMAC ( upstream ) and CC, RDA, DSA, sizing agents, and 
water treatment chemicals ( downstream )  
(283)  In the paper and water treatment industry, PolyDADMAC  is used to produce 
CC, RDA, DSA, sizing agents, and water treatment chemicals.  
(284)  BASF is no longer active in the production of this intermediate commodity 
chemical163 and only resells PolyDADMAC purchased from third parties ( such 
as [CONFIDENTIAL ]) for resal e. 
(285)  Solenis does not produce PolyDADMAC but procures it on the merchant market 
mainly from BASF  and [CONFIDENTIAL] . Solenis uses PolyDADMAC to 
produce water treatment chemicals, sizing agents , and CC.  
(286)  The table below provides an overview of the vertical rel ationship between 
BASF and Solenis in relation to PolyDADMAC and of the competitive 
landscape in the upstream EEA market.  
Table 18 
UPSTREAM  DOWNSTREAM  
Products  BASF's market 
share  Main competitors  Products  BASF's 
main 
customer  Solenis' main 
supplier  
PolyDADMAC  worldwide  
[5-10]% (resale 
only)  SNF [40-50]% 
Ecolab [30-40]% DSA, RDA, CC, 
sizing, water 
treatment  n.a. BASF ( [40-50]%) 
 
[CONFIDENTIAL]  EEA  
[0-5]% (resale 
only)  SNF [50-60]% 
Ecolab [0-5]% 
Source : BASF's estimates  
Input Foreclosure  
(287)  The Commission considers that the notified concentration  is unlikely to raise 
any risks of input foreclosure since BASF's market share on the upstream 
market for the supply of PolyDADMA C is below 10%164, both at EEA and 
global levels . BASF  faces several upst ream competitors , including in particular 
SNF and Ecolab , which have market shares similar to or significantly higher 
than BASF . Moreover, BASF is a mere reseller, with no production capabilities , 
relying on competitors for its PolyDADMAC sourcing . Therefore, BASF  is 
                                                 
163  BASF closed its PolyDADMAC manufacturing capacities, which were located in the EEA, the US, and Australia.  
164  See Non -horizontal Merger Guidelines, para. 25.  
 
54 unlikely to have the ability and sufficient market power to significantly 
influence the supply of PolyDADMAC . 
Customer Foreclosure  
(288)  The Commission considers that Solenis is not a large enough buyer to raise any 
risks of customer foreclosure in relation to the EEA supply of PolyDADMAC . 
In 2017, Solenis' total purchases of PolyDADMAC amounted to 
[CONFIDENTIAL]  tons and less than EUR [CONFIDENTIAL] , [40-50]% of 
which being sourced from BASF. Therefore, the  demand that could potentially 
be foreclosed is marginal, that is to say  less than [0-5]% of the total demand 
sourced on the EEA merchant market. Also, the Commission notes that, in all 
the downstream affected markets, Solenis' market share is below 30% (s ee 
Section 5.1 ). 
Conclusion  
(289)  In light of the above, and in view of the results of the market investigation and 
of all the evidence available to it, the Commission concludes that the notified 
concentration does not raise serious doubts as to its compatibilit y with the 
internal market in relation to the vertical link between the supply of 
PolyDADMAC (upstream) and the manufacture and supply CC, RDA, DSA, 
sizing agents, and water treatment chemicals (downstream).  
5.2.10.  PEI ( upstream ) and defoamers, CC, RDA, sizing agents, and water 
treatment chemicals ( downstream )  
(290)  PEI, a polymer which can be used to produce paper and water treatment 
chemicals, as well as in other applications (e.g., detergent adhesives and 
cosmetics).  
(291)  BASF is active in the production of PEI. BASF is the only manufacturer of PEI 
in the EEA. It sells PEI to only [very few ] customers active in the paper and 
water treatment industry, namely Solenis [CONFIDENTIAL ]. 
(292)  Solenis does not produce PEI but sources it on the merchant market. In 2017, in 
the EEA, Solenis sourced all its PEI requirements from BASF . 
(293)  The table below provides an overview of the vertical relationship between 
BASF and Solenis in relation to PEI and of the competitive landscape in the 
upstream EEA market.  
Table 19 
UPSTREAM  DOWNSTREAM  
Products  BASF's 
market share  Main 
competitors  Products  BASF's main customer  Solenis' 
main 
supplier  
PEI worldwide  
[70-80]% Nippon Shokubai 
[20-30]% CC ( fixation 
agents ), 
Defoamers, 
RDA, WSA, 
water treatment  Solenis [CONFIDENTIAL]  BASF 
(100%)  EEA  
[90-100]% Nippon Shokubai 
[0-5]% 
Source : BASF's estimates  
 
