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 -MERG ER-REGISTRY@ec.europa.eu . 
 EUROPEAN COMMISSION  
Brussels, 30.4.2018  
C(2018 ) 2747 final  
PUBLIC VERSION  
 
To the notifying party  
Subject : Case M .8851 – BASF /Bayer Divestment Business  
Commission decision pursuant to Article 6(1)(b) in conjunction with 
Article 6(2) of Council Regulation No  139/20041 and Article 57 of the 
Agreement on the European Economic Area2 
                                                 
1  OJ L 24, 29.1.2004, p. 1  (the 'Merger Regulation'). With effect from 1 December 2009,  the Treaty 
on the Functioning of the European Union ('TFEU') has introduced certain changes, such as the 
replacement of 'Community' by 'Union' and 'common market' by 'internal market'. The termi nology 
of the TFEU will be used throughout this decision.  
2  OJ L 1, 3.1.1994, p. 3 (the 'EEA Agreement').  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information omitted has been replaced by 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 TABLE OF CONTENTS  
1. THE PARTIES  ................................ ................................ ................................ ............  5 
2. THE CONCENTRATION  ................................ ................................ ..........................  6 
3. UNION DIMEN SION  ................................ ................................ ................................ . 6 
4. COMPETITIVE ASSESSME NT ................................ ................................ ................  6 
4.1. Weed management  ................................ ................................ ............................  7 
4.1.1.  Introduction  ................................ ................................ .........................  7 
4.1.2.  Definition of innovation spaces in NSH  ................................ ..............  8 
4.1.2.1.  Commission precedents  ................................ .......................  8 
4.1.2.2.  Notifying Party's views  ................................ .......................  9 
4.1.2.3.  Commission assessment  ................................ ......................  9 
4.1.2.4. Conclusion  ................................ ................................ ...........  9 
4.1.3.  Activities of the Parties and their competitors ................................ ..... 9 
4.1.3.1.  BASF's herbicide innovation  ................................ ...............  9 
4.1.3.2.  The Bayer Divestment Business's herbicide 
innovation  ................................ ................................ ..........  12 
4.1.3.3.  Competitors' innovation in NSH  ................................ ....... 14 
4.1.4.  Notifying Party's views  ................................ ................................ ...... 15 
4.1.5.  Competitive assessment in NSH innovation  ................................ ..... 16 
4.1.5.1.  The Transaction would likely reduce innovation 
competition between the Parties' overlapping and 
close NSH pipeline projects with a [NSH line of 
research 1]  ................................ ................................ .........  16 
4.1.5.2.  The Bayer Divestment Business's [NSH line of 
research 2] does not overlap with BASF's NSH 
innovation efforts ................................ ...............................  22 
4.1.5.3.  The Bayer Divestment Business's [NSH line of 
research 3] does not overlap with BASF's NSH 
innovation efforts ................................ ...............................  23 
4.1.6.  Conclusion  ................................ ................................ .........................  24 
4.2. Traits  ................................ ................................ ................................ ................  24 
4.2.1.  Introduction  ................................ ................................ .......................  24 
4.2.2.  Activities of the Parties  ................................ ................................ ..... 27 
4.2.2.1.  BASF  ................................ ................................ .................  27 
4.2.2.2.  Bayer Dives tment Business  ................................ ...............  29 
4.2.2.3.  Overlaps between BASF and Bayer Divestment 
Business  ................................ ................................ .............  30 
 
3 4.2.3.  Market definition  ................................ ................................ ...............  31 
4.2.3.1.  Product market definition  ................................ ..................  31 
4.2.3.2.  Geographic market definition  ................................ ............  33 
4.2.4.  Competitive assessment: price/ product competition in HT 
traits  ................................ ................................ ................................ ... 34 
4.2.4.1.  Notifying Party's view  ................................ .......................  34 
4.2.4.2.  Commission assessment  ................................ ....................  34 
4.2.4.3.  Conclusions on price/product competition in HT 
traits  ................................ ................................ ...................  37 
4.2.5.  Competitive assessment: innovation competition in GM HT 
traits  ................................ ................................ ................................ ... 37 
4.2.5.1.  Notifying Party's view  ................................ .......................  37 
4.2.5.2.  Commission assessment  ................................ ....................  37 
4.2.5.3.  Conclusions on competition in GM HT trait 
innovation  ................................ ................................ ..........  40 
4.2.6.  Competitive assessment: inn ovation competition in GM DR 
traits  ................................ ................................ ................................ ... 40 
4.2.6.1.  Notifying Party's view  ................................ .......................  40 
4.2.6.2.  Commission assessment  ................................ ....................  41 
4.2.6.3.  Conclusion on innovation competition in GM DR 
traits  ................................ ................................ ...................  43 
4.2.7.  Conclusion on traits  ................................ ................................ ...........  43 
4.3. Seed treatment  ................................ ................................ ................................ . 43 
4.3.1.  Introduction  ................................ ................................ .......................  43 
4.3.2.  Market definition  ................................ ................................ ...............  44 
4.3.2.1.  Product Market Definition  ................................ .................  44 
4.3.2.2.  Geographic market definition  ................................ ............  46 
4.3.3.  Activities of the Parties  ................................ ................................ ..... 46 
4.3.3.1.  BASF's activities in seed treatment  ................................ ... 46 
4.3.3.2.  Bayer Divestment Business' activities in seed 
treatment  ................................ ................................ ............  47 
4.3.4.  Competitive assessment in nematicidal seed treatment  .....................  48 
4.3.4.1.  Notifying Party arguments  ................................ ................  48 
4.3.4.2.  Commission assessment  ................................ ....................  48 
4.3.4.3.  Conclusion on nematicidal seed treatment  ........................  52 
4.3.5.  Insecticidal seed treatment ................................ ................................ . 52 
4.3.6.  Vertical links between seed treatment (up -stream) and 
(treated) seeds (down -stream)  ................................ ...........................  53 
4.3.7.  Conclusion on seed treatment  ................................ ............................  53 
 
4 4.4. Digital Agriculture  ................................ ................................ ...........................  53 
4.4.1.  Overview of the digital agriculture sector  ................................ .........  53 
4.4.2.  Activities of the Parties in digital agriculture  ................................ .... 54 
4.4.2.1.  BASF's activities in digital agriculture  ..............................  54 
4.4.2.2.  The Bayer Digital Agriculture Assets  ...............................  57 
4.4.3.  Market definition  ................................ ................................ ...............  59 
4.4.3.1.  Product market definition  ................................ ..................  59 
4.4.3.2.  Geographic market definition  ................................ ............  60 
4.4.4.  Competitive assessment: Digital agriculture  ................................ ..... 61 
4.4.4.1.  Notifying Party's views  ................................ .....................  61 
4.4.4.2.  Commission assessment  ................................ ....................  61 
4.4.5.  Conclusion on digital agriculture  ................................ ......................  62 
5. PROPOSED REMEDIES  ................................ ................................ ..........................  62 
5.1. Framewo rk of the assessment of the commitments  ................................ .........  62 
5.2. Commitments submitted by the Notifying Party  ................................ .............  63 
5.3. Initial Commitments  ................................ ................................ ........................  63 
5.4. The Commission's market test  ................................ ................................ .........  64 
5.5. Final Commitments submitted by the Notifying Party  ................................ .... 66 
5.5.1.  Description of the Final Commitments  ................................ .............  66 
5.5.2.  Assessment of the Final Commitments  ................................ .............  66 
5.5.3.  Conclusion on the Final Commitments  ................................ .............  66 
6. CONCLUSION  ................................ ................................ ................................ .........  67 
 
 
5 Dear Sir or Madam,  
(1) On 7 March 2018 , the European Commission  (the 'Commission')  received 
notification of a proposed concentration pursuant to Article 4 of the Merger 
Regulation by which BASF SE ( 'BASF ' or the 'Notifying Party' , Germany) 
would  acquire , within the meaning of Article 3(1)(b) of the Merger Regulation , 
control over parts of  Bayer Aktiengesellschaft ( 'Bayer ', Germany) 
(the 'Transaction') .3  
(2) The present Transaction takes place as a result of a prior notification to the 
Commission of a proposed concentration between Bayer and Monsanto . By 
decision of 21 March 2018, adopted in application of Article 8(2) of the Merger 
Regulation, the Commission declared th at concentration between Bayer and 
Monsanto compatible with the internal market and the EEA Agreement4 
(the 'Bayer/Monsanto decision') , subject to full compliance with the 
commitments annexed to that decision (the ' Bayer/Monsanto Commitments').  
Pursuant to the Bayer/Monsanto Commitments, Bayer committed to divest 
certain assets.  
(3) On 9  April  2018 ,5 following a modification of the Bayer/Monsanto 
Commitments, BASF notified to the Commission a modification of the scope  of 
the Transaction . The modification6 of the scope of the Transaction  consist s in: 
(a) The acquisition  of Bayer 's Poncho, VOTiVO, Poncho/VOTiVO, 
VOTiVO/RedigoM, COPeO, and ILeVO nematicidal seed treatment 
businesses (the 'Seed Treatment Assets') instead of Monsanto's 
NemaStrike nemat icide business; and  
(b) The acquisition  of Bayer 's digital agriculture business worldwide 
(the 'Digital Agriculture Assets') instead of the granting to BASF of a 
binding, perpetual, irrevocable and sole worldwide licence to Bayer's 
current and pipeline digital  agriculture products.  
(4) The scope of the Transaction is defined in the asset purchase agreements, 
entered into between Bayer and BASF on 13 October 2017 (the 'APAs'), as 
subsequently amended by the non -binding term sheet of 16 February 2018 and 
by the lette r of intent dated 5 March 2018. The assets and personnel included in 
the revised scope of the Transaction are referred to in this Decision as the ' Bayer 
Divestment Business'. BASF and the Bayer Divestment Business  are referred to 
together as the 'Parties'.  
1. THE PARTIES  
(5) BASF  is active worldwide in a range of businesses organised in five segments: 
chemicals (e.g. petrochemicals and intermediat es), performance products 
(e.g. dispersion and pigments), functiona l materials and solutions 
                                                 
3  Publication in the Official Journal of the European Union No C 96 , 14.3.2018 , p. 34.  
4  Commission Decision in Case M.8084 – Bayer/Monsanto (2018) . 
5  BASF's submission pursuant to Article 5(3) of Commission Regulation (EC) No 802/2004 
('BASF  5(3) Submission').  
6  The Commission approved Bayer's request to modify the commitments on 11 April 2018.  
 
6 (e.g. construction chemicals and coatings), oil & gas, and agricultural solutions. 
In the pesticides sector, BASF offers fungicides, insecticides, and herbicides as 
well as seed treatment products. Moreover, BASF is active in the discovery of 
genes that can be used to develo p genetically modified ( 'GM') crops.  
(6) The Bayer Divestment Business consists of  assets and personnel relating to 
Bayer's : (i) global broad acre crop seeds and traits business ; (ii) global 
glufosinate ammonium ( 'GA') business ; (iii) EEA agricultural and 
non-agricultural glyphosate business ; (iv) non -selective herbicide ( 'NSH ') lines 
of research relating to [NSH line of research 2] ; [NSH line of research 3] , and 
[NSH line of research 1] ; (v) Seed T reatment Assets; (vi) Digital Agriculture 
Assets;  and (vi) g lobal vegetable seeds business.  
2. THE CONCENTRATION  
(7) Through the Transaction, BASF would acquire  sole control over the Bayer 
Divestment Business  within the meaning of Article 3(1)(b) of the Merger 
Regulation  by way of purchase of assets . 
3. UNION  DIMENSION  
(8) The undertakings concerned have a combined aggregate world -wide turnover of 
more than EUR 2 500 million [ BASF: EUR 64.5 billion; the Bayer Divestment 
Business: EUR […]]. Moreover, the undertakings concerned have a combined 
aggregate turnover in excess of EUR 1 00 million in three Member  States and 
have a turnover in excess of EUR 25 million in these three Member States [ […] 
– BASF: EUR […], the Bayer Divestment Business: EUR  […]; […] – BASF: 
EUR […], the Bayer Divestment Business: EUR […]; […] – BASF: EUR […], 
the Bayer Divestment Business: EUR […]]. The undertakings concerned do not 
achieve more than two -thirds of their aggregate U nion-wide turnover within one 
and the same Member State. The notified operation therefore has an Union 
dimension  pursuant to Article 1(3) of the Merger Regulation . 
4. COMPETITIVE  ASSESSMENT  
(9) The Commission considers below the competitive effects of the Transaction in 
the areas  in which the Parties at least partially overlap : (i) weed management (in 
particular NSH innovation ), (ii) traits, in particular  herbicide tolerance trait 
innovation and disease resistance trait innovation, (iii ) nematicidal seed 
treatment;  and ( iv) digital agriculture.  There is no horizontal overlap between 
the Parties as regards broad acre crop seeds, glufosinate,  glyphosate and 
vegetable seeds. There is also no vertical link giving rise to affected markets 
between those activities and the activities discussed in this Decision. These non -
overlapping activities are, therefore,  not further discussed in this D ecision.  
(10) The Commission assesses below the likelihood that serious doubts arise 
regarding the compatibility of the Transaction with the internal market and 
the EEA Agreement, in relation to current and potential competition as well as 
to innovation competition.  
 
7 (11) As set out in Dow/DuPont  and Bayer/Monsanto7 and further detailed in 
Section  4.1.5.1 , when considering the likely impact of transactions on 
innovation competition the Commission takes into account  in particular  the 
closeness and importance of the Parties' respective innovatio n efforts, and 
assesses the corresponding likelihood that at least part of these efforts would be 
discontinued, delayed or reoriented  as a result of the Transaction . 
4.1. Weed management  
4.1.1.  Introduction  
(12) The Parties do not overlap in the EEA  regarding their current  activities in NSH 
and selective herbicides , BASF having no NSH sales and the Bayer Divestment 
Business having no selective herbicide sales in the EEA . The Parties also do not 
overlap regarding innovation relative to selective herbicides , the Bayer 
Divestm ent Business having no selective herbicide research. Finally,  the Parties 
do not overlap regarding weed management systems, since BASF is not a weed 
management system player.8 Accordingly, the Commission only assesses the 
Parties ' activities in innovation relating to NSH.  
(13) NSH are products that have a broad spectrum of action and kill both grasses and 
broadleaf weeds. In particular, and contrary to selective herbicides, they can 
harm or even kill the crops on which they are used. NSH have four main 
agricultural uses: (i) so -called 'burndown' pre - or post -season to clear a field of 
all vegetation (including volunteer crops), (ii) so -called 'over -the-top' or 'OTT' 
use, in combination with herbicide -tolerant crops to clear fields of w eeds during 
the planting season,  (iii) as a pre -harvest desiccating treatment, accelerating and 
evening the ripening process, and (iv)  so-called 'trees, nuts and vines' or 'TNV' 
uses to kill weeds around resistant crops such as fruit trees . Use of NSH is m ore 
limited in the EEA than globally, largely because of stricter regulation in terms 
of both authorised doses and uses.  
(14) From a global perspective, there are currently four key NSH molecules  or active 
ingredients ('AI's) : glyphosate, glufosinate ammonium ( 'glufosinate' or 'GA'), 
diquat and paraquat. While all four molecules can be characterised as NSH, they 
may differ in terms of mode of action ('MoA') and spectrum, and suitability for 
given uses. NSH are under regulatory pressure globally, in particular in  the 
EEA, where paraquat is no longer approved and uses of the other three AI s have 
been already restricted (for instance, glufosinate).  
(15) Since new MoAs have not been introduced to the herbicide market in several 
decades, managing growing resistance to exis ting MoAs is of paramount 
importance. The issue is particularly acute in NSH because of the widespread 
use of glyphosate over glyphosate -tolerant crops, which has led to the 
development of resistant weed populations. In practice, many AIs can typically 
only be used once or, at most, twice per crop cycle, and sometimes entire MoAs 
are limited to one or two uses per crop cycle.  
                                                 
7 See Commission Decision in Cases M.7932 – Dow/DuPon t (2017) and M.8084 – Bayer/Monsanto 
(2018).  
8 Form CO, chapters 6B.1 and 6B.2. See also Commission Decision in Case M.8084 – 
Bayer/Monsanto (2018), Section XI.1.  
 
8 (16) Because  of the two main constraints – resistance management and a limited 
number of windows for treatment – growers need to develop s pray programmes 
to fully address their weed control needs. To facilitate this process, commercial 
products are increasingly mixtures of several AIs with different MoAs. Such 
mixtures allow to limit resistance development and to broaden spectrum in order 
to solve as many weed problems as possible in the few available treatment 
opportunities. Another way to limit resistance is to rotate AIs – in particular 
different MoAs and chemical classes.9 
4.1.2.  Definition of innovation spaces in NSH  
4.1.2.1.  Commission precedents  
(17) In Dow/DuPont  and Bayer/Monsanto , the Commission considered that 
innovation should not be understood as a market in its own right, but as an input 
activity for downstream product markets. While innovation eventually results in 
products competing on th ose market s, the assessment of innovation competition 
cannot be directly conflated with the relevant downstream product markets.  
(18) The assessment of the effects on innovation competition of a merger in the crop 
protection industry such as the present one requires the identification and 
analysis of those spaces in which innovation competition occurs, so as to assess 
whether the Transaction would significantly impede innovation competition in 
such spaces.  
(19) Indeed, R&D players such as the Parties do not innovate for all th e product 
markets composing the entire crop protection industry at the same time. They do 
not innovate randomly either,  but targeting specific spaces within that industry. 
When setting up their innovation capabilities and conducting their research, they 
target specific innovation spaces which are upstream of lucrative product 
markets and product markets which are of strategic interest for the R&D player 
in question. In order to assess innovation competition, it is thus important to 
consider the spaces in which this innovation competition occurs.  
(20) In Bayer/Monsanto ,10 the Commission considered that innovation spaces for 
NSH are burndown and over -the-top uses across crops, as well as weed 
management in perennial crops (TNV). It also considered that, when looki ng at 
innovation spaces for NSH, innovators attempt to discover and develop 
molecules that would be suited for as many areas as possible, and usually at 
least for burndown and over -the-top uses. Therefore, when assessing the parties' 
innovation efforts, th e Commission focused on their efforts for NSH overall and 
only further discussed the specific impact on individual NSH uses ( burndown , 
over-the-top uses across crops  and weed management in perennial crops  - TNV ) 
as appropriate.  
(21) The Commission further took the view that innovation spaces for NSH are 
global, because innovation efforts are rolled -out in all possible geographies 
across the globe.  
                                                 
9 See Commission Decision in Case M.7932 – Dow/DuPont (2017), Section V.6.6.1.6.  
10  See Commi ssion Decision in Case M.8084 – Bayer/Monsanto (2018), Section XI.1.4.1.  
 
9 4.1.2.2.  Notifying Party 's views  
(22) In its submissions, the Notifying Party did not specifically address the question 
of the def inition of innovation spaces or more generally the appropriate 
framework to assess innovation competition.  
4.1.2.3.  Commission assessment  
(23) In the absence of any new facts or arguments brought by the Parties or resulting 
from the Commission's investigation, the Commi ssion confirms the conclusions 
reached in Bayer/Monsanto .11 
(24) The Commission thus takes the view that innovation spaces for NSH are 
burndown and over -the-top uses across crops, as well as weed management in 
perennial crops (TNV). It must be noted, howev er, that when looking at 
innovation spaces for NSH, innovators attempt to discover and develop 
molecules that would be suited for as many areas as possible, and usually at 
least for burndown and over -the-top uses. Therefore, when assessing the Parties' 
innovatio n efforts, the Commission will focus on their efforts for NSH overall 
and will only further discuss the specific impact on individual NSH uses 
(burndown , over-the-top uses across crops  and weed management in perennial 
crops  - TNV ), as appropriate.  
(25) The Commission further takes the view that innovation spaces for NSH are 
global, because innovation efforts are rolled -out in all possible geographies 
across the globe.  
4.1.2.4.  Conclusion  
(26) In light of its precedents and taking into account the results of its investigat ion, 
the Commission considers that the relevant spaces to assess NSH innovation are 
the ones including R&D investment and activities targeting the development of 
NSH products, either as a whole or for specific NSH uses such as conventional 
use in perennial  crops (TNV), burndown and over -the-top uses across crops, 
globally.  
4.1.3.  Activities of the Parties and their competitors  
4.1.3.1.  BASF's herbicide innovation12 
(27) BASF has several herbicide pipeline projects. Th ose projects relate to the 
following molecules or chemical cla sses: trifludimoxazin (a protoporphyrinogen 
oxidase inhibitor or '[mode of action 1 ]'-inhibitor), [NSH line of research  1], 
[NSH line of research  3], [herbicide line of research 4] and cinmethylin (a Fat -A 
inhibitor). Aside from cinmethylin (for which only  selective uses in cereals and 
rice are being developed), these chemistries are – depending on the specific 
chemistry – being developed for […]. The following paragraphs detail each 
project.  
                                                 
11  See Commission Decision in Case M.8084 – Bayer/Monsanto (2018), Section XI.1.4.1.  
12  Form CO, chapter 6B.1, paragraphs 425 -426. 
 
10 (28) [NSH line of research 1] . BASF has […] pipeline projects.  
(29) On the one hand, BASF has trifludimoxazin  […], a residual broad spectrum 
herbicide with strength on broadleaf weeds and [mode of action  1]-resistance -
breaking activity currently in Phase 3  (development) . Registration activities are 
ongoing, with planned dossier s ubmission in the first semester of 2018 
(excluding the EEA and Brazil). Trifludimoxazin is not intended to be registered 
or launched in the EEA. Target applications globally are burndown, TNV and 
OTT use with herbicide tolerance (' HT') traits across multiple crops both pre -
emergence and post -emergence.  
(30) The combination of trifludimoxazin with BASF's currently commercialised 
saflufenacil [mode of action 1 ] chemistry (sold under the Kixor brand , only 
outside the EEA ) provides broad spectrum weed control and control of [mode of 
action 1 ]-resistant weeds. In particular, the combination of [trifludimoxazin ] 
with Kixor will offer growers (i)  a burndown option for warm season crops, and 
(ii) a herbicide for OTT use – in combination with an HT trait – in several crops, 
including soybean , cotton and corn, giving growers a new resistance -breaking 
option.  
(31) On the other hand, BASF has [NSH line of research  1]. 
Figure 1 – BASF's [NSH line of research  1] project (1)  
[…] 
Source:  BASF's response to the Commission's request for information RFI Q32, Annex Q.16.6, page 2.  
Figure 2 – BASF's [NSH line of research  1] project (2)  
[…] 
Source:  BASF's response to the Commission's request for information RFI Q32, Annex Q.16.6, page 4.  
(32) [NSH line of research  3].13 […].14 
(33) [Herbicide  line of research  4].15 
(34) Cinmethylin . BASF's pipeline project relating to the cineole class of chemistry 
([cinmethylin ]) is in late -stage development (Phase 3), and its reg istration 
application is expected to be submitted in the second quarter of 2018. 
[Cinmethylin ] is a selective pre -emergence herbicide for cereals and rice. It is in 
particular not intended for OTT use in combination with an HT trait, or for 
burndown or TNV  uses.  
                                                 
13 [NSH line of research  3] are [mode of action 3]  from a novel chemical class, which show promising 
efficacy across a large spectrum of weeds – notably weeds resistant to glyphosate and broadleaf 
weeds.  
14 […]. 
15 See for instance BASF's response to the Commission's request for information RFI 10, including 
Annex Q.4.3 . […]. 

