Commission européenne, DG COMP MERGER REGISTRY, 1049 Bruxelles, BELGIQUE  
Europese Commissie, DG COMP MERGER REGISTRY, 1049 Brussel,   BELGIË  
 
Tel: +32 229 -91111. Fax: +32 229 -64301. E -mail: COMP -MERGER -REGISTRY@ec.europa.eu .  EUROPEAN COMMISSION  
Brussels, 11.02.2020  
C(2020 ) 858 final  
PUBLIC VERSION  
 
To the notifying parties  
Subject : Case M. 9641 – SNAM / FSI / OLT  
Commission decision pursuant to Article 6(1)(b) of Council Regulation 
No 139/20041 and Article 57 of the Agreement on the European Economic 
Area2 
Dear Sir or Madam,  
(1) On 7 January 2020, the European Commission received notification of a proposed 
concentration (the “ Transaction ”) pursuant to Article 4 of the Merger Regulation by 
which SNAM S.p.A. (“SNAM”) and First State Investments International Ltd 
(“FSI”) acquire joint control, in the meaning of Article 3(1) and 3(4) of the EUMR, 
over OLT Offshore LNG Toscana S.p.A. (“ OLT”; SNAM  and FSI are designated 
hereinafter as the “Notifying Parties” or, together with OLT , the “Parties”) . 
1. THE  PARTIE S  
(2) SNAM, a company listed on the Italian Stock Exchange, is the holding company of 
the SNAM group, which is active in the development and inte grated management of 
                                                 
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 terminology of the TFEU will 
be used throughout this decision.  
2  OJ L 1, 3.1 .1994, p. 3 (the “EEA Agreement”).  

 
 
2 gas infrastructures and, in particular, in the transmission, regasification and storage 
of natural gas in Italy as well as in other European Union countries. SNAM is 
indirectly controlled by the Italian investment bank Cassa Depositi e  Prestiti S.p.A. 
(“CDP”). In turn, CDP is controlled by the Italian Government (namely, the Ministry 
of Economics and Finance).  
(3) FSI, the European brand name of First Sentier Investors (formerly known as 
Colonial First State Global Asset Management), is a c ompany within the asset 
management division of Mitsubishi UFJ Trust and Banking Corporation, which is 
one of Japan’s largest asset managers and a wholly owned subsidiary of Mitsubishi 
UFJ Financial Group Inc.  
(4) OLT is active in the management of a floating s torage and regasification unit for 
liquified natural gas (“ LNG ”) in Italy. The offshore regasification terminal is located 
about 22 km off the Tuscan coast between Livorno and Pisa.  
2. THE  CONCE NTRATION  
(5) The Transaction consists of the acquisition by SNAM and FSI of joint control of 
OLT.  
(6) Currently OLT is jointly controlled by FSI (via its subsidiary First State SP S.à r.l., 
“FSI BidCo”)  with a participation of 48.24%,  and Iren Mercato S.p.A. (“Iren 
Mercato”) , with a participation of 46.79% .3 The remaining part of the capital is held 
by two minor ity shareholders ( ASA , 2.28% and Golar , 2.69% ). 
(7) The Transaction will be implemented according to the terms of the following 
agreements:  
a) a Sale and Purchase Agreement, dated 20 September 2019, between Iren 
Mercato and ASA for the acquisition by Iren Mercato of ASA’s shareholding in 
OLT. After the implementation of this agreement, Iren Mercato will own a 
49.07% shareholding in OLT;  
b) a Sale and Purchase Agreement, dated 20 September 2019, between Iren 
Mercato and SNAM for the purchase by SNAM of a 49.07% shareholding in 
OLT;  
c) an […], which will be executed by SNAM on the closing date of the Transaction, 
pursuant to which […]. 
(8) Upon completion of the Transaction, OLT’s shareholding structure will be the 
following:  
 
 
 
                                                 
3  Case M.9341 - First State Investment International / Iren Mercato / Olt Offshore LNG Toscana.  
 
 
3 Shareholder  % of share capital  
SNAM  49.07%  
FSI Bidco  48.24%  
Golar  2.69%  
 
(9) […], post -Transaction, […], OLT will be jointly controlled by SNAM and FSI 
Bidco:  
a) OLT shareholders’ meetings would be validly constituted, and its resolutions 
validly taken, respectively, with the presence and the favourable vote of as many 
shareholders as represent the percentage of capital required under applicable law 
that will have to include, in any case, the presence and the favourable vote of 
both SNAM and FSI BidCo ; 
b) OLT’s board of directors consists of […] members, […] of whom will be 
appointed by SNAM and […] by FSI BidCo. Board meetings are validly 
convened, and resolutions val idly passed, with the majorities required by 
applicable law that must, in any case, include the attendance and favourable vote 
of […] SNAM and […] FSI BidCo . More specifically, all resolutions for the 
approval of strategic decisions, […], are taken by the board of directors by 
simple majority, provided that […]. 
c) The chairman of the board will be appointed upon designation by […]; 
d) OLT’s […] CEOs will be designated […]; 
e) OLT’s Chief Financial Officer will be […] designated by […]. 
(10) Therefore, upon completion of  the Transaction, OLT will be jointly controlled by 
SNAM and FSI  within the meaning of Article 3(1)(b) of the Merger Regulation . 
(11) OLT is and will continue to be a full -function joint venture, active on the market as 
any other players in the same sector. OLT  has its own management and personnel 
and has access to sufficient resources including finance, staff, and assets (tangible 
and intangible) in order to conduct on a lasting basis its business activities in the 
LNG regasification service market. OLT has and  will continue to have its own 
presence in the market and does not have relevant sales/purchase relationships with 
the parent companies. Therefore, OLT will be active as a fully functional joint 
venture.  
(12) The Transaction, therefore, constitutes a concentrat ion pursuant to Articles 3(1)(b) 
and 3(4) of the Merger Regulation.  
3. UNION  DIME NSION  
(13) The undertakings concerned have a combined aggregate worldwide turnover of more 
than EUR 5 000 million (SNAM […] million, FSI […] million, OLT […] million). 
Each of SNAM and FSI has an EU -wide turnover in excess of EUR 250 million 
 