55 Input Foreclosure  
(294)  The Commission considers that the notified concentration is unlikely to raise 
any risks of input foreclosure in relation to the supply of PEI for several reasons. 
First, BASF only sells very limited quantities of PEI to Solenis and other 
customers  active in the downstream affected markets  ([CONFIDENTIAL]  
kilotons in the EEA in 2017 , that is to say , [5-10]% of BASF's EEA capacity). 
Second, the JV would have a modest position in all downstream affected 
markets (share s below 30%) facing competition (i) from several rivals , but also 
(ii) from alternative technologies compet ing with PEI (e.g. PEI CC compete 
with CC based on other chemistries) , which is corroborated by the limited 
volumes of PEI sold by BASF to customers active in the paper and water 
treatment industry.  This would make any foreclosure strategy unprofitable. 
Finally , the Commission also notes that, pre-Transaction , BASF is already 
vertically integrated  and that the market investigation revealed no substantiated 
competition concerns from downstream competitors.165 
Customer Foreclosure  
(295)  The Commission considers that the notified  concentration  does not raise any 
risks of customer foreclosure in relation to the supply of PEI since, pre -
Transaction, BASF is Solenis' exclusive supplier in the EEA. In other words, the 
demand that could potentially be foreclosed is null.  
Conclusion  
(296)  In light of the a bove, and in view of the results of the market investigation and 
of all the evidence available to it, the Commission concludes that the notified 
concentration does not raise serious doubts as to its compatibility with the 
internal market in relation to the  vertical link between the supply of PEI 
(upstream) and the manufacture and supply defoamers, CC, RDA, sizing agents, 
and water treatment chemicals (downstream).  
5.2.11  BME ( upstream ) and water treatment chemicals ( downstream )  
(297)  BME  is used for various applications, including the oil and gas, agriculture, 
pharmaceutical, and optical industries. BME can also be used to produce 
polyacrylates, which are inputs for water treatment chemicals.  
(298)  BASF is active in the manufacture of BME. In the EEA, Solenis is BASF 's only 
BME customer active in the paper and water treatment industry.  
(299)  Solenis does not produce in-house BME but sources it on the merchant market  
mainly from BASF . 
(300)  The table below provides an overview of the vertical relationship between 
BASF a nd Solenis in relation to BME and of the competitive landscape in the 
upstream EEA market.  
                                                 
165  See Q85 of quest ionnaire Q2 to competitors in end chemical products.  
 
56 Table 20 
UPSTREAM  DOWNSTREAM  
Products  BASF's market 
share  Main competitors  Products  BASF's main 
customer  Solenis' main 
supplier  
 