 
12 4.1.3.2.  The Bayer Divestment Business's herbicide innovation16 
(36) The Bayer Divestment Business includes data and know -how gathered by Bayer 
from laboratory and field trials relating to all non -selective uses conducted on 
certain classes of chemistry (but not data or know -how relating to selective uses, 
which Bayer retains), as we ll as information on the structure and samples of the 
relevant molecules. The three relevant chemical classes are: [NSH line of 
research  2], [NSH line of research  1] and [ NSH line of research  3]. The Bayer 
Divestment Business also includes exclusive licenc es to Bayer's intellectual 
property rights  relating to these chemical classes for non -selective uses (which 
are (i) the control of unwanted vegetation in permanent crops and plantation 
crops, such as trees, nuts and vines; (ii) burndown; and (iii)  over-the-top use 
over HT field crops), as well as lead scientists working on these lines of research 
(in accordance with local labour law).  
(37) The Bayer Divestment Business's  NSH lines of research target […], as detailed 
in the following paragraphs. In view of the ea rly stage of the  Bayer  Divestment 
Business 's pipeline projects, planned peak sales as well as specific target 
geographic markets are not  yet available . 
(38) [NSH line of research 1] . The Bayer  Divestment Business is researching [NSH 
line of research  1] system o f herbicide toleran t crops . As shown in Figure 3 to 
Figure 6, the latest available pipeline information confirms that the project 
show s promising efficacy and resistance -breaking properties (in regard both to 
older [NSH line of research 1]  and to glyphosate). It is being actively p ursued, 
with promotion to phase  […] planned  for […] and market launch for […]. This 
research began at the en d of 2016 and the Bayer Divestment Business already 
promoted the first molecule from this class – […] – to field testing in 2017. 
Meanwhile, […] further candidate  molecules  have been identified and will be 
tested in the 2018 field season in comparison to […]. 
Figure 3 – The Bayer Divestment Business's  [ NSH line of research  1] project (1)  
[…] 
Source:  BI 33681 ''2017 -12-15 WM_RPC_Annual Portfolio Review '', page 88 [highlighting added].  
Figure 4 – The Bayer  Divestment Business's  [ NSH line of research  1] project (2)  
[…] 
Source:  BI 33681 ''2017 -12-15 WM_RPC_Annual Portfolio Review '', page 94 [highlighting added].  
Figure 5 – The Bayer Divestment Business's  [NSH line of research  1]) information 
package (1)  
[…] 
Source:  Bayer's internal document ''[NSH line of research 1]  Information Package '', page 11.  
                                                 
16 Form CO, chapter 6B.1, paragraphs 432 -433. 


 
15 Figure 11 – Weed management competitor patent activ ity 
[…] 
Source:  BI 33681 ''2017 -12-15 WM_RPC_Annual Portfolio Review '', page 13 [highlighting added].  
Figure 12 – Weed control pipeline landscape (BASF view) (1)  
[…] 
Source:  BASF's response to the Commission's request for informat ion RFI 11, Annex Q.2.2., page 79.  
Figure 13 – Weed control pipeline landscape (BASF view) (2)  
[…] 
Source:  BASF's response to the Commission's request for information RFI 11, Annex Q.2.2., page 80.  
(48) […], as detailed in Section 4.1.5.1 . 
4.1.4.  Notifying Party 's views  
(49) In the Form CO, the Notifying Party in essence argued that : 
(a) BASF does not manufacture or sell NSH in the EEA and t here are thus no 
overlaps between the Parties there;  
(b) BASF's pipeline chemistries are not substitutes for the Bayer Divestment 
Business's current products and lines of research since BASF's projects 
[…]; 
(c) BASF would in any event have every incentive to pursu e its own NSH 
lines of research in view of ( i) glufosinate's uncertain future in the EEA, 
(ii) resistance management and ( iii) higher margins on novel patent -
protected AIs compared with off -patent AIs;  
(d) the Bayer Divestment Business's [NSH line of research 2] and [NSH line 
of research 1]  do not overlap with BASF's existing chemistry, […], and 
BASF would therefore have full incentives to pursue the  Bayer  
Divestment Business's lines of research;  
(e) there is no overlap between BASF's [NSH line of research 3] and 
[herbicide line of research 4] and the  Bayer  Divestment Business's [NSH 
line of research 3] and [NSH line of research 2] , and therefore no scope 
for concerns in that regard;  
(f) there is likely no overlap between the Parties' respective [NSH line of 
research 1] , […], and therefore no scope for concerns in that regard, 
especially given BASF's strong incentives to pursue both [NSH line of 
research 1]  as possible complements and in view of the high attrition rate 
of research projects at such early research stages; and 
 
16 (g) there is a high degree of uncertainty regarding the successful outcome, 
final technical characteristics and commercial prospects of the Parties' 
herbicide lines of research since they are still in discovery.17 
4.1.5.  Com petitive  assessment in NSH innovation  
(50) Currently, both Parties have R&D efforts in NSH , as detailed in Section  4.1.3 . 
(51) The Parties claimed that there would be no overlap or at least sufficient scope 
for differentiation between the Parties' respective lines of research, notably in 
view of different technical profiles (weed spectrum, selectivity, residuality, 
toxicology, resistance -breaking ability, global registrability, target crops a nd 
uses, etc.) and timing.18 BASF would thus have every incentive to fully pursue 
the Bayer Divestment Business's NSH lines of research in parallel with its own 
lines of research.  
(52) In particular, […].  By contrast, […].19 
(53) Moreover, the Parties also claimed tha t a large number of competing innovators 
for NSH – including [NSH line of research 1]  – would in any event continue to 
constrain the Parties.20 
(54) However, the Commission considers in light of its investigation and the 
available information that the Transactio n would raise serious doubts as to its 
compatibility with the internal market and the EEA Agreement in view of a 
possible overlap between  the Parties' respective lines of research  for the 
development of NSH with a [NSH line of research 1]  mode of action . The likely 
effects of the Transaction on innovation for NSH (i)  with a [NSH line of 
research 1]  mode of action, (ii) based on the [NSH line of research  2] chemistry 
and (iii)  based on the [NSH line of research  3] chemistry are assessed separately 
below.  
4.1.5.1.  The Transaction would likely reduce innovation competition between the 
Parties' overlapping and close NSH pipeline projects with a [NSH line of 
research 1]  
 The Parties have overlapping and close NSH lines of research based on 
the [NSH line of research 1]  MoA  
(55) In spite of the Parties' arguments to the contrary, it is apparent from the 
description of the Parties' R&D efforts in NSH innovation in Section  4.1.3  that 
their respective [NSH line of research 1]  projects overlap.  
(56) The Commission's investigation indicates that the Transaction would create an 
overlap likely giving rise to innovation competition concerns because (i) the 
                                                 
17  Form CO, chapter 6B.1, paragraphs 421, 440, 442 and 449 -457. See also the Parties' Memorandum 
on [NSH line of research  1], 21 March 2018.  
18  Form CO, chapter 6B.1, paragraphs 452 -457. See also the Parties' Memorandum on [NSH line of 
research  1], 21 March  2018.  
19  Form CO, chapter 6B.1, paragraph 454. The Commission notes that 'total herbicides' is a way for 
BASF to refer to NSH (see Form CO, ch apter 6B.1, paragraph 396, second bullet).  
20  Parties' Memorandum on [NSH line of research 1] , 21 March 2018, Section 5.  
 
17 Parties' respective [NSH line of  research 1]  pipeline projects appear to be both 
targeting the same uses ( […]), (ii) the Parties' respective [NSH lines of 
research  1] appear to be from the same chemical class and have similar technical 
profiles, and (iii) the re is  likely only one other c ompeting [NSH line of 
research  1] molecule ( […]) with the potential of having a global reach.  
(57) This conclusion is consistent with the findings  in Bayer/Monsanto  that the 
combination of […] of the […] existing [NSH line s of research 1]  ([…]) would 
likely lead to a significant impediment to effective competition because of 
(i) their close technical characteristics as well as target uses and (ii)  similar 
timing for use over HT crops.21 
(58) Indeed, BASF's own assessment of existing [NSH line of research 1]  researc h 
projects suggests that BASF's […] and the Bayer Divestment Business's [NSH 
line of research 1]  are as close to one another as […] and the Bayer Divestment 
Business 's [NSH line of research 1]  in terms of technical characteristics, target 
uses and timing f or use over HT crops . This is  notably so because BASF's […] 
project is closely derived from the […] molecule, which is for instance 
illustrated in Figure 15. 
(59) Figure 14 and Figure 15, extracted from a BASF presentation to the 
Commission, illustrate the technical closeness of BASF's […] [NSH line of 
research 1]  candidate, […]. 
Figure 14 – Excerpts from BASF's presentation to the case team on 
14 March  2018  (1) 
[…] 
Source:  BASF's presentation to the Commission on 14 March 2018 'New [NSH line of research  1], 
page  7. 
Figure 15 – Excerpts from BASF's presentation to t he case team on 
14 March  2018  (2) 
[…] 
Source:  BASF's presentation to the Commission on 14 March 2018 'Overview of [NSH line of 
research  1] chemistries '. 
(60) These elements confirm the Commission's view that BASF's […] and the Bayer 
Divestment Business 's [NSH l ine of research 1]  project are from the same 
chemical class and have similar technical characteristics .22 
(61) Similarly, the Commission's view that the Parties' respective [NSH line of 
research 1]  projects overlap in terms of at least some of their target uses is 
confirmed by their respective descriptions in Section 4.1.3 . 
(62) In sum, the Commission considers that the Parties currently have overlapping 
and close NSH pipeline projects with a [NSH line of research 1]  MoA . 
                                                 
21  See the Commission Decision in Case M.8084 – Bayer/Monsanto (2018), Section XI.1.  
22  See also the Parties' Memorandum on [NSH line o f research 1] , 21 March 2018, paragraphs 3.6 
to 3.8. 
 
18 
 The Transaction would likely reduce innovation competition  in NSH 
with a [NSH line of research 1]  MoA  
(63) Paragraph 38 of the Horizontal Merger Guidelines provides that 'effective 
competition may be significantly impeded by a merger between two important 
innovators, for instance between two comp anies with 'pipeline' products related 
to a specific product market '. 
(64) This can be the case if the pipeline product (or line of research) of one of the 
merging parties was likely to capture significant revenues from the actual or 
potential competing product  of the other merging party (be it another pipeline 
product – or line of research – or products currently marketed). This adverse 
externality is internalised post -merger – from the perspective of each innovator, 
the expected loss of profits on the products  of the other merging firm adds to the 
opportunity cost of innovating – making it more likely that post -Transaction a 
pipeline product (or line of research) is discontinued, deferred or redirected 
(particularly in the presence of significant development an d commercialisation 
costs as is the case in crop protection).  
(65) Consumers may also ultimately be harmed in this case by both the loss of 
product quality and variety and the reduced intensity of future product market 
competition in the markets where the disco ntinued/deferred/redirected pipeline 
product(s) would potentially have been introduced but for the Transaction. This 
effect applies both in the short -term, notably in relation to existing pipeline 
products and current lines of research, and over time, in r elation to future R&D 
efforts.  
(66) As explained in Section 4.1.5.1 .A, in this case the Commission considers that 
the Parties currently have overlapping and close NSH pipeline projects with a 
[NSH line of research 1]  MoA. In particular, BASF's […] and Bayer's [NSH line 
of research 1]  target – at least partly – the same uses ( […]). They also  appear to 
be from the same chemical class and have similar technical profiles ( […]). 
(67) The products resulting from these respective [NSH line s of research 1]  are 
therefore likely to cannibalise each other's future NSH sales, thereby reducing 
the incentives for the merged entity to continue post -Transac tion with both of 
the Parties' [NSH line s of research 1]  with the same intensity as each of the 
Parties would have in the absence of the Transaction.  
(68) Accordingly, the Commission considers it likely that the merged entity would 
discontinue, delay or reorien t one or both of the Parties' respective [NSH line s of 
research 1]  post-Transaction.  
(69) In alleging that […] and the [NSH line of research 1]  project would potentially 
be sufficiently differentiated (in terms of resistance -breaking activity, global 
registrabi lity and launch timing) to provide a clear incentive for the merged 
entity to fully pursue both projects post -Transaction23 – the Parties explained 
that 'BASF would have a clear incentive to develop the Bayer [NSH line of 
research 1]  Project […] so as to co mplement  the [NSH line of research 1]  
projects it is currently pursuing ' and that the [NSH line of research 1]  'would be 
                                                 
23 Parties' Memorandum on [NSH line of research 1] , 21 March 2018, Section 3.  
 
19 a useful and most welcome supplement  to the BASF [NSH line of research 1]  
portfolio ' (emphasis added in both cases).24 
(70) The Parties argued that these statements and their supporting evidence show that 
[…] and the [NSH line of research 1]  project are sufficiently differentiated pre -
Transaction to justify their continued full development post -Transaction in a 
way similar to w hat the Parties would separately have done in the absence of the 
Transaction: 'BASF would have a clear incentive to develop it […] and this 
incentive would be no different  to Bayer's incentive to develop the product, 
absent the Bayer/Monsanto  deal' (emphas is added).25 
(71) However, on the contrary, the Commission considers that these statements in 
fact suggest that the merged entity would post -Transaction not have the same 
incentive to develop both project s as they would have been  pre-Transaction. 
Indeed, these s tatements suggest that the merged entity would likely orient the 
two lines of research to be complements rather than (at least partial ) substitutes , 
which they likely would have been if left  in the respective hands of two 
independent players absen t the Tra nsaction.  
(72) In any event, even the Parties acknowledged that this alleged incentive to fully 
pursue both projects would be particularly present "if the new [NSH line of 
research 1]  has some combination of differentiated chemistry, resistance -
breaking propert ies and/or global registrability ", which at this stage is not 
confirmed on the basis of the latest available data on both […] and the [NSH 
line of research 1]  project.26 
(73) The Parties further argued that this case would be materially different from 
Bayer/Monsanto  in view of (i) the absence of any collaboration creating 
uncertainty as to BASF's ability to pursue [NSH line of research  1]; and (ii) the 
absence of any synergy plans regarding NSH innovation, by contrast with the 
evidence relied upon in Bayer/Monsanto .27 
(74) The Commission notes regarding the first point that the described uncertainty 
was only a subsidiary consideration – specifically related to the identified risks 
regarding the collaboration between Monsanto and Sumitomo on the [NSH line 
of research  1] – in its concerns relating to NSH innovation in Bayer/Monsanto . 
(75) Regarding the second point, the Commission notes that BASF only very 
recently decided to acquire the Bayer Divestment Business, in particular the 
[NSH line of research 1] . It is ther efore unsurprising that BASF would not have 
drafted synergy plans in the ordinary course of business, as it would at this stage 
likely not have had sufficient time to prepare  such plans . 
(76) Nevertheless, the Commission considers it likely that  BASF – once the  
acquisition would be consumed – would proceed with testing to profile the 
[NSH line of research 1]  project. Such profiling would likely confirm the 
Commission's view in the present Decision – based on the latest available 
                                                 
24 Parties' Memorandum on [NSH line of research 1] , 21 March 2018, paragraphs 3.9 and 3.20.  
25 Parties' Memorandum on [NSH line of research 1] , 21 March 2018, paragraph 3.13.  
26 Parties' Memorandum on [NSH line of research 1] , 21 March 2018, paragraph 4.4.  
27 Parties' Memorandum on [NSH line of research 1] , 21 March 2018, paragraph 5.4.  
 
20 information from Bayer – on the e xistence of an overlap, with the corresponding 
effect on the merged entity's incentives to fully pursue or instead 
reorient/delay/discontinue at least one of the  projects post -Transaction.  
(77) This conclusion is fully in line with the Commission's concern that , post -
Transaction, the [NSH line of research 1]  and [NSH line of research  1] projects 
would no longer compete head -to-head, but likely be reoriented and optimised 
as complementary elements of a single portfolio , and one project could possibly 
even be full y discontinued.  
(78) Furthermore, respondents to the market investigation confirmed that a crop 
protection player such as BASF would likely not develop two NSH projects if 
they are technically very similar as is the case at stake , possibly irrespective of a 
significant difference in timing (which in any event does not arise in the present 
case):28 '[i]f market, size and registerability are similar, a crop protection 
company should select one product enough. Even if there is big gap in its launch 
timing, similar chemical may bring similar resistance problem '; 'our opinion is 
that one of the two similar products would be eliminated. This is because the 
cost of bringing to market a new Active Ingredient is extremely high (+$100M), 
for obvious reasons of cost savings , synergies and avoid 'cannibalism ': if there 
were two very similar products, only one would be commercialized '; 'one of the 
two projects would likely fall by the wayside. Such outcome is likely regardless 
of timing between the two projects '.29 
(79) Some respond ents also suggested that this could similarly be the case even 
where two NSH projects are technically dissimilar if they are aligned on timing, 
in view of the limited availability of R&D funds:30 '[g]enerally, if two NSH 
pipeline projects are different in t erms of technical characteristics, SC believes 
that a difference in timing between the two projects would affect the likelihood 
of them being conducted in parallel. This is principally because the different 
timelines would allow the company in question to allocate funds and human 
resources more efficiently between the two projects '.31 
(80) Based on the above, the Commission considers that serious doubts arise 
regarding the compatibility of the Transaction with the internal market and 
the EEA Agreement in relation  to NSH [NSH line of research 1]  research.  
 There is only a  limited constraint from innovation efforts of competing 
players in view of high barriers to entry  
(81) In Bayer/Monsanto , the Commission explained the differentiated innovation 
capabilities and incentiv es by category of crop protection players. In essence, it 
concluded that only global R&D -integrated crop protection players have full 
innovation capabilities, notably in view of the high barriers to entry in crop 
protection innovation. Other players have m ore limited capabilities, focused on 
                                                 
28  Questionnaire to Competitors (Q1), questions  G.2 and G.2.1.  
29  Questionnaire to Competitors (Q1), ID217, ID235 and ID272, question G.2.1.  
30  Questionnaire to Competitors (Q1), questions G.3 and G.3.1.  
31  Questionnaire to Competitors (Q1), ID217, question G.3.1.  
 
21 discovery, development or pure generic competition, typically with a more 
limited ability to register and market products globally.32 
(82) The Commission further explained in Bayer/Monsanto  that only players which 
are active both in crop protection and in traits and seeds have full incentives to 
develop NSH lines of research for all possible uses in view of their ability to 
fully monetise such lines of research across all uses, including OTT use over HT 
crops (regarding both N SH and trait revenues).33 
(83) Accordingly, the potential competitive constraint which a given player could 
constitute for the Parties in NSH innovation would to a large extent depend on 
these differentiated capabilities and incentives. In particular, strong pot ential 
competitive constraints could likely only be exercised by  other global R&D -
integrated crop protection and seed players (Bayer -Monsanto, DowDuPont and 
ChemChina -Syngenta). Other players could only constitute a more limited 
competitive constraint, likely unable to compensate the reduction of competition 
result ing from the Transaction.  
(84) Moreover, the Parties closely monitor competitors' pipelines and patent activity, 
and test molecules patented by competitors to assess targets and efficacy. They 
gather this information through various sources such as investor presentations 
and patent applications from other crop protection companies. On that basis, the 
Parties have a good understanding of their competitors' pipelines, which allows 
them to reliably  project future sales and determine the current value of their own 
pipeline projects  vis-à-vis competing projects . 
(85) In this case, the Parties' own internal competitive intelligence confirmed that 
competing R&D activity in NSH is limited, especially in the [NSH line of 
research 1]  MoA. In particular, Figure 10 to Figure 13, describing the Parties' 
latest view of the industry weed management pipeline and Bayer's latest view of 
industry weed management patent activity, confirm that there are very few, if 
any, NSH projects in the industry, especially with a  [NSH line of research 1]  
MoA, since most of the presented projects are selective herbicides.  
(86) The Parties contested this finding, in essence arguing that several other players 
are active in NSH innovation, including in the [NSH line of research 1]  MoA.34 
Similar arguments were already raised by Bayer and Monsanto in 
Bayer/Monsanto  and assessed by the Commission .35 However, BASF  did not 
provide any new arguments or evidence supporting such  alleged competition.  
Notably, BASF is ultimately unable to identify more than one specific NSH 
project from strong and independent competing global players.  
                                                 
32 See Commission Decision in Case M.80 84 – Bayer/Monsanto (2018), Section XI.1.4. See also the 
Commission Decision in Case M.7932 – Dow/DuPont (2017), Sections V.1.5, V.8.3.3 and V.8.6.  
33 See Commission Decision in Case M.8084 – Bayer/Monsanto (2018), Section XI.1.4.  
34 Parties' Memorandum on [NSH line of research 1] , 21 March 2018, Section 5. Similar arguments 
were already raised by the Parties in Bayer/Monsanto  (see Commission Decision in Case M.8084 – 
Bayer/Monsanto (2018), Section XI.1.4.).  
35 Parties' Memorandum on [NSH line of research 1] , 21 March 2018, Section 5. Similar arguments 
were already raised by the Parties in Bayer/Monsanto  (see Commission Decision in Case M.8084 – 
Bayer/Monsanto (2018), Section XI.1.4.).  
 
22 (87) Indeed, as already explained in Bayer/Monsanto  and further illustrated in Figure 
16, the specific examples of competing ( [NSH line of research 1] ) NSH projects 
appear to be limited to […]. The additional patenting activities from other 
players are not specifically rela ted to any NSH project.36 
Figure 16 – BASF's view of additional [NSH line of research 1]  candidate molecules  
[…] 
Source:  BASF's response to the Commission's request for information RFI Q32, Annex Q.16.4, page 54.  
(88) […] constitutes a limited competitive constraint on global R&D -integrated 
players such as Bayer and BASF in view of its limited development, registration 
and access to market capabilities globally.37 
(89) In addition, […].38 […]. 
(90) Similarly, […]. This conclusion is c onsistent with the Commission's assessment 
in Bayer/Monsanto  that the relevant global players for [NSH line of research 1]  
NSH innovation are likely limited to Bayer, […] and BASF.39 
(91) Overall, the […] projects would thus constitute a limited competitive cons traint 
likely unable to compensate the likely reduction of innovation competition 
which would result from the Transaction.  
(92) In sum, from all the available information, the Commission understands that 
very few , if any , other players in the industry have NSH as an R&D target or 
pursue specific projects targeting NSH innovation spaces , especially with 
a [NSH line of research 1]  MoA.  
(93) In any event, no element on the file would contradict the Commission's 
conclusion that serious doubts arise  regarding the compatib ility of the 
Transaction with the internal market and the EEA Agreement in relation to NSH 
[NSH line of research 1]  research.  
 Conclusion  
(94) For the reasons set out above and on the basis of the data made available during 
the investigation, the Commission therefore considers that the Transaction raises 
serious doubts regarding  its compatibility with the internal market and the  EEA 
Agreement by eliminating an important and close competitive constraint  in 
relation to NSH innovation based on the [NSH line of r esearch 1]  MoA . 
4.1.5.2.  The Bayer Divestment Business's [NSH line of research 2]  does not overlap 
with BASF's NSH innovation efforts  
(95) In the absence of any research activities by BASF in [NSH line of research  2] or 
even […] – which the Commission's investigation confirmed – there is no 
overlap in [NSH line of research 2]/[…]  R&D between the Parties.40 
                                                 
36 See Commission Decision in Case M.8084 – Bayer/Monsanto (2018), Section XI.1.4.  
37 See Commission Decision in Case M.8084 – Bayer/Monsanto (2018), Section XI.1.4.  
38 See Bayer's internal document […]. 
39 See Commission Decision in Case M.8084 – Bayer/Monsanto (2018), Section XI.1.4.  
 
