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, 07.12.2020  
C(2020 ) 8915 final  
PUBLIC VERSION  
  
International Flavors and Fragrances Inc.  
521 West 57th Street  
New York City, NY 10019  
United States of America  
Subject : Case M.9827 - INTERNATIONAL FLAVORS & FRAGRANCES / 
NUTRITION & BIOSCIENCES   
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 30 October 2020 , the European Commission received notification of a 
concentration pursuant to Article 4 of Council Regulation (EC) 139/2004 (‘ the 
Merger Regulation ’) which would result from a proposed transaction by which  
International Flavors & Fragrances Inc ( ‘IFF’, USA ) intends to acquire  control,  
within the meaning of Article 3(1)(b) of th at Regulation, of the whole 
Nutrition  & Biosciences business ( ‘N&B ’, USA) owned by DuPont de Nemours, 
                                                 
1  Council Regulation (EC) No 139/2004 of 20 January 2004 on the control of concentrations between  
undertakings, OJ L 24, 29.1.2004, p. 1. With effect from 1 December 2009,  the Treaty on the 
Functioning of the European Union (‘TFEU’) has introduced certain c hanges, 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’).  
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information omitted has been replaced by 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 Inc. (“DuPont”)  by way of purchase of shares ( ‘the Transaction ’).3 In this Decision, 
IFF and N&B  are referred to as ‘the Parties ’. The undertaking that would result from 
the Transaction is referred to as ‘the merged entity’.  
1. THE PARTIES  
(2) IFF (the United States) is a public company based in New York, listed on the New 
York Stock Exchange, the Tel Aviv Stock Exchange and Euronext Paris. It is active 
worldwide in the development, production and supply of flavours and fragrances 
used in consumer goods industries, such as food and beverage, personal care, and 
home care industrie s. 
(3) N&B , headquartered in Delaware (the United States), is a business unit of DuPont . It 
is active worldwide in the development, production and supply of food and  
industrial  ingredients  and additives,  including  (i) natural  and plant -based specialty 
ingredients (e.g. proteins, emulsifiers, sweeteners), (ii) solutions for health and 
bioscience applications (e.g. probiotics, fibres, cultures, enzymes, microbial control), 
functional cellulosic polymers and seaweed derived excipients for pharma and 
dietar y supplements.  
2. THE TRANSACTION  
(4) The Transaction is to be achieved by means of the implementation of a separation 
and distribution agreement and a merger agreement, both signed on 15 December 
2019, by which IFF is to acquire 100% of the outstanding equity of  a new company 
(SpinCo) to which DuPont will transfer its N&B business, in the so-called Reverse 
Morris Trust  transaction.4 IFF will therefore acquire sole control of the N&B 
business.  
(5) The Transaction would henceforth  result in a concentration within the meaning of 
Article 3(1)(b) of the Merger Regulation.  
3. UNION  DIMENSION  
(6) The Parties have a combined aggregate world -wide turnover of more than 
EUR  5 000 million (IFF EUR 4 662 million; N&B EUR 5 667 million). The 
aggregate Union -wide turnover of each of the P arties is more than EUR 250 million 
(IFF EUR […]; N&B EUR […]) and neither of th e Parties  achieve s more than two -
thirds of their aggregate U nion-wide turnover within one and the same Member 
State. The refore, the notified concentration has a U nion dimensio n within the 
meaning of Article 1(3) of the Merger Regulation.  
                                                 
3  Publication in the Official Journal o f the European Union No C 380 , 11.11.2020 , p. 8. 
4   Reverse Morris Trust is a corporate transaction that includes a divisive reorganisation (spin -off or a 
split-off) followed by an acquisitive reorganisation (merger) to allow a tax -free transfer of a 
subsidiary under USA  law. 
 
