Commission européenne, DG COMP MERGER REGISTRY, 1049 Bruxelles, BELGIQUE  
Europese Commissie, DG COMP MERGER REGISTRY, 1049 Brussel,   BELGIË  
 
Tel: +32 229 -91111. Fax: +32 229 -64301. E -mail: COMP -MERGER -REGISTRY@ec.europa.eu .  EUROPEAN COMMISSION  
Brussels, 24.02.2022  
C(2022 ) 1274 final  
PUBLIC VERSION  
 
Lear Corporation  
21557 Telegraph Road Southfield  
MI 48033  
USA  
Subject : Case M.10512 - LEAR CORPORATION / INTERIOR COMFORT 
SYSTEMS BUSINESS OF KONGSBERG AUTOMOTIVE GROUP  
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 24 January 2022 , following a referral pursuant to Article 4(5) of the Merger 
Regulation , the European Commission received notification of a proposed 
concentration pursuant to Article 4 of the Merger Regulation by which Lear 
Corporation ("Lear"  or the “Notifying Party” ) will acquire sole control within the 
meaning  of Article 3(1)(b)  of the  Merger Regulation over the interior comfort 
systems business of Kongsberg Automotive ASA  ("Target ") (“the proposed 
Transaction”) .3 Lear and the interior comfort systems business of Kongsberg  
                                                 
1  OJ L 24, 29.1.2004, p. 1 (the ’Merger Regulation ’). With effect from 1 December 2009,  the Treaty on the 
Functioning of the European Union ( ‘TFEU ’) has introduced certain changes, such as the replacement of  
‘Commu nity’ 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 55I, 2.2.2022, p. 1. 
In the published version of this decision, 
some information has been omitted 
pursuant to Article 17(2) of Council 
Regulation (EC) No 139/2004 concerning 
non-disclosure of business secrets and other  
confidential information. The omissions are 
shown thus […] . Where possible the 
information omitted has been replaced by 
ranges of figures or a general description.  
 
 
2 Automotive ASA  (“Kongsberg”)  are desig nated hereinafter as the “parties to the 
proposed Transaction ”. 
1. THE  PARTIE S  
(2) Lear supplies automotive seating, wire harnesses and electronics to major 
automakers . Lear’s activity in the seating segment includes the design, development, 
engineering, just-in-time ("JIT") assembly and delivery of complete seat systems to 
original equipment manufacturers ("OEMs"), and the design, development, 
engineering and manufacture of all major seat components, including seat structures 
and mechanisms.  
(3) The Target co nsists of assets constituting the whole of the Target’s interior comfort 
systems business , as well as 100% of the shares of Kongsberg’s business in Mexico, 
Kongsberg Automotive S. de R.L. de C.V.  The interior comfort systems business of 
Kongsberg  manufactu res, supplies and sells seat heating, seat ventilation, lumbar 
support and massage equipment, panel heating, ancillary electronic units and system 
components for passenger cars .  
2. THE  CONCE NTRATION  
(4) Pursuant to a n asset and  share pur chase agreement signed on  28 October  2021 , the 
proposed Transaction consists of  Lear (via various subsidiaries) acquiring  assets and 
– in respect of  the Target’s part of Kongsberg ’s business in Mexico only – shares 
from various subsidiaries of  Kongsberg.  
(5) Upon completion of the proposed Transaction, Lear will exercise sole control over  
the Target.  
(6) It follows that  the proposed Transaction constitutes a concentration within the 
meaning of Article 3(1)(b) of the Merger Regulation.  
3. UNION  DIME NSION  
(7) The proposed Transaction does not meet the thresholds  of Article 1(2) or Article 1(3) 
of the Merger Regulation as the EU turnover of one of the parties to the proposed 
Transaction (the Target) amounted to only EUR […] in 2020.  
(8) Nonetheless, the  proposed  Transaction fulfils the two conditions  set out in Article 
4(5) of the Merger Regulation since it is a concentration within the meaning of 
Article 3 of the Merger Regulation and it is capable of being reviewed under the 
national competition laws of at least three Member States – in this case,  five Member 
States (namely […]) were capable of reviewing it .  
(9) On 03.11.2021 , the Notifying Party , by means of a reasoned submission , requested  
that the proposed Transaction be examined by the Commission pursuant to Article 
4(5) of the Merger Regulation. A copy of that submission was transmitted to the 
Member States on  03.11.2021  and t he Member States competent to examine the  
proposed  Transaction did not express disagreement to the referral request within the 
period laid down by the Merger Regulation.  
 