BME  worldwide  
[40-50]% Sunion [40-50]% 
Chevron [10-20]% Water treatment 
chemicals  Solenis (100%)  BASF ( [90-100]% 
EEA  
[50-60]% Chevron [20-30]% 
Sunion [10-20]% 
Source: BASF's estimates 
Input Foreclosure 
(301)  The Commission considers that the notified concentration does not raise any 
risks of customer foreclosure in relation to the supply of BME since, pre-
Transaction, BASF does not supply BME to any of Solenis' competitors on the 
downstream vertically affected markets. Therefore, the demand that could 
potentially be foreclosed is null.  Moreover, alternative input can be used in the 
production of polyacrylates, such as mercaptopropionic acid (3-MPA), which 
Solenis is currently used for the same purpose as BME. Finally, The 
Commission also notes that in the downstream affected markets, the JV's market 
share is below 2 0% and that BASF is already vertically integrated pre-
Transaction.  
Customer Foreclosure 
(302)  The Commission considers that the notified concentration does not raise any 
risks of customer foreclosure in relation to the supply of BME in the EEA since 
Solenis is not an important source of demand for upstream competitors. In fact, 
customers active in water treatment chemicals are not a major source of demand 
for BME. For instance, in 2017, only [0-5]% of BASF's total production of 
BME was sold to customers active in the downstream affected markets. 
Moreover, Solenis already sources the vast majority of its BME requirements 
from BASF pre-Transaction ([90-100] %) and has market shares well below 20% 
in the downstream affected markets. It follows that the demand that could 
potentially be foreclosed is minimal. 
Conclusion 
(303)  In light of the above, and in view of the results of the market investigation and 
of all the evidence available to it, the Commission concludes that the notified 
concentration does not raise serious doubts as to its compatibility with the 
internal market in relation to the vertical link between the supply of BME 
(upstream) and the manufacture and supply of water treatment chemicals 
(downstream).  
5.2.12.  Glyoxal ( upstream ) and DSA, WSA ( downstream )  
(304)  Glyoxal is used for various applications, including textiles, leather, cosmetics, 
oil and gas, etc. In the paper industry, glyoxal is used to produce gPAM, which 
is in turned used to produce synthetic DSA and, to a more limited extent, WSA.  
(305)  BASF is active in the production of glyoxal and sells it to several customers 
active in the paper industry, namely Solenis, [CONFIDENTIAL]. 
 
57 (306)  Solenis does not manufacture glyoxal  but sources from BASF.  
(307)  The table below provides an overview of the vertical relationship between 
BASF and Solenis in relation to glyoxal and of the competitive landscape in the 
upstream EEA market.  
Table 21 
UPSTREAM  DOWNSTREAM  
Products  BASF's 
market share  Main competitors  Products  BASF's main 
customer  Solenis' main 
supplier  
Glyoxal  worldwide  
[20-30]% Weyl Chem [0-5]% 
Chinese suppliers [70-
80]% gPAM -based  
DSA and WSA  Solenis, 
[CONFIDENTIAL]  BASF (100%)  
EEA  
[60-70]% Weyl Chem [10-20]% 
Chinese suppliers [20-
30]% 
Source : BASF's estimates  
Input Foreclosure  
(308)  The Commission considers that the notified concentration  does not raise any 
risks of customer foreclosure in relation to the supply of glyoxal for the 
following reasons. First, on the upstream market, BASF has several competitors 
(notably from China), both at EEA and global levels. Moreover, at worldwide 
level, BASF 's market share is well below 30%.166 Second, BASF sells very 
limited quantities of glyoxal to Solenis and other custo mers  active in the 
downstream affected market: [CONFIDENTIAL] kilotons in the EEA in 2017, 
that is to say  [0-5]% of BASF's total capacity. Third , on the downstream 
affected markets, the Parties have a moderate position facing several rivals (see 
Section s 5.1.4 and 5.1.5 ). In addition, alternative technologies compete with 
gPAM based chemicals in the downstream affected markets: according to the 
Parties ' estimate s, gPAM accounts for less than 10% of the synthetic DSA and 
about 11% of the WSA supplied in the EEA. The above would make any 
foreclosure strategy unprofitable. Finally, the Commission also notes that BASF 
is already vertically integrated  pre-Transaction and that the market investigation 
revealed no substantiated competition concerns from down stream 
competitors.167 
Customer Foreclosure  
(309)  The Commission considers that the notified concentration  does not raise any 
risks of customer foreclosure in relation to the supply of glyoxal since, pre -
Transaction, BASF is Solenis ' exclusive supplier in the EEA. In other words, the 
demand that could potentially be foreclosed is null.  
Conclusion  
(310)  In light of the above, and in view of the results of the market investigation and 
of all the evidence available to it, the Commission concl udes that the notified 
                                                 
166  See Non -horizontal Merger Guidelines, para. 25.  
167  See Q93 of questionnaire Q2 to competitors in end chemical products.  
 