3 4. RELEVANT MARKETS  
(7) The Parties’  activities overlap horizontally in the supply of cultures and plant -based 
proteins . There are also a limited number of  vertical links between the Parties’ 
activitie s in relation to locust bean gum , microcrystalline cellulose (MCC)  and 
emulsifiers.  In addition , the Transaction entails  the conglomerate integration of two 
largely  complementary  product portfolios  with significant individual market 
positions involving , in particular , the supply by N&B of functional ingredients such 
as soy -based proteins , locust bean gum, MCC, enzymes and probiotics  for dietary 
supplements .5  
4.1. Cultures  
(8) Cultures are living microorganisms, such as bacteria, yeast or mould used in food 
and beverage manufacturing, animal and plant health, and animal feed. They provide 
a beneficial  impact when used in a production process or included in a final product. 
Cultures  ferment sugars and hence lower the pH value to protect the food, e.g., to 
extend sh elf life and inhibit specific contaminating flora. Food manufacturing 
Cultures are used as  bacterial starters or adjuncts and as protective Cultures in the 
production process of a  variety of products in the food and beverage industry  -
including meat and da iry - to achieve greater production efficiency and specific 
product characteristics (such as  flavo ur, texture, consistency, colo ur, taste), and to 
preserve perishable foods.  
(9) The Parties’ activities only overlap in the manufacturing and supply of Dairy 
Cultures and Cultures for Meat, as well as in a number of sub -segments. N&B also 
has limited sales of Cultures for  Plant-based food.  
4.1.1.  Relevant Product Market s 
4.1.1.1.  The Commission’s decisional practice  
(10) The Commission has not previously defined a market for Cultures. In a previous 
case, the Commission considered a market for dairy cultures in the area of ‘Cultures 
for food production’, but ultimately left the exact  market definition open.6 
4.1.1.2.  The Parties’ views  
(11) The Parties submit that the product market definition with re spect to Cultures can be 
left open,  as the Transaction does not give rise to competition concerns irrespective 
of the exact market definition. In any event , the Parties argue that in any case no 
distinction  should be made  between Cultures for Meat and Dair y Cultures . The 
                                                 
5  The Transaction gives rise to other de minimis horizontal overlaps and/or vertical links regarding the 
following product categories: antioxidants, dietary fibres & prebiotics, cosmetic ingredients, essential 
oils, functional system  ingredients, sweeteners, food inclusions, flavours, colours, fragrances, 
essential nutrients and phosphates. The Parties’ combined market shares in these areas are far below 
20% and increments are very limited. As regards the vertical links, the supply ma rket shares are also 
far below 30%, and purchases represent less than 1% of total demand. Moreover, post -Transaction 
there will remain several alternative sources of supply. It can therefore be reasonably excluded that 
the Transaction may entail an impact on competition in the supply of these products.  
6  Commission decision of 18 July 2005 in Case M.3845 – PAI/Chr. Hansen , paragraphs 10, 12 and 23.  
 
4 Parties add that no further distinction s should be defined  for Dairy Cultures and 
Cultures for Meat based, respectively, on type of culture  or on type of end product.7 
(12) More precisely , the Parties argue with respect to Dairy Cultures that a segmentation 
between Cultures for Cheese and Fresh Dairy Cultures would not be appropriate. 
First, the Parties claim that there is considerable supply -side substitutability since 
both Cultures for Cheese and Fresh Dairy Cultures are typically produced on t he 
same production lines using the same equipment,. Second, the Parties argue that 
while demand -side substitutability between different types of Dairy Cultures is 
limited,8 all Dairy Cultures are interchangeable from a supply -side. According to the 
Parties , with the exception of surface and ripening Cultures, the technology and 
know -how used for the production of all types of Cultures are very similar and Dairy 
Culture producers therefore generally offer all variations. The Parties further submit 
that simil ar bacterial strains are regularly used for the different types of Dairy 
Cultures .9 
(13) The Parties further explain that if  Dairy Cultures were to be further segmented, 
a distinction could be made between acidifying Cultures and other Cultures such as 
protecti ve Cultures in Fresh Dairy Cultures and Cultures for Cheese, adjuncts in 
cheese, surface, and ripening Cultures in cheese, or probiotic Cultures in Fresh Dairy 
Cultures. Following such a segmentation, the Parties would only overlap in 
acidifying Cultures.10  
(14) Finally , the Parties submit that  in any case and  in view of the very small market 
share increment  the exact market definition  with respect to Dairy Cultures  can be left 
open.11 
(15) With respect to Cultures for Meat, the Parties submit that the definition of the 
relevant product market can also be left open . According to the Parties, a  possible 
distinction could be drawn between acidifying Cultures, surface Cultures and 
protective Cultures. However, the Parties argue that while de mand -side 
substitutability between these different types of Cultures for Meat is limited, the 
Parties state that from a supply -side perspective, they are largely interchangeable. 
The technology and know -how used for production of all types of Cultures are 
largely similar. While not all suppliers of Cultures for Meat offer all three types of 
Cultures for Meat, the Parties argue that they could easily expand their portfolio.12 
(16) If Cultures for Meat were to be segmented by type of end product, according to the 
Parties, a distinction between Cultures for Dried  and Semi -Dried Sausages 
(potentially further sub -segmented into Cultures  for Northern European 
ripening -style, Cultures for Southern European ripening -style and Cultures for US 
ripening -style), Cultures for Dried Cured Ham, Cultures for Cooked Sausages , 
                                                 