 
4 (SNAM […] million, FSI […] million), but they do not achieve more than two -thirds 
of their aggregate EU -wide turnover within one and the same Member State.  
(14) The Transaction  therefore has a Union dimension pursuant to Article 1(2) of the 
Merger Regulation.   
4. RE LE VANT MARKE TS  
4.1. Introduction  
(15) Natural gas originates in oilfields or natural gas fields. After being processed and 
purified at a treatment plan t, natural gas can be suppli ed either in gaseous form 
through pipelines or in liquid form, as LNG. When supplied as LNG, natural gas is 
converted in liquid form in a liquefaction plant, transported in specially -designed 
LNG tankers and then delivered for regasification at a receiving  terminal at the point 
of destination or used directly as LNG for certain specific applications. Once 
regasified, LNG is transported in the pipeline network where it is mixed with 
"piped" natural gas. It is then distributed and supplied to end customers.  
(16) In the previous decisional practice of the Commission,4 the gas markets have been 
segmented into i) the production and exploration for natural gas, ii) gas wholesale 
supply, iii) gas transmission (via high pressure systems), iv) gas distribution (via low 
pressure systems), v) gas storage, vi) gas trading, vii) gas supply to end customers5  
and viii) the market for infrastructure for gas imports.  
(17) OLT is active in the market for infrastructure for gas imports in Italy. It owns and 
operates an offshore regasifi cation terminal located about 22 km off the Tuscan coast 
between Livorno and Pisa, with a storage capacity of 137,100 cubic meters of LNG 
and a maximum annual regasification capacity of 3.75 billion cubic meters.  
(18) […]. 
(19) SNAM is also active in the market for infrastructure for gas import s in Italy via a 
regasification terminal in Panigaglia (La Spezia) and via pipelines. In addition, 
SNAM is present in the following related markets in Italy: (i) gas transmission (via 
high-pressure systems) and (ii) gas storage . 
4.2. Product market  definition  
4.2.1.  Infrastructure for gas import s 
(20) In previous decisions, the Commission considered the question whethe r the market 
for infrastructure  for gas import s could be sub -segmented into the following 
markets: (i) regasification services fo r the import of liquid natural gas; (ii) 
interconnection points with international gas pipelines; and (iii) underground gas 
                                                 
4  M.3440 ENI/EDP/GDP, M.3294 EXXONMOBIL/BEB, M.3293 Shell/BEB, M.4180 Gaz de France/Suez, 
M.3868 DONG/Elsam/Energi E2.  
5  This market can be further subdivided according to different types of users (big and industrial, small and   
medium enterprises, households, etc .). 
 
 
5 storage.6 The Commission ultimately left open the exact market definition. However, 
in another decision, the Commission concluded that underground gas storage 
represented a separate market .7 
(21) The Notifying Parties submit that the exact market definition can be left open as, in 
their view, the Transaction does not raise competition concerns regardless of the 
market definition adopted.  
(22) The results of the market investigation conducted in the present case indicated that 
entities that import gas in Italy do so by using both pipelines and regasification 
terminals. The majority of the respondents to the market investigation8 consider that 
regasification terminals and pipelines are interchangeable facilities in order to carry 
out the import of gas.9 However, a number of  respondents  consider the two types of 
infrastructures to be more complementary than substitutable solutions.10 Some 
respondent s have indicated that the costs associated to pipelines and regasification 
terminals are different and planning gas imports shall take into account different 
timelines, depending on the infrastructure chosen . Also, minimum capacity 
requirements may be prov ided for in contracts for the utilisation of pipelines, which 
do not apply in the case of regasification terminals.11 Other  respondents  have 
mentioned that some substitutability  exists , but they have not substantiated their 
position or they have indicated that this substitutability  would nevertheless  be 
limited , only for short -term gas import. Different regulatory regimes applicable to 
the two  types of infrastructure  may also impact the level of substitutability between 
the two types of infrastructure .12 
(23) The Commission considers that , for the purposes of this decision,  it may be left open 
whether pipelines and regasification terminals belong to the same relevant product 
market or belong to separate relevant product markets, as the Transaction does not 
lead to serious doubts as to its compatibility with the internal market, regardless of 
the market definition adopted. With respect to gas storage and consistently with 
previous Commission’s practice,13 for the purposes of this decision , the Commission 
considers gas storage as a separate market.  
SSLNG services  
(24) The Notifying Parties submitted  that all regasification terminal operators are 
considering to start offering Small -scale LNG services (SSLNG). Such services 
consist in processing LNG delivered by large cargoes in order to sell it as a fuel to 
                                                 
6  M.5649 - RREEF FUND/ ENDESA/ UFG/ SAGGAS , paras. 11-15; M.8771 - Total/Engie , paras. 23-27. 
7  M. 1383 – Exxon / Mobil , recital 69.  
8  Throughout this decision, when the Commission refers to the (number of) respondents in relation to a 
given question of the market investigation this excludes all respondents that have not provided an answer 
to that question or  replied "I do not know", unless stated otherwise. For  example, "a majority of 
respondents" means a majority of respondents having replied to a given question and not having ticked "I 
do not know".  
9  See replies to question 7 in questionnaire Q1 of 8 Jan uary 2020 to competitors and customers.  
10  See replies to question 7.1 in questionnaire Q1 of 8 January 2020 to competitors and customers.  
11  See, for example, replies by Enel and A2A to question 6 in questionnaire Q1 of 8 January 2020 to 
competitors and c ustomers.  
12  See replies to questions 10 and 10.1 in questionnaire Q1 of 8 January 2020 to competitors and customers.  
13  M.5549 EDF/Segebel ; M.3696 E.ON/MOL ; M.3410 Total/Gaz de France . 
 