58 concentration does not raise serious doubts as to its compatibility with the 
internal market in relation to the vertical link between the supply of Glyoxal 
(upstream) and the manufacture and supply of DSA and WSA (downstream).  
5.2.1 3. Morpholine ( upstream ) and water treatment chemicals ( downstream )  
(311)  Morpholine is a chemical used for various applications, including corrosion 
inhibitors, crop protection agents, dyes, optical brighteners, pharmaceuticals, 
etc. It is also used as an inpu t in water treatment chemicals.  
(312)  BASF is active in the production of morpholine. In the EEA, BASF sells 
morpholine to mainly one customer active in the water treatment industry, 
namely Solenis . 
(313)  Solenis uses morpholine  to produce water treatment chemicals for use in boilers. 
It does not manufacture morpholine in -house but sources  on the merchant 
market almost exclusively from BASF.  
(314)  The table below provides an overview of the vertical relationship between 
BASF and Soleni s in relation to morpholine and of the competitive landscape in 
the upstream EEA market.  
Table 22 
UPSTREAM  DOWNSTREAM  
Products  BASF's market 
shar e Main competitors  Products  BASF's main 
customer  Solenis' main 
supplier  
Morpholine  worldwide  
[20-30]% Huntsman [25-35]% 
Chongqing 10 -20% 
Balaji 10 -20% Water 
treatment 
chemicals  Solenis  
([90-100]%) BASF  
(ca 100%)  
EEA  
[30-40]% Huntsman [50-60]% 
Source : BASF's estimates  
Input Foreclosure  
(315)  The Commission considers that the notified concentration  does not raise any 
risks of customer foreclosure in relation to the supply of morpholine  since the 
demand that could potentially be foreclosed is quasi null. I n 2017, Solenis 
accounted for [90-100]% of BASF's sales of morpholine to customers active in 
the downstream affected markets (BASF supplied negligible amount to one 
downstream rival, namely  Synthron ). In any event, customers active in water 
treatment chemicals only account for a limited fraction of the total demand for 
morpholine . Moreover, on the up stream market , both at worldwide and EEA 
levels , BASF has moderate market shares  (comprised between 23% and 40%) 
and faces a larger competitor (Huntsman). Finally, the Commission also notes 
that the JV's market share on the downstream affected markets is w ell below 
20% and that BASF is already vertically integrated pre -Transaction . 
Customer Foreclosure  
(316)  The Commission considers that the notified concentration  does not raise any 
risks of customer foreclosure in relation to the supply of morpholine since, pre -
Transaction, Solenis sources morpholine almost exclusively from BASF , that is 
 
59 to say [ca 100 ]% of its requirements in the EEA . In other words, the demand 
that could potentially be foreclosed is quasi  null. 
Conclusion  
(317)  In light of the above, and in view of t he results of the market investigation and 
of all the evidence available to it, the Commission concludes that the notified 
concentration does not raise serious doubts as to its compatibility with the 
internal market in relation to the vertical link between  the supply of Morpholine 
(upstream) and the manufacture and supply of water treatment chemicals 
(downstream).  
5.2.14.  DEAE ( upstream ) and water treatment chemicals ( downstream )  
(318)  DEAE is a chemical used for various applications. It is notably used as a 
neutralizing amine for industrial coating, an intermediate for various surfactants, 
and an input in water treatment chemicals.  
(319)  BASF is active in the production of DEAE. BASF only sells DEAE to two 
customers active in the water treatment industry, namely Solenis and 
[CONFIDENTIAL ].  
(320)  Solenis uses DEAE in water treatment as corrosion inhibitor in boiler 
applications. It does not manufacture DEAE in -house but sources on the 
merchant market exclusively from BASF.  
(321)  The table below provides an overview of the verti cal relationship between 
BASF and Solenis in relation to DEAE and of the competitive landscape in the 
upstream EEA market.  
Table 23 
UPSTREAM  DOWNSTREAM  
Products  BASF's market 
share  Main 
competitors  Products  BASF's main customer  Solenis' 
main 
supplier  
DEAE  worldwide  
[10-20]% Eastman 60 -70% 
Sterling 5 -10% Water 
treatment 
chemicals  Solenis ( [60-70]%) 
[CONFIDENTIAL]  BASF 
(100%)  EEA  
50-60% Eastman 40 -50% 
Sterling 5 -10% 
Source : BASF's estimates  
Input Foreclosure  
(322)  The notified concentration  does not raise input foreclosure concerns with respect 
to the supply of DEAE to customers active in the paper and water treatment for 
the following reasons. C ustomers active in paper and water treatment chemicals 
only account for a minor fraction of the t otal demand for DEAE . In particular, in 
the EEA, in 2017, other than Solenis, BASF only sold DEAE a limited amount 
of DEAE ( [CONFIDENTIAL] ) to one customer active in the downstream 
affected market ( namely  [CONFIDENTIAL] ). In other words, in the EEA, 
BASF could only potentially foreclose one downstream rival  and t he volumes 
that this company would need to source from alternative suppliers would be 
very modest. It is very unlikely that upstream competitors would not have the 
 