 
3 (10) Accord ingly, the notified concentration is deemed to have a Union dimension 
pursuant to Article 4(5) of the Merger Regulation . 
4. RE LE VANT MARKE T S 
(11) The Parties’ activities are related vertically because the seat componen ts produced 
upstream by the Target  are inputs for the downstream JIT assembly of complete car 
seat systems  where Lear is active.  
(12) The JIT assembly  of complete car seat s is an activity  whereby  OEMs themselves or  
“Tier 1 suppliers” ( specialised assemblers of complete seats  or vertically integrated 
seat m anufacture rs, such as Lear) assembl e the d ifferent components , including 
those supplied by “Tier 2 suppliers” (such as the Target) , in or close to the car 
factory  of the OEM.4 JIT assembly  requires that high volumes of complete car seats  
must be de livered on a very short notice directly to the OEM’s production li ne to be  
immediately installed in a car.  
4.1. Product market definitions  
4.1.1.  Seat components (upstream)  
(13) In past decisions in the automotive sector , the Commission has  discussed, but 
ultimately left open, whether separate markets exist for the production and sale of 
indivi dual seat components.5 The Commission has to date not defined product 
markets for the specific car seat components produced by the Target, i.e., seat 
support equipment (lumbar support and seat massage equipment)  and seat thermal 
solutions (thermal heat mats and thermal vent ilation  systems ).  
4.1.1.1.  Seat support equipment   
(14) Lumbar support and seat massage equipment typically constitute part of a seat 
component producer’s seat support portfolio, as both products aim at improving a 
passenger’s seating position and comfort.  Lumbar support provides lower back 
support to car passengers and helps them keep a correct seating position. Massage 
equipment helps stimulate a car passenger’s musculature and blood circulation.  
                                                 
4  Classifying suppliers as being “Tier 1”, “Tier 2”, etc. is common practice in the automotive industry.  
5  Cases M.10232  Brose / Sitech; M.8405 Lear / Grupo Antolin Assets; M.6136 JCI / Automotive Business 
of Keiper Recaro Group; M.6045 JCI / CRH.  
 
 
4 Figure 1: seat support equipment images  
 
Massage equipment  
    
  Mechanical Lumbar Support    Pneumatic Lumbar Support  
 
(15) The Commission  has considered whether there is a separate market for lumbar 
suppo rt equipment systems but ultimately left open whether it  constitutes  a separate 
market from the supply of other seat components .6 
(16) The Notifying Party submits that, based on its functionality, seat support equipment 
(i) is not a substitute for any of other seat co mponents, and (ii) that, while some of 
the seat support equipment’s functions are similar to those of seat structures, it 
cannot function as a s ubstitute for a seat structure as the seat support equipment 
would not be able to provide its function without the seat structure in place.7 
(17) The Notifying Party further submits that  there is a strong degree of substitutability 
between lumbar support and massage equipment as b oth occupy the same position in 
the seat structure, and when it comes to their appl ication, massage equipment 
performs all the functi ons of lumber support equipment. Where present, massage 
equipment replaces the installation of lumbar support equipment.8 
(18) The results from the market investigation  were  mixed . A majority of customers 
consid ered that seat support equipment should be further segmented be tween seat 
                                                 
6  Case  M.10232 Brose / Sitech . 
7  Form CO, paragraph 78.  
8  Form CO, paragraph 81.  

 
 