 
6 LNG -fuelled trucks or ships. SSLNG can also be used to divide large LNG 
shipments in smaller LNG loads to deliver through smaller ships (for example to 
local networks in Sardinia). According to the Notifying Parties, all projects relating 
to SSLNG are still at a very preliminary stage and there is n o market for SSLNG 
services yet, distinct from the market for infrastructure for gas import s or from the 
possible regasification service segment.  
(25) With respect to the question whether the services of SSNLG, which are still in 
development  in Italy, are subst itutable with ordinary regasification services, the 
results of the market investigation are inconclusive . On the one hand, the majority of 
respondents to the market investigation  have indicate d that SSLNG services are 
distinct from the traditional regasifi cation services offered by LNG terminals .14 One 
respondent submitted that SSLNG services are very different from conventional 
LNG services in terms of market, logistic costs, operations, etc .15 On the other hand, 
another respondent submitted that it is too e arly in the development of the SSLNG 
market in Italy to provide an opinion on the differences between SSLNG services 
and traditional services provided by regasification terminals.16 In general , 
respondents  to the market investigation  confirmed that this is a nascent market, not 
yet sufficiently developed, and therefore it could be difficult to provide a final view.  
(26) However , for the purpose of this decision, the Commission considers that it may be 
left open whether SSLNG services belong to the same product market as 
regasification terminals services  (or, under a broader product market definition, to 
the overall market for infrastructure for gas imports)  or are part of a separate product 
market, as the Transaction does not raise serious doubts as to its compa tibility with 
the internal market, regardless of the market definition adopted.  
4.2.2.  Gas transmission  
(27) The transmission of natural gas consists of physical gas transportation services via 
high-pressure pipelines to gas wholesale suppliers that aim to resell the ir gas either 
to other gas wholesalers, to distributors, or to large industrial customers that are 
directly connected to the gas transmission network.  
(28) In its decisional practice, the Commission has consistently considered gas networks 
as natural monopolies .17 The Notifying Parties do not challenge this conclusion.  
(29) The results of the market investigation confirm that the conclusions reached by the 
Commission in its previous practice are still valid for Italy today.18 The Commission 
therefore considers that gas  networks for the transmission  of gas are natural 
monopolies and each of them constitute a distinct product market . 
                                                 
14  See replies to questions 11 and 11.1 in questionnaire Q1 of 8 January 2020 to competitors and customers.  
15  ENEL, reply to question 11 .1 in questionnaire Q1 of 8 January 2020 to competitors and customers.  
16  Terminale GNL Adriatico, reply to question 1 1.1 in questionnaire Q1 of 8 January 2020 to competitors 
and custo mers.  
17  M.6984 - EPH/ STREDOSLOVENSKA ENERGETIKA , para. 25; M.3696 E.ON/MOL , recital 97.  
18  See replies to questions 12 and 12.1 in questionnaire Q1 of 8 January 2020 to  competitors and customers.  
 
 
7 4.2.3.  Gas storage  
(30) In previous decisions, the Commission has defined a separate relevant product 
market for the storage of natural gas, while consi dering a further distinction between 
pore and cavern storage facilities as well as between storage facilities suited for the 
storage of high calorific value (H -gas) and storage facilities suited for the storage of 
low calorific value (L -gas).19 The Commissi on has however ultimately left the latter 
questions open.  
(31) The Notifying Parties consider that the product market definition can be left open as, 
in their view, the Transaction does not raise competition concerns regardless of the 
market definition adopted.  
(32) The results of the market investigation confirm that gas storage facilities belong to a 
separate product market.20 As to the possible distinction between (i) pore and cavern 
and (ii) facilities for the storage of L -gas and H -gas, the market investigation 
indicated that such distinction s are irrelevant for Italy, as there would not be cavern 
storage facilities and no L -gas grids/storages .21 
(33) In view of the above, the Commission considers that storage facilities belong to a 
separate market, while any possible s egmentation can be left open, as the 
Transaction does not lead to serious doubts as to its compatibility with the internal 
market  regardless of the market definition adopted in this respect.  
4.3. Geographic market  definition  
4.3.1.  Infrastructure for gas import s 
(34) In pa st decisions, the Commission considered  that the market for  infrastructure  for 
gas import s, including LNG regasification terminals, was national in scope but 
ultimately left open whether the geographic scope was national or wider . 22 
(35) The Notifying Parties submit that the exact market definition can be left open as the 
Transaction would not give rise to competition concerns regardless of the geographic 
scope. With respect to the possible segment of regasification services, the Notifying 
Parties submit that a  sub-national definition would be inappropriate, as the specific 
geographic location of an LNG terminal would not play a role in the decision of gas 
importers.  
(36) The results of the market investigation indicate that the geographic scope of the 
marke t for in frastructure  for gas imports  in general, and for regasification terminals 
in particular, is national.23 The majority of the respondents to the market 
investigation also confirmed that the different regasification terminals in Italy are 
substitutable, irresp ective of their different location s in Italy.24 Therefore, for the 
                                                 
19  M.5467 RWE Essent ; M.3410 Total / Gaz de France . 
20  See replies to questions 13 and 13.1 in questionnaire Q1 of 8 January 2020 to competitors and customers.  
21  See replies to questions 14 and 14.1 in questionnaire Q1 of 8 January 2020 to competitors  and customers.  
22  M.5649 - RREEF FUND/ ENDESA/ UFG/ SAGGAS , paras. 16-18; M.8771 - Total/Engie , paras. 35-37. 
23  See replies to questions 16, 16.1, 17 and 17.1 in questionnaire Q1 of 8 January 2020  to competitors and 
customers.  
24  See replies to questions 18, 18.1, 19 and 19.1 in questionnaire Q1 of 8 January 202 0 to competitors and 
customers.  
 