60 capacity to supply such limited v olumes to  [CONFIDENTIAL] . In this respect, 
the Commission notes that, on the upstream market, BASF competes with 
several competitors , including in particular Eastman, which has significant 
market shares at worldwide and EEA comprised between 40% and 70%) . 
Moreover, the combined entity would have a modest position in the downstream 
markets (share s below 20%) facing  competition by several rivals.  This would 
make any foreclosure strategy unprofitable.  Finally, the Commission also notes 
that BASF is already ver tically integrated  pre-Transaction.  
Customer Foreclosure  
(323)  The Commission considers that the notified concentration  does not raise any 
risks of customer foreclosure in relation to the supply of DEAE since, pre-
Transaction, BASF is Solenis ' exclusive supplier in the EEA. In other words, the 
demand that could potentially be foreclosed is null.  
Conclusion  
(324)  In light of the above, and in view of the results of the market investigation and 
of all the evidence available to it, the Commission concludes that the notified 
concentration does not raise serious doubts as to its compatibility with the 
internal market in relation to the vertical link between the supply of DEAE 
(upstream) and the manufacture and supply of water treatment  chemicals 
(downstream).  
5.2.15.  ADAME/ADAMEQ ( upstream ) and CC, RDA, WSA, and water treatment 
chemicals ( downstream )  
(325)  ADAME (also known as DMA3) is a chemical intermediate which is nearly 
always quaternised to produce ADAMEQ (also known as DMA3Q), for use  as a 
co-monomer in the production cPAM , which is in turn used as an input in RDA, 
WSA, CC, and water treatment chemicals.  
(326)  BASF produces ADAME but only for captive use. BASF's production capacity 
in the EEA is currently insufficient to meet BASF  DOM 's inte rnal demand, 
which therefore requires BASF DOM to import and purchase ADAME from 
third parties. BASF manufactures ADAME (for captive use only) at its plant in 
[CONFIDENTIAL ], as well as its plant in Nanjing (China) which is part of a 
joint venture with SIN OPEC.168 BASF also owns ADAME production assets  at 
its plant located in [CONFIDENTIAL ]. However, pursuant to a tolling 
agreement concluded with SCL in 2009, in the context of the commitments in 
case M.5355 – BASF/CIBA169, the entire ADAME capacity in 
[CONFIDENTIAL] belongs to SCL. Under the above commitments, the tolling 
agreement had [CONFIDENTIAL]  duration and was due to expire in  
                                                 
168  [CONFIDENTIAL].  
169  In case M.5355, the Commission found that BASF's acquisiti on of sole control over CIBA would raise serious 
doubts in the EEA market for ADAME due to the reduction in the number of competitors from three to two. In 
order to address this concern, the commitments annexed to the clearance decision dated 12 March 2009  in case 
M.5355 – BASF/CIBA provided for the divestiture of the ADAME production assets located in BASF's 
Ludwigshafen plant (in Germany) to a new entrant. However, at the request of BASF and the remedy taker (SCL),  
the above commitments were subsequently modified to the effect that BASF could retain the legal ownership of 
the ADAME production assets and conclude a tolling agreement with SCL (see Commission decision dated 12 
October 2009).  
 