5 lumbar support and  seat massage equipment , whereas a majority of competitors 
considered that the manufacturing and supply of seat support equipment  is a distinct 
market that should n ot be sub -segmented .9 
(19) In any event, for the purposes of this Decision, it can be left open whether  the 
manufacturing and supply of seat support equipment is a separate  market  from a 
wider market  for the production and supply  of seat components  and whether the 
manufacturing and supply of seat support equipment  should  be sub -segmented  as the 
proposed Transaction does not raise serious doubts as to its compatibility with the 
internal market even under the narrowest market definition. Therefore,  the 
Commission will analyse the impact of the  proposed  Transaction on  the sub -
segments for both seat lumbar support and seat massage equipment . 
4.1.1.2.  Seat thermal solutions   
(20) Car seats (and indirectly to a certain extent the whole car) are heated by t hermal heat 
mats and are co oled by  seat ventilation systems . Seat thermal solutions have a 
similar  function as  HVAC  (heating, ventilation, and air conditioning) system s. The 
Commission previously considered  whether the supply of HVAC systems  to the 
automotive industry  is a separate market , though it ultimately left the definition 
open .10 
Figure 2: seat thermal solutions images  
  
  Seat thermal heat mats   Seat ventilation system  
 
(21) The Notifying Party submits that  seat thermal solutions : (i) serve a different purpose 
than lumbar support and seat massage equipment ; and (ii)  are not a substitute for 
HVAC systems, but rather an ex tension, or complement, of them, noting that s eat 
thermal solutions are more frequently ordered by OEMs alongside HVAC systems to 
provide a holistic climate  control system in a given car.11 
(22) In relation to f urther segmenting the market, the Notifying Party  points to the 
contrasting purposes of  thermal heat mats and thermal ventilation  systems  and they 
provide  market  data on the basis of a product segmentation a t the component level .12 
                                                 
9  See replies to question 6 of questionnaires Q1 to competitors and Q2 to customers.  
10  Case M.7564, Mahle Behr / Delphi Thermal  Systems Business.  
11  Form CO, paragraphs 82-83. 
12  Form CO, paragraphs 82 and 84.  

 
 
6 (23) The results from the market investigation  were  mixed , with a slight majority  overall  
considering that  the manufacturing and supply of  seat thermal solutions  is a distinct 
market  and should not be further sub -segmented for  seat thermal heat mat s and seat 
thermal ventilation.13 
(24) In any event, for the purposes of this Decision, it can be left op en whether  the 
manufacturing and supply of seat thermal solutions is a separate market from a wider 
market for the production and suppl y of seat components  and whether the 
manufacturing and supply of seat thermal solutions  should be sub -segmented as the 
proposed Transaction does not raise serious doubts as to its compatibility with the 
internal market even under the narrowest market defin ition. Therefore, the 
Commission will analyse the impact of the  proposed  Transaction on  the sub -
segments for both seat thermal heat mats and seat thermal ventilation.  
4.1.2.  JIT assembly of complete car seat s (downstream)  
(25) In past decisions in the automotive secto r the Commission has  discussed a potential 
market for the JIT assembly of complete car seats, but ulti mately left open whether 
the JIT assembly  of comple te car seat s on the one hand, and the manufacturi ng of its 
individual components  on the other hand, constitute different relevant product 
markets.14 
(26) The Notifying Party considers the JIT assembly of complete car seats  to be a 
separate product market, for the following reasons:15 
(a) When purchasing seats that are to be installed in cars, as OEMs generally do 
not only purchase the seats, but also the JIT delivery , they  run separate tender 
procedures for the assembly and JIT supply of complete car seats on the one 
hand and for individual com ponents on the other hand ; 
(b) The JIT assembly of comple te car seats  should also be differentiated from the 
production and supply of individual seat components, as JIT suppliers 
typically assemble the seats in proximity to the OEM’s car production plants 
using components that they either source from third parti es (often selected 
directly by the OEMs)  or their own Tier 2 and Tier 3 facilities located 
elsewhere ; 
(c) The requirement to deliver large volumes at short notice (usually within less 
than 14 hours), in turn requires specific know -how in logistics and supply 
chain management, as well as investments by the seat manufacturer to ensure 
the timely flow of supply . 
(27) In relation to types of vehicle, Lear is not active in JIT  assembly of [all types of]  
vehicles and t he Notifying Party  considers that a segmentation betwe en passenger 
cars and light commercial vehicles is not appropriate . It states that all major 
providers are able to provide JIT assembly  of complete seats for both passenger cars 
                                                 