7  Form CO. para 6.53 . 
8  Form CO. paras 6.38 -6.39.  
9  Form CO para. 6.41.  
10  Form CO paras. 6.41 -6.42.  
11  Form CO para 6.42.  
12  Form CO paras 6.43 -6.46.  
 
5 Cultures for Cooked Ham and other Cultures, in particular for Parboiled / Fresh 
Sausages could be considered.13 
(17) The Part ies acknowledge that when considering Cultures for Meat by type of end  
product,  demand -side substitutability would be limited, because different end 
product production processes require different types of Cultures for Meat. However,  
according to the Parties, supply -side substitutability is significant, as the technology 
and know -how used for t he production of all types of Cultures for Meat are largely 
similar (with the exception of surface cultures which require different production 
assets). While not all suppliers of Cultures for Meat offer Cultures for all end  
products, the Parties argue that  they could easily expand their portfolio.14  
(18) Finally , the Parties submit that  in any case and in view of the moderate  combined 
market shares  of the Parties  in such sub -segments, the exact  market definition with 
respect to Cultures for Meat can be left open.15 
4.1.1.3.  The Commission’s assessment  
(19) The outcome of the market investigation provides strong indications that the market 
for the manufacture and supply of Cultures should be segmented and that in 
particular the manufacture and supply of Cultures for Meat, Dairy Cultures and 
Cultures for Plant-based food each constitute a distinct product market.  
(20) The majority of r espondents to the market investigation consider  that Cultures for 
Meat, Dairy Cultur es and Cultures for Plant-based food constitute three separate 
markets due to their limited substitutability in terms of properties, modes of action, 
applications and/or price. While the majority of customers answered with ‘I do not 
know’, the majority of customers expressing their opinion indicated  that a 
consideration of three separate markets is appropriate.16 A majority of competitors 
also considers this distinction appropriate.17 
(21) While one customer indicated that  ‘[c]ulture development is a competence th at can 
be applied to several areas of expertise ’,18 another  customer explain ed that ‘these 
are really 3 different markets (dosage of application, technology, people…) ’.19 
Another customer explained  that ‘[t]he respective cultures show other functionalities 
and other requirements depending on the application ’.20 A further customer 
mentioned  that ‘ the cultures are mainly distinguished by their different application 
technology and the need for advice. In part there are also significant differences in 
regulatory/ qualitative requirements […] ’.21 While one competitor state d that 
‘[s]uppliers of cultures can in principle produce both meat and dairy cultures even 
                                                 
13  Form CO para 6.47.  
14  Form CO para 6.48.  
15  Form CO para. 6.52.  
16  Q1 – Questionnaire to customers, replies to question C.A.1.  
17  Q2a and Q2b – Questionnaires to competitors, replies to question C.A.1.  
18  Q1 – Questionnaire to customers, reply to question C.A.1.1.  
19  Q1 – Questionnaire to customers, reply to question C.A.1.1.  
20  Q1 – Questionnaire to customers, reply to question C.A.1.1.  
21  Q1 – Questionnaire to customers, reply to question C.A.1.1. Courtesy  translation. The original 
German text reads: ‘ Die Kulturen unterscheiden sich hauptsächlich durch ihre unterschiedliche 
Anwendungstechnik und den Beratungsbedarf. Teilweise gibt es auch große Unterschiede bei 
regulatorischen/qualitativen Anforderungen ‘. 
 