61 [CONFIDENTIAL] . However, [CONFIDENTIAL]  the tolling agreement , which 
was therefore automatically extended until at least  [CONFIDENTIAL] . 
[CONFIDENIAL] .  
(327)  BASF is also active in the production of ADAMEQ , [CONFIDENTIAL – 
information regarding BASF’s production] . [CONFIDENTIAL – BASF’s 
ADAMEQ customers and volumes sold in 2017] . 
(328)  Solenis does not manufacture in -house ADAME but so urces it on the merchant 
market from [CONFIDENTIAL] . In 2016/2017, Solenis also purchased a 
limited amount of ADAMEQ on the merchant market, exclusively from BASF.  
(329)  The table below provides an overview of the vertical relationship between 
BASF and Solenis  in relation to ADAME/ADAMEQ and of the competitive 
landscape in the upstream EEA market.  
Table 24 
UPSTREAM  DOWNSTREAM  
Products  BASF's 
market share  Main 
competitors  Products  BASF's main 
customer  Solenis' main 
supplier  
ADAME  Wordlwide  
0% (captive 
use only)  Arkema ( [70-80]%) 
SCL ( [20-30]%) 
ADAMEQ  (captive use only)  [CONFIDENTIAL]  
EEA  
0% (captive 
use only)  Arkema ( [70-80]%) 
SCL ( [20-30]%) 
ADAMEQ  worldwide  
[20-30]% n.a. 
cPAM -based 
RDA, WSA, CC, 
water treatment  [CONFIDENTIAL]  BASF (100%)  EEA  
[20-
30]% SNF 
Arkema  
Source : BASF's estimates  
Input Foreclosure  
(330)  As regards the supply of ADAME , the Commission considers that the notified 
concentration  is unlikely to raise any risks of input foreclosure since BASF is 
not active on the upstream merchant market in the EEA . Moreover, in terms of 
capacity, BASF's share in the EEA is below 30%170 (i.e. [20-30]% at its 
[CONFIDENTIAL] plant  in [CONFIDENTIAL] ), facing three alternative 
manufacturers , namely Arkema ( [40-50]%)171, Kemira ([10-20]%), and SCL 
([10-20]%). In this respect, the Commission notes that, under the above -
mentioned tolling agreement  entered into between BASF and SCL , the entire 
ADAME capacity at [CONFIDENTIAL] belongs to SCL, and therefore cannot 
be foreclosed by BASF, at least until  [CONFIDENTIAL] and potentially 
beyond if SCL decides to do so . [CONFIDENTIAL] . 
(331)  [CONFIDENTIAL]  This is corroborated by one internal document of BASF.  
                                                 