13  See replies to question 7 in questionnaires Q1 to competitors and Q2 to customers . 
14 Cases  M.8405 Lear / Grupo Antolin Assets; M.6136 JCI / Automotive Business of Keiper Recaro Group.  
15  Form CO, paragraph 98.  
 
 
7 and light commercial vehicles  and they  regularly participate in requests for 
quotations ( "RFQs ") across the light  vehicle segments .16 
(28) Most respondents to  the market investigation  support the view that the JIT assembly 
of complete car seats  is a separate product market  from the production and supply of 
individual seat components17, and  furthermore that it  should not be segmented by 
type of vehicle18. One respondent noted that whether assembly of complete car seats 
is distinct from the manufacturing and supply of individual components depends on 
the type and complexity of the component in  question ; they stated  that for some 
components “most JIT seat suppliers ” can produce the components as well as doing 
the assembly of complete car seats  but that “ In other cases such as complex front 
seat structures or front head rests or lumbar/massage sy stems, some/most JIT seat 
suppliers are not able to produce these components in -house  [and so they] would be 
distinct markets ”.19 
(29) In any event, for the purposes of this Decis ion, the exact product market definition 
may be left open as the  proposed  Transaction does not raise serious doubts as to its 
compatibility with the internal market under any of the considered plausible market 
definitions . The Commission will analyse the impact of the proposed Transaction on 
the market for the JIT assembly of c omplete car seats . 
4.2. Geographic market definitions  
4.2.1.  Seat components (upstream)  
(30) In past decisions the Commission has considered the markets for automotive 
components (including car seats and car seat components) , as well as for HVAC 
systems , to be at least EEA -wide if not broader .20 
(31) The Notifying Party considers that the relevant geographical market is global.21 In 
support of this view, in relation to the specific characteristics of the components 
subject to this proposed Transaction , it states : 
(a) Components can be shipped across long distances, transport costs or logist ics 
do not constitute a barrier , they are shipped in bulk and stored easily and 
efficiently in warehouses that manufacturers can easily build all over the 
world;  
(b) OEMs do not requir e these components to be produced near the OEM / Tier 1 
manufacturing sites  and tenders are increasingly organis ed on a global basis  
(with an increasing participation of Asian suppliers ); 
                                                 
16  Form CO, paragraphs 124 -5. 
17  See replies to question 4 of questionnaires Q1 to competitors and Q2 to customers.  
18  See replies to question 8 of questionnaires Q1 to competitors and Q2 to customers.  
19  See reply to question 4 of questionnaire Q2 to custom ers. 
20  Case s M.10232 Brose / Sitech ; M.6136  JCI / Automotive Business of Keiper Re caro Group; M.7564  
Mahle Behr / Delphi Thermal  Systems Business.  
21  Form CO, paragraph 86.  
 