 
8 purpose of this decision, the Commission considers that the market  for infrastructure 
for gas imports (possibly split between pipelines and regasification terminals) is  
national . 
(37) With respec t to SSLNG services, the Notifying Parties submit that a future potential 
separate market for SSLNG services provided by LNG terminals would most likely 
have a geographic dimension broader than national. The results of the market 
investigation are mixed, w ith some respondents pointing to a national dimension of 
the market and other  respondents  to a supra -national dimension, dependent on the 
specific location of the different SSLNG terminals.25 In any case, and consistently 
with the geographic dimension of th e market for infrastructure for gas import s, the 
Commission will base its assessment on the most narrow plausible market definition, 
i.e. national.  
4.3.2.  Gas transmission  
(38) In its past decisional practice, the Commission has generally considered the market 
for gas  transmission to be national, although noting that the region covered by the 
physical infrastructure grid constitutes the narrowest possible delineation of the 
geographic market. 26 
(39) The Notifying Parties submit that, for the purposes of the Transaction, the  
geographic market may be considered national and limited to the Italian territory.  
(40) Based on the results of the market investigation,27 the Commission considers that the 
market for gas transmission can be considered national in scope, in line with its 
decis ional practice.  
4.3.3.  Gas storage  
(41) The Commission has previously defined the geographic scope of the market for the 
storage of natural gas to be either national or regional, while keeping account of a 
potential broadening in view of the liberalization of this sector in Europe. 28 
(42) The Notifying Parties submit that, for the purposes of the Transaction, the 
geographic market may be considered national.  
(43) Based on the results of the market investigation,29 the Commission considers that the 
market for gas storage can be  considered national in scope, in line with its decisional 
practice.  
                                                 
25  See replies to questions 20 and 20.1 in questionnaire Q1 of 8 January 2020  to competitors and customers.  
26  M.6984 - EPH/ STREDOSLOVENSKA ENERGETIKA , para. 25; M.3696 E.ON/MOL , recital 126.  
27  See replies to questions 21 and 21.1 in questionnaire Q1 of 8 January 2020  to competitors and customers.  
28  M.6984 - EPH/ STREDOSLOVENSKA ENERGETIKA , para. 24; M.3696 E.ON/MOL , recitals 128 -130. 
29  See replies to questions 22 and 22.1 in questionnaire Q1 o f 8 January 2020  to competitors and customers.  

 
 
10 (48) Moreover, both the OLT and the Panigaglia (SNAM) terminals would operate under 
a Third Party Access (TPA) regulated regime, i.e. they provide their regasification 
capacity to all interes ted market participants under transparent and non -
discriminatory conditions. Pursuant to Article 24(1) of the Legislative Decree 
164/2000 (adopted to implement EU gas directives), companies operating gas 
network infrastructures and LNG terminals have a gen eral duty to grant access (in a 
non-discriminatory manner) to who so requests (subject to the compliance with the 
access technical requirements). This non -discrimination obligation has been further 
strengthened by the Italian Gas and Electricity Authority (ARERA) in an integrated 
text on access to regasification services, adopted in 2017. This text provides that 
LNG operators must allocate their available regasification capacity on the basis of 
transparent and non -discriminatory tenders to be held in light of the criteria set out in 
the text itself and in the operators’ respective regasification codes. The auctions are 
carried out through an IT platform made available by Gestore dei Mercati Energetici 
S.p.A. (“GME”), indirectly wholly owned by the Ministry o f Economy and Finance. 
The tariffs for the provision of the regasification services are calculated according to 
criteria set out by ARERA resolutions. Both OLT and Panigaglia have adopted 
regasification codes that confirm and implement those provisions. Ac cording to the 
Notifying Parties, this stringent regulatory framework would prevent the Parties 
from exercising any form of market power.  
(49) Furthermore, the Notifying Parties submit that the different characteristics between 
the OLT and the SNAM regasificati on terminals limit the competitive dynamics 
between them. In particular, OLT is equipped to receive LNG from carriers with a 
cargo capacity between 65,000 m3 and 180,000 m3, while Panigaglia would only be 
compatible with carriers having a capacity of up to  70,000 m3. Currently, only five 
LNG carriers would be accepted at the Panigaglia Terminal.  
(50) As for SSLNG services, the Notifying Parties submit that the market is still 
inexistent in Italy and in any case OLT’s and SNAM’s SSLNG plans would address 
two diff erent segments of the potential market: OLT would load LNG onto 
bunker/feeder vessels, while Panigaglia would load it onto tanker trucks. Moreover, 
such services would already be offered by most of the European LNG regasification 
terminals (some of which h aving material impact on the Italian market due to their 
location in the Mediterranean basin) and would be offered by various operators 
which are either building or developing merchant SSLNG facilities. Finally, ARERA 
has adopted a specific resolution, app licable to both the OLT and the Panigaglia 
terminals, ensuring a transparent and non -discriminatory offer of SSLNG services to 
all concerned shippers.  
5.2.2.  The Commission’s assessment  
(51) As noted  in section 1, OLT operates an offshore regasification terminal locat ed about 
22 km off the Tuscan coast between Livorno and Pisa, with a storage capacity of 
137,100 cubic meters of LNG and a maximum annual regasification capacity of 3.75 
billion cubic meters.  
(52) SNAM operates a regasification terminal in Panigaglia, near La S pezia (Liguria) 
with regasification capacity of 3.5 billion cubic metres of gas per year. Furthermore, 
SNAM operates an entry point through a pipeline at Tarvisio (North Italy).  