23 (96) More generally, the Bayer Divestment Business's [NSH line of research 2]  
project targets […]. 
(97) On that basis, only BASF's […] chemistry could overlap wit h the Bayer 
Divestment Business's [NSH line of research 2]  project, since both target […]. 
(98) However, th ose two projects are significantly different since the [NSH line of 
research 2]  project is mainly planned as a […]. By contrast, BASF's […] is a 
selective  molecule,41 not targeted at any of the NSH uses planned for the [NSH 
line of research 2]  project and likely n ot registrable in the  EEA.  
(99) These technical differences make it unlikely that the Transaction would affect 
innovation competition in relation to the  Bayer Divestment Business's [NSH line 
of research 2] . 
(100)  The Commission will accordingly not further assess possible effects of the 
Transaction on the Bayer Divestment Business's [NSH line of research 2] . 
4.1.5.3.  The Bayer Divestment Business's [NSH line of research  3] does not overlap 
with BASF's NSH innovation efforts  
(101)  Similarly, there is no overlap between the Parties in [NSH line of research 3]  
research since the investigation confirmed that BASF and the Bayer Divestment 
Business are developing [NSH line of resear ch 3]  molecules for different 
applications: BASF's [NSH line of research 3]  research is […],42 whereas the 
Bayer Divestment Business is developing [NSH line of research 3]  molecules 
for […]. 
(102)  Indeed, the licences to Bayer's NSH lines of research included in the Bayer  
Divestment Business are limited to non -selective uses only and explicitly 
exclude any research and sales into selective uses, where Bayer retains all rights 
to pursue its R&D efforts.  
(103)  More specifically, the Bayer Divestment Business's [NSH line of research  3] 
project targets […]. 
(104)  From a target use perspective,  BASF's […] [NSH line of research 1] chemistry 
could thus overlap with the Bayer Divestment Business's [NSH line of 
research  3] project, […]. 
(105)  The Commission notes that both BASF and the Baye r Divestment Business 
were pre -Transaction pursuing in parallel a [NSH line of research 3]  and a [NSH 
line of research 1]  for innovation in NSH (although BASF discontinued its own 
[NSH line of research 3]  in view of […] and independently from the 
                                                                                                                                                 
40  Form CO, chapter 6B.1, paragraph 456.  
41  In Bayer/Monsanto , the Commission confirmed its precedents that selective and non -selective 
herbicides constitute separate relevant product markets (see the Commission Decision in Case 
M.8084 – Bayer/Monsanto (2018), Section XI.1.).  
42  Form CO, chapter 6B.1, paragraph 456. See also BASF's response to the Commission's request for 
information RFI 10, paragraphs 3 -4 and 8 -9, and BASF's response to the Commission's request for 
information RFI Q32, Annex Q.15.3.  
 
24 Transacti on), thus showing the likely incentive to pursue such lines of research 
in parallel rather than discontinue, delay or reorient them.  
(106)  In the present case, one of the drivers for the incentives to develop in parallel 
[NSH line of research 3]  and [NSH line of  research 1]  molecules is likely the 
significant difference between the two projects , deriving from the fact that they 
relate to different chemical classes and act with different MoAs : […] is a [NSH 
line of research 1]  and the  Bayer  Divestment Business's [NSH line of research 3]  
project is an [NSH line of research 3] . 
(107)  Moreover, as noted in Bayer/Monsanto , both Bayer and Monsanto were 
planning […].43 
(108)  Through the Transaction , BASF would acquire Bayer's pre -existing position in 
HT systems and it is likely to have, as Bayer did,  an incentive to develop both 
an [NSH line of research 3]  chemistry and a [NSH line of research 1]  chemistry 
in parallel […]. 
(109)  The Commission therefore considers that BASF would  still have the incentive to 
fully pursue both the Bayer Divest ment Business's [NSH line of research 3]  and 
its own [NSH line of research 1 ] project as they would have been separately 
pursued by BASF and Bayer  in the absence of the Transaction. This would 
particularly be the case taking into account BASF's acquisition of the 
corresponding HT trait research from the Bayer Divestment Business, which is 
tailored to the Bayer Divestment Business's [NSH line of rese arch 3]  and would 
not work in combination with BASF's own [NSH line of research 3]  pipeline 
chemistry.44 
(110)  The Commission will accordingly not further assess possible effects of the 
Transaction on the  Bayer  Divestment Business's [NSH line of research 3] . 
4.1.6.  Conc lusion  
(111)  For the reasons set out above and on the basis of the data made available during 
the investigation, the Commission considers that the Transaction raises serious 
doubts regarding  its compatibility with the internal market and the EEA 
Agreement by eli minating an important and close competitive constraint  in 
relation to NSH innovation based on the [NSH line of research 1] MoA . 
4.2. Traits  
4.2.1.  Introduction  
(112)  Plant 'traits' are phenotyping characteristics of a plant, such as yield, early 
maturing, height, herbicide tolerance, insect or disease resistance, etc.  
(113)  Historically, a plant trait referred to a characteristic of a plant obtained via 
natural breeding. Today, breeders have additional tools to provide a plant with  
                                                 
43  See the Commission Decision in Case M.8084 – Bayer /Monsanto (2018), Section XI.1.  
44  Form CO, chapter 6B.1, paragraph 456.  
 
25 desired characteristic s such as the use of  genetically modified ( 'GM') traits .45 
Developers of GM traits identify a desired trait ( for instance  drought resistance) 
and the corresponding gene(s). This gene can then be  transformed into test lines, 
characteri sed and later introgressed into elite germplasm46 for variety 
development.  
(114)  Traits can also be developed by prompting genetic mutations using , for example,  
chemical/radiological methods (thus creating a so-called ' non-GM' trait). 
BASF 's Clearfield trait, which confers herbicide tolerance to certain  
imidazolinones  ('IMIs') ,47 is one example of such a non -GM trait.  
(115)  The most prevalent types of traits are: 
(a) Traits conferring tolerance to a given herbicide, often referred to as 
herbicide tolerance ( 'HT') traits. For farmers, these traits, in combination 
with the related herbicide (s), can represent an element of so -called 'weed 
management ' (see Section 4.1). The most common and wide -spread HT 
trait confers tolerance to glyphosate , a NSH; and  
(b) Traits conferring resistance to insect species. These traits are o ften 
referred to as insect resistance ( 'IR') traits, and represent for farmers an 
alternative to insecticides.  
(116)  In recent years, some firms have also developed  a number of other  traits 
provi ding additional desired characteristics. The designation of those t rait 
categories can vary f rom firm to firm . Based mainly  on the classification 
employed by the Bayer Divestment Business , the following categories can be 
distinguished:48 49 
(a) Disease resistance  ('DR') traits: traits that confer specific resistance to 
selected diseases, such as virus diseases, scab, fusarium,  rust, tan spot, 
septoria, etc. ; 
(b) Crop efficiency  ('CE') traits: traits that (i) improve yield (including traits 
that allow a better nutrient uptake), (ii) enhance or p reserve plant health, 
or (iii) mitigate abiotic stresses, for instance  drought or salinity stress; and 
                                                 
45  For the purpose of the present Decision, the definition provided in Article 2(2) of 
Directive  2001/18/EC of the European Parliament and of the Council of 12 March 2001 on the 
delib erate release into the environment of genetically modified organisms and repealing Council 
Directive 90/220/EEC, OJ L 106, 17.4.2001, p. 1, is employed, i.e. '' Genetically Modified Organism 
(GMO)' means an organism, with the exception of human beings, in w hich the genetic material has 
been altered in a way that does not occur naturally by mating and/or natural recombination ', where 
'organism' means ' any biological entity capable of replicating or of transferring genetic material '. 
46  Elite germplasm is the germplasm used for the development of varieties that are already 
commercialised or planned to be commercialised in the near future.  
47  Imidazolinones are a chemical class of herbicides.  
48 Parties'' response to the M.8084 Commission''s request for informat ion RFI 35, questions 7 and 8.  
49  BASF uses different nomenclatures, compared to the Bayer Divestment Business. The Commission 
considers that, for the purpose of the present Decision, BASF's definitions of Fungal Resistance, 
Yield & Stress, and Output trai ts are equivalent to, respectively, Disease Resistance, Crop 
Efficiency, and Quality traits.  
 
26 (c) Quality traits: traits that produce a modified and differentiated crop when 
compared to  the basic one, for example a  modified oil/fatty acid profile in 
soybeans. Quality traits are generally developed to service a specific 
consumer/processor demand.  
(117)  Traits can be stacked together, thus forming a 'stack ', a group  of traits 
introgressed in the same seed variety. For examp le, the Bayer Divestment 
Business 's Balance GT stack is composed of two HT traits, one providing 
resistance to glyphosate and the other to isoxaflutole.  
(118)  Trait monetis ation can occur  in two different ways: (i)  through licensing of the 
finished trait or stack to seed breeders, or through sales of own seeds containing 
the finished trait or stack ; and (ii) through licensing of the technology bearing 
the underlying gene from which a trait for a certain variety can be developed . 
(119)  GM trait development and commercialisation require , among other 
requirements , (i) elite germplasm and (ii) broad  testing  areas . The main reason 
for having both requirements  is that the introgression of a GM trait into a variety 
might lead to a number of unwanted, negative effects, such as a yield reduction 
or a change of the germination time . Thus, extensive tests on elite traited 
germplasm are required.  
(120)  Therefore, a company like BASF, which pre-Transaction did  not have a seed 
business and did not own elite germplasm , cannot  develop and commercialise 
GM traits.  It can therefore  only monetise its GM innovation effort s by out -
licensing the technology bearing the underlying genes.  
(121)  Moreover, different industry players have different business models : a non-
integrated company like BASF engages in early trait innovation activities in 
view of licensing the results to se ed and trait players, whereas  the integrated 
crop protection and seed players DowDuPont, Bayer -Monsanto and 
ChemChina -Syngenta typically  develop traits from discovery to 
commercialisation in -house for use in their own seeds (in addition to licensing 
to third party seed players). Competition in trait innovation between these 
companies with different business models  and innovation activities  is therefore 
less strong  than it is among companies with the same business model  and 
innovation activities . 
(122)  In contrast, the requirements for bringing a non -GM trait to the point of 
commercialisation are substantially simpler than for GM traits. This is b ecause 
the unwanted effects mentioned in paragraph (119)  are much more limited, thus 
requiring less extensive tests, which , in most cases,  can be executed on non -elite 
germplasm.50  
(123)  Therefore, a trait innovator with no seed activities (such as BASF  pre-
Transaction ) is able to develop non -GM traits and to bring the complete, 
commercially ready technology to market through other seed companies – 
including small seed companies.51 
                                                 
50  BASF's response to the Commission's request for information RFI 5, question 2, paragraph 6.  
51  BASF's response to the Commission's request for information RFI 5, question 2, paragraph 3.  
 
27 4.2.2.  Activities of the Parties  
4.2.2.1.  BASF  
(124)  BASF is active in non -GM trait research and development. Moreover, BASF is 
active in trait innovation  that can be developed into GM traits.  
(125)  As it does not have a seed business pre -Transactio n, BASF must rely on others 
to develop the genes it discovers into commercial GM traits. Therefore, for GM 
traits, BASF is only active as regards innovation, with no or very limited 
activities in actual development. Indeed, BASF typically only provides sup port 
and knowledge transfer to a trait development partner.  
(126)  In contrast, for non -GM traits, BASF develops commercial traits, ready to be 
introgressed by a seed company that in -licenses them .52 
(127)  Therefore, for non -GM traits, BASF can monetise its innovation efforts by 
out-licensing the fully developed traits, whereas for GM traits, BASF monetises 
its trait innovation  activities  by out -licensing the underlying  technologies  to trait 
developer s. In addition to trait licen ce fees, in the case of HT traits , BASF 
monetises its GM trait innovation  efforts through the sales of the associated 
herbicides.53 
(128)  The only two commercial trait products owned by  BASF are non -GM, 
namely  (i) Clearfield  and (ii) Duo Maize System / POAST Protected Corn .54 
Further details about each t rait are set out below.  
(a) Clearfield.  Clearfield is a non -GM HT trait conferring  resistance to IMIs. 
Clearfield is available for rice, OSR, wheat, sunflower, corn, barley and 
lentils . The vast majority (approx imately  […]) of BASF's Clearfield 
income is derived from […] seeds. Clearfield is licensed to third -party 
seed partners, who independently set the price of the Clearfield -traited 
seeds for growers. Clearfield over -the-top patents have expired in most 
jurisdictions and will expire by 2023 in all other jurisdictions. IMIs are 
also off -patent and face a large number of generic competitors . […]. 
(b) Duo Maize System / POAST Protected Corn . BASF offers two non -GM 
traits which confer tolerance to ACCase -inhibitor herbicides in corn. The 
Duo Maize System is marketed in Europe and the POAST Protected Corn 
is marketed in the U nited States . Both traits were  launched in 1996  and are  
planted on a very small number of acres ( […] hectares  in 2016 )55. BASF 
generates […] from licensing the m. 
                                                 
52  In the Form CO, BASF's view is that BASF is only active in the gene discoveries. However, further 
evidence, such as the BASF's response to the Commission's request for information RFI 5, 
question  2, indicates that, for non -GM traits, BASF is active as a trait developer. In developing 
non-GM traits, the need for owning an elite germplasm is reduced, compared to GM traits.  
53  Form CO, chapter 6A, paragraph 260.  
54  BASF also had a GM HT trait for soybean for the Brazilian market called 'Cultivance', which was 
co-developed with Embrapa. Cultivance never reached the market […]. 
55  Form CO, paragraph 278.  



 
31 4.2.3.  Market definition  
4.2.3.1.  Product market definition  
 Commission precedents  
(144)  In its most recent precedent ,62 the Commission concluded that trait development 
and licensing is a separate product market , upstream from the markets for the 
breeding and commercialisation of seeds . 
(145)  In that decision, t he Commission also considered that there appear to be three 
activities relating to the research, development and licensing of traits, all of 
which are upstream of the seeds markets:63 
(a) Trait discoveries licensing,  from which traits can be developed , which is 
the discovery and initial validation of the underlying trait genes , which are 
out-licensed to trait developers. The Commission considered that the trait 
discoveries licensing activities did not constitute  a separate product market 
because the se activities concern research and early development , and are 
to be treated as i nnovation spaces . The Commission concluded that 
innovation competition takes place in spaces consisting of groupings of 
crop/functionality combinations,64 such as HT in soybean, DR in soybean, 
or IR in cotton.  
(b) Single trait licensing , for which the Commission concluded that separate 
product markets were to be distinguished on the basis of the  functionality 
of the relevant trait (e.g. HT, IR etc.) and crop  in which it is introgressed ; 
and 
(c) Stack licensing , for which the Commission concl uded that separate 
product markets exist for each crop (but not for each functionality).65 
(146)  With respect to the definition of the innovation space for trait s, the Commission 
concluded that innovation competition takes place in spaces consisting of 
groupings of crop/functionality combinations ,66 such as HT in soybean , DR in 
soybean, or IR in cotton . 
(147)  In defining the product markets for single trait licensing and for stack licensing, 
the Commission did not distinguish between GM and non -GM.67 
                                                 
62  Commi ssion Decision in Case M.8084 – Bayer/ Monsanto (2018), recital 864.  
63  Commission Decision in Case M.8084 – Bayer/Monsanto (2018), recitals 866 – 873. 
64  Commission Decision in Case M.8084 – Bayer/ Monsanto (2018), recital 1015.  
65  For stacks, there is no  split by functionality, as it is in the nature of stacks to have several functions 
(e.g. tolerance to one or more herbicides and/or one or more insecticides).  
66  Commission Decision in Case M.8084 – Bayer/ Monsanto (2018), recital 1015.  
67  In Commission Decision in Case M.8084 – Bayer/ Monsanto (2018), none of the affected markets 
included non -GM single traits or stacks with at least one non -GM trait. Regarding innovation 
spaces, the parties activities were considered to compete closely if t hey both focused on GM or on 
non-GM traits (see for example Section X.1.7.5.7 regarding non -GM traits for wheat).   
 
32 
 Notifying Party 's views 
(148)  The Notifying Party considers that trait discover ies licensing should not be 
considered as an innovation space, but rather a separate product market. 
According to the  Notifying Party , this is because  several companies, research 
institutes and universities are active in trait discover ies and typically monetise 
their effort s through licensing agreements with trait developers.  
 Commission assessment  
(149)  In light of its precedents and in the absence of new ele ments , the Commission 
concludes  that the development and licensing of traits constitute s a separate 
product market, upstream from the markets for the breeding and 
commercialisation of seeds. The Commission also confirms that  three activities  
related to tra its can be distinguished, namely: i) trait discoveries licensing from 
which traits can be developed ; ii) single traits licensing; and iii) stacks licensing.  
(150)  In line with its precedents,68 the Commission notes  that there are several players 
active in the licensing of trait discoveries, which  monetise their research efforts 
through the  licensing of their intellectual propert y rights , but it confirms that 
trait discoveries should be not be treated as a product markets, but rather as 
innovation spaces . 
(151)  Indeed, t he Commission also notes  that trait discoveries  licensing activities are  
related to research or early development of traits , which, in the case of GM 
traits, are further developed and eventually brought to the market by a limited 
number of firms . Therefore , it is appropriate to consider the discovery of genes 
as a research or early discovery part of the trait research and development , 
irrespectively of whether  this is conducted in -house by a trait developer or in 
cooperation with third parties . 
(152)  Therefore, t he Commission considers that trait innovation and its outcomes, 
including trait discoveries licensing, should not be understood as a market in its 
own right, but as an input activity for the trait development and licensing  
market , which is upstream from th e seeds markets .69 Such input activity is 
characterised by innovation spaces consisting of groupings of crop/functionality 
combinations such as , for example,  HT in soybean, DR in soybean, or IR in 
cotton.  
(153)  Regarding single trait licensing, the Commission considers  that separate product 
markets are to be distinguished as combinations of crops and functionalities 
(e.g. HT trait for soybean). Further sub -segments are also to be distinguished for 
the IR functionality.  
(154)  Also for  stack licensing, the Commission considers  that separate product 
markets are to be distinguished by crops, for instance  stacks for soybean or 
stacks for cotton.  
                                                 
68  See for example, M.8084 – Bayer/ Monsanto (2018), Section X.1.4.4.  
69  Commission Decision in Case M.8084 – Bayer/Monsanto (2018), recital  1023.  
 
33 
 Conclusion  
(155)  The Commission confirms its findings in a previous case70 and consider s that 
there are three different activities  relating to traits, all of which are upstream of 
seed markets, namely: i) trait discoveries licensing from which traits can be 
developed ; ii) single traits licensing; and iii) stacks licensing.  
(156)  Trait discoveries  licensing is characteri sed by innovation spaces consisting of 
groupings of crop/functionality combinations such as HT in soybean , DR in 
soybean, or IR in cotton . 
(157)  Within single trait licensing, separate markets need to be distinguished by crop 
and functionality. In the case of IR traits, sub -segments als o apply (e.g. IR 
Lepidoptera for cotton).  
(158)  Finally, within stacks licensing separate markets are to be identified by crop.  
4.2.3.2.  Geographic market definition  
 Commission precedent  
(159)  In its most recent precedent , the Commission considered that the relevant 
geographic  market s for single trait licensing , and stack licensing  are global.71 
Innovation on traits (including traits discoveries licensing) also takes place on a 
global basis , because innovation efforts are rolled -out in all possible geographies 
across the globe .72 
 Notifying Party 's view  
(160)  The Notifying Party agrees that the geographic scope of trait -related markets is 
global , but notes that, with one exception, no GM traits are approved for 
cultivation in the EEA and it is unlikely that further GM traits will become 
available in the EEA in the foreseeable  future . 
 Commission assessment  
(161)  In light of its precedents and in the absence of new elements, t he Commission 
considers  that the relevant geographic market s for single trait licensing , stack 
licensing , as well as innovation in traits  are global . 
(162)  This conclusion is supported by the fact that  activities associated with the trait 
value chain (from innovation  to marketing and commercialisation) are 
conducted on a global level, and the sole activity that is narrower tha n global is 
the trait introgression process, which is a breeding process and, as such, is 
neither part of the innovation, nor  of the development and licensing of traits. 
                                                 
70  Commission Decision in Case M.8084 – Bayer/Monsanto (2018), Section X.1.4.9.  
71  Commission Decision in Case M.8084 – Bayer/Monsanto (2018), Section X.1.5.3 and 
recitals  836-844. 
72  Commission Decision in Case M.8084 – Bayer/Monsanto (2018), recit al 1024.  
 
34 
 Conclusion  
(163)  The Commission confirms its findings in a previous case73 and considers that  
the relevant geographic market s for single  trait licensing , stack licensing  as well 
as innovation in traits (including traits discoveries licensing)  are global.  
4.2.4.  Competitive assessment: price/ product competition  in HT traits  
4.2.4.1.  Notifying Party 's view  
(164)  The Notifying Party submits that the only overlap regarding the development 
and licensing of traits (i.e. of existing products) occurs in HT single traits for 
corn and OSR . More specifically, the licensing of BASF 's Clearfield overlaps 
with that of the  Bayer Divestment Business 's Liberty Link in corn and in OSR. 
However, the Notifying Party 's view is that the overlap does not raise 
competition concerns.  
4.2.4.2.  Commission  assessment  
(165)  The Commission agrees with the Notifying Party 's view that existing product 
overlap s occur in the markets for the licensing of HT single traits for corn and 
OSR. In particular, the licensing of the Bayer Divestment Business' s Liberty 
Link for corn overlaps with that of BASF 's Clearfield for corn and Duo Maize 
System/ POAST Protected Corn . With respect to HT traits for OSR, BASF 's 
Clearfield for OSR overlaps with the Bayer Divestment Business 's Liberty Link 
for OSR.  
 BASF 's HT single traits for corn  are not close or important competitor s 
to Bayer 's Divestment Business 's HT single traits  
(166)  In corn, BASF's Clearfield and Duo Maize System/ POAST Protected Corn 
have a very limited market presence and penetration rate. In 2016, Clearfield 
was present in corn varieties covering only […] hectares of land worldwide  and 
Duo Maize System/ POAST Protecte d Corn were planted in […] hectares of 
land worldwide. BASF's HT traits for corn represent a […] share of the […] 
million hectares  planted worldwide  in 2016  with corn varieties carrying at least 
one HT trait.  The Bayer Divestment Business 's HT traits for corn are carried by 
crops planted on […] million  hectares worldwide  (2016) . Monsanto 's and 
DowDuPont 's HT traits for  corn are instead present in , respectively,  more 
than 62.5 million hectares  and more than 46.5 million hectares  (2016)  (Table 6). 
                                                 
73  Commission Decision in Case M.8084 – Bayer/Monsanto (2018), Section X.1.5.4.  


 
37 difficulties in monetizing its HT single traits and is in a significantly weaker 
competitive position than Bayer and Monsanto.  
(174)  Indeed, BASF 's HT single traits for OSR do not compete closely to Bayer 
Divestment Business 's LibertyLink  and Bayer does not appear to benchmark, 
compare or collect market intelligence to any material extent regarding BASF's 
HT traits in OSR. This indicates that BASF is not a close or important 
competitor to Bayer . 
(175)  In addition to  the limited impact on the market of BASF 's HT traits  in OSR, 
BASF is only active in non -GM trait s, whereas the Bayer Divestment Business 
is active in GM traits . The Parties  thus appear to serve, at least to some extent, 
two different types of customers . For this reason, the products of BASF and of 
the Bayer Divestment Business do not appear to compete closely  with each 
other . 
4.2.4.3.  Conclusions on price/product competi tion in HT traits  
(176)  Based on the above  considerations , the Commission considers  that the 
Transaction does not raise serious doubts as to its compatibility with the internal 
market  with respect to HT traits for corn and HT traits for OSR , because the 
Parties ' HT single traits do not compete closely and BASF 's market presence is 
limited . 
4.2.5.  Competitive assessment: innovation competition in GM HT traits  
4.2.5.1.  Notifying Party 's view  
(177)  The Notifying Party argue s that there are no competi tion concerns associated 
with innovation  for GM HT traits  because there is no overlap or, in case of 
overlaps, because there is no close innovation competition . 
4.2.5.2.  Commission assessment  
 The Parties do not fully overlap in GM HT innovation because BASF is 
not active in all phases of GM trait innovation  
(178)  In Bayer/Monsanto , the Commission considered gene discovery and other early 
pipeline stage projects as part of the activities covered by HT trait innovation 
spaces.81 In that decision, both Bayer and Monsanto were considered as leading 
innovators because, among other reasons: i) the ir past  innovation has led to a 
number of commercially successful products currently on the market; ii) they 
are both fully active in all trait innovation activities, and, with respect to their 
pipelines, in all phases of their projects; and iii) they are both integrated players 
with capabilities to develop single traits  and stack s and introgress them into their 
own varieties or to out -license them to other seed companies.  
                                                 
81  In Commission Decision in Case M.8084 – Bayer/Monsanto (2018),  the Commission considered in 
early pipeline a trait project that is still in the discovery or pre -development stage, where most of the 
innovation costs have still not been incurred, and with a lower likelihood of success than products in 
a more advanced s tate of development. For both Bayer and Monsanto, this definition includes 
projects in phase 0 to phase 2. See recitals 1016 and 1020.  
 