6 though these two cultures are not interchangeable as regards their use in meat and 
dairy products ’,22 it als o indicated  that in its view , ‘cultures for meat, dairy cultures 
and cultures for plant -based food constitute three different product segments. While 
the culture -base may be related with ability to leverage scale and know -how across 
the product segments, t he underlying properties and modes of action of the cultures 
in the various applications differ ’.23 
(22) Further, while a majority of customers answered with ‘I do not know’, a majority of 
customers expressing their opinion do not consider suppliers of Cultures to be able 
to switch production across Cultures for Meat, Dairy Cultures or Cultures for Plant-
based food, within a short period of time and without incurring significant additional 
costs.24 While one customer explain ed that ‘ [s]witching is possible in case  required 
know -how is available. Process/fermenters are similar ’,25 other customers disagree. 
One customer caution ed and explain ed that it is ‘[p]ossible, however, with limits of 
sufficient cleaning. Also particular attention to labels respect such as vegan, halal, 
kosher etc and image/reputations risks if manufactured within one plant ’.26 Another 
customer state d that ‘ in part there are large differences in qualitative requirements 
[…] which have a significant impact on the production ’.27 
(23) Competitors’ res ponses to this question  are conflicting, with one competitor stating 
that ‘[i]n general, we consider there to be a high degree of supply -side substitution 
between said segments, mainly due to the above -mentioned ability to leverage scale 
and know -how acro ss the various product segments by key suppliers in the 
market ’.28 However, another competitor state d that the ‘[c]ost of requalification is 
considered to be high ’.29 
(24) While responses to the market investigation are not conclusive, they suggest a lack 
of dema nd-side substitutability and at best limited supply -side substitutability. It 
therefore appears that a distinction between separate markets for the manufacture 
and supply of Cultures for Meat, Dairy Cultures and Cultures for Plant-based food  
could be appro priate . 
(25) However, t he outcome of the market investigation is  less conclusive with respect to 
whether a further distinction of the markets for the manufact ure and supply of 
Cultures for M eat and Dairy Cultures  (where the Parties overlap)  either by type of  
culture o r by end  product would be  appropriate.   
(26) With respect to Cultures for Meat, while the majority of customers answered ‘I do 
not know’, the majority of customers expressing their opinion submit that the 
technology and know -how used in the production of acidifying, surface and 
                                                 
22  Minutes of a call with a competitor on 8 September 2020.  
23  Q2a – Questionnaire to competitors, reply to question C.A.1.1.  
24  Q1 – Questionnaire to customers, replies to question C.A.2.  
25  Q1 – Questionnaire to customers, reply to question C.A.2.1.  
26  Q1 – Questionnaire to customers, reply to question C.A.2.1.  
27  Q1 – Questionnaire to customers, reply to question C.A.2.1. Courtesy translation. The original 
German text reads: ‘ Teilweise gibt es große Unterschiede bei qualitativen Anforderungen […] die 
sich erheblich auf die Produktion auswirken ‘. 
28  Q2a – Questionnaire to competitors, reply to question C.A.2.1.  
29  Q2b – Questionnaire to competitors, reply to question C.A.2.1.  
 