 
8 (c) Most of the Target ’s products contai n relatively mature technology and they 
are relatively simple, low -tech pr oducts that  conform to global standards 
without significant quality differences between suppliers.  
(32) The results from the market investigation  indicate that seat components are general ly 
sourced on a global basis .22 However,  some respondents point to sourcing on a 
regional/EEA basis23, the majority responded that prices f or automotive components  
differ significantly in different regions of the world24, and most competitors stated 
that they  supply their customers in the EEA from plants located both globally and in 
the EEA25. 
(33) In any event, for the purposes of this Decis ion, the precise geographic scope of the 
market may be left open since  the proposed Transaction does not raise serious 
doubts as to its compatibility with the internal market or the functioning of the EEA 
Agreement regardless of the geographic market definition adopted. T he Commission 
will analyse the impact of the proposed Transaction  on the relevant car seat 
components at the E EA level.  
4.2.2.  JIT assembly of complete car seat s 
(34) In past decisions the Commission  has considered the geographic scope of the market 
for the JIT assembly  of complete car seat s to be  at least EEA -wide26, although it h as 
been left open  in some decisions27. 
(35) The Notifying Party considers that the relevant geographical market  is at least EEA -
wide.28 In support of this view, it states:  
(a) Competition for the award of contracts takes place in EEA -wide bidding or 
tender procedures ; 
(b) Any new suppliers that need to invest in  a production site near the OEM 
customer can do so given the long lead times between the award of a contract 
and the start of production (two to four years) , and they will typically recoup 
those costs during the initial contract period given the long durat ion of the 
contracts (typically between four to six years and longer s hould the programs 
be extended);  
(c) Manufacturers that already have production sites close to the relevant OEM 
manufacturing plants may and do lose JIT seat assembly contracts to 
competitor s without an established production site in proximity . 
                                                 
22  See replies to question 9 of questionnaires Q1 to competitors and Q2 to customers . 
23  See replies to question 9 in of questionnaires Q1 to competitors and Q2 to customers . 
24  See replies to question 10 of questionnaire Q2 to customers and question 11 of questionnaire Q1 to 
competitors . 
25  See reply to question 10 in questionna ire Q1 to competitors . 
26 Case s M.10232  Brose / Sitech ; M.6136  JCI / Automotive Business of Keiper Re caro Group; M.7564  
Mahle Behr / Delphi Thermal Syste ms Business.  
27 Case s M.8405 Lear / Grupo Antolin Assets; Case M.5930  JCI / Michel Thierry Group . 
28  Form  CO, paragraph 100.  
 
 
9 (36) Some responses to  market investigation  suggest a global market, although overall 
they point to the market being at least EEA -wide. The summary of one respondent 
was that “ Sourcing of complete seats is EEA -wide, sourcing of components is 
global ”.29 
(37) In any event, for the purposes of this Decis ion, the precise geographic scope of the 
market may be left open since the  proposed  Transaction does not raise serious 
doubts as to its compatibility with the internal market or the functioning of the EEA 
Agreement regardless of the geographic market definition adopted. The Commission 
will analyse the impact of the proposed Transaction on the market for the JIT 
assembly of complete car seats at the EEA level.  
5. COMPE TITIVE ASSE SSME N T 
(38) The proposed Transaction does not lead to any horizontal overlaps  nor will it give 
rise to any  conglomerate effect s. The parties’ activities lead to vertical r elationships 
between the upstream market s for seat thermal solutions and seat support equipment 
(and potential segments ), where the Target is active, and the downstream market for 
JIT assembly of complete seats , where Lear is active . 
(39) The proposed Transacti on only gives rise to one vertically affected market between 
the potential segment for the manufacturing and supply and thermal heat mats for 
which the Target ha d a market share30 of [30-40]%  at EEA level  in 202031 and the 
downstream market for JIT assembly of complete seats for which  Lear ha d a market 
share of [20-30]%  at EEA level  in 202032. On all the other plausible product and 
geographic markets discussed in section 4  above, the parties’ combined market 
shares are all below the 30% threshold and therefore these markets are not further 
examined.  
(40) According to the Commission’s Guidelines on the assessment of non -horizontal 
mergers under the Council Regulation on the control of concentrations between 
undertakings (‘Non -horizontal Merger Guidelines ’), foreclosure effects may occur 
where actual or potential rivals’ access to supplies or markets is hampered or 
eliminated as a result of the merger, thereby reducing these companies' ability and/or 
incentive to compete33.  
(41) In assessing the likelihood of a n anticompetitive customer foreclosure scenario, the 
Commission examines, first, whether the merged entity would have the ability to 
foreclose access to downstream markets by reducing its purchases from its upstream 
rivals, second, whether it would have th e incentive to reduce its purchases upstream, 
and third, whether a foreclosure strategy would have a significant detrimental effect 
on consumers in the downstream market34.  
                                                 