 
 
14 in different pricing, as the Panigaglia Terminal would offer the most convenient 
tariffs, due to the capacity constraint in the accepted carriers. 35 
(62) Moreover, the Commission observes that the activity of the regasification terminals 
is subject to specific sectoral regulation aimed at (i) ensuring free access to all users 
of the network with equal conditions, (i) the impartial and neutral use of LNG 
terminals and gas transport networks under normal market conditions, and (iii) 
determining the mai n obligations of the subjects involved in the gas transport or 
operating LNG terminals. With specific regard to LNG regasification activities, the 
ARERA has adopted an integrated text on access to regasification services, which is 
aimed at setting out the criteria ensuring the freedom of access, neutrality and non -
discrimination in the provision of regasification services.36 With reference to the 
allocation of LNG regasification capacity, the integrated text provide s that operators 
must allocate their available regasification capacity on the basis of transparent and 
non-discriminatory tenders to be held in light of the criteria set out in the text and in 
their respective regasification codes. A competitive mechanism h as been introduced 
for the allocation of regasification capacity: (i) an ascending clock auction algorithm 
for the allocation of annual and multi -annual regasification capacity and (ii) pay -as-
bid auctions for the allocation of regasification capacity for periods of less than one 
year. A dedicated IT platform is provided for the management of the allocation 
procedures (PAR – Platform for the Allocation of Regasification capacity) – which 
regasification companies can voluntarily join to in order to allocate their 
regasification capacity. The functioning of this platform is defined in accordance 
with requirements set out in the integrated text.  
(63) Following the adoption of the integrated text, both OLT and SNAM have adopted 
regasification codes that confirm and i mplement those provisions for their respective 
regasification terminals. With specific respect to OLT, the regasification code 
adopted states that allocation capacity is allocated as follows:  
(a) multi-annual and annual regasification capacity is made availabl e through an 
open ascending clock auction mechanism;  
(b) capacity during the thermal year is allocated via “pay as bid” auctions; and  
(c) any short -term capacity that may still be unsold after the performance of the 
aforementioned procedure will then be available on a “first -come -first-
served” basis.  
(64) Finally, the tariffs for the provision by OLT of the regasification services are 
calculated according to the criteria set out by ARERA resolutions and are approved 
periodically by ARERA.  
(65) In the above respect, all respo ndents t o the market investigation have  indicated that 
TPA regulation and other regulatory measures adopted by the ARERA  are effective 
in ensuring level playing field competition in access to regasification terminals.37 In 
particular it has been submitted t hat the current regulation ensures that all market 
                                                 
35  See replies to questions 25 and 25.1 in questionnaire Q1 of 8 January 2020  to compe titors and customers.  
36  Resolution 660/2017/R/gas, Integrated text of the provisions on guarantees of free access to the 
regasification service of liquefied natural gas . 
37  See replies to questions 26 and 2 6.1 in questionnaire Q1 of 8 January 2020 to comp etitors and customers.  
 
 
15 operators can access the essential gas infrastructures, including regulated 
regasification terminals, on non discriminatory terms and based on transparent and 
predictable tariffs / economic conditions defi ned by the Italian Regulatory Authority. 
Moreover, the market -based mechanism for regasification capacity allocation 
guarantees to any operator the possibility to access the auction mechanism. 38 
(66) Similarly, the vast majority of the respondents has also indi cated that, in their 
opinion, TPA regulation and other regulatory measures adopted by the ARERA  are 
effective in preventing regasification terminals’ operators from exercising any form 
of market power in relation to the access to their facilities.39  
(67) In add ition, the Commission notes that no respondent to the market investigation has 
expressed any concern about the impact that the Transaction could have on the 
market for  infrastructure  for gas imports  and on the market for regasification 
terminal.40 Some res pondents have also submitted that the Transaction can have a 
positive impact on those markets. In particular, it has been underlined that SNAM 's 
core business is investing in gas infrastructures . Also, it is expected that this 
Transaction could be a first s tep for potential investments in increasing the 
regasification capacity in Italy, increasing in the meantime the possibilities of a 
diversification of supply and a consequent increase of security .41 It has also been 
submitted that the experience of SNAM in the gas sector could lead to a more 
efficient management of the regasification terminals and all buyers could benefit of 
this. 42 
SSLNG services  
(68) With respect to SSLNG services, the result of the market investigation has been 
mixed. First, the majority of respondents submitted that when SSLNG will be 
offered, SNAM (Panigaglia) and OLT will compete for customers, although with 
certain limitation s (only for vessels and not for trucks , OLT being an offshore 
terminal ).43 However, the majority of respondents subm itted that the Transaction 
will have a positive or neutral impact on SSLNG services in Italy. 44 
(69) A respondent submitted that the Transaction could have a negative effect on the 
provision of SSLNG services, because SNAM would be the only operator that has 
the possibility in Italy to offer SSLNG services for road and maritime transport 
directly from a regasification terminal. Other operators in Italy would need to build a 
coastal deposit to offer the same services. 45 Similarly, another respondent submitted 
                                                 
38  ENI, reply to question 2 6.1 in questionnaire Q1 of 8 January 2020 to competitors and customers.  
39  See replies to questions 27 and 27.1 in questionnaire Q1 of 8 January 2020  to competitors and customers.  
40  See replies to question s 36.1 and 36.2 in questionnaire Q1 of 8 January 2020  to competitors and 
customers.  
41  A2A, reply to question 38 in questionnaire Q1 of 8 January 2020  to competitors and customers.  
42  See replies to question 32.1 in questionnaire Q1 of 8 January 2020  to co mpetitors and customers.  
43  See replies to questions 30 and 30.1 in questionnaire Q1 of 8 January 2020  to competitors and customers.  
44  See replies to question 36.3 in questionnaire Q1 of 8 January 2020  to competitors and customers.  
45  Edison, reply to questions 36.4 and 37.1 in questionnaire Q1 of 8 January 2020  to competitors and 
customers.  
 