7 protective Cultures for Meat are similar.30 A customer explain ed this by referring to 
the ‘[s]ame type of fermenters an d know -how’.31 Another customer indicated  that ‘ all 
are produce[d] by fermentation, the way [s] to c[h]aracterize them are quite 
similar ’.32 While competitors’ responses to this question are overall inconclusive, 
one competitor s tated  that ‘[b]roadly speaking , the culture -base and related 
know -how within the mentioned sub -segments of meat cultures are based on the 
same technology platform ’.33 
(27) To the question whether a supplier of a certain sub -type of Cultures for Meat 
(acidifying, surface or protective Culture s) can switch production to another sub -type 
in the short term and without incurring significant additional costs, responses from 
customers and competitors are inconclusive. While a customer explain ed that it 
thinks ‘ a [switch]  is difficult ’,34 a competitor indicated  that the sub -types of Cultures 
for Meat ‘ are based on the same production and technology platforms ’.35 
(28) As regards the question whether a segmentation of the market for the manufacture 
and supply of Cultures for Meat  by end -product wo uld be appropriate, responses 
from customers and competitors are inconclusive.  In response to the question of 
whether a supplier of Cultures for Meat can switch production across end 
applications, e.g. Dried  and Semi-Dried Sausages, Dried Cured Ham or Cook ed 
Meat, without incurring significant additional costs, a customer explain ed that ‘ to 
find a new culture you have a long product development with expensive laboratory 
costs ’.36 A competitor however s tated  that such Cultures for specific end -products 
‘are b ased on the same production and technology platforms ’ and that in its view, 
‘cultures for meat constitute an overall market segment ’.37 
(29) Therefore, wh ile it cannot be excluded that a further distinction of the market for the 
manufacture and supply of Culture s for Meat may be appropriate, the outcome of the 
market investigation does not conclusively support such a further distinction.  
(30) With respect to Dairy Cultures, while the majority of customers answered ‘I do not 
know’, the majority of customers expressing their opinion submit that the technology 
and know -how used in the production of Dairy Culture sub -types such as acidifying, 
protective for fresh dairy, ripening for cheese and pro biotic Cultures for fresh dairy 
are similar.38 While one customer stated  that there are ‘[d]ifferent consumer needs 
and different manufacturing process [es]’,39 another customer explain ed that such 
sub-types utilise the ‘[s]ame basic processes, obviously with specific requirements 
for each area ’ and that the ability to switch fr om Dairy Culture sub -types  ‘depends 
on generally available knowledge within company and available equipment ’.40 
Another customer also submit ted a nuanced answer, stating that the sub -types of 
                                                 
30  Q1 – Questionnaire to customers, replies to question C.A.3.  
31  Q1 – Quest ionnaire to customers, reply to question C.A.3.1.  
32  Q1 – Questionnaire to customers, reply to question C.A.3.1.  
33  Q2a – Questionnaire to competitors, reply to question C.A.3.1.  
34  Q1 – Questionnaire to customers, reply to question C.A.4.1.  
35  Q2a – Questionnaire to competitors, reply to question C.A.4.1.  
36  Q1 – Questionnaire to customers, reply to question C.A.5.1.  
37  Q2a – Questionnaire to competitors, reply to question C.A.5.1. and C.A.5.2.  
38  Q1 – Questionnaire to customers, replies to question C.A.6.  
39  Q1 – Questionnaire to customers, reply to question C.A.6.1.  
40  Q1 – Questionnaire to customers, reply to question C.A.6.1.  
 