29  See replies to question 9 of questionnaires Q1 to competitors and Q2 to customers . 
30  In volume (units).  
31  [30-40]%  in 2019 and [30-40]%  in 2018.  
32  As well as in 2019 and 2018  in volume and in value.  
33  Non-horizontal Merger Guidelines, paragraph 18.  
34  Non-horizontal Merger Guidelines, paragraph  59. 
 
 
10 (42) In assessing the likelihood of an anticompetitive input foreclosure scenario, the 
Commission examines, first, whether the merged entity would have, post -merger, the 
ability to substantially foreclose access to inputs, second, whether it would have the 
incentive to do so, and third, whether a foreclosure strategy would have a significant 
detrimental effect on competition downstream35. 
5.1. Position of the Notifying Party  
(43) The Notifying Party argues that there are no affected markets as the geographic 
markets are global. In any case, at EEA level, it considers that the vertically affected 
markets of the supply of thermal heat mats (upstream) and the JIT supply of 
complete car seats (downstream) do not raise concerns as there is no risk of 
foreclosure (from inputs or customers) as the merged entity will have neither the 
ability nor the incentive to foreclose actual or potential competitors36.  
5.2. Assessment of the Commission  
(44) Based on the information provided by the Notifying Party and the results of the 
market investigation, the Commission agrees with the Notifying Party that the 
proposed Transaction is unlikely to raise serious doubts as to its compatibility with 
the internal market with respect to th is vertical relationship.  
5.2.1.  No input foreclosure  
(45) First, t he Commission considers that Lear and the Target will not have the ability to 
substantially foreclose  access to the thermal heat mats for the following reasons:  
(a) The Target’s market shares remain relatively moderate, below 40% at EEA 
level and below 30% at global level. Several large competitors of the Target 
will remain on the upstream market such as Gentherm, Kwangjin, and IG 
Bauerhin . As a consequence, customers of the Target can turn to other 
suppliers.   
(b) The provision of car seat components commonly takes place in a bidding 
market  with experienced buyers  and where a number of large competitors 
upstream compete with the parties to serve these buyers .  
(c) OEMs  enjoy a certain degree of buyer power and they often use a directed -
buy strategy (in the automotive industry in general, but also specifically in 
relation to car seat component s) whereby they choose Tie r 2 component 
suppliers  (such as Kongsberg) , negotiate the term s and conditions with them 
and direct  Tier 1 suppliers (such as Lear) to buy  components from the Tier 2 
suppliers . Where the OEMs apply such a strategy, Lear must abide by the 
conditions negoti ated and agreed between the OEMs and the Tier 2 supplier; 
Lear cannot choose other Tier 2 suppliers  nor negotiate  its own terms. The 
results from the market investigation confirm than the directed -buy strategy 
is widely used  by OEMs37.  In addition, a competitor points out that “ the 
markets – in the automotive industry in general, and this business area in 
                                                 
35  Non-horizontal Merger Guidelines, paragraph 32.  
36  Form Co, paragraphs 147 and f . 
37  See replies to question 14  of questionnaires Q1 to competitors and Q2 to customers . 
 