 
16 that SNAM will control the two terminals that in the near future are likely to offer 
SSLNG services in the Tyrrhenian Sea. 46 
(70) In this regard, first of all the Commission notes that currently neither SNAM nor 
OLT offer SSLNG services in Italy.  OLT plans to star t offering SSLNG services in 
[…], while SNAM (Panigaglia) foresees to start offering SSLNG services in […].47 
Other operators are currently either building or developing merchant SSLNG 
facilities that should be able to offer such services in the near future , in particular 
coastal deposits designed to allow both reloading of LNG on tanker trucks and on 
feeder/bunker vessels.48 A respondent to the market investigation confirmed that in 
2021 it will complete the construction of the first coastal deposit on mainl and Italy 
and will be able to offer SSLNG  services to the Italian market. Other coastal deposits 
would be under construction or under authorization process in Sardinia and mainland 
Italy.49 Moreover, some respondents to the market investigation confirmed th at 
SSLNG  services are already offered by other European LNG regasification terminals 
(some of which having  a material impact on the Italian market due to their location 
in the Mediterranean basin) .50 
(71) Second, SSLNG services would be ancillary for a regasific ation operator such as 
OLT and would represent a limited part of its activity. The provision of SSLNG 
service would be mainly used  to optimiz e OLT’s Terminal activity, especially during 
inactivity periods. Although , due to the early stage of development of  the SSLNG 
sector, it is not possible to properly analyse  the demand for SSLNG services (since 
there is currently no actual market for SSLNG services for vessels in Italy), 
according to an OLT forecast for the future SSLNG sector, the share of the demand 
that the OLT Terminal would address would range from […] (in case of moderate 
demand growth) to […] (in case of stronger demand growth, as estimated by Italian 
authorities) .51 
(72) Furthermore, it is worth noting that the OLT and the Panigaglia terminals would 
offer two different kinds of SSLNG services: in accordance with the request 
submitted to the Italian authorities in order to obtain the authorization to provide 
SSLNG services, OLT will be enabled to discharge LNG exclusively on 
feeder/bunker vessels (OLT,  being an offshore facility, cannot provide any direct 
SSLNG service for loading LNG onto tanker trucks). LNG loaded onto 
feeder/bunker vessels may  be transported to any port for direct bunkering (Ship -to-
Ship) to LNG fuelled ships. Conversely, SNAM’s curr ent business plan for 
Panigaglia foresees to offer SSLNG services for loading exclusively onto tanker 
trucks. LNG loaded onto tanker trucks is transported to small local stations where it 
serves the demand of LNG as a fuel for the terrestrial transportatio n. Therefore, there 
would be little, if any, substitutability between OLT’s and other SNAM’s SSLNG 
services.  
                                                 
46  Societa’ Gasdotti Italia, reply to question 36.4 in questionnaire Q1 of 8 January 2020  to competitors and 
customers.  
47  […]. 
48  Form CO, table 4  (SSLNG infrastructures).  
49  Edison, reply to question 31, in questionnaire Q1 of 8 January 2020  to competitors and customers.  
50  A2A, reply to question 30.1 and Societa’ Gasdotti Italiani, reply to question 31 in questionnaire Q1 of 8 
January 2020  to comp etitors and customers.  
51  Annex 6.48 to the Form CO – […]. 
 
 
17 (73) Finally, although in general SSLNG services are (and will be) offered at market 
terms and conditions, specific provisions apply to the offer of SSL NG services by 
certain infrastructure operators (including OLT and Panigaglia).52 In particular, the 
relevant provisions state that SSLNG capacity shall be allocated on the basis of 
transparent and non -discriminatory procedures. The economic conditions for the 
provision of SSLNG services are defined by each operator in compliance with the 
principles of transparency and equal treatment between users. Operators are required 
to publish, in a transparent manner, the technical and economic conditions for the 
provision of additional SSLNG services and to offer such services in a non -
discriminatory manner.  
5.2.3.  Conclusion on horizontal non -coordinated effects  
(74) Based on the foregoing, the Commission considers that the Transaction does not 
raise serious doubts as to its com patibility with the internal market with respect to 
horizontal non -coordinated effects.  
5.3. Horizontal coordinated effects in the market for infrastructure for gas imports  
5.3.1.  The Notifying Parties’ view  
(75) The Notifying Parties submit that the Transaction will not  give rise to horizontal 
coordinated effects on the market for  infrastructure  for gas imports  or on 
hypothetical markets for regasification services, for the following reasons:  
(a) tariffs applied by both OLT and SNAM are extensively regulated and both 
partie s are subject to third -party access obligation;  
(b) there is no  past history of collusion in the market for  infrastructure for gas 
imports in Italy;  
(c) post-Transaction, the market shares of the operators will be totally 
asymmetric, for all market definitions;  
(d) the main operators will remain differentiated, implying a limited risk of 
coordination;  
(e) the Transaction will not change the competitive structure on the market, as 
OLT is active only to a very limited extent and the Parties will continue to 
face competitio n from strong suppliers;  
(f) the Transaction will not alter the existing degree of transparency in the 
market;  
(g) no credible deterrent mechanism or reaction of outsiders will be possible, 
because S NAM  and OLT, as well as their competitors, will have no option 
but to apply the prices approved by the national authority.  
                                                 