8 Dairy Cultures utilise the ‘[s]ame type of fermenters, but for ot her fermentation 
process [es] and nutrients, specific knowledge [is] necessary ’.41 Competitors’ 
responses to this question are overall inconclusive, yet one competitor state d that 
‘[b]roadly speaking, the culture -base and related know -how within the mentione d 
sub-segments of dairy cultures are based on the same technology platform ’42 and 
another remark ed that it ‘[s]uppose [s] an unique technology and know -how is 
used’.43 
(31) When a sked whether a supplier of a certain sub -type of Dairy Cultures (acidifying, 
protecti ve for fresh dairy, ripening for cheese, probiotic Cultures for fresh dairy) can 
switch production to another sub -type in the short term and without incurring 
significant additional costs, customers and competitors provide inconclusive  
responses . One custo mer state d there are ‘[d]ifferent manufacturing process [es]’.44 
Another customer state d that there are ‘ specific requirements for each area ’ and 
further that in any case it is important for the manufacturer to pay ‘ particular 
attention to labels […] such as  vegan, halal, kosher etc and image/reputations risks 
if manufactured within one plant ’.45 A competitor however point ed out that all these 
sub-segments of Dairy Cultures ‘ are based on the same technology platform ’ and 
that ‘[t]his is confirmed by the fact t hat all key suppliers in the industry have 
offerings within all of these sub -types of cultures ’.46 
(32) Therefore, whereas it cannot be excluded that a more refined product market, leading 
to a further segmentation of the market for the manufacture and supply of  Dairy 
Cultures , may be appropriate, the outcome of the market investigation does not 
conclusively support such a further segmentation . 
(33) In conclusion, the Commission considers that, for the purposes of this Decision, it is 
appropriate to assess separately the markets for Dairy Cultures, Cultures for Meat 
and Cultures for Plant -based food. In any event , the exact scope of product market 
definition with respect to Cultures can be left open, since the Transaction would not 
raise serious doubts as to its compat ibility with the internal market under any 
plausible alternative product market definition.  
4.1.2.  Relevant Geographic Market  
(34) The Commission has not previously defined a geographic market for Cultures.  
(35) The Parties submit that the market for Cultures should be def ined as  worldwide  in 
scope , because suppliers of Cultures have manufacturing plants in all regions of the 
world  and therefore can and do serve their customers on a worldwide basis.47 
(36) The outcome of the market investigation on the question whether an EEA or 
worldwide geographic market definition for Cultures is appropriate, is inconclusive . 
                                                 
41  Q1 – Questionnaire to customers, reply to question C.A.6.1.  
42  Q2a – Questionnaire to competitors, reply to question C.A.6.1.  
43  Q2b – Questionnaire to competitors, reply to question C.A.6.1.  
44  Q1 – Questionnaire to customers, reply to question C.A.7.1.  
45  Q1 – Questionnaire to customers, reply to question C.A.7.1.  
46  Q2b – Questionnaire to competitors, reply to ques tion C.A.7.1.  
47  Form CO, para. 6.57.  
 
9 (37) Whereas  the majority of customers answered ‘I do not know’,  the majority of 
customers expressing their opinion consider the conditions of competition (such as 
same suppliers, quality and price) to be generally the same in the EEA  with respect 
to Dairy Cultures, Cultures for Meat and Cultures for Plant-based food .48 While one 
customer states that ‘[w]ithin the area of cultures […] the global players are limited 
an[d] thereby present in the entire world with more or less equal conditions ’,49 
another customer submits that from its point of view with respect to dairy culture s, 
‘the conditions for healthy competition are given in the EEA ’.50  
(38) In contrast, while the majority of competitors answered ‘I do not know’, the majority 
of competitors expressing their opinion consider the conditions of competition to be 
generally the sam e worldwide with respect to Dairy Cultures, Cultures for Meat and 
Cultures for Plant-based food.51  
(39) Considering their own procurement of Diary Cultures, Cultures for Meat and 
Cultures for Plant-based food, whereas a majority of customers answered ‘I do not 
know’, a majority of customers expressing their opinion indicate the EEA as the 
relevant geographic scope.52 One customer explicitly state d that it ‘ buy[s] Cultures 
via N&B and manufactured in Europe ’.53 While the majority of competitors 
answered ‘I do not k now’, those that provided substantive answers submit that the 
scope of their company’s sales for Dairy Cultures, Cultures for Meat and Cultures 
for Plant-based food is worldwide.54 One competitor state d that it ‘ operates globally 
in more than 140 countries ’.55 
(40) In any event, for the purpose s of this Decision, the exact scope of the geographic  
market definition with respect to Cultures can be left open, as the Transaction would 
not raise serious doubts as to its compatibility with the internal market under any  
plausible alternative geographic  market definition.  
4.2. Plant -based Proteins  
(41) Plant -based Protein s are ingredients derived from plant sources, such as soy, wheat, 
pea, maize, corn, grains, canola, hemp, mung bean, rice, potato, algae, fungi, etc. 
They are main ly offered as Isolates, Concentrates , or Textured types , which have  
each varying  percentage s of protein content , form s (grain or powder), and 
technologies  applied in the manufacturing process. Plant -based Protein s are used 
across a variety of applications , including food and beverage, health, infant nutrition, 
pet food, and animal feed. In the food industry, Plant -based Protein s can be used 
either as meat substitutes or as an additional bulking agent in meat products to 
                                                 