38 (179)  In Bayer/Monsanto , the Commission considered that  BASF , contrary to Bayer 
and Monsanto,  is a more limited player in HT trait innovation . As detailed in  
Section 4.2.2.1 , […]82. 
(180)  In the Form CO, BASF confirmed the limited range of its activities in HT trait 
innovation, and further explained that it does not commercialise any GM HT 
traits.83 
(181)  The example of BASF 's [NSH line of research 1]  HT trait shows the limited 
extent of BASF's innovation activities in HT trait innovation.  In that case, the 
[…]. 
(182)  In view of the above , the Commission confirms its conc lusion in 
Bayer/ Monsan to that BASF cannot be considered a full innovator in GM HT  
traits, contrary to Bayer -Monsanto.  
(183)  The Commission therefore considers that the Parties only partially  overlap in 
GM HT trait innovation, since BASF is overall only partially active in such 
innovation  (i.e. only in phase 0 and phase 1 , and not in phase 2) . 
(184)  For completeness, the Commission nevertheless assesses below whether the 
Parties' activities in GM HT innovation  would be close.  
 BASF 's and the Bayer Divestment Bus iness 's activities in GM HT 
innovation  are not close  
(185)  The analysis of the Parties ' pipelines, research targets, lines of research as well 
as patent shares related to traits show that  the Parties are both active in 
innovation  for GM HT traits for cotton, soybean and  OSR , although the range of 
their respective activities is different, as explained above . 
(186)  With respect to innovation in  GM HT traits for cotton, soybean and OSR , 
the Parties' activities do not overlap and are in any event not close to one 
anothe r. As discussed above, BASF was active until […] in [NSH line of 
research  3 HT genes]  research,  and is currently conducting research for the 
development of traits conferring toleran ce to [NSH line of research  1] and 
[herbicide  line of research  4] herbicides.  
(187)  With respect to [NSH line of research 3  HT genes ], the Bayer  Divestment 
Business is currently at an early -stage of its innovation  process ,84 whereas 
BASF  discontinued its effort s […].85 BASF  decided to discontinue it s [NSH line 
of research  3 HT genes]  innovation effort  because  […].86 BASF is now 
developing its [NSH line of research 3]  chemistry for […] and does not have 
                                                 
82  For the definition of the pipeline phases gene discovery and proof of concept, refer to Table 3. 
83  Form CO, chapter 6A.  
84  Bayer put on hold its effort in [NSH line of research 3]  trait innovation when the associated 
herbicide candidate molecule […] was found to have toxicology issues. However, such an effort 
was recently resumed and planned to be continued (see Commission Decision in Case M.8084 – 
Bayer/Monsanto (2018), Section X.1.5.5.1). Details on the Bayer Divestment Business' efforts in 
[NSH li ne of research 3]  herbicide are in Section 4.1.3.1 .  
85  BASF's response to the Commission's request for information RFI 12, question 3; BASF's respo nse 
to the Commission's request for information RFI 8, question 1.  
86  Form CO, chapter 6A, paragraph 355.  
 
39 any plan s to restart the effort to develop  [NSH line of research 3]  molecules 
suited for […]. Indeed,  BASF considers 'unkno wn, but unlikely ' to find [NSH 
line of research 3]  chemical compounds for […], considering its  available  
intellectual prop erty space  and therefore is unlikely to relaunch its research 
program to develop an [NSH line of research 3  HT trait ]  .87 
(188)  In view of the fact that the innovation activity of BASF in [NSH line of 
research  3 HT traits ] has stopped and it is unlikely  to be re -started, it appears 
that there is no competition with the Bayer Divestment Business 's [NSH line of 
research 3  HT trait ] innovatio n effort.  
(189)  In relation  to [NSH line of research 1  HT innovation ], the early stage innovation 
effort of the Bayer Divestment Business is based on gene s which were licensed 
to Bayer by BASF under a  Material Testing Agreement (MTA).88 Indeed, in  line 
with BASF 's strategy, once a gene for a GM trait is discovered and the 
feasibility of the GM HT trait technically validated, a partner with seed and trait 
development capabilities is required  for bringing the eventual trait to the market. 
Bayer is one of the variou s potential partners to whom BASF licensed the gene 
for evaluation purposes.89 
(190)  In view of the above, the Commission considers that the  activities of the Parties 
appear to be complementary since the discovery of the [NSH line of research 1]  
GM HT gene s was f inalised by BASF, while the development  of the 
corresponding traits is underway by the Bayer Divestment Business and other 
players.  The Transaction w ould thus not adversely affect the development of the 
related [NSH line of research 1]  GM HT trait , nor wou ld it affect BASF's GM 
HT innovation  activities since these activities have ended with the identification 
and licensing of the relevant genes . The Transaction would rather only move in -
house to BASF the testing activities and, potentially, the development and 
commercialisation of the resulting  trait. 
(191)  The Commission also considered whether  BASF 's innovation effort in 
[herbicide  line of research  4] traits  competes with the inn ovation effort of the  
Bayer  Divestment Business in [NSH line of research  3 HT traits ]. The 
Commission concludes that there is very limited closeness in the Parties ' 
innovation efforts  because the two HT traits perform only with the associated 
herbicide ( namely  the [herbicide line of research 4] HT with the [herbicide line 
of research 4] chemistry and the [NSH line of research 3]  HT with the [NSH line 
of research 3]  chemistry) . The related herbicides appear to be more 
complement s than substitut es since BASF's [herbicide line of research 4] 
chemistry would be applied […], while the Bayer Divestment Business's [NSH 
line of research 3]  chemistry would be applied […].90 
(192)  The Commission further notes that BASF was pre-Transaction pursuing in 
parallel a [NSH line of research  3 HT traits]  line of research , an [herbicide  line 
of research  4] HT line of research  and a [NSH line of research  1] HT line of 
research  (although BASF discontinued its own [NSH line of research  3] in view 
                                                 
87  […]. 
88  Form CO, chapter 6A, paragraph 294.  
89  Form CO, chapter 6A, paragraph 290.  
90  BASF's response to the Commission's request for information R FI 10, question 3.  
 
40 of […] and independently from the Transaction) . This  show s the likely incentive 
to pursue such lines of research in parallel rather than discontinue, delay or 
reorient them  post-Transaction . 
(193)  In the present case, one of the drivers for the incentives to develop i n parallel 
[NSH line of research  3], [herbicide  line of research 4] and [ NSH line of 
research  1] HT innovation  is likely the significant difference between the three 
projects . This  deriv es from the fact that they relate to different chemical classes 
and ac t with different MoAs  and, in some cases, target  different application 
timing s: the [herbicide line of research 4] chemistry has  a […] MoA and would 
be used […] and the [NSH line of research 1]  chemistry has a [NSH line of 
research 1]  MoA , whereas  the Bayer Divestment Business's [NSH line of 
research 3]  project is an [NSH line of research 3]  to be used […]. 
(194)  The Commission therefore considers that BASF would have every incentive to 
fully pursue both the Bayer Divestment Business's [NSH line of research  3] HT 
line of research and its own [herbicide line of research  4] HT and [NSH line of 
research 1]  HT project s as they would have been separately pursued by the 
Parties in the absence of the Transaction. This would particularly be the case 
taking into accoun t BASF's acquisition of the corresponding [NSH line of 
research 3]  NSH  research from the Bayer Divestment Business, which is 
tailored to the Bayer  Divestment Business's [NSH line of research 3]  HT line of 
research and would not work in combination with BAS F's [herbicide line of 
research 4] HT traits .91 
(195)  Finally, the Commission also c onsidered potential closeness between  the 
innovation effort of BASF in [NSH line of research 1]  HT and the innovation 
effort of the  Bayer  Divestment business in [NSH line of research 3]  HT. Also in 
this case, there is limited closeness in the Parties' innovation efforts because the 
two HT traits perform only with the associated herbicides (namely the [NSH 
line of research 1]  HT with the [NSH line of research 1]  chemistry and t he [NSH 
line of research 3]  HT with the [NSH line of research 3]  chemistry) . Moreover,  
the related herbicides appear to be sufficiently differentiated since they are from 
different chemical classes and act with different MoAs.  
4.2.5.3.  Conclusions  on competition in  GM HT trait innovation  
(196)  Based on the above, the Commission considers that the Transaction does not 
raise serious doubts as to its compatibility with the internal market with respect 
to innovation in GM HT traits for cotton, soybean and OSR.  
4.2.6.  Competitive assessment: innovation competition in GM DR traits  
4.2.6.1.  Notifying Party's view  
(197)  The Notifying Party argue s that there are no competition concerns associated 
with innovation  for GM DR traits either because there is no overlap or, in case 
of overlaps, because there is no close innovation competition.  
                                                 
91  Form CO, chapter 6B.1, paragraph 456.  



 
44 They secure themselves to the plant tissue and suck nutrition from it, which 
therefore negatively affects plant yield.92  
(208)  Since most nematodes live in the soil, they re present one of the most difficult 
pest problems to identify and control. It has been estimated that some 10% of 
world crop production is lost because  of plant nematode damage.93  
(209)  Seed treatment formulations are  based on the same active ingredients which are  
also used for the formulation of nematicides, insecticides and fungicides for 
foliar/soil crop protection. However,  they contain additional specific inert 
ingredients such as additives, polymers, anti -freezing agents, dyes or pigments, 
in order to ensure that the dressed seeds are marked as such or the seed dressing 
sticks to the seeds.  The active ingredients in seed treatments can be chemical or 
biological.  
(210)  In the EEA, seed treatment producers sell their products mainly to seed 
companies but also – to a l imited extent – to wholesalers, dealers/co -operatives 
or directly to large growers.94  
4.3.2.  Market definition  
4.3.2.1.  Product Market Definition  
 Commission precedents  
(211)  In previous cases,95 the Commission considered that seed treatment constitutes a 
separate product market rather than a particular type of application of crop 
protection products because they target different pests, and the customers and 
distribution channels are not identical  as they are generally sold to seed 
companies whereas other crop protection products are sold to distributors and 
are applied by growers.  
(212)  Seed treatment has been  further divided by crop and by indication 
(e.g. fungicidal, insecticidal) . Nematicidal seed tr eatments constitute an 
additional segment to fungicidal and insecticidal seed treatments.96 
(213)  As regards the seeds market that is downstream to seed treatment, the 
Commission has referred in previous decisions to the existence of a separate 
product market for  treated seeds, but did not ultimately reach a conclusion on 
the market definition of treated seeds.97  
                                                 
92 Commission Decision in Case M.8084 – Bayer/Monsanto (2018), recital 2067.  
93 Commission Decision in Case M.8084 – Bayer/Monsanto (2018), recital 2068.  
94 Form CO, chapter 6B.3, paragraph 525.  
95 Commission Decision in Case M.8084 – Bayer/Monsanto (2018), Section X.I.2.2.1, and cases 
referred to in that decision.  
96  Commission Decision in Case M.8084 – Bayer/Monsanto (2018), Section X.I.2.2.1, and cases 
referred to in that decision, and cases refer red to in that decision.  
97  Commission Decision in Case M.8084 – Bayer/Monsanto (2018), Section X.I.2.2.1.3.  
 
45 
 Notifying Party 's views  
(214)  In line with the Commission's precedents, the  Notifying Party has submitted 
data on the basis of a seed treatment product market divided by indication and 
by crop .98 
 Commission assessment  
(215)  In light of its precedents  and in the absence of new elements ,99 the Commission 
is of the view that seed treatments should be divided by crop and indication . 
Nematicidal seed treatments constitute an additional segment to fungicidal and 
insecticidal seed treatments.  
(216)  The Commission does not consider that it is appropriate to further segment the 
nematicid al seed tr eatment market into biological and chemical nemat icidal seed 
treatments  because  it is clear from the Parties' internal documents that chemical 
and biological nematicid al seed treatments  compete  with one another for the 
same end uses . For example, [extract from BASF  internal document] .100  
(217)  As regards the  seeds market that is downstream to seed  treatment , the 
Commission considers, in line with its precedents101, that treated seeds 
constitute a separate market. However, for the purpose of this decision, it can be 
left open whether the product market includes als o untreated seeds since the 
Transaction does not give rise to concerns about its compatibility with the 
internal market with respect to treated seeds  under any plausible market 
definition.  
 Conclusion  
(218)  As regards nematicidal seed treatment, the Commission concludes  that the 
relevant product market to retain for the competitive analysis is seed treatment 
for nematode control on a crop by crop basis.  
(219)  As regards insecticidal and fungicidal seed treatment, the Commission considers 
that separate  product market s exist for  insecticidal or fungicidal seed treatment 
market, which are both further segmented on a crop  by crop and pest or disease 
basis.  
(220)  As regards the downstream market to the seed treatment market s, for the 
purpose of this Decision, the Commission consi ders that treated seeds constitute 
a separate market but it can be left open whether this includes also untreated 
seeds since the Transaction does not give rise to concerns about its compatibility 
with the internal market under any plausible market definit ion. 
                                                 
98  Form CO, chapter 6B.3, paragraphs 535 -536. 
99 Commission Decision in Case M.8084 – Bayer/Monsanto (2018), Section X.I.2.2.1 and cases 
referred to  in that decision.  
100  BASF's response to the M.8084 Commission's request for information to BASF RFI Q23, 
[Annex  8.z.1: […]]. 
101  Commission Decision in Case M.8084 – Bayer/Monsanto (2018), Section X.I.2.2.1.3 and cases 
referred to in that decision.  
 
46 4.3.2.2.  Geographic market definition  
 Commission precedents  
(221)  In previous cases, the Commission considered that the relevant geographic 
market for seeds and seed treatment102 is national in scope.  
 Notifying Party 's views  
(222)  In line with the Commission's precedents,  the Notifying Party has submitted 
data on the basis of a national segmentation of insecticidal and fungicidal seed 
treatment on a crop by crop basis .103  
 Commission assessment  
(223)  In light of its precedents104 and in the absence of new elements, the Commission 
considers  that seed treatment product markets  and seeds markets  are national in 
geographic scope.  
 Conclusion  
(224)  In light of the above, the Commission concludes that seed treatment product 
markets and seeds markets are national in geographic scope.  
4.3.3.  Activities of  the Parties  
(225)  BASF is active in insecticidal and fungicidal seed treatment  and has a 
nematicidal seed treatment  product  in the pipeline. The  Bayer  Divestment 
Business includes a number of nematicidal seed treatment products, including  
nematicidal seed treatment pipeline product s, an insecticidal seed treatment 
product, as well as seeds.  
4.3.3.1.  BASF's activities in seed treatment  
(226)  BASF is active in insecticidal and fungicidal seed treatment . Its insecticidal seed 
treatment portfolio includes on e product branded as MUNDIAL  ([…]), sold 
only in the Netherland s for use on onions, garlic and vegetables .105 MUNDIAL 's 
sales are due to cease in the EEA . BASF has chosen not to re -register the 
product in the Netherlands, as use of fipronil was restricted b y EU authorities.106 
(227)  BASF 's portfolio of fun gicidal seed treatments includes products for use on 
cereals commercialized in several EEA countries, as well as fungicidal seed 
treatment authorised for use on OSR in Germany (Acrobat WP (dimethomorph)) 
                                                 
102 Commission Decision in Case M.8084 – Bayer/Monsanto (2018), Section X.I.2.2.2 and cases 
referred to in that decision.  
103 Form CO, chapter 6B.3, paragraphs 535 – 536. 
104 Commission Decision in Case M.8084 – Bayer/Monsanto (2018), Section X.I.2.2.2, and cases 
referred to in that decision.  
  Should read: “f ipronil ”. 
105  Form CO, chapter 6B.3, Table BASF EEA […] seed treatment portfolio, at paragraph 550.  
106  BASF  5(3) Submission, paragraph 45.  
 
47 and fungicidal seed treatment products for use on ornamentals, onion/garlic, and 
vegetables in the Netherlands.107 
(228)  BASF also has a pipeline biological nematicidal control  product, Trunemco, 
whose two active components are bacillus amyloliquefaciens, and  a semio 
chemical, cis -jasmone. In terms of nematode action, Trunemco primes plant 
physiology and stimulates the defence system of plants in order to protect the 
plant from nematodes, rather than killing the nematodes (as a chemical 
nematicide would do).108 Trunemco is expected to be launch ed in the US 
in 2019 and in the EEA  around […].109 Globally, Trunemco's target crops are 
corn, soybean and cotton .110 In the EEA , BASF plans to first launch Trunemco 
on […].111 
4.3.3.2.  Bayer Divest ment  Business ' activities in seed treatment  
(229)  The Bayer Divestment Business includes  the data, know -how, employees, 
intellectual property, registrations, sales and marketing assets, and contracts 
comprising Bayer's nematicidal /insecticidal  seed treatment businesses Poncho, 
VOTiVO, Poncho/VOTiVO, Poncho/VO TiVO 2.0 , ILeVO, COPeO and Bayer's 
nematicidal seed treatment pipeline products VOTiVO/Redigo  M (Bacillus 
firmus / prothioconazole/ metalaxyl) and […]. The Bayer  Divestment Business  
seed treatment assets generated a turnover of EUR  […] in 2017.  
(230)  While the Bayer  Divestment Business’  nematicide control  seed treatments are 
not currently sold  in the EEA,  Bayer  planned  to launch its biological nematicidal 
seed treatment VOTiVO/ Redigo M in the  EEA in 2018 on corn and 
sugarbeet.112 The active ingredient in VOTiVO is  a bacterium, bacillus firmus . 
Like Trunemco, VOTiVO/Redigo M is a biological nematicide which does not 
kill nematodes, but rather protects plants from attack by nematodes.  Bacillus 
firmus  has two major functions as an active ingredient: first, it protects  against 
nematodes by perforating the outer -layer of the nematode egg and by 
minimizing the attractiveness of the roots for nematodes and second by 
strengthening the plant as such.  Estimated peak sales of this product  in the EEA  
are EUR  […].113  
(231)  The Bayer Divestment Business ' nematicidal seed treatment products 
Poncho/VOTiVO, Poncho/VOTiVO 2.0, ILeVO, COPeO are not sold in the 
EEA and Bayer had no  plans to do so in the future.114  
(232)  The Bayer  Divestment Business also includes  two pipeline products which are 
likely to be launched in the EEA, [extract from Bayer internal 
document] .115,116,117,118,119  
                                                 
107  Form CO, chapter 6B.3, Table BASF EEA […] seed treatment portfolio,  at paragraph 550.  
108  Form CO, chapter 6B.3, paragraph 585.  
109  BASF  5(3) Submission, paragraph 33, Form CO, Chapter 6B.3 at paragraphs 551 – 553. 
110  BASF's response to the Commission's request for information RFI2, [Annex Q1.1 […]], slide 5.  
111  Form CO, chapter 6B.3, Table BASF seed Treatment Pipeline, at paragraph 551.  
112 BASF  5(3) Submission, paragraph 36.  
113 Bayer's internal document BI 19366 'VOTiVO/Redigo M concept, 15 September 2017', slide 15.  
114  BASF 5(3) Submission, paragraph 36.  
 
48 (233)  Fluopyram is a versatile active ingredient as a foliar fungicide120 and also as a 
seed treatment for broad acre crops and soil nematicides for all crops.121 It is 
currently sold in the US and other countries outside the EEA under the brand 
name ILeVO. Fluopyram is not currently sold as a nematicidal seed treatment in 
[extract from Bayer internal document] .122  
(234)  The Bayer Divestment B usiness seed treatment  assets  include  two insecticidal 
seed treatment products, namely (i) Poncho 600 FS, which uses the active 
ingredient clothianidin FS 600 G Red and is applied in the EEA in corn and 
sunflower; and (ii) Deter, which uses clothianidin FS 250 G and is applied in 
the EEA in cereals. In 2017, the former was sold in Bulgaria, France, Germany, 
Hungary, Romania and Spain, while the latter was sold in the Czech Republic, 
Slovakia and the UK.123  
(235)  The Bayer Divestment Business also includes  activities which are downstream 
from seed treatment markets, namely  vegetable and broad acre crops seeds in 
various EEA member states .  
4.3.4.  Competitive assessment in nematicidal seed treatment  
4.3.4.1.  Notifying Party arguments  
(236)  The Notifying Party's submission observes that the commitments submitted to 
the Commission, which includes the divestment of BASF's Trunemco, resolves 
any potential competition concerns by removing the horizontal overlap between 
Trunemco and the Bayer Divestment Business' seed treatment assets.124  
4.3.4.2.  Commission assessment  
 Competitive l andscape in nematicidal seed treatment  
(237)  Nematicidal seed treatment is an area where there are worldwide very few 
products available but where there is huge market potential. In the EEA , there 
are currently no nematicidal seed treatment products available at  all. 
Consequently, the Commission considers that any products launching in the 
                                                                                                                                                 
115 Bayer's intern al document BI -EDISC -0141615 'Notes, Action & Decision Summary SPC, 21 & 
22 November 2016', page  11. 
116  BASF  5(3) Submission, paragraph 40.  
117 Bayer's internal document BI -EDISC -0141615 'Notes, Action & Decision Summary SPC, 21 & 
22 November 2016', page  9. 
118  Commission Decision in Case M.8084 – Bayer/Monsanto (2018), recital 2116.  
119  Commission Decision in Case M.8084 – Bayer/Monsanto (2018), recital 2117.  
120  The Bayer Divestment Business includes only fluopyram seed treatment applications, Bayer retains 
all other patents for use in non -seed treatment applications. This includes, for example, patents 
relating to fluopyram's use as a foliar fungicide.  
121 Bayer's internal document BI 10432 […]. 
122 Bayer's internal document BI 10456 'Fluopyram, Maximum Use Rates,  September 2017', slide 5.  
123  BASF 5(3) Submission, paragraph 36. The application of Poncho 600 FS in flowering crops 
including corn and sunflower is restricted pursuant to Commission Implementing Regulation 
No 485/2013, and sales of this product for use i n corn and sunflower are possible in the EEA only 
subject to derogations from relevant national authorities, Bayer expects a complete ban of 
clothianidin covering all of the EU to be announced in June 2018.  
124  BASF 5(3) Submission, paragraph 47.  
 
49 nematicidal seed treatment market are likely to have a significant competitive 
impact  and this finding is supported by internal documents of the Parties.  
(238)  For example, b oth Baye r125 and BASF126 have been working on making farmers 
aware of the significant damage caused by nematodes and on the detrimental 
impact that nematodes h ave on yield in order to promote their new nematicidal 
seed treatment products. Indeed, o ne BASF internal document refers to 
Trunemco […] and marketing of nematicidal seed treatment products tend to 
focus on improved yield provided to growers.  […].127 
Figure 17 – BASF document referring to key benefits of  Trunemco and ne maticides  
[…] 
(239)  The competitive landscape is limited. In the following internal document set out 
at Figure 18 below,  BASF shows that  there are [5-10] products globally (the 
Bayer Divestment Business' VOTiVO and ILeVO/COPeO, Syngenta's products 
Avicta and Clariva, Bayer/Monsanto's NemaStrike and Valent's Aveo) across all 
crops that compete with Trunemco, two of which are part of the Bayer 
Divestment  Business ( VOTiVO  and ILeVO).  
Figure 18 – [Extract from BASF  internal document]  
[…] 
Source:  [BASF  internal document] . 
(240)  Three of these products are based on chemical active ingredients (NemaStrike, 
Avicta and ILeVO/COPeO) and three are based on biological components 
(VOTiVO, Clariva and Aveo). […]. Bayer/Monsanto's NemaS trike will also 
launch in the EEA .128  
(241)  Of the remaining three products, the two Syngenta products are either not able 
or not likely to launch in the EEA . First , Syngenta's Clariva is for use on 
soybean which is not a key cro p in the EEA . Second, Syngenta's Avicta product 
is a much older product  (its first launch took place in 2006129) and it is based on 
abamectin, which, as a nematicide is currently only approved in Italy and 
registered only for use on vegetable crops.130 This product cannot therefo re be 
launched in the EEA  as a nematicidal seed tre atment for row crops. Finally, 
Valent's product Aveo is based on the same bacillus as Trunemco but on a 
different strain (Bacillus amyloliquefaciens, strain PTA -4838*) which targets 
                                                 
125  Bayer's internal document BI  19366 'VOTiVO/Redigo M concept, 15 September 2017', slide 12.  
126  As can be seen from the Commission decision in Case M.8084 – Bayer/Monsanto, 
recital  2088 -2098, Monsanto was also investing in the area of nematicidal seed treatm ent with 
NemaStrike  […].  See also BASF's response to the M.8084 Commission request of information to 
BASF RFI Q23, [Annex Q8.z.5: […]]. 
127  American Phytopathological Society and Kline Nematicide Market Study 2014, as cited by BASF 
in BASF's response to the  M.8084 Commission request of information to BASF RFI Q23, 
[Annex  Q8.z.5: […]]. 
128  Commission Decision in Case M.8084 – Bayer/Monsanto (2018), recital 2098.   
129  https://www.syngentaseedcare.com/avicta.  
130 Regarding Abamectin see Commission Decision in Case M.7932 – Dow/DuPont (2017), 
recital  1602. Abamectin is registered as a nematicide only for the following vegetable crops: 
tomato, squash and eggplant.  
 