52  Resolution No. 168/2019/R/gas  of ARERA.  
 
 
18 5.3.2.  The Commission’s assessment  
(76) As set out in the Horizontal Merger Guidelines,53 to find coordinated effects 
evidence is needed that the horizontal merger changes the nature of competition in 
such a way that firms that previously were not coordinating their behaviour are now 
significantly more likely to coordinate and raise prices or o therwise harm effective 
competition. A merger may also make coordination easier, more stable or more 
effective for firms that  were coordinating prior to the merger.54 
(77) As regards the overall market for infrastructure for gas imports, the Commission 
considers  that the Transaction does not lead to horizontal coordinated effects because  
(i) the increment brought about by the Transaction will be marginal (less than 2%) ; 
and (ii) a series of operators, with different market shares and different 
infrastructures (p ipelines, regasification terminals) will remain active in the market. 
The Transaction will not change the nature of competition and the competitors 
would remain differentiated, implying a limited risk of increased coordination.  
(78) With respect to a possible m arket for regasification services, the Commission  
considers that coordinated effects can be excluded for the following reasons.  
(79) First, there is only limited substitutability (if any) between the regasification services 
offered by the Parties, due to the d ifferent capacity of the LNG carriers accepted by 
OLT and Panigaglia respectively (see above section 5.2.2). In this respect, the 
Transaction would have limited impact on the nature of competition in the market 
for regasification services in Italy. For the  same reason, the Transaction could 
increase the asymmetry between the two remaining operators on the market, as 
SNAM will be able to accept vessels of all sizes (either in Panigaglia or via OLT), 
while LNG Adriatica would not be able to accept smaller ves sels. 
(80) Second, t he Transaction would not significantly alter the existing degree of 
transparency on the market either, as already today tariffs and commercial conditions 
applied by the regasification terminals operating under TPA rules (as OLT and 
Panigagli a) are public. Therefore, the Commission considers that any possible 
impact of the Transaction on transparency will not materially change the existing 
ability of firms to monitor deviations.  
(81) Third , also the sectoral regulation described in previous section  5.2.2  – in accordance 
with which all operators must allocate their available regasification capacity on the 
basis of transparent and non -discriminatory tenders and with tariffs calculated 
according to the criteria set out by ARERA – suggests that the poss ibility to 
coordinate the competitive behaviour in the regasification service market would not 
increase substantially following the Transaction, as the particular allocation 
mechanisms will remain unchanged irrespective of the number of operators in the 
market.  
(82) Finally, any coordinated effects ha ve to be excluded also in a hypothetical market for 
SSLNG services. First, as  explained  above,  OLT and SNAM will provide different 
services on this market (LNG loading, respectively, onto bunker/feeder vessels and 
tanker trucks) and therefore the Transaction would not change substantially the 
                                                 
53  Horizontal Merger Guidelines, paragraphs 22, 39 et seq.  
54  Horizontal Merger Guidelines, paragraph 22(b).  
 
 
19 nature of (future) competition. Second, a series of other coastal deposits (designed to 
allow reloading of LNG on both tanker trucks and on vessels) and small -scale  
liquefactio n units have been built/are under development by several third parties in 
Italy and will enter into service in the coming years.55 The Commission considers 
that changes in demand and supply are an element to be taken into consideration in 
the assessment of any possible coordinated effects , especially in a nascent market as 
the SSLNG services one where the growth rate is expected to be exponential .56 
Therefore, demand conditions do not look sufficiently stable to make coordination 
likely.  
5.3.3.  Conclusion on horizontal coordinated effects  
(83) In light of the above considerations, t he Commission considers  that the Transaction 
does not raise serious doubts as to its compatibility with the internal market   with 
respect  to horizontal coordinated effects.  
5.4. Non-horizonta l effects  
(84) Customers of regasification terminals (i.e. LNG gas importers), once their LNG 
loads are processed and converted back to a gaseous state, need transmission and/or 
storage capacity, in order to deliver the commodity to their customers. Therefore, the 
Transaction will bring about a vertical  relationship in Italy between the upstream 
market for infrastructure for gas import s (and its possible sub -segments  including 
regasification terminals and SSLNG ), where OLT and SNAM are both  active, and  
the downs tream  markets for  (i) gas transmission and (ii) gas storage, where SNAM 
is active.  
5.4.1.  The Notifying Parties’ view  
(85) The Notifying Parties submit that the Transaction would not have any vertical 
negative effect, mainly because access to the Italian gas transport ation network and 
storage services is subject to a strict regulatory framework – including third -party 
access at tariffs defined on the basis of the criteria established by the Italian 
Regulatory Authority – which would eliminate any risk of foreclosure.  
(86) The Notifying Parties submit  that the ir arguments as to  the absence of any ability to 
foreclose are supported  by the conclusions of the Italian Antitrust Authority  in the 
case Cassa Depositi e Prestiti/SNAM . In fact, according to the Authority’s decision 
in this case, the pervasive and consolidated regulatory framework of activities in the 
markets for gas transportation, storage and distribution would make impossible any 
distorting use of vertical integration.57 
(87) Furthermore, SNAM is not  active in the producti on and commercialization of natural 
gas58 (in compliance with the full -ownership unbundling model envisaged by EU 
law) and, therefore, the decision to opt for SNAM or other competitors in a related 
                                                 
55  See above paragraph 70. 
56  Annex 6.48 to the Form CO – SSLNG Market Outlook.  
57  Italian Antitrust Authority , decision of 8 August 2012, case C11695 - Cassa Depositi e Prestiti/SNAM , 
para. 84. 
58  SNAM has a 13.5% minority participation without any rights of control in Italgas, a company listed on the 
Italian Stock Exchange and active as gas distributor in Italy.  
 