170  See Non -horizontal Merger Guidelines, para. 25.  
171  [CONFIDENTIAL] .  
 
62 (332)  As regards the supply of ADAMEQ , the Commission considers that the notified 
concentration  is unlikely to raise any risks of input foreclosure since B ASF's 
market share on the upstream market is below 30%172 Both at EEA and global 
level. BASF also faces two strong competitors, namely SNF and Arkema.  
Moreover, the Commission also notes that (i) al ternative input can be used in the 
production of cPAM (such as DMAPA) and (ii) alternative technologies 
compete with cPAM based chemicals in the downstream affected markets (e.g. 
cPAM based DSA compete with synthetic DSA based on other chemistries) . 
The ab ove would make any foreclosure strategy unrealistic and unprofitable . 
Finally, the Commission notes that BASF is already vertically integrated pre -
Transaction.  
Customer Foreclosure  
(333)  As regards the supply of ADAME , although, the EEA customer base appears 
rather consolidated, with a limited number of significant customers ( including 
Solenis ), the Commission considers that the Transaction does not raise any risks 
of customer foreclosure.  
(334)  First, the Parties w ould not have the ability to implement a customer f oreclosure 
strategy  since the JV would not have sufficient in -house capacity to internalise 
the volumes currently sourced by Solenis from [CONFIDENTIAL] . Indeed, 
[…]*  ADAME production capacity transferred to the JV  is the production 
capacity located in [CONFIDENTIAL] (around [CONFIDENTIAL] kilotons per 
year) which , already pre -Transaction, is insufficient to fully meet the internal 
demand of BASF DOM (around [CONFIDENTIAL] kilotons a year) . In fact, in 
2017 , BASF DOM was required to import and purchase from third parties 
around [CONFIDENTIAL] kilotons of ADAME.   
(335)  Moreover, BASF (excluding BASF DOM) would not have ADAME production 
capacity in the EEA. Indeed, as already mentioned , the entire ADAME capacity 
at [CONFIDENTIAL] belongs to SCL  and not to BASF, at least until 
[CONFIDENTIAL] . Outside the EEA, BASF 's only ADAME production 
capacity is in the Nanjing  plant  (in China) which has currently no spare 
capacity.173 Moreover, th is Nanjing  plant  is operated under a joint venture with a 
third party ( SINOPEC ) and will not be part of the JV. Given the involvement of 
a third party, it is unlikely that the Chines e joint venture would supply ADAME 
to the JV (combining BASF DOM and Solenis) at [CONFIDENTIAL]  . Indeed, 
since the JV is jointly controlled by Solenis , it would have to negotiate, with the 
Chinese joint -venture, supply terms and conditions on the same basis as any 
other third party customers . In addition, i mporting into the EEA ADAME 
produced in th e Chinese joint venture would entail higher logistic and 
transportation costs (close to [0-20]% according to the Parties' estimates) , as 
well as higher risks in terms of supply reliability , which would make a 
foreclosure significantly less profitable and thus less likely.  
                                                 
* Should read: “the only”  
172  See Non -horizontal Merger Guidelines, para. 25.  
173  See the Notifying Parties' response to RFI 6, question 5.  
 
63 (336)  Second,  although the customer base is rather consolidated, […]* the Parties, 
Solenis' total demand […]** for less than 20% of the total upstream ADAME 
merchant market in the EEA and even less at worldwide level  ([10-20]%), 
which would also undermine the Parties' ability to implement a customer 
foreclosure strategy . Furthermore, t he fact that, in the downstream affected 
markets, cPAM based chemicals compete with chemicals based on other 
chemistries and that Solenis' market share s are below 30% (see Section 5.1 ) 
would also make a customer foreclosure less profitable and thus less likely . 
(337)  Finally , the Commission notes that, even if the Parties had the ability and 
incentives to implement a customer foreclosure strategy, which in light of the 
above considerations appear s unlikely, it is unclear whether it would have a 
significant detrimental effect on end -customers on the downstream affected 
markets as it would allow the Parties to internalise pre-existing double mark -
ups.174 
(338)  As regards the supply of ADAMEQ , the notified concentration  does not raise 
any risks of customer foreclosure since, pre -Transaction, BASF is Solenis' 
exclusive supplier in the EEA. In other words, the demand that could potentially 
be foreclosed is null.  
Conclusion  
(339)  In light of the above, and in view of  the results of the market investigation and 
of all the evidence available to it, the Commission concludes that the notified 
concentration does not raise serious doubts as to its compatibility with the 
internal market in relation to the vertical link betwe en the supply of 
ADAME/ADAMEQ (upstream) and the manufacture and supply of CC, RDA, 
WSA, and water treatment chemicals (downstream).  
6. CONCLUSION  
(340)  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 Regul ation and Article 57 of the EEA Agreement.  
For the Commission  
(Signe d) 
Margrethe VESTAGER  
Member of the Commission  
                                                 
* Should read: “according to”  
** Should read: “accounts”  
174  See Non -horizontal Merger Guidelines, para. 13.