 
11 particular – are very competitive and characterized by strong OEM buyer 
power. In particular, the OEM could simply make other supplie rs stronger as 
there are various of them to choose from and increasing new one s (in 
particular from Asia) entering the market .”38 
(46) Second, the new entity will not have any incentive to engage in a foreclosure 
strategy upstream for comparatively low -cost car seat components.  Indeed, such a 
strategy would expose Lear to not being  selected by OEMs in future  tenders they 
organis e for the JIT assembly of entire car seats. Given the much higher value of an 
entire JIT assembly contract, this would lead to great loss es for the new entity.  In 
that respect, a customer underlines that it could decide to switch to other providers: 
“Lear can offer a higher vertical integration of seats / seat components which might 
result in good/better offers. If Lear would plan to offer higher prices after the 
acquisition of Kongsberg, this might result in a loss of the future contract as also 
other JIT suppliers have partners for “Kongsberg parts” and/or will offer 
interesting pricing .”39. The market investigation confirms that there are,  besides the 
parties, sufficient competitors with sufficient capabilities on the JIT assembly of 
entire car seats40.  
(47) Third, the majority of respondents to the market investigation consider that the 
proposed T ransaction will have no (or at most a limited) i mpact on competition (in 
terms of prices, choice, quality and innovation). Some customers even consider that 
the proposed  Transaction will have positive effect s on the market41.  
5.2.2.  No customer foreclosure  
(48) The Commission considers that the notified concentration is unlikely to result in  any 
risk of customer foreclosure.  
(49) First, the Commission takes the view that  the new entity is  not likely to have the 
ability to foreclose  access to downstream markets : 
- Tier 2 suppliers will continue to be able to sell their thermal heat mats to 
competitors  downstream , such as Adient (the number 1), Faurecia and Magna  
representing more than 70% of the EEA market. The proposed  Transaction will 
not result in any increment o f the Notifying Part y and the Target’ s market share 
of this component. The market investigation confirms that there will remain 
sufficient competitors on the JIT assembly  of complete car seats market42. 
- It stems from the market investigation that a majority  of OEMs organise different 
tenders for the JIT assembly  of complete seats and the individual components of 
                                                 
38  See also: “ in the event of price increases in seating components, the OEMs have the ability and incentive 
to encourage and support new seat component market entrants”. See replies to question s 16 and  22 of 
questionnaire Q1 to competitors . 
39  Reply  to questionnaire Q2 to customers.  
40  See replies to question 13  of questionnaire Q1 to competitors and to question 12 to questionnaire Q2 to 
customers . 
41  See replies to questions 20 -24 of questionnaires Q2 to customers . 
42  See replies to question 13  of questionnaires Q1 to competitors  and to question 12 of questionnaire Q2  to 
customers . 
 
 
12 the seats43. In addition, the OEM s largely use a directed -buy sourcing strategy 
pursuant to which they  impose  their preferred Tier 2 suppliers  (as all as the terms 
and conditions) on Tier 1 suppliers44. Even if it wishes to do so, Lear cannot 
decide unilaterally to source exclusively from Kongsberg.  As a result, Lear will 
not have the capability to foreclose Tier 2 suppliers.  
(50) Second , the new entity would have a modest position in the downstream market 
(market shares below 30%) facing competition by several important rivals. Given the 
market characteristics, this would make any foreclosure strategy unprofitable  and 
therefore the new entity will ha ve no incentive to enter in such strategy .  
(51) Third, the majority of respondents to the market investigation consider that the  
proposed  Transaction will have no (or at most a limited) impact  on competition (in 
terms of prices, choice, quality and innovation)45.  
(52) In light of the above, the proposed Transaction is unlikely to result in any input or 
customer foreclosure and the Commission concludes that the proposed Transaction 
does not raise serious doubts as to its compatibility with the internal market.  
6. CONCLU SION  
(53) For the above reasons, the European Commission has decided not to oppose the 
proposed  Transaction  and to declare it compatible with the internal  market and with 
the EEA Agreement. This decision is adopted in application of Article 6(1)(b) of the 
Merger Regulation and Article 57 of the EEA Agreement .  
For the Commission  
 
 
(Signed)  
Margrethe VESTAGER  
Executive Vice-President  
 
                                                 
43  See replies to question 5 of questionnaire Q2 to customers . 
44  The importance of the direct -buy strategy can vary depending on the relevant components.  
45  See replies to questions 20 -24 of questionnaires Q1 to competitors  and Q2 to customers .