50 soybean cyst nematodes131 and the main target crop is therefore soybean. It has 
just been launched in the US, but it is unclear when and if it would come to 
the EEA .  
(242)  The Commission therefore considers that in the EEA there are likely to be either 
one (Bayer/M onsanto 's NemaStrike ), or at most two , competitors (including 
Valent 's Aveo) to the merged entity.  
 The Parties are each planning to launch important nematicidal seed 
treatment products  in the EEA  
(B.i) Bayer  
(243)  As discussed above, the Bayer  Divestment Business includes a biological 
nematicidal seed treatment product […] called VOTiVO. […].132 VOTiVO  has 
however already been  successfully sold in the US since 2011, together with an 
insecticide, under the product name 'Poncho/VOTiVO '.133 Bayer perceives its 
product Poncho/VOTiVO as a market -leading product in the  US. For example, 
Bayer notes t hat the product has grown to become 'the most trusted and the most 
utilized seed treatment in the USA '134, which is applied yearly on over 45 million 
acres of corn and which provides efficacy against major corn pests .135 
Poncho/VOTiVO itself is now being enhan ced by the addition of TWO.O in the 
USA (Poncho/VOTiVO 2.0), which has been introduced in August  2017.  
(244)  [Extract from Bayer internal document] .136,137,138 
(245)  [Extract from Bayer internal document] .139,140, […]if nematodes are of greater 
concern and we have data to show  in a broad range of environments we provide 
benefit. '141 
(B.ii) BASF  
(246)  As discussed above, BASF  also has a biological nematicidal seed treatment 
product  in its pipeline , Trun emco . In trials BASF notes that it has outperformed 
rivals, by significantly reducing plant  damage (from nematodes) and increasing 
yield: […]% yield increase over current standards in corn and cotton…. 
Superior performance observed with [Trunemco]  over competitors .'142 […].143 
                                                 
131  https://www.valent.com/agriculture/products/aveoez/download -literature.cfm.  
132 BASF  5(3) Submission, pa ragraph 36, M.8084 BI  19366 'VOTiVO/Redigo M concept, 
15 September 2017', slide 9.  
133 Commission Decision in Case M.8084 – Bayer/Monsanto (2018), recital 2082.  
134 Bayer's internal document BI 08500 'SeedGrowth Biologics, Strategy Update', slide 11.  
135 Bayer' s internal document BI 08500 'SeedGrowth Biologics, Strategy Update', slide 11.  
136 Bayer's internal document BI 19366 'VOTiVO/Redigo M concept, 15 September 2017', slide 9.  
137 Bayer's internal document BI 19366 'VOTiVO/Redigo M concept, 15 September 2017', slide 7.  
138 Bayer's internal document BI 19366 'VOTiVO/Redigo M concept, 15 September 2017'.  
139 Bayer's internal document BI 19366 'VOTiVO/Redigo M concept, 15 September 2017', slide 15.  
140  Bayer's internal document BI 19366 'VOTiVO/Redigo M concept, 15 Sep tember 2017', slide 14.  
141 Bayer's internal document BI 19366 'VOTiVO/Redigo M concept, 15 September 2017', slide 14.  
142  BASF's response to the M.8084 Commission request of information to BASF RFI Q23, 
[Annex  Q8.z.5: – […] Nematode solution to the unseen yi eld robber].  
143  BASF's response to the M.8084 Commission request of information to BASF RFI Q23, 
[Annex  Q8.z.5: – […] Nematode solution to the unseen yield robber].  
 
51 (247)  Trunemco is expected to launch in […] in […] and to come to […] around 
[…].144  
 The Transaction brings together two important and close potential 
competitors on nematicidal seed treatment  
(248)  The Transaction brings together the nematicidal  seed treatment products of 
BASF and the Bayer Divestment Business, which will be  competing i n a market 
with very few competitors.  
(C.i) […] 
(249)  […]145 […].146 […]. 
Figure 19 – [Extract from BASF  internal document]  
[…] 
Source:  [BASF  internal document] . 
(250)  […].147 
(251)  […].148 
(C.ii)  Both Trunemco and VOTiVO/RedigoM are biological products with 
similar methods of nematode control  
(252)  Both Trunemco and VOTiVO are biological products based on different types of 
bacteria ( bacillus amyloliquefaciens  (strain MBI 600)  and bacillus firmus 
respectively ). Rather than killing the nematodes  outright , both products func tion 
in such a way as to repel the nematode, by protecting the plant. The Commission 
notes that w hile from a market definition perspective biological and chemical 
nematicidal seed treatments compete with one another for the same end uses, the 
biological se ed treatments are likely to compete more closely with each other, 
than with chemical seed treatments.  
(C.iii)  […] 
(253)  Potatoes and corn are the most important crops for nematicides, globally, 
accounting for the largest share of nematicide sales.149  
                                                 
144  BASF Submission pursuant to Article 5(3) of Commission Regulation (EC) No 802/2004 
('BAS F 5(3) Submission'), Form CO, Chapter 6B.3 at paragraphs 551 – 553. 
145  BASF's response to the M.8084 Commission's request of information to BASF RFI Q23, 
[Annex  8.z.8 ' […] Virtual Global BVP Workshop'], slide 29.  
146  BASF's response to the M.8084 Commission 's request of information to BASF RFI Q23, 
[Annex  Q8.z.1 'FCC Project Review […]'], slide 9.  
147  BASF's response to the Commission request of information RFI 2, [Annex Q1.1 ' […] Project Board 
2017'], slide 15.  
148  BASF's response to the M.8084 Commission req uest of information to BASF RFI Q23, 
[Annex  Q8.z.5: […] Nematode solution to the unseen yield robber].  
149  BASF's response to the M.8084 Commission's request for information to BASF RFIQ23, 
[Annex  Q8.y.3 'Kline Nematicide Market Study'].  
 
52 (254)  Globally, Trunemco's target crops are corn, soybean and cotton with an internal 
BASF document noting that it is: 'Driven by Seed Treatment in soybean, corn, 
and cotton. '150 These are the same main target crops as the Bayer Divestment 
Business portfolio.151 […].152 
(255)  The Notifying Party submits that at present, […].153 However, the Commission 
considers it likely that BASF will register […].154 
 Limited competitive constraints from competitors  
(256)  As noted at Section 4.3.4.2 .A nematicid al seed treatment is an area in which 
there are very few products currently competing and this competitive landscape 
is not expected to change in the near future.155  
(257)  The Commission therefore concludes that the competitive constraints on the 
merged entity  are likely to be limited, since on the basis of the above assessment 
there appears to be just  one (Bayer/Monsanto 's NemaStrike), or at most two 
(Valent 's Aveo) competi tors to the merged entity.  
4.3.4.3.  Conclusion on nematicidal seed treatment  
(258)  For the reasons set out above and based on the results  of its investigation, the 
Commission considers that serious doubts arise regarding the compatibility of 
the Transaction with the int ernal market and the  EEA Agreement in relation to 
potential competition for  nematicidal seed treatment in corn and sugar beet . In 
particular, the Commission considers  that the Transaction would likely  eliminate 
an important a nd close competitive constraint , resulting in non -coordinated 
effects on competition  and therefore leading to a significant impediment of 
effective competition.  
4.3.5.  Insecticidal seed treatment  
(259)  There is no horizontal overlap between BASF 's insecticide seed treatment 
MUNDIAL and the Bayer Divestment Business ' insecticide seed treatment 
products because the respective products do not compete in the same crops or 
geographic markets in the EEA.156  
                                                 
150  BASF's response to the Commission's request for information RFI2, [Annex Q1.1: ' […] Project 
Board 2017'], slide 5.  
151  Commission Decision in Case M.8084 – Bayer/Monsanto (2018), recital 2073.  
152 Bayer's internal document BI 19366 'VOTiVO/Redigo M concept, 15 September 2017', slide 7.  
153  BASF's memorandum on nematicides, page 8.  
154  Form CO, chapter 6B.3, Table BASF seed Treatment Pipeline, at paragraph 551, Bayer's internal 
document BI 19366 'VOTiVO/Redigo M concept, 15 September 2017', slide 7.  
155  Commission Decision in  Case M.8084 – Bayer/Monsanto (2018), recitals 2141 to 2143.  
156  BASF 5(3) Submission, paragraph 36. The application of Poncho 600 FS in flowering crops 
including corn and sunflower is restricted pursuant to Commission Implementing Regulation 
No 485/2013, and sales of this product for use in corn and sunflower are possible in the EEA only 
subject to derogations from relevant national authorities, Bayer expects a complete ban of 
clothianidin covering all of the EU to be announced in June 2018.  
 
53 4.3.6.  Vertical links between  seed treatment (up -stream) and (treated) seeds (down -
stream)  
(260)  According to t he information provided by the Notifying Party,157 the 
Transaction gives rise to a vertical relation ship between the upstream supply of 
seed treatment products by BASF, on the one hand, and the downstream market 
for commercialisation of seeds by the Bayer Divestment Business, on the other, 
only as regards fungicidal seed treatment and OSR treated seeds in Germany . 
However, these markets will not be affected as a result of the Transaction. 
BASF has estimated market share on the upstream market of [20-30]%158 and on 
the downstream market both for OSR seeds and OSR treated seeds the Bayer 
Divestment Business has a negligible market share ( [5-10]%).159  
(261)  On the basis of the above, the Transaction does not raise serious doubts as 
regards its impact on the fungicidal seed treatment market and OSR treated 
seeds in Germany.  
4.3.7.  Conclusion on seed treatment  
(262)  The Commission considers that serious doubts arise regardi ng the compatibility 
of the Transaction with the internal market and the EEA Agreement in relation 
to potential competition for nematicidal seed treatment in corn and sugar beet, 
because it is likely that the Transaction would eliminate an important and cl ose 
competitive constraint, resulting in non -coordinated effects on competition and 
therefore leading to a significant impediment of effective competition.  
(263)  The Commission does not consider that serious doubts arise regarding the 
compatibility of the Transa ction with the internal market and the EEA 
Agreement in relation to insecticidal seed treatment and vertical links between 
seed treatment (up -stream) and (treated) seeds (down -stream).  
4.4. Digital Agriculture  
4.4.1.  Overview of the digital agriculture sector  
(264)  Digital agriculture (or digital farming) refers to the collection of data and 
information about fields, crop and farms with the aim of providing tailored 
advice or aggregated data to farmers. Digital agriculture makes use of precision 
farming160 technology . In addit ion, it also takes recourse to intelligent networks 
and data management tools. Digital agriculture enables the provision of a range 
of measurement and advisory services, including in relation to weather, yield, 
                                                 
157  Form CO, c hapter 6B.3., paragraph 568 and BASF's response to the Commission's request for 
information RFI 2, question 2.  
158  BASF's response to the Commission's request for information RFI 2, question 2.  
159  Parties' response to the M.8084 Commission's request for inf ormation RFI 30, [Annex 30.2]. The 
market share concerns treated seeds, but also all seeds given that basically all OSR seeds are treated 
with a fungicide.  
160 Precision agriculture refers to hardware and equipment (e.g. planters , sensors, robotics) that can  
execute farming tasks more efficiently and precisely. Precision agriculture hardware devices 
provide a potential source of data for digital agriculture and potentially enable better 
implementation of digital agriculture insights; however, precision agricu lture is not digital 
agriculture.  
 
54 farm management or prescriptions and recommen dations of fertility, seeds, and 
crop protection products, with the aim of increasing farm productivity.  
(265)  According to the Notifying Party, digital agriculture is currently in its infancy. 
However, globally countries are adopting digital agriculture at a s ignificant 
pace. Digital agriculture is of particular importance given that by  2025 the 
global po pulation is expected to reach 8  billion people (9.6 billion by  2050),161 
and the overall food production will need to significantly increase (by  ~70%) in 
a relat ively short period to meet the demand.  
(266)  The drive to improve agricultural productivity and increase profits is enhancing 
the adoption of digital agriculture.162 For instance, digital farm management 
services are expected to grow wo rldwide from USD 1.6 billio n in 2017 to 
USD  4.1 billion by  2022; and in Europe, the y are expected to reach 
USD  1.3 billion by 2022.163 
(267)  Digital technologies and analytics are transforming agriculture, making a farm 's 
field operations more insight driven and efficient. Digital agricultu re is generally 
expected to be the main new trend for farming in the coming years and a key 
source of information and recommendations for farmers. Bayer considers that 
'[d]igital farming is about to revolutionise agriculture, not only in Europe, but 
worldw ide' and that it offers 'the biggest game changing potential .'164  
4.4.2.  Activities of the Parties in digital agriculture  
(268)  BASF is active in the provision of digital agriculture services.  
(269)  The Bayer Divestment Business ' digital agriculture activities (the 'Bayer Digital 
Agriculture Assets ') will be transferred to BASF in their entirety. Bayer will 
receive a non -exclusive licence back to use certain technology needed for Bayer 
to sell certain of the digital agriculture products outside North America.  
4.4.2.1.  BASF 's activi ties in digital agriculture  
(270)  BASF has a limited suite of digital farming application tools including Maglis, 
which has not yet been fully launched in the EEA, and several small local digital 
offerings in selected EEA countries.  
                                                 
161 CEMA's website regarding 'The Global Food Challenge' at: http://www.cema -agri.org/page/global -
food-challenge (ID11912).  
162 M.8084 Form CO, part 5, Annex 5.1, MarketsandMarkets Report: ' Farm Management Software 
Market – Global Forecast to 2022 ' (2017).  
163 M.8084 Form CO, part 5, Annex 5.1, MarketsandMarkets Report: ' Farm Management Software 
Market – Global Forecast to 2022 ' (2017).  
164 Press release entitled 'Digital Farming set to revolutionize agriculture', 7 June 2017, av ailable at: 
http://www.politico.eu/sponsored -content/digital -farming -set-to-revolutionize -agriculture/.  
 
55 
 Existing products  
(271)  BASF currently  provides small local digital offerings in selected EEA countries , 
including in Germany, France, UK, Austria, and Belgium,  to support customers 
in their activities.  
(i) Weather tools : a standard online weather forecast programme featuring 
forecasts a t postal code level in Germany, France, UK, Austria, Belgium, among 
other countries. […]. BASF's main  weather tool  is BASF Weather.  
(ii) Field insight tool , named Observ 'Online, an online tool to which BASF 's 
distributors can upload their observations on d isease occurrences on the plots of 
land they visit. This tool is only available in France.  
(iii) Farm management tool  named BASF Schlagkartei, a tool meant for use 
by farmers to record their business transactions. It is only available in Germany 
and is kn own as.  
(iv) Crop protection solution tools : BASF provides a number of localised, 
non-automated crop protection solutions. In Germany, this consists of an online 
product catalogue (PIA, regional advice). In the UK (Weed ID App, Cereals 
Disease ID App, Total Oilseeds App), France (Atlas), and Austria (regional 
advice), this consists of levelled flowcharts which farmers can follow to come to 
a diagnosis on what is plaguing a crop.  
(272)  Nutrient application tools : in the UK (The CAT app, OSR GAI app), BASF 
provides a biomass indicator which helps assess a crop 's physiology based off a 
picture of it.  
(273)  The above tools have a very limited scope and user group. They are not part of 
Maglis, and aside from BASF Schlagkartei (see paragraph […]), generate no 
income.  
(274)  Additionally, one of Maglis tools, the Maglis Customer Navigator  has been 
launched as a pilot in the Czech Republic (see Section 4.4.2.1  (B)) 
 Pipeline products  
(275)  Maglis is a modular system comprised of several BAS F's digital application 
tools. These tools offer a variety of different functionaliti es, but are independent 
of each other, must be downloaded separately and do not provide for the 
systematic exchange of data between them.   
(i) Maglis Customer Navigator . This is an application tool that is used by the 
BASF sales organisation to work with f armers in order to address their needs 
and growing priorities.  Based on information shared with BASF by farmers, the 
BASF sales organisation uses the Maglis Customer Navigator to recommend the 
relevant crop protection products that would be suitable for fa rmers ' individual 
farm and field -specific needs. The level of detail of the recommendation is 
dependent on the level of information shared by the farmer (e.g. crop type, area 
                                                 
  Should read: “271”. 
 
56 planted, farmi ng preference). The product recommendation also contains the 
label instruction on how to use the product, with an understandin g of the 
farmer 's preferences. The Maglis Customer Navigator is not linked to so -called 
'big data ' and any advice is 'manual ' rather than generated by an agronomic 
engine.  Maglis Customer Navigator  is currently a vailable in the United States. 
In the EEA, it has been launched as a pilot product  in the Czech Republic.  
(ii) Maglis Crop Plan . This tool offers a convenient and efficient way for 
farmers to monitor and manage field activities in -season. As  soon as the planned 
seeding date has been decided, Maglis Crop Plan oversees and connects 
information about local weather, soil conditions and weed, disease and pest 
warnings for farmers ' individual plans.  With this information at hand, farmers  
can proact ively manage their fields, as well as record and assign tasks to their 
farm team.  The Maglis Crop Plan is mainly based on publicly available data and 
basic informatio n provided by the farmer (e.g. location and seed type) as 
opposed to proprietary field tri al data etc. Based on the information entered into 
it, the Maglis Crop Plan generates an alert to a farmer regarding when to use a 
crop protection product on a field -specific level (no variable -rate capabilities). 
The product also uses algorithms to make p redictions on the likeli hood of a 
negative event (e.g. disease occurrence) based on the information put into the 
application tool by the farmer.  The Maglis Crop Plan has been launched as a 
pilot in Canada.  It has not yet been la unched at all  in the EEA.  
(iii) Maglis Sustainability Assessment . This application is a post -season tool 
used to evaluate farm efficiency (e.g. fuel and water usage) so as to increase 
profitability. With the goal of helping farmers becom ing more resource efficient, 
this tool demonstr ates the impact of different agricultural practices on main 
sustainability factors, such as business profitability, soil health, biodiversity, etc. 
Maglis Sustainability Assessment has been launched as a pilot in Canada.  It has 
not yet been launched at all  in the EEA. ·  
(iv) Maglis Agronomic Advice . This is an application tool to provide 
information on the likelihood of a disease occurrence.  The tool generates a 
recommendation based on weather data and geographic location.  The current 
intention is that the  tool would be used by the BASF sales organisation, 
although usage by farmers is also possible.  Maglis Agronomic Advice is still in 
development.  
(v) Maglis Leaf Analysis . This is an application to give the farmer feedback 
on which disease he/she has on his /her field based on a picture the farmer takes 
of a part of the field and then sends to the app.  The tool analyses the photo and, 
if possible, identifies the disease and recommends a corresponding BASF crop 
protection product that could  be used to treat th e disease. This tool is still in 
development, but was beta -tested in Germany in 2017.  
(276)  BASF considers Maglis as a tool to interact with its customers/farmers in order 
to sell BASF crop protection products.  Maglis does not host third party tools, 
nor does BASF charge its customers a fee for use of Maglis apps.  
(277)  BASF plans to merge Maglis Crop Plan and Maglis Sustainability Assessment 
into a single tool named Maglis Farm Navigator in the near future. The stand -
alone tools of Maglis Crop Plan and Maglis Sustai nability will then be 
discontinued, likely still in 2018 . BASF has already done so from 1 January 2018 
 
57 in Canada. Maglis Farm Navigator  will combine the functionalities of Maglis 
Crop Plan and Maglis Sustainability Assessment, enabling farmers to optimise 
their farm operations on a continuous basis by way of analyses of field forecasts 
and practices.  
(278)  […].165 
4.4.2.2.  The Bayer  Digital  Agriculture Assets  
(279)  The Bayer  Digital Agriculture Assets includes in particular  Bayer 's entire digital 
agriculture business worldwide, i ncluding all employees (with the exception of 
six employees to be retained by Bayer), all tangible and intangible assets, all 
intellectual property rights, brands, source code, data and algorithms, and 
supporting materials for the entirety of Bayer Digital  Farming 's global product 
portfolio, and all literature, documentation, milestone reports, algorithms, data, 
architecture and source code pertaining to Bayer 's digital agriculture research 
and development pipeline at all stages of development.166 
 Existing pr oducts  
(280)  The Bayer  Digital Agriculture Assets include the following existing products : 
(i) Expert. com is an analytics tool for the evolvement of certain fungal 
diseases in agricultural crops. The analytics provide information for a farmer to 
consider when determining the volume and frequency of fungicide applications 
and cer tain insecticide applications. expert.com is able to analyse the infection 
process of a number of fungal diseases in wheat, barley, rye, triticale, oil seed 
rape, potatoes and sugar beet s. expert.com is also able to analyse the 
development and migration of certain pests and the duration of  effectiveness of 
insecticides.  expert.com produces for the farmer a list of crop protection 
products (not limited to Bayer products exclusively) which will be effective 
against the relevant pest or fungal diseases detected. expert.com gives a high 
level recommendation of base dosage for a predefined restricted set of market 
products or product combinations.  
(ii)  Zoner is a mapping tool that provides gra phic representations of satellite 
or aerial imagery of fields, enabling the farmer to identify heterogonous zones of 
field fertility or plant stress. Zoner is designed to assist farmers, agricultural 
consultants or governments decide how best to optimise m anagement decisions 
on a localised field or regional scale, but does not provide recommendations like 
xarvio Field Manager (see below). Zoner is currently being beta tested in Spain 
(mostly by Bayer internal users, although some external users are beta tes ting 
Zoner in Spain).  
(iii) Climate.center  is an online database which stores and manages weather 
data from different sources in a standardised, user -friendly format. Bayer 
purchases the weather data from third -party suppliers and resells the data 
through access to the programme.  Bayer purchases weather data from several 
                                                 
165  Form CO, Annex 6C.1.  
166  For the full list of the Bayer Digital Agriculture Assets, see paragraph 50 of the Schedule to the 
Commitments in Case M.8084 – Bayer/Monsanto (2018).  
 