 
20 market (for example, in the gas storage market) will rest u pon the  shippers 
concerned and could not be influenced by SNAM.  
5.4.2.  The Commission’s assessment  
(88) Non-horizontal effects may principally arise when mergers give rise to foreclosure. 
A merger is said to result in foreclosure where actual or potential rivals' access to 
supplies or markets is hampered or eliminated as a result of the merger, thereby 
reducing these companies' ability and/or incentive to compete.59 Such foreclosure 
may discourage entry or expansion of rivals or encourage their exit. Such foreclosur e 
is regarded as anti -competitive where the merging companies — and, possibly, some 
of its competitors as well — are as a result able to profitably increase the price 
charged to consumers.60 
(89) In the gas transmission market, SNAM is the main transmission syst em operator in 
Italy and has a natural monopoly over its network.  Considering the whole Italian gas 
network, SNAM has a market share of [90-100]% in volume (gas handled) and of 
[90-100]% in value (based on 2018 figures). The remaining competitors are 
operators of small local networks.  
(90) In the gas storage market, SNAM is active through its subsidiary Stogit, which 
manages nine active storage facilities in Italy. SNAM has a market share of [90-
100]% in volume (gas handled, natural gas year 2018/2019) and [90-100]% in value 
(2018). The only other operator is Edison Stoccaggio (with a market share of [0-5]% 
in volume and [5-10]% in value).  
(91) Regardless of SNAM’s market shares in the gas transmission market and in the gas 
storage market, the Commission considers th at the Transaction will not raise serious 
doubts as to its compatibility with the internal market with respect to non -horizontal 
effects , for the reasons explained below.  
(92) First,  both the market for gas transmission and the market for gas storage are subjec t 
to sector -specific regulation in Italy (adopted to implement the corresponding EU 
sectoral law), which prevents gas operators from refusing access to their facilities 
and from charging excessive tariffs. In particular:  
(a) With respect to gas transmission, p ursuant to Legislative Decree No 
164/2000, natural gas transportation and dispatching services are subject to 
regulation by ARERA, in order to guarantee all users of the network the 
freedom of access on equal terms to such markets (as well as impartiality and 
neutrality of the services). The regulation has been detailed by ARERA 
Resolution no. 137/02 and subsequent amendments, on the basis of which gas 
transportation companies have adopted their own network codes;  
(b) As regards the gas storage, Legislative Dec ree No 164/2000 provides for a 
general third -party access regime to storage services and gives ARERA the 
power to define the criteria and the economic conditions for the provision of 
storage services.  
                                                 
59  Non-horizontal Merger Guidelines, paragraph 29.  
60  Non-horizontal Merger Guidelines, paragraph 29.  
 
 
21 (93) Second, respondents  to the market investigation have co nfirmed the relevance of the 
sectoral regulation in order to limit the ability of the Parties to foreclose access to the 
relevant markets.  The vast majority of the respondents submitted that SNAM’s 
position in gas transmission and/or storage in Italy would  not provide any advantage 
to OLT after the Transaction, notably because of the extensive regulation of the 
relevant markets.61 Similarly,  the vast majority of the respondents submitted that, 
even taking into account SNAM's position in gas transmission and storage, it does 
not consider that OLT would have either the ability or the incentive to foreclose its 
competitors in the market for  infrastructure for gas imports , again thanks to the 
regulated regime of the relevant markets.62 
(94) Third, more  general, the vas t majority of the respondents to the market investigation 
confirmed that in their opinion the sectoral regulation applicable in Italy to gas 
transmission and gas storage is effective in preventing SNAM from exercising any 
form of market power following the  Transaction.63 One respondent confirmed  that 
sectoral regulation would provide a clear framework that would not highlight any 
evident risks to increase SNAM’s ability to exercise market power as a result of the 
Transaction.64 
(95) In light of the above, the Comm ission considers that the merged entity would not 
have the ability to foreclose its rivals.  
(96) Moreover, considering that, in accordance with the described regulatory framework, 
SNAM would not have any possibility to discriminate between operators with 
respec t both to access to the facilities and to the applicable tariffs, and also 
considering that OLT is not active in Italy in the production, supply and distribution 
of natural gas, the Commission considers that the merged entity would not have any 
incentive to foreclose its rivals.  
5.4.3.  Conclusion on non -horizontal effects  
(97) In light of 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  non-horizontal effects.  
  
                                                 
61  See replies to questions 32 and 32.1 in questionnaire Q1 of 8 January 2020  to compet itors and customers.  
62  See replies to questions 33 and 33.1 in questionnaire Q1 of 8 January 2020  to competitors and customers.  
63  See replies to questions 34 and 34.1 in questionnaire Q1 of 8 January 2020  to competitors and customers.  
64  Società Gasdotti  Italia , reply to question 34.1 in questionnaire Q1 of 8 January 2020  to competitors and 
customers.  
 
 
22  
6. CONCLUSION  
(98) For the above reasons, the European Commission has decided not to oppose the 
notified operation and to declare it compatible with the internal market and with the 
EEA Agreement. This decision is adopted in application of Article 6(1)(b) of the 
Merger Regulation and Article 57 of the EEA Agreement.  
For the Commission  
 
 
(Signed)  
Margreth e VESTAGER  
Executive Vice -President