58 companies including: Deutscher Wetterdienst (DWD) Germany; Meteogroup 
Germany; Wetter Online Germany; Ubimet Austria; Geosys; and several local 
organisations with a local weather station ne twork (for example, the Agricultural 
Chambers in Germany).  
(iv) Weedscout  is Bayer 's smartphone app used for the identification of weeds 
from smartphone camera images taken by the farmer as he scouts his fie ld. The 
app analyses the image taken by the farme r to identify the type of weed. 
Weedscout is still in use, although is being superseded by xarvio Scouting (see 
recital (vii) below ). 
(v) Alertas  is an analytics tool for the evolvement of certain fungal diseases 
and pests in agricultural crops on regional  basis. It consists of a web interface to 
provide risk and weather prediction to farmers based on predefined city 
locations. The tool also offers an application -programming interface ( 'API') to 
provide risk and weather prediction to TV screens at sales out lets. 
(vi) FTpro  is a solution for the management of industry development pilot 
protocols based on information from external partners including: (i) the 
capability to collect field level data for the pilots and associate it with protocol 
job steps; and (ii ) the capability to monitor the progress of all protocols down to 
the individual job step. FTpro is a solution to automate the assembly and 
gridding of data sets relevant to a field trial into an analyst specified grid shape 
and dimension. The web applicat ion allows t o view services, vectors 
(i.e., polygons and points) and imagery, view maps, turn layers on and off with 
definition query for dynamic map services or query for feature layers. FTpro 
allows the user to upload and process vector/raster data.  
(vii)  xarvio Scouting  is a mobile smartphone app for identifying weeds, insects, 
diseases, nitrogen stress and leaf damage through an image taken by the farmer 
on a smartphone camera. The image is analysed by the image recognition 
algorithm in the app to identify the weed, ins ect, disease, nitrogen lev el or leaf 
damage in the crop. xarvio Scouting  was launched in November 2017.  The 
recognition algorithm in the app is a self -learning algorithm , that relies on a 
large database of images in order for the software to accurately ide ntify weeds, 
insects, diseases, nitrogen stress and leaf damage.  
(viii)  xarvio Field Manager  is a web -based software designed as a hyper -
localised field management tool for farmers to gain maximum efficiency out of 
their use of crop protection products. xa rvio Field Manager provides an 
assessment on the risk of diseases, and advises on: (i) the timing for the 
application of fungicides (and herbicides currently outside EEA) to a given crop 
(Spray Timer); and (ii) the localised field -zone where the crop prote ction 
product needs to be applied at variable dosage rates. The advice is contained in a 
prescription (i.e. the file for the implementation of the prescription by the 
farmer 's agronomic equipment) (Zone Spray).  
(281)  xarvio Field Manager is designed to augment t he performance and customer 
experience of Bayer 's portfoli o of crop protection products. It will achieve 
optimum performance with Bayer 's own product portfolio as the software can 
access all internal produ ct information as a data input.  However, xarvio Fie ld 
Manager does not operate exclusively with Bayer 's rang e of crop protection 
 
59 products. xarvio Field Manager is also able to advise on the most efficient usage 
of crop protection products from other suppliers.  
(282)  Xarvio Field Manager has three core functional ities:  
– Spray Timer . This function automatically notifies the farmer of the 
optimal time to spray fungicides on his fields for one out of four applications per 
growing season. The prescription is generated by an agronomic engine using a 
disease risk mode l as a basis, and is provided for a given crop at field level. 
Spray Timer provides a prescription for spraying of fungicides, while the 
functionality for herbicides is in ear ly development outside the EEA.  Spray 
Timer does not generate a file for the impl ementation of the prescription by the 
farmer 's agronomic equipment.  
– Zone Spray  uses satellite imagery (and additional data sourced either from 
third parties) to identify variations in biomass across a farmer 's field.  Based on 
these differences in biomass  measurements, and the input from growth stage 
models, xarvio Field Manager is able to generate a variable crop protection 
application map, also referred to as a crop protecti on application 'prescription '. 
The map, which can be used directly with the farme r's spraying machinery, 
illustrates to the farmer the localised areas of the field where s/he needs to apply 
a greater or smaller amount of a crop protection product, o r none at all.  
–  Autopilot Beta  is capable of automatically planning and performing an  
entire fungicide strategy working with data fr om Spray Timer and Zone Spray. 
The Autopilot Beta is currently a pipeline project, it is in the testing stage and is 
not yet finalised.   
 Pipeline projects  
(283)  The Bayer  Digital Agriculture Assets include pipeline projects , as specified in 
Annex RC.2 to the commitments in Bayer/Monsanto , that are planned to 
become new products or enhancements of existing products. As part of the 
divestment , BASF will acquire  all literature, documentation, milestone reports, 
IP, algorithms, source code and data sets related to those pipeline projects.  
4.4.3.  Market definition  
4.4.3.1.  Product market definition  
 Commission precedents  
(284)  In Bayer/Monsanto ,167 the Commission assessed the digital agriculture sector, in 
particular, the provision of digitally -enabled agronomic prescriptions, which 
was considered a differentiated product market that could be further segmented 
by input product (e.g.  fungicides, herb icides, insecticides, fertilizers, seeds, etc.) 
and by crop groupings (e.g. broad acre crops).  
                                                 
167  Commission Decision in Case M.8084 – Bayer /Monsanto (2018), recitals 2562 to 2578.  
 
60 
 Notifying Party 's views  
(285)  According to the Notifying Party,168 distinguishing a product/application as a 
digitally -enabled prescription or a more general digital far ming application is 
not always evident since digital agricu lture is still in its infancy. BASF considers 
a qualitative competitive assessment of digital agriculture products a more 
adequate approach.  
 Commission assessment  
(286)  Digital agriculture services are highly differentiated and still evolving. As 
mentioned in Section 4.4.2 , the Parties are offering or developing a diverse 
range of digital agriculture services . 
(287)  In particular, digital agriculture includes, among others, the provision of 
digitally -enabled agronomic prescriptions  ('digitally -enabled prescriptions '). 
These are recommendations or advice provided to growers on the selectio n and 
application (e.g. dosage, timing, etc.) of agronomic inputs (e.g. seeds, crop 
protection products such as herbicides, insecticides and fungicides, fertilisers, 
etc.) provided at a geographically increasingly granular level (e.g. field, field -
zone, ev entually by square meter) for a grower to implement . These 
recommendations are  generated by an analytics agronomic engine based on 
large sets of public and proprietary data.  
(288)  For the purpose s of this decision , the Commission focusses on the provision of 
digitally -enabled prescriptions  within the broad sector of digital agriculture . 
This is because,  in other area, based on the available evidence, the results of the 
investigation and taking into account the stage of the development and current 
features of digi tal agriculture as a whole, the Parties ' activities do not seem to 
overlap and/or sufficient competition would likely remain post -Transaction.  
4.4.3.2.  Geographic market definition  
 Commission precedents  
(289)  In Bayer/Monsanto ,169 the Commission assessed the digital agricu lture sector, in 
particular, the provision of digitally -enabled prescriptions, which was 
considered to be a national market . However,  the Commission also  took into 
account  the broader regional geographic context where relevant.  
 Notifying Party 's views  
(290)  The Notifying Party has not contested the definition of the geographic market 
applied by the Commission for the purposes of competitive assessment  in 
Bayer/Monsanto .170  
                                                 
168  Form CO, chapt er 6C, paragraph 610.  
169  Commission Decision in Case M.8084 – Bayer/Monsanto (2018), recitals 2583 to 2593.  
170  Form CO, chapter 6.C, paragraph 610.  
 
61 
 Commission assessment  
(291)  There are strong indications  that the market s for the provision of  digitally -
enabled prescriptions  are national in scope.  
(292)  The market investigation conducted in the recent Bayer/Monsanto  decision 
indicated that the majority of competitors and customers understand that digital 
agriculture services are developed centrally but they are tweaked and adapted 
for deployment in individual countries even if their core characteristics and 
functionalities do not change.171 
(293)  Additionally, factors such as farming practices, language, government 
regulations and specific local laws would n eed to be taken into account to  be 
able to provide digital agriculture services . 
(294)  The Commission considers the relevant geographic market for the provision of 
digitally -enabled prescriptions can be left open.  However,  in its assessment , the 
Commission will take into account the national market as well as the broader 
regional geographic context where relevant.   
4.4.4.  Competitive assessment: Digital agriculture  
4.4.4.1.  Notifying Party 's views172 
(295)  First, the Notifying Party argues that the Transaction does not give rise to any 
concerns in a market for digitally -enabled prescriptions, or in digital agriculture 
in general.  
(296)  BASF claims that: (i) the Bayer Digital Agriculture Assets will allow BASF to 
become a n effective competitor to Bayer/ Monsanto and other pl ayers; 
(ii) BASF 's current geographic footprint is different from Bayer 's; (iii) the 
acquisition of the Bayer Digital Agriculture Assets will not incentivise BASF to 
limit or discontinue investment in its current portfolio; and importantly (iv) the 
Parties ' digital farming p ortfolios are to a large extent not comparable from a 
user perspective.  
(297)  Additionally, BASF indicates that there is currently a vast range of players 
active in digital farming. Every company in the digital farming space is 
developing one or more products wh ich differ in various ways in terms of data 
input, technology, functionality or focus.173 
4.4.4.2.  Commission assessment  
(298)  For the reasons set out below, the Commission considers that the Transaction 
would not give rise to serious doubts in relation to digitally -enable d 
prescriptions . 
                                                 
171  Commission Decision in Case M.8084 – Bayer/Monsanto (2018), recitals 2584 to 2590.  
172  Form CO, chapter 6C, paragraphs 636 -637. 
173  Form CO, chapter 6C, paragraph 612.  
 
62 (299)  First, the Parties  do not overlap in  digitally -enabled prescriptions functionalities. 
As described above, BASF's Maglis suite of products is being developed mainly 
as a marketing tool enabling BASF to better interact with distributors and 
farmers.  In the future, Maglis will provide general recommendations to farmers 
to help them use information collected from various sources to facilitate the 
taking of crop management decisions . The Commission considers that  Maglis is 
not currently and appe ars unlikely to be in the foreseeable future a tool 
providing digitally -enabled prescriptions  of a type enabled by the Bayer Digital 
Agriculture Assets . In contrast to BASF’s Maglis general recommendations and 
as detailed in the Bayer/Monsanto  decision174, Bayer's digital agriculture efforts 
include the development and the offering of digitally -enabled prescriptions  
based on algorithms and data at a granular level and oriented towards achieving 
specific results . Bayer is about to start commercialising its di gitally -enabled 
prescriptions of fungicides for broad acre crops in the EEA and is likely to 
further expand its offering in terms of crop protection products and crops 
covered.  
(300)  Second , the divestment of the Bayer  Digital Agriculture Assets will be 
accompan ied by a worldwide (excluding North America) licence back to Bayer 
that will allow Bayer to continue developing and offering digital agriculture 
products based on the technologies it is divesting to BASF. Therefore, the 
Transaction will not only preserve t he existing  number of competitors offering 
digitally enabled prescriptions present in the EEA but will actually  increase the 
number of active players.  Indeed, the Transaction will transfer to BASF Bayer's 
current and pipeline digitally -enabled prescription  assets and products in the 
EEA, creating a new competitor in this market without removing Bayer's ability 
to offer such prescriptions on the basis of the transferred technologies.  
4.4.5.  Conclusion  on digital agriculture  
(301)  On the basis of the available evidence an d the results of the investigation, the 
Commission considers that the Transaction does not give rise to serious doubts 
as to its compatibility with the internal market in relation digitally enabled 
prescriptions . 
5. PROPOSED REMEDIES  
5.1. Framework of the assessment of the commitments  
(302)  Where, as in this case, a notified concentration raises serious doubts as to its 
compatibility with the internal market, the Parties may modify the notified 
concentration so as to remove the grounds for the serious doubts iden tified by 
the Commission with a view to having it declared compatible with the internal 
market pursuant to Article 6(1)(b) in conjunction with Article 6(2) of the Merger 
Regulation.  
(303)  As set out in the Commission Notice on Remedies, commitments have to 
elimi nate the Commission's serious doubts entirely  and they have to be 
comprehensive and effective from all points of view.  
                                                 
174  Commission Decision in Case M.8084 – Bayer/Monsanto (2018), recitals 2614 to 2629.  
 
63 (304)  In assessing whether or not commitments will restore effective competition, the 
Commission considers all relevant factors, including the type, scale and scope of 
the proposed commitments, with reference to the structure and particular 
characteristics of the market in which the Commission has identified serious 
doubts, including the position of the Parties and oth er participants on the marke t. 
5.2. Commitments submitted by the Notifying Party  
(305)  In order to address the serious doubts raised by the Transaction with a view to 
rendering the concentration compatible with the internal market, the Notifying 
Party  has modified the notified concentration by submitting to the Commission 
proposed commitments.  
(306)  The Notifying Party submitted two sets of commitments. Notably, the Notifying 
Party formally submitted a remedy proposal on 9 April 2018  and a revised 
remedy proposal on 10 April 2018 (the 'Initial Commitm ents'). After the 
Commission gathered the views of market participants on the Initial 
Commitments ( the ' market test '), and informed the Notifying Party of the 
remaining serious doubts raised by the Transaction, the Notifying Party 
submitted a revised remed y proposal on 20 April 2018  (the 'Final 
Commitments '). 
(307)  The Commission considers that the Final Commitments are sufficient to ensure 
that, if implemented, the Transaction no longer raises serious doubts as to its 
compatibility with the internal market. The Final Commitments are annexed to 
this Decision and form an integral part of the Decision.  
5.3. Initial Commitments  
(308)  Initially, the Notifying Party proposed the divestment of two separate 
divestment packages, to be purchased by either separate purchasers or by on e 
single purchaser  (the 'Purchaser ' or 'Purchasers' ): BASF's Trunemco assets (the 
'Nematicidal Seed Treatment Assets ') and a licence to Bayer's [NSH line of 
research 1]  for NSH ( the '[NSH line of research 1]  Data Transfer and Licence ' 
and, together  with th e Nematicidal Seed Treatment Assets , the 'Divestment 
Businesses').  
(309)  The Nematicidal Seed Treatment Assets consist of the assets comprising BASF 's 
global nematode control seed treatm ent pipeline project, known as 'Trunemco'  
and which consists of a co mbination of a biological ( a type of bacillus (bacteria) 
that colonises plant roots and excludes pathogens) and a semio -chemical. As 
described in the Initial Commitments, the Nematicidal Se ed Treatment Assets 
consist ed of: 
(a) all intellectual property related  to Trunemco, including but not limited to 
worldwide patents, trademarks, and copyrights;  
(b) all product registrations and pending regulatory submissions related to 
Trunemco;  
(c) all current formulations and those in development, as well as inter alia all 
develop ed processes, procedures, recipes, manuals, and quality control 
 
64 measures for the manufacture and formulation of Trunemco, including but 
not limited to protectable trade secrets;  
(d) all data and analyses from Trunemco field trials, including ongoing trials, 
protocols, and studies and summaries of such studies;  
(e) all sales and marketing assets, including BASF 's marketing and 
distribution plans, all market research conducted to date on Trunemco, the 
Trunemco website and domains, and Trunemco social media sites (to the 
extent that such websites, domains or social media sites are in existence);  
(f) a transitional supply agreement for the biological (bacillus) component of 
Trunemco, at variable cost for an initial period of one year , which can be 
extended at the option of the purchaser for up to two further periods (up to 
a total of three  years);  and 
(g) a number of transitional services including: sales and marketing training; 
assistance regarding regulatory approvals; support regarding the 
completion of ongoing regulatory stu dies; consulting support re garding 
supply chain processes.  
(310)  The [NSH line of research 1]  Data Transfer and Licence consist ed of the transfer 
of data and know -how from field trials and an exclusive licence to the IP rights 
and know -how relating to such line of research for all non -commercial and 
commercial applications in the field of non -selective uses. The [NSH line of 
researc h 1] Data Transfer and Licence also include d the transfer of two key 
personnel.  Moreover, as described in the Initial Commitments, the [NSH line of 
research 1]  Data Transfer and Licence included a material testing agreement for 
BASF's [NSH line of research  1]-tolerance genes and an option for the 
Purchaser to use these genes in developing  [NSH line of research 1] -tolerant 
[…] through a development and commercial licence ( with a cross -licence  giving 
BASF's [NSH line of research 1]  chemistry access to the Pur chaser's traited 
acres).  
(311)  In addition, the Notifying Party proposed to enter into related commitments, 
including  the separation of the divested businesses from their retained 
businesses, the preservation of the viability, marketability and competitiveness 
of the divested businesses, including the appointment of a monitoring trustee 
and, if necessary, a divestiture trustee.  
(312)  The Commission assessed the appropriateness of the Initial Commitments  and 
carried out a market test.  
5.4. The Commission 's market test  
(313)  The Commission launched a market test of the Initi al Commitments on 
11 April  2018 . 
(314)  In general, the view of the market test respondents was  that the Initial 
Commitments could remedy the serious doubts identified by the Commission, 
subject to the modification of  a number of specific eleme nts of the Initial 
Commitments.  
 
65 (315)  In particular, a majority of respondents indicated that it was important for the 
Purchaser of the Nematicidal Seed Treatment Assets to obtain  personnel in order 
to ensure the viability and competit iveness of the Nematicidal Seed Treatment 
Assets . A majority of respondents  also indicated that  the transitional supply  
arrangements (at variable cost) for the biological (bacillus) component of 
Trunemco should be of a longer duration  than foreseen in the Initial 
Commitments .175 
(316)  A number of respondents also indicated that the IP licence provisions were too 
restrictive. In the Initial Comments, the Purchaser was granted a licence of IP 
based on the original two -component formulation of Trunemco only. These 
respondents indicated that the Purchaser should be free to create additional 
mixtures using the two components of Trunemco, for example by adding an 
additional active ingredient.176 A number of respondents further identified that 
due to BASF retaining certain I P rights regarding the mixture compon ents, it 
was not excluded that BASF could re -enter the nematicidal seed treatment 
market with a product consisting of the same or similar components of 
Trunemco.177 
(317)  Regarding the [NSH line of research 1]  Data Transfer and Licence, half of the 
respondents expressing a view explained that the ancillary cross -licensing 
obligation would have an adverse effect on the Purchaser's incentives to fully 
develop the [NSH line of research 1]  line of research globally , as well as more 
generally on the viability and competitiveness of th e [NSH line of research 1]  
Data Transfer and Licence.178 This obligation would require the Purchaser and 
BASF to enter into an additional cross -licensing agreement giving BASF access 
to th e Purchaser's [NSH line of research 1]  traited acres, if the Purchaser made 
use of the option to a non -exclusive development and commercial licence to 
BASF's [NSH line of research 1]  tolerance genes. Such option would enable the 
Purchaser to develop [NSH l ine of research 1] -tolerance traits based on these 
BASF genes to be used with the products developed through the [NSH line of 
research 1]  line of research.  
(318)  In all other respects, respondents generally considered that the Divested 
Businesses  include all nec essary assets and would be able to compete effectively 
with the merged entity.179 
                                                 
175  See responses to the Questionnaire on Commitments offered by BASF and to the Questionnaire on 
Commitment s offered by BASF  
176  See responses to the Questionnaire on Commitments offered by BASF and to the Questionnaire on 
Commitments offered by BASF  
177  See responses to the Questionnaire on Commitments offered by BASF and to the Questionnaire on 
Commitments of fered by BASF  
178  See responses to the Questionnaire on Commitments offered by BASF and to the Questionnaire on 
Commitments offered by BASF.  
179  See responses to the Questionnaire on Commitments offered by BASF and to the Questionnaire on 
Commitments offere d by BASF.  
 
66 5.5. Final Commitments s ubmitted by the Notifying Party  
5.5.1.  Description of the Final Commitments  
(319)  As explained above, the Notifying Party submitted the Final Commitments on 
20 April 2018 . The full text of the Final Commitments is attached as the Annex 
to this Decision.  
(320)  The Final Commitments have been modified vis -à-vis the Initial Commitments 
as described in Section 5.3 as follows:  
(a) at the option of the Purchaser, up to […] employees […] are included in 
the Nematicidal Seed Treatment Assets to ensure their viability and 
competitiveness ; 
(b) transitional supply of the biological (bacillus) component of Trunemco at 
variable cost was modifie d from a total maximum period of […] years to 
an initial  period of […] years, extendable up to a total of […] years ; 
(c) BASF commits  not to assert its rights un der any patents to restrict the use 
of the Nematicidal Seed Treatment Assets in mixtures with any other 
active ingredients;  
(d) BASF shall not develop or commercialise a nematicidal seed treatment 
based on the two Trunemco components, for a period of […] years 
following the sale of the Nematicidal Seed Treatment Assets (or the 
lifetime of the patent rights, whichever is longer); and  
(e) […]. 
(321)  The Final Commitments also clarify some language to ensure that all necessary 
rights and assets transfer to the Purchasers.  
5.5.2.  Assessment of the Final Commitments  
(322)  The Commission considers that the Final Commitments set aside  the serious 
doubts raised by the Transaction entirely because they remove the entire overlap 
between the Parties in nematicidal seed treatment in the EEA and NSH 
innovation  in which serious doubts were raised. The Commission also finds that 
the modifications contained in the Final Commitments and described at 
Section  5.5.1  above address the outstanding issues , as identified in the course of 
the market investigation , related to the viability and competitiveness of the 
Divestment Business es. 
5.5.3.  Conc lusion on the Final Commitments  
(323)  For the reasons outlined above, the Commission considers that the commitments 
entered into by the undertakings concerned are sufficient and appropriate to 
eliminate the serious doubts as to the compatibility of the Transaction with the 
internal market with  respect to (i) the sale of nematicidal seed treatment  in 
the EEA  and (ii) NSH innovation . 
(324)  Under the first sentence of the second subparagraph of Article 6(2) of the 
Merger Regulation, the Commission may attach to its decision conditions and 
 
67 obligations in tended to ensure that the undertakings concerned comply with the 
commitments they have entered into vis -à-vis the Commission with a view to 
rendering the concentration compa tible with the internal market.  
(325)  The fulfilment of the measures that gives rise to t he structural change of the 
market is a condition, whereas the implementing steps that are necessary to 
achieve this result are generally obligations on the Parties. Where a condition is 
not fulfilled, the Commission's decision declaring the concentration compatible 
with the internal market and the EEA Agreement is no longer applicable. Where 
the undertakings concerned commit a breach of an obligation, the Commission 
may revoke the clearance decision in accordance with Article  6(3) of the Merger 
Regulation.  The undertakings concerned may also be subject to fines and 
periodic penalty payments under Articles 14(2) and 15(1) of the Merger 
Regulation.  
(326)  In accordance with the basic distinction between conditions and obligations, the 
commitments in Section s B and C  as well as the Schedule  of the Final 
Commitments set out in the Annex constitute conditions attached to this 
decision, as only through full compliance therewith can the structural changes in 
the relevant markets be achieved. The other commitments set out in the Annex 
constitute obligations, as they concern the implementing steps that are necessary 
to achieve the modifications sought in a manner compatible with the internal 
market.  
(327)  The full text of the Final Commitments is attached  to this Decision as the Annex 
and forms an integral part thereof.  
6. CONCLUSION  
(328)  For the above reasons, the Commission has decided not to oppose the proposed  
concentr ation notified on 7 March 2018,  as modified by the commitments 
presented on 20 April 2018 , and to declare it compatibl e with the internal 
market and with the functioning of the EEA Agreement, subject to full 
compliance with the conditions in Sections B and C as well as the Schedule  of 
the commitments annexed to the present decision and with the obligations 
contained in th e other sections of the said commitments. This decision is 
adopted in application of Article 6(1)(b) in conjunction with Article  6(2) of the 
Merger Regulation and Article 57 of the EEA Agreement.  
For the Commission  
 
 
(Signed)  
Phil HOGAN  
Member of the Commi ssion  
 
  
Annex  
 
   20 April 2018  
 
 
Case M. 8851 – BASF / BAYER DIVESTMENT BUSINESS  
 
COMMITMENTS TO THE EUROPEAN COMMISSION  
Pursuant to Article 6(2) of Council Regulation (EC) No 139/2004 (the Merger Regulation ), 
BASF SE ( BASF ) hereby enter into the following Commitments (the Commitments ) vis-à-vis 
the European Commission (the Commission ) with a view to rendering its proposed 
acquisition of the Bayer Divestment Business (the Concentration ) compatible with the 
internal market and the functioning of the EEA Agreement.   
This text shall be interpreted in light of the Commission’s decision pursuant to Article 6(1)(b) 
of the Merger Regulation to declare the Concentration compatible with the internal market 
and the functioning of the EEA  Agreement (the Decision ), in the general framework of 
European Union law, in particular in light of the Merger Regulation, and by reference to  the 
Commission Notice on remedies acceptable under Council Regulation (EC) No 139/2004 and 
under Commission Regu lation (EC) No 802/2004 (the Remedies Notice ). 
 
Section A.  Definitions  
 
1. For the purpose of the Commitments, the following terms shall have the following 
meaning:  
 
Affiliated Undertakings : undertakings controlled by the Parties and/or by the ultimate 
parents of the Parties, whereby the notion of control shall be interpreted pursuant to 
Article 3 of the Merger Regulation and in light of the Commission Consolidated 
Jurisdictional Notice unde r Council Regulation (EC) No 139/2004 on the control of 
concentrations between undertakings (the Consolidated Jurisdictional Notice ).  
 
Assets: the assets that contribute to the current operation or are necessary to ensure the 
viability and competitiveness  of the Divestment Businesses as indicated in Section B and 
Section C and described more in detail in the Schedule.   
 
BASF : BASF SE, a stock corporation incorporated under the laws of the Federal Republic 
of Germany, with its registered office at G -FLL/S -D100, Ludwigshafen am Rhein, 67056, 
and registered with the local court ( Amtsgericht ) Ludwigshafen am Rhein under 
Handelsregister (commercial register) number HRB 6000 . 
Bayer : Bayer Aktiengesellschaft, a stock corporation incorporated under the laws of the 
Federal Republic of Germany, with its registered office at Kaiser -Wilhelm -Allee 1, 51373 
 
2  Leverkusen, Germany, and registered with the local court ( Amtsgericht ) Cologne under 
Handelsregister number 48248.  
Bayer Divestment Business : the businesses to be acqu ired by BASF from Bayer pursuant 
to the commitments given by Bayer to the European Commission in case M.8084 – 
Bayer/Monsanto . 
 
Confidential Information : any business secrets, know -how, commercial information, or 
any other information of a proprietary natu re that is not in the public domain.  
 
Conflict of Interest : any conflict of interest that impairs the Trustee's objectivity and 
independence in discharging its duties under the Commitments.  
 
Divestment Businesses : the Trunemco Assets and the  [NSH line of  research  1] Data 
Transfer and Licence.  
 
Divestiture Trustee : one or more natural or legal person(s) who is/are approved by the 
Commission and appointed by BASF and who has/have received from BASF the 
exclusive Trustee Mandate to sell the Divestment Businesses to one or more Purchasers at 
no minimum price.  
  
Effective Date : the date of adoption of the Decision.  
 
Hold Separate Managers : the persons appointed by BASF for the Divestment 
Businesses to manage the day -to-day businesses under the supervisio n of the Monitoring 
Trustee.  
 
Key Personnel : all personnel necessary to maintain the viability and competitiveness of 
the Divestment Businesses, as listed in the Schedule, including the Hold Separate 
Managers  (as applicable) .  
 
Monitoring Trustee : one or more natural or legal person(s) who is/are approved by the 
Commission and appointed by BASF, and who has/have the duty to monitor BASF’s 
compliance with the conditions and obligations attached to the Decision.  
 
Monsanto : Monsanto Company, a corporation inc orporated under the laws of the State of 
Delaware, United States of America, with its registered office at 800 North Lindbergh 
Boulevard, St Louis, Missouri, 63167, United States of America, and registered with the 
Secretary of State of the State of Delawa re under File Number 3174788.  
 
Parties:   BASF and Bayer.  
 
Purchaser : the entity or entities approved by the Commission as acquirer or acquirers of 
the Divestment Businesses in accordance with the criteria set out in Section E.  
 
Purchaser Criteria : the cri teria laid down in paragraph 18 and paragraph 19 of these 
Commitments that Purchasers of the Divestment Businesses must fulfil in order to be 
approved by the Commission.  
 
3   
Schedule(s) : the schedule(s) to these Commitments describing more in detail the 
Divestment Businesses.  
 
[NSH line of resear ch 1] Data Transfer and Licence : the package of intellectual 
property rights relating to [NSH line of research 1 h] class herbicide chemistry type [mode 
of action  for NSH line of research 1 ] inhibitor described in part II of the Schedule to 
which BASF commits to give the Purchaser exclusive rights  for non -selective uses . This 
in addition includes: (i) a material transfer agreement on terms substantially similar to 
those granted by BASF to […] (as per the […], attached as Annex I), which includes a 
resea rch license for the Purchaser […]; and (ii) an option to a non -exclusive development 
and commercial license, on commercially reasonable terms, to […] that will be 
exercisable if the Purchaser develops a registrable [NSH line of research  1] class herbicide 
chemistry type [mode of action for NSH line of research 1]  inhibitor as defined in the 
[NSH line of research  1] Data Transfer and License.   The non -exclusive development and 
commercial license would  permit the Purchaser to develop a [mode of action  for NS H 
line of research 1 ] HT trait in […].   
 
[NSH line of research  1] Data Transfer and Licence Closing : the transfer to the 
Purchaser of the [NSH line of research  1] Data Transfer and Licence.  
 
[NSH line of research  1] Data Transfer and Licence Closing Period : the period of […] 
from the approval of the Purchaser and the terms of sale by the Commission.  
 
[NSH line of research  1] Data Transfer and Licence First Divestiture Period : the 
period of […] from the date of the cl osing of the Bayer / Monsanto transaction.  
 
[NSH line of research  1] Data Transfer and Licence Samples : samples of up to 
100 milligrams of chemical structures where such samples are still available to BASF and 
have not degraded in storage.  BASF will not re-synthesise samples of chemical structures 
if it no longer has sufficient volumes, or quality, of the relevant samples.  
 
Trunemco Assets : the assets comprising BASF’s global nematode control seed treatment 
pipeline project, known as ‘Trunemco’, described  in part I of the Schedule, and defined by 
the nematode repellent combination of MBI 600 and cis -Jasmone.  
 
Trunemco Assets Closing : the transfer to the Purchaser of the Trunemco Assets.  
 
Trunemco Assets Closing Period : the period of […] months from the app roval of the 
Purchaser and the terms of sale by the Commission.  
 
Trunemco Assets First Divestiture Period : the period of […] months from the date of 
the closing of the Bayer / Monsanto transaction.  
 
Trunemco Patent Rights : the patents cited in paragraph 3 (a)(i) -(iii) of part I of the 
Schedule.  
Trustee(s) : the Monitoring Trustee and/or the Divestiture Trustee as the case may be.   
 
4   
Trustee Divestiture Period : the period of […] months from the end of the Trunemco 
Assets First Divestiture Period  and/or [NSH line of research  1] Data Transfer and Licence 
First Divestiture Period (as applicable) . 
 
Section B.  The commitment to divest the Trunemco Assets  
 Commitment to divest  
 
2. In order to maintain effective competition, BASF commits to divest, or procure the 
dives titure of, the Trunemco Assets by the end of the Trustee Divestiture Period as a 
going concern to a Purchaser and on terms of sale approved by the Commission in 
accordance with the procedure described in paragraph 18 of these Commitments.  To 
carry out the divestiture, BASF commits to find a Purchaser and to enter into a final 
binding sale and purchase agreement for the sale of the Trunemco Assets wit hin the 
Trunemco Assets First Divestiture Period. If BASF has not entered into such an 
agreement at the end of the Trunemco Assets First Divestiture Period, BASF shall grant 
the Divestiture Trustee an exclusive mandate to sell the Trunemco Assets in accord ance 
with the procedure described in paragraph 32 in the Trustee Divestiture Period.  
 
3. BASF shall be deemed to have complied with this commitment if: 
 
 (a) by the end of the Trustee Divestiture Period, BASF or the Divestiture Trustee 
has entered into a final binding sale and purchase agreement for the Trunemco 
Assets and the Commission approves the proposed Purchaser and the terms of 
sale as being c onsistent with the Commitments in accordance with the 
procedure described in paragraph 18; and  
 
 (b) the Trunemco Assets Closing takes place within the Trunemco Assets Closing 
Period.  
 
4. In order to maintain the structural effect of the Commitments, BASF shall, for a period of 
10 years after the Trunemco Assets  Closing  or the lifetime of the Trunemco Patent Rights 
(whichever is longer) , not acqu ire, whether directly or indirectly, the possibility of 
exercising influence (as defined in paragraph 43 of the Remedies Notice, footnote 3) over 
the whole or part of the Trunemco Assets, or develop and/or commercialise any seed 
treatment with nematicidal action that uses the nematode repellent combination of 
MBI  600 and cis -Jasmone  in any form (including in a mixture of Trunemco with other 
components), unless, following the submission of a reasoned request from BASF showing 
good cause and accompanied by a report from the Monitoring Trustee (as provided in 
paragraph 46 of these Commitments), the Commission finds that the structure of the 
market has ch anged to such an extent that the absence of influence over the Trunemco 
Assets is no longer necessary to render the proposed concentration compatible with the 
internal market.  
 
 
5   Structure and definition of the Divestment Business  
 
5. The Trunemco Assets consists of the assets comprising BASF’s global nematode control 
seed treatment pipeline project, known as ‘Trunemco’, described in part I of the Schedule, 
and defined by the nematode repellent combination of MBI 600 and cis -Jasmone.   
 
Section C.  The commitment to divest the [NSH line of research  1] Data  Transfer and 
Licence  
 Commitment to divest  
 
6. In order to maintain effective competition, BASF commits to divest, or procure the 
divestiture of, the [NSH line of research  1] Data Transfer  and Licence by the end of the 
Trustee Divestiture Period as a going concern to a Purchaser and on terms of sale 
approved by the Commission in accordance with the procedure described in paragraph 19 
of these Commitments.  To carry out the divestiture, BASF commits to find a Purchaser 
and to enter into a final binding sale and purchase agreement for the sale of the [NSH line 
of research  1] Data Transfer  and Licence within the [NSH line of research  1] Data 
Transfer and Licence First Divestiture Period.  If BASF has not entered into such an 
agreement at the end of the [NSH line of research  1] Data Transfer and Licence First 
Divestiture Period, BASF shall grant the Divestiture Trustee an exclusive mandate to sell 
the [NSH line of research  1] Data Transfer and Licence in accordance with the procedure 
described in paragraph 32 in the Trustee Divestiture Period.  
 
7. BASF shall be deemed to have complied with this commitment if:  
 
 (a) by the end of the Trustee Divestiture Period, BASF or the Divestiture Trustee 
has entered into a final binding sale and purchase agreement for the [NSH line 
of research  1] Data Transfer and Licence and the Commission approves the 
proposed Purchaser and the  terms of sale as being consistent with the 
Commitments in accordance with the procedure described in paragraph 19; and  
 
 (b) the [NSH line of resea rch 1] Data Transfer and Licence Closing takes place 
within the [NSH line of research  1] Data Transfer and Licence Closing Period.  
 
8. In order to maintain the structural effect of the Commitments, BASF shall, for a period of 
[…] after the [NSH line of research  1] Data Transfer and Licence Closing, not acquire, 
whether directly or indirectly, the possibility of exercising influence (as defined in 
paragraph 43 of the Remedies Notice, footnote 3) over the whole or part of the [NSH line 
of research  1] Data Transfer and Licence, unless, following the submission of a reasoned 
request from BASF showing good cause and accompanied by a report from the 
Monitoring Trustee (as provided in paragraph 46 of these Commitments), the Commission 
finds that the structure of the market has changed to such an extent that the absence of 
influence over the [NSH line of research  1] Data Transfer and Licence is no longer 
necessary to render the proposed concentration compatible with the internal market.  
 
 
6   Structure and definition of the Divestment Business  
 
9. The [NSH line of research  1] Data Transfer and Licence comprises the package of 
intellectual property rights relating to  [NSH line of research  1] class herbicide chemistry 
type [mode of action  for NSH line of research 1 ] inhibitor described in part II of the 
Schedule to which BASF commits to give the Purchaser exclusive rights  for non -selective 
uses.   
 
 Section D.   Related commitments  
 
 Preservation of viability, marketability and competitiveness  
 
10. From the Effective Date until the Trunemco Assets Closing and [NSH line of research  1] 
Data Transfer and Licence Closing (as applicable), BASF shall preserve or procure the 
preservation of the economic viability, marketability and competitiveness of the 
Divestment Businesses, in accordance with good business practice, and shall minimise as 
far as possible any risk of loss of competitive potential  of the Divestment Businesses. In 
particular BASF undertakes:  
(a) not to carry out any action that might have a significant adverse impact on the 
value, management or competitiveness of the Divestme nt Businesses or that 
might alter the nature and scope of activity, or the industrial or commercial 
strategy or the investment policy of the Divestment Businesses;  
(b) to make available, or procure to make available, sufficient resources for the 
developme nt of the Divestment Businesses, on the basis and continuation of 
the existing business plans;  
(c) to take all reasonable steps, or procure that all reasonable steps are being taken, 
including appropriate incentive schemes (based on industry practice), to 
encourage all Key Personnel to remain w ith the Divestment Businesses. 
Where, nevertheless, individual members of the Key Personnel exceptionally 
leave the Divestment Businesses, BASF, with the assistance of Bayer, shall 
provide a reasoned proposal to repla ce the person or persons concerned to the 
Commission and the Monitoring Trustee. BASF must be able to demonstrate to 
the Commission that the replacement is well suited to carry out the functions 
exercised by those individual members of the Key Personnel.  The replacement 
shall take place under the supervision of the Monitoring Trustee, who shall 
report to the Commission.  
 
 Hold -separate obligations  
 
11. BASF commits, from the Effective Date until the Trunemco Assets Closing and the [NSH 
line of research  1] Data Transfer and Licence Closing (as applicable), to keep, or procure 
the keeping of, the Divestment Businesses separate from the businesses it is retaining and 
to ensure that unless explicitly permitted under these Commitments: (i)  management and 
staff of the businesses retained by BASF have no involvement in the Divestment 
Businesses; and (ii) the Key Personnel have no involvement in any business retained by 
 
7  BASF and do not report to any individual outside the Divestment Businesses.  For the 
avoidance of  doubt, BASF also commits  to […]. 
 
12. Until the Trunemco Asset Closing and [NSH line of research  1] Data Transfer and 
Licence Closing (as applicable), BASF shall assist the Monitoring Trustee in ensuring that 
the Divestment Businesses are managed as distinct and saleable entities separate from the 
businesses which BASF is retaining.  Immediately after the adoption of the Decision, 
BASF shall appoint a Hold Separate Manager for each of the Trunemco Assets and [NSH 
line of research  1] Data Transfer and Licence r espectively. […]. The Hold Separate 
Managers shall manage the Divestment Businesses independently and in the best interest 
of the businesses with a view to ensuring their continued economic viability, marketability 
and competitiveness and their independenc e from the businesses retained by BASF . The 
Hold Separate Managers shall closely cooperate with and report to the Monitoring Trustee 
and, if applicable, the Divestiture Trustee. Any replacement of either or both Hold 
Separate Managers shall be subject to the procedure laid down in paragraph 10(c) of these 
Commitments. The Commission may, after having heard BASF, require BASF to replace 
either or both Hold Separate Managers.  
 
 Ring -fencin g 
 
13. BASF shall implement, or procure to implement, all necessary measures to ensure that it 
does not, after the Effective Date, obtain any Confidential Information relating to the 
Divestment Businesses and that any such Confidential Information obtained by BAS F 
before the Effective Date will be eliminated and not be used by BASF. In particular, the 
[NSH line of research  1] Data Transfer and Licence shall not be incorporated into any 
central information technology network held by BASF.  BASF shall implement 
appropriate ring -fencing measures in respect of the way in which information related to 
the Trunemco Assets is stored on its central information technology network until such 
time as the participation of the Trunemco Assets in the central information technolog y 
network can be severed.  BASF may obtain or keep information relating to the Divestment 
Businesses which is reasonably necessary for the divestiture of the Divestment Businesses 
or the disclosure of which to BASF is required by law . […]. 
 
 Non-solicitati on clause  
 
14. BASF undertakes, subject to customary limitations, not to solicit, and to procure that 
Affiliated Undertakings do not solicit, the Key Personnel transferred with the Divestment 
Businesses for a period of […] after the [NSH line of research  1] Data Transfer and 
Licence Closing.  
 
 
8   Due diligence  
 
15. In order to enable potential purchasers to carry out a reasonable due diligence of the 
Divestment Businesses, BASF shall, subject to customary confidentiality assurances and 
dependent on the sta ge of the divestiture process:  
 
(a) provide, or procure to provide, to potential purchasers sufficient information as 
regards the Divestment Businesses;  
 
(b)  provide, or procure to provide, to potential purchasers sufficient information 
relating to the Key Personn el and allow them reasonable access to the Key 
Personnel.  
 
 Reporting  
 
16. BASF shall submit written reports in English on potential purchasers of the Divestment 
Businesses and developments in the negotiations with such potential purchasers to the 
Commission and the Monitoring Trustee no later than 10 days after the end of every 
month following the Effective Date (or otherwise at the Commission’s request). BASF 
shall submit a list of all potential purchasers having expressed interest in acquiring the 
Divestmen t Businesses to the Commission at each and every stage of the divestiture 
process, as well as a copy of all the offers made by potential purchasers within five days 
of their receipt.  
 
17. BASF shall inform the Commission and the Monitoring Trustee on the prepa ration of the 
data room documentation and the due diligence procedure and shall submit a copy of any 
information memorandum to the Commission and the Monitoring Trustee before sending 
the memorandum out to potential purchasers.  
 
Section E.  The Purchaser  
 
18. In order to be approved by the Commission as the Purchaser of the Trunemco Assets, the 
Purchaser must fulfil the following criteria:  
 
(a) The Purchaser shall be independent of and unconnected to each of BASF and Bayer 
and their respective Affiliated Undert akings (this being assessed having regard to the 
situation following the divestiture) ;  
 
(b) The Purchaser shall have the financial resources, proven expertise and incentive to 
maintain and develop the Trunemco Assets as a viable and active competitive force in 
competition with BASF and other competitors;  
 
(c) The acquisition of the Trunemco Assets by the Purchaser must neither be likely to 
create, in light of the information available to the Commission, prima facie  competition 
concerns nor give rise to a risk that the implementation of the Commitments will be 
delayed. In particular, the Purch aser must reasonably be expected to obtain all necessary 
 
9  approvals from the relevant regulatory authorities for the acquisition of Trunemco 
Assets; and  
 
(d) The Purchaser shall have relevant industry experience.  
 
19. In order to be approved by the Commission a s the Purchaser of the [NSH line of 
research  1] Data Transfer and Licence, the Purchaser   - who can be (but does not need to 
be) the same Purchaser as the Purchaser of the Trunemco Assets - must fulfil the 
following criteria:  
 
(a) The Purchaser shall be in dependent of and unconnected to each of BASF and Bayer 
and their respective Affiliated Undertakings (this being assessed having regard to the 
situation following the divestiture) ;  
 
(b) The Purchaser shall have the financial resources, proven expertise and  incentive to 
maintain and develop the [NSH line of research  1] Data Transfer and Licence as a 
viable and active competitive force in competition with BASF and other competitors. 
[…]; and   
 
(c) The acquisition of the [NSH line of research  1] Data Transfer and Licence by the 
Purchaser must neither be likely to create, in light of the information available to the 
Commission, prima facie  competition concerns nor give rise to a risk that the 
implementation of the Commitments will be delayed. In p articular, the Purchaser must 
reasonably be expected to obtain all necessary approvals from the relevant regulatory 
authorities for the acquisition of the [NSH line of research  1] Data Transfer and 
Licence.  
 
20. The final binding sale and purchase agreements (as well as ancillary agreements) relating 
to the divestment of the Divestment Businesses shall be conditional  on the Commission’s 
approval. When BASF has reached agreement with each Purchaser, it shall submit a fully 
documented and reasoned proposal, incl uding a copy of the final agreement, within one 
week to the Commission and the Monitoring Trustee.  BASF must be able to demonstrate 
to the Commission that each Purchaser fulfils the Purchaser Criteria and that the 
Divestment Businesses are being sold in a  manner consistent with the Commission' s 
Decision and the Commitments.  For the approval, the Commission shall verify that each 
Purchaser fulfils the Purchaser Criteria and that Divestment Businesses are being sold in a 
manner consistent with the Commitment s including their objective to bring about a lasting 
structural change in the market. The Commission may approve the sale of the Divestment 
Businesses without one or more Assets or parts of the personnel, or by substituting one or 
more Assets or parts of t he personnel with one or more different assets or different 
personnel, if this does not affect the viability and competitiveness of the Divestment 
Businesses after the sale, taking account of the proposed Purchaser.  
 
 
10  Section F.  Trustee  
 
 I. Appointment pro cedure  
 
21. BASF shall appoint a Monitoring Trustee to carry out the functions specified in these 
Commitments for a Monitoring Trustee. BASF commits not to close the Concentration 
before the appointment of a Monitoring Trustee.  
 
22. If BASF has not entered into b inding sale and purchase agreement (or agreements) 
regarding the Divestment Businesses one month before the end of the Trunemco Assets 
First Divestiture Period and/or [NSH line of research  1] Data Transfer and Licence First 
Divestiture Period (as applicabl e) or if the Commission has rejected a purchaser proposed 
by BASF at that time or thereafter, BASF shall appoint a Divestiture Trustee for the part 
of the Divestment Businesses (i.e. the Trunemco Assets and/or the [NSH line of 
research  1] Data Transfer and Licence as applicable) for which either BASF has not 
entered into a binding sale and purchase agreement, or the Commission has rejected a 
purchaser. The appointment of the Divestiture Trustee shall take effect upon the 
commencement of th e Trustee Divestiture Period.  
 
23. The Trustee shall:  
 
(i) at the time of appointment, be independent of BASF and its Affiliated Undertakings;  
 
(ii) possess the necessary qualifications to carry out its mandate, for example have 
sufficient relevant experience as an investment banker or consultant or auditor; and  
 
(iii) neither have nor become exposed to a Conflict of Interest.  
 
24. The Trustee shall  be remunerated by BASF in a way that does not impede the independent 
and effective fulfilment of its mandate.  In particular, where the remuneration package of 
a Divestiture Trustee includes a success premium linked to the final sale value of the 
Divestme nt Business, such success premium may only be earned if the divestiture takes 
place within the Trustee Divestiture Period.  
 
  Proposal by BASF  
 
25. No later than two weeks after the Effective Date, BASF shall submit the name or names of 
one or more natural or legal persons whom BASF proposes to appoint as the Monitoring 
Trustee to the Commission for approval.  No later than one month before the end of  the 
Trunemco Assets First Divestiture Period and/or [NSH line of research  1] Data Transfer 
and Licence First Divestiture Period (as applicable), or on request by the Commission, 
BASF shall submit a list of one or more persons whom BASF proposes to appoint  as 
Divestiture Trustee to the Commission for approval. The proposal shall contain sufficient 
information for the Commission to verify that the person or persons proposed as Trustee 
fulfil the requirements set out in paragraph 23 and shall include:  
 
(a) the full terms of the proposed mandate, which shall include all provisions 
necessary to enable the Trustee to fulfil its duties under these Commitments ;  
 
11   
(b) the outline of a work plan which describes how the Trustee intends to carry out 
its assigned tasks;  
 
(c)  an indication whether the proposed Trustee is to act as both Monitoring Trustee 
and Divestiture Trustee or whether different trustees are pro posed for the two 
functions.  
 
  Approval or rejection by the Commission  
 
26. The Commission shall have the discretion to approve or reject the proposed Trustee(s)  and 
to approve the proposed mandate subject to any modifications it deems necessary for the 
Trustee to fulfil its obligations. If only one name is approved, BASF  shall appoint or cause 
to be appointed the person or persons concerned as Trustee, in accorda nce with the 
mandate approved by the Commission. If more than one name is approved, BASF  shall be 
free to choose the Trustee to be appointed from among the names approved.  The Trustee 
shall be appointed within one week of the Commission’s approval, in accordance with the 
mandate approved by the Commission.  
 
  New proposal by the BASF  
 
27. If all the proposed Trustees are rejected, BASF  shall submit the names of at least two 
more natural or legal persons within one week of being informed of the rejection, in 
accordance with paragraphs 21 and 26 of these Commitments.  
 
  Trustee nominated by the Commission  
 
28. If all further proposed Trustees are rejected by the Commission, the Commission shall 
nominate a Trustee, whom BASF  shall appoint, or cause to be appointed, in accordance 
with a trustee mandate approved by the Commission.  
 
 
 II. Functions of the Trustee  
 
29. The Trustee shall assume its specified duties and obligations in order to ensure 
compliance with the Commitments. The Commission may, on its own initiative or at the 
request of the Trustee or BASF, give any orders or instructions to the Trustee in order to 
ensure compliance with the conditions and obligations attached to the Decision.   
 
  Duties and obligations of the Mo nitoring Trustee  
 
30. The Monitoring Trustee shall:  
 
(i)        propose in its first report to the Commission a detailed work plan describing how it 
intends to monitor compliance with the obligations and conditions attached to the 
Decision.  
 
 
12  (ii) oversee, in close co -operation with the Hold Separate Managers, the on -going 
management of the Divestment Businesses with a view to ensuring its continued 
economic viability, marketability and competitiveness and monitor compliance by 
BASF with the conditi ons and obligations attached to the Decision. To that end the 
Monitoring Trustee shall:  
 
  (a) monitor the preservation of the economic viability, marketability and 
competitiveness of the Divestment Businesses, and the keeping separate of 
the Divestment Businesses from the business retained by the Parties, in 
accordance with paragraphs 10 and 11 of these Commitments;  
 
  (b) supervise the manage ment of the Divestment Businesses as a distinct and 
saleable entity, in accordance with paragraph 12 of these Commitments;  
 
  (c) with respect to Confi dential Information:  
 
 determine all necessary measures to ensure that BASF does not after 
the Effective Date obtain any Confidential Information relating to the 
Divestment Businesses;  
 
 in particular strive for the severing of the Divestment Businesses’ 
participation in a central information technology network to the extent 
possible, without compromising the viability of the Divestment 
Businesses;  
 
 make sure that any Confidential Informa tion relating to the Divestment 
Businesses obtained by BASF before the Effective Date is eliminated 
and will not be used by BASF;  
 
 decide whether such information may be disclosed to or kept by BASF 
as the disclosure is reasonably necessary to allow BASF to carry out 
the divestiture or as the disclosure is required by law; and  
 
  (d) monitor the splitting of assets and the allocation of Key Personnel between 
the Divestment Businesses and BASF or Affiliated Undertakings;   
 
(iii) propose to BASF such measures as the Monitoring Trustee considers necessary to 
ensure BASF’s compliance with the conditions and obligations attached to the 
Decision, in particular the maintenance of the full economic viability, 
marketability or competitiveness of the Divestment Businesses , the holding 
separate of the Divestment Businesses and the non -disclosure of competitively 
sensitive information;  
 
(iv) review and assess potential Purchasers as well as the progress of the divestiture 
process and verify that, dependent on the stage of the div estiture process:  
 
  (a) potential Purchasers receive sufficient and correct information relating to 
the Divestment Businesses and the Key Personnel in particular by 
 
13  reviewing, if available, the data room documentation, the information 
memorandum and the d ue diligence process, and  
 
  (b) potential Purchasers are granted reasonable access to the Key Personnel;  
 
(v) act as a contact point for any requests by third parties, in particular potential 
purchasers, in relation to the Commitments;  
 
(vi) provide to the Commis sion, sending BASF a non -confidential copy at the same 
time, a written report within 15 days after the end of every month that shall cover 
the operation and management of the Divestment Businesses as well as the 
splitting of assets and the allocation of [NSH line of research  1] Data Transfer and 
Licence Personnel so that the Commission can assess whether the business is held 
in a manner consistent with the Commitments and the progress of the divestiture 
process as well as potential Purchasers;  
 
(vii) promptly report in writing to the Commission, sending BASF a non -confidential 
copy at the same time, if it concludes on reasonable grounds that BASF is failing 
to comply with these Commitments;  
 
(viii) within one week after receipt of the documented proposal referred to in 
paragraph  18 and paragraph 19 of these  Commitments (as applicable), submit to 
the Commission, sending BASF a non -confidential copy at the same time, a 
reasoned opinion as to the suitability and independence of the proposed Purchasers 
and the viability of the Divestment Businesses after the Sal e and as to whether the 
Divestment Businesses are sold in a manner consistent with the conditions and 
obligations attached to the Decision, in particular, if relevant, whether the Sale of 
the Divestment Businesses without one or more Assets or not all of t he Key 
Personnel affects the viability of the Divestment Businesses after the sale, taking 
account of the proposed purchaser;  
 
(ix) assume the other functions assigned to the Monitoring Trustee under the 
conditions and obligations attached to the Decision.  
 
31. If the Monitoring and Divestiture Trustee are not the same legal or natural persons, the 
Monitoring Trustee and the Divestiture Trustee shall cooperate closely with each other 
during and for the purpose of the preparation of the Trustee Divestiture Period in order to 
facilitate each other's tasks.  
 
  Duties and obligations of the Divestiture Trustee  
 
32. Within the Trustee Divestiture Period, the Divestiture Trustee shall sell at no minimum 
price the Divestment Businesses to a purchaser, provided that the Commission has 
approved both the purchaser and the final binding sale and purchase agreement (and 
ancillary agreements) as in line with the Commission's Decision and the Commitments in 
accordance with paragraphs 18 and 20 of these Commitments. The Divestiture Trustee 
shall include in the sale and purchase agreement (as well as in any ancillary agreements) 
such terms and conditions as it considers appropriate for an expedient sale in the Trustee 
 
14  Divestiture Period.  In particular, the Divestiture  Trustee may include in the sale and 
purchase agreement such customary representations and warranties and indemnities as are 
reasonably required to effect the sale.  The Divestiture Trustee shall protect the legitimate 
financial interests of BASF, subject to BASF’s unconditional obligation to divest at no 
minimum price in the Trustee Divestiture Period.  
 
33. In the Trustee Divestiture Period (or otherwise at the Commission’s request), the 
Divestiture Trustee shall provide the Commission with a comprehensive mo nthly report 
written in English on the progress of the divestiture process. Such reports shall be 
submitted within 15 days after the end of every month with a simultaneous copy to the 
Monitoring Trustee and a non -confidential  copy to BASF . 
 
 III. Duties an d obligations of the Parties  
 
34.  BASF shall provide and shall cause its advisors to provide the Trustee with all such co -
operation, assistance and information as the Trustee may reasonably require to perform its 
tasks. The Trustee shall have full and complet e access to any of BASF’s or the 
Divestment Businesses’ books, records, documents, management or other personnel, 
facilities, sites and technical information necessary for fulfilling its duties under the 
Commitments and BASF and the Divestment Businesses s hall provide the Trustee upon 
reques t with copies of any document. BASF and the Divestment Businesses shall make 
available to the Trustee one or more offices on their premises and shall be available for 
meetings in order to provide the Trustee with all inf ormation necessary for the 
performance of its tasks.  
 
35. BASF shall provide the Monitoring Trustee with all managerial and administrative 
support that it may reasonably request on behalf of the management of the Divestment 
Businesses. This shall include all a dministrative support functions relating to the 
Divestment Businesses which are currently carried out at headquarters level.  BASF shall 
provide and shall cause its advisors to provide the Monitoring Trustee, on request, with 
the information submitted to p otential purchasers, in particular give the Monitoring 
Trustee access to the data room documentation and all other information granted to 
potential Purchasers in the due diligence procedure.  BASF shall inform the Monitoring 
Trustee on possible purchasers,  submit lists of potential Purchasers at each stage of the 
selection process, including the offers made by potential Purchasers at those stages, and 
keep the Monitoring Trustee informed of all developments in the divestiture process.  
 
36. BASF shall grant or procure Affiliated Undertakings to grant comprehensive powers of 
attorney, duly executed, to the Divestiture Trustee to effect the sale (including ancillary 
agreements), the Trunemco Assets Closing and the [NSH line of research  1] Data Transfer 
and Licence  Closing (as applicable) and all actions and declarations which the Divestiture 
Trustee considers necessary or appropriate to achieve the sale and the Trunemco Assets 
Closing and the [NSH line of research  1] Data Transfer and Licence Closing (as 
applicable ), including the appointment of advisors to assist with the sale process.  Upon 
request of the Divestiture Trustee, BASF shall cause the documents required for effecting 
the sale and the Trunemco Assets Closing and the [NSH line of research  1] Data Transfe r 
and Licence Closing (as applicable) to be duly executed.  
 
 
15  37. BASF shall indemnify the Trustee and its employees and agents (each an Indemnified 
Party ) and hold each Indemnified Party harmless against, and hereby agrees that an 
Indemnified Party shall have n o liability to BASF for, any liabilities arising out of the 
performance of the Trustee’s duties under the Commitments, except to the extent that such 
liabilities result from the wilful default, recklessness, gross negligence or bad faith of the 
Trustee, it s employees, agents or advisors.  
 
38. At the expense of BASF, the Trustee may appoint advisors (in particular for corporate 
finance or legal advice), subject to BASF’s approval (this approval not to be unreasonably 
withheld or delayed) if the Trustee considers the appointment of such advisors necessary 
or appropriate for the performance of its duties and obligations under the Mandate, 
provided that any fees and other expenses incurred by the Trustee are reasonable. Should 
BASF refuse to approve the advisors proposed by the Trustee the Commissio n may 
approve the appointment of such advisors instead, after having heard BASF. Only the 
Trustee shall be entitled to issue instructions to the advisors.  Paragraph 37 of these 
Commitments shall apply mutatis mutandis . In the Trustee Divestiture Period, the 
Divestiture Trustee may use advisors who served BASF during the Divestiture Period if 
the Divestiture Trustee considers this in the best interest of an expedient sale.  
 
39. BASF agrees that the Commission may share Confidential Information proprietary to 
BASF with the Trustee.  The Trustee shall not disclose such information and the 
principles contained in Article 17 (1) and (2) of the Merger Regulation ap ply mutatis 
mutandis .  
 
40. BASF agree that the contact details of the Monitoring Trustee are published on the 
website of the Commission's Directorate -General for Competition and they shall inform 
interested third parties, in particular any potential Purchaser s, of the identity and the tasks 
of the Monitoring Trustee.  
 
41. For a period of 10 years from the Effective Date the Commission may request all 
information from the Parties that is reasonably necessary to monitor the effective 
implementation of these Commitme nts. 
 
 IV. Replacement, discharge and reappointment of the Trustee  
 
42. If the Trustee ceases to perform its functions under the Commitments or for any other 
good cause, including the exposure of the Trustee to a Conflict of Interest:  
 
(a) the Commission may, after hearing the Trustee and BASF, require BASF to replace 
the Trustee; or  
(b) BASF may, with the prior approval of the Commission, replace the Trustee.  
43. If the Trustee is removed according to paragraph 42 of these Commitments, the Trustee 
may be required to continue in its function until a new Trustee is in place to whom the 
Trustee has effected a full hand over of all relevant in formation. The new Trustee shall be 
appointed in accordance with the procedure referred to in paragraphs 21-28 of these 
Commitments.  
 
 
16  44. Unless removed according to paragraph 42 of these Commi tments, the Trustee shall cease 
to act as Trustee only after the Commission has discharged it from its duties after all the 
Commitments with which the Trustee has been entrusted have been implemented. 
However, the Commission may at any time require the rea ppointment of the Monitoring 
Trustee if it subsequently appears that the relevant remedies might not have been fully and 
properly implemented.  
 
Section G.  The review clause  
 
45. The Commission may extend  the time periods foreseen in the Commitments  in response  
to a request from BASF or, in appropriate cases, on its own initiative. Where BASF 
requests an extension of a time period, it shall submit a reasoned request to the 
Commission no later than one month before the expiry of that period, showing good 
cause . This request shall be accompanied by a report from the Monitoring Trustee, who 
shall, at the same time send a non -confidential copy of the report to BASF. Only in 
exceptional circumstances shall BASF be entitled to request an extension within the last 
month  of any period.  
 
46. The Commission may further, in response to a reasoned request from BASF showing 
good cause waive, modify or substitute, in exceptional circumstances, one or more of the 
undertakings in these Commitments. This request shall be accompanied by a report from 
the Monitoring Trustee, who shall, at the same time send a non -confidential copy of the 
report to BASF. The request shall not have the effect of suspending the application of the 
undertaking and, in particular, of suspending the expiry of any time period in which the 
undertaking has to be complied with.  
 
Section G.  Entry into force  
 
47. The Commitments shall take effect upon the date of adoption of the Decision.  
 
 
 
17  SCHEDULE  
 
PART I  
I. Introduction  
1. The Divestment Businesses comprise the Trunemco Assets and the  [NSH line of 
research  1] Data Transfer and Licence. This Part I presents information on the 
Trunemco Assets,  which comprise BASF’s global pipeline projects relating to 
nematode control seed treatment, known as ‘Trunemco’. The Trunemco Assets  
essentially consist of all rights necessary for the Purchaser to obtain regulatory 
approvals for the use of Trunemco as a seed treatment product, and to manufacture 
and ultimately commercialise Trunemco.  
2. Trunemco is a formulated product which relies on tw o known active ingredients: 
bacillus amyloliquefaciens  (strain MBI 600), which is a biological (i.e. a bacteria that 
colonises plant roots and excludes pathogens); and cis-jasmone, which is a 
semioc hemical […]. In addition, Trunemco involves a standard formulation requiring 
know -how that will be possessed by any player active in seed treatment or biologicals. 
BASF’s proprietary know -how relates to the specific combination of active ingredients 
for use as a nemat ode control seed treatment. Unlike conventional chemical 
nematicides, Trunemco repels (but does not kill) nematodes.  
II. The Trunemco Assets  
3. The Trunemco Assets consist of the entirety of the assets comprising BASF’s global 
pipeline project for nematode contro l seed treatme nt, known as ‘Trunemco’, which is 
defined by the nematode repellent combination of MBI 600 and cis -jasmone 
(including all tangible and intangible assets, rights, liabilities and obligations). The 
Trunemco Assets include, but are not limited t o: 
(a) all intellectual property  related to Trunemco and bacillus amyloliquefaciens  
(strain MBI 600) – originally referred to as bacillus subtilis – in combination 
with cis -jasmone (the active ingredients in Trunemco) as a two -component 
mixture for use as a ne matode control seed treatment, including but not limited 
to worldwide patents, trademarks, and copyrights.   Specifically:  
(i) BASF IP relating to bacillus amyloliquefaciens  (strain MBI 600) 
combined with cis -jasmone for use as a nematode control seed 
treatment  will be exclusively licensed to the Purchaser […]; 
(ii) BASF IP relating to bacillus subtilis in combination with cis -jasmone 
will be exclusively licensed  to the Purchaser ( […]) for use as a 
nematode control seed treatment;  
(iii) in relation to cis -jasmone, BASF hol ds an exclusive licence to use […]. 
BASF commits to grant the Purchaser an exclusive sub -licence to cis -
jasmone in relation to the manufacture and use of Trunemco as a 
nematode control seed treatment [...]. Furthermore, BASF will not 
 
18  assert its rights under the exclusive licence from […] in any way that 
restricts the use of the Trunemco Assets by the Purchaser for nematode 
control seed treatment.  
(iv) BASF will not assert its rights under any patents to restrict  the use of 
the Trunemco Assets by the Purchase r for nematode control seed 
treatment in mixtures with any other active ingredient , under the 
provision that none of the other active ingredient is itself (as a 
compound or as part of a mixtur e of two or more active ingredients 
none of which is Trunemco) c laimed by any patent owned , controlled 
or in-licensed  by BASF.   
(b) all product registrations and pending regulatory submissions related to 
Trunemco;  
(c) all current formulations and those in development, as well as inter alia all 
developed processes, procedures, recipes, manuals, and quality control 
measures for the manufacture and formulation of Trunemco, including but not 
limited to protectable trade secrets;  
(d) all data and analyses from Trunemco field trials, including ongoing trials, 
protocols, and studies and s ummaries of such studies;  
(e) all sales and marketing assets, including BASF’s marketing and distribution 
plans, all transferable market research conducted to date for Trunemco , the 
Trunemco website and domains, and Trunemco social media sites (to the 
extent t hat such websites, domains or social media sites are in existence at 
closing);  
4. BASF commits to supply the Purchaser with MBI 600 under a supply agreement on 
the following basis post -closing:  
(a) Prior to first market launch of Trunemco, BASF commits to provide such 
quantities of MBI 600  to the Purchaser as are necessary for the continued 
development of the Trunemco Assets (e.g. testing materials) at the purchase 
price and conditions from a third party supplier that BASF enjoys for the 
respective quantities (hereinafter referred to as “va riable cost” for the purpose 
of this paragraph 4).  
(b) After first market launch of Trunemco, BASF commits to provide the 
Purchaser with a transitional commercial supply of MBI 600  at variable cost 
for an initial period of [1-3 years] .   
(c) At the Purchaser’s opt ion, BASF commits to renewing the term of any 
MBI  600 supply agreement for up to two further periods of [0-1 year] , for a 
total of up to [4-5 years]  after the first market launch of Trunemco, on each 
occasion subject to the Commission’s approval following consultation with the 
Monitoring Trustee and to be supplied at variable cost.    
 
19  (d) Any subsequent supplies of MBI 600 will be based on commercial terms 
agreed with BASF and the Purchaser.   
5. BASF will also use its best efforts to assist the Purchaser with tak ing over the 
continued negotiation of the supply agreement for cis -jasmone which BASF is 
currently negotiating with […], or where necessary, with the creation of new supply 
agreements for cis -jasmone, as the case may be, to be in place within such a timefr ame 
as is reasonably required by the Purchaser to enable timely market launch; BASF will 
also provide the Purchaser with lists of third -party vendors that are known to be 
capable of supplying commercial quantities of cis -jasmone.  
6. The Trunemco Assets will o nly require supply or services agreements between BASF 
and the Purchaser on a transitional basis; no long -term supply agreements will be 
required, unless desired by the Purchaser. BASF commits to enter into any such 
transitional agreements deemed necessary  by the Monitoring Trustee.  The basis upon 
which BASF will provide transitional supplies and services (aside from in relation to 
MBI 600 and cis -jasmone, which are dealt with in paragraphs 4 and 5 above) is set out 
in in more detail in Section III below.  
7. At the written request of the Purchaser, BASF commits to providing training and 
information required by the Purchaser, delivered by appropriate specialists, to prepare 
the Purchaser’s sa les and marketing teams to begin selling the products comprising the 
Trunemco Assets subject to receipt of relevant registrations.  Such training will be 
available for up to [0-1 year]  following the written request of the Purchaser, with the 
option of two extensions of [0-6 months]  each at the Purchaser’s option. BASF 
commits to provide this support at variable cost, as calculated using BASF’s standard 
accounting practices, excluding overhead costs.  
8. BASF will provide to the Purchaser the option to offer employment to up to […] 
employees (in total) working on the Trunemco Assets, subject to the Commission’s 
approval following the opinion of the Monitoring Trustee, including on whether these 
employees a re required by the Purchaser.  These employees, once identified by BASF 
in consultation with the Monitoring Trustee and approved by the Commission 
(following the opinion of the Monitoring Trustee), will be regarded as Key Personnel 
for the purposes of thes e Commitments.  Any transfer of such Key Personnel to the 
Purchaser is also subject to all applicable employment laws.  
 
III. Transitional Service Agreements, and Licensing Agreements 
Potentially Required to Support the Commitments  
9. BASF and Purchaser shall negot iate the agreements required to support the Trunemco 
Assets.  Transitional supplies or services will be provided by BASF at variable cost for 
an initial period of [0-1 year]  after the written request of the Purchaser.  
(a) At the Purchaser’s option, BASF commit s to renewing the term of any 
transitional agreements for up to two further periods of [0-1 year] , for a total of 
up to [1-3 years]  after the written request of the Purchaser, on each occasion 
 
20  subject to the Commission’s approval following consultation wit h the 
Monitoring Trustee.  
(b) Any subsequent supplies or services will be based on commercial terms agreed 
between BASF and Purchaser.  
10. BASF commits to enter into any such transitional agreements deemed necessary by the 
Monitoring Trustee. The Parties currently  contemplate the following post -sale 
transitional services with the Purchaser, though this is subject to further negotiation:  
Regulatory Approvals  
11. BASF will assist the Purchaser in applying for the Purchaser’s [Jurisdiction A]  
[Jurisdiction B]  and, at the discretion of the Purchaser, EU and [Jurisdiction C]  
product registrations to complete the transfer of such registrations.  BASF will also 
transfer its Maximum Residue Limit ( MRL ) dossier and any other pending dossiers 
that are submitted to regu lators by Purchaser Closing.  BASF will also assist the 
Purchaser in responding to inquiries or follow -up questions from the [regulators]  
regarding BASF’s updated toxicology studies. This support is expected to continue for 
up to [0-1 year] . While a regulat ory strategy for [Jurisdiction C]  and Europe has not 
been developed, BASF commits to transfer any documents or know -how that has been 
developed towards that end.  
Product Testing / Ongoing Regulatory Studies  
12. In addition to transferring data and records to t he Purchaser, BASF will support the 
Purchaser with a combination of completing advanced ongoing studies, completing 
trials planned for the current growing season, and/or transferring the lab analysis 
portion of recently initiated studies to Purchaser for b oth product testing purposes and 
regulatory purposes, to the extent that any studies are currently underway. The extent 
of support will depend on the level of progress in the respective studies and 
Purchaser’s capabilities.  BASF will also assist Purchaser in applying for Experimental 
Use Permits ( EUPs ) in required jurisdictions.  BASF will provide support in 
transferring its Material Transfer Agreements ( MTAs ) with third -parties and 
accompanying research data, and use reasonable efforts to obtain any third p arty 
consents needed in this regard. Finally, in completing applicable ongoing studies, 
BASF will also provide consulting support to Purchaser to supplement its 
understanding of Trunemco formulations in development for row crops and other 
specialty crops, as well as its understanding of formulation compatibility, application, 
dust-off, stability, plantability, and seed safety. This support is expected to continue 
for up to [0-1 year] . 
Production / Application / Supply Chain Processes  
13. BASF will provide consu lting support to the Purchaser in developing the Purchaser’s 
plans for introducing Trunemco into its seed treatment facilities, and will also provide 
general advice to the Purchaser, on request, concerning its own manufacturing site 
readiness, maintenance of quality controls, and development of treatment application 
 
21  protocols. BASF will also support Purchaser in developing its understanding of 
Trunemco application methodology and chemistry and will provide technical and 
troubleshooting support.  
Intellectual  Property  
14. BASF will provide documents necessary to license patents / patent applications and 
trademarks / trademark applications to the Purchaser and will support the Purchaser in 
responding to inquiries/prosecution of Trunemco -related patents and trademar ks. 
BASF will also support the transition of any pending invention disclosures. It is 
anticipated that such support will continue for earlier of three months or until 
assignments are complete.  
Marketing  
15. BASF will make available to the Purchaser all marketi ng, sales and distribution plans 
for Trunemco which have been developed prior to closing.   
Other  
16. If there is any asset or personnel which is not covered by this Schedule but which is 
both used (exclusively or not) in the Trunemco Assets and necessary for the continued 
viability and competitiveness of the Divestment Business, that asset or an adequate 
substitute will be offered to potential purchasers.  
 
  
 
22  PART II  
I. Introduction  
1. The Divestment Businesses comprise the Trunemco Assets and the  [NSH line of 
research  1] Data Transfer and Licence.  This Part II presents information on the [NSH 
line of research  1] Data Transfer and Licence.  
 
II. [NSH line of research  1] Data Transfer and Licence  
2. The [NSH line of research  1] Data Transfer and Licence consist of the entirety of the 
assets comprising the package of intellectual property rights relating to [NSH line of 
research]  class herbicide chemistry type [mode of action  for NSH line of research 1 ] 
inhibitor that are transfe rred to BASF under the under the terms of the commitments in 
M.8084 – BASF / Monsanto , […]. In accordance with these terms , the [NSH line of 
research  1] Data Transfer and Licence includes but is not limited to:  
(a) transfer to the Purchaser of all data and kno w-how gathered by Bayer up to the 
Effective Date from all field trials conducted on [NSH line of research  1] 
Chemistries as relating to all non -selective uses as well as information on the 
structure, and [NSH line of research  1] Data Transfer and Licence S amples, of 
the relevant molecules;  
(b) grant to the Purchaser of a perpetual, exclusive, worldwide licence1 of all IP 
rights and know -how relating to the BASF Divestment Business’s [NSH line 
of research  1] Chemistries existing at the Effective Date for all non -
commercial and commercial applications in the field of non -selective uses, 
including:2 
(i) for the control of unwanted vegetation for example in permanent crops 
and plantation crops (such as trees, nuts and vines), on roadsides, 
squares, industrial sites, air ports or railway tracks; or  
(ii) for the burn -down application, for example in farm crops; and  
(iii) for the application on herbicide tolerant field crops (HT crops) in which 
the tolerance is conferred by man -made mutation or transgenic 
modification.  
3. Explicitly exclu ded from this licence is any selective use in any plant which is tolerant 
by nature.  
                                                 
1  For the avoidance of doubt, by granting  the Purchaser an exclusive licence to the non -selective uses, 
BASF and Bayer will no longer have the right to use the IP rights and know -how covered by the [NSH 
line of research  1] Data Transfer and Licence for these non -selective uses while the Purchaser will not 
have the rights to use the IP rights and know -how covered by the [NSH line of research  1] Data 
Transfer and Licence for selective uses.  
2  […].