48  Q1 – Questionnaire to customers, replies to question B.1.  
49  Q1 – Questionnaire to customers, reply to question B.1.1.  
50  Q1 – Questionnaire to customers, reply to question B.1.1. Courtesy translation. The original  French 
reads: ‘ les conditions d’une concurrence saine sont réunies au sein de l’espace économique 
européen ’. 
51  Q2a and Q2b – Questionnaires to competitors, replies to question B.1.  
52  Q1 – Questionnaire to customers, replies to question B.2.  
53  Q1 – Questionnaire to customers, replies to question B.2.1.  
54  Q2a and Q2b – Questionnaires to competitors, replies to question B.2.  
55  Q2a – Questionnaire to competitors, reply to question B.2.1.  
 
10 reduce the overall cost.56 Further, Plant-based Protein  is often used as an ingredient 
for Active Nutrition, which includes protein fortified snack bars and protein 
beverages (such as protein shakes) that are largely used for weight management 
purposes and as sports and fitness nutrition . 
(42) Whil e both the N&B Business and IFF manufacture and sell Plant -based Protein s, in 
particular Soy -based Proteins, their activities overlap only to a limited  extent given 
IFF’s minor activities in this area.  IFF purchases Plant -Based Proteins, including SPI 
[details on IFF’s purchases and supply sources] , for use in its production of Food 
Inclusions and Systems.  
4.2.1.  Relevant Product Market  
4.2.1.1.  The Commission’s decisional practice  
(43) The Commission has previously considered a market for protein products obtained 
from oi lseed and other sources which would in particular include soy products. The 
Commission noted that there is a degree of substitutability with other products, such 
as milk products, fish products, eggs, peas, but also significant demand and supply -
side subst itutability with other plant sources such as grains, maize, and corn.57  
(44) More recently, the Commission left open whether protein products could also 
encompass oilseed meals or if a more narrow market for soy protein products 
including soy meal or maybe just  for soy bean meal should be defined.58 The 
Commission further considered whether each individual soy protein product, 
namely, soy flour protein, textured soy protein (‘ TSP’), soy protein concentrates 
(‘SPC’), and  soy protein isolates (‘ SPI’), could form  s eparate segment s — while 
noting that there was a considerable degree of demand -side substitutability between 
the different types —but ultimately left the product market definition open.59  
4.2.1.2.  The Parties’ views  
(45) The Parties submit that the Plant -based Protein  market should not be segmented by 
the source of the protein , and that, in particular, soy -based proteins should not be 
considered a separate market product . 
(46) From a demand -side perspective , the Parties  argue that  consumers’ demand for 
vegetable protein is not  specific to soy, that there is considerable interest in 
novel Plant -based Protein  sources, and that food manufacturers often  label  their 
products  therefore  as “plant  protein”  or “vegetable  protein”  instead  of “soy  
protein”.  Further, they contend that plant protein prices are generally correlated 
with their protein content and product functionality and not only with the protein 
source.  They submit that most of these Plant -based Protein s are used  in a similar  
technical  manner  in the same  applications  as soy protein,  such  as meat alternatives, 
processed meats, beverages, nutrition bars, dairy -alternatives, etc. In addition, t he 
Parties contend  that pea protein in particular is attracting  an increasing demand 
                                                 
56  Particularly in developing markets, Plant -based Proteins are blended with meat in order to reduce the 
price for the end user.  
57  Commission decision of 20 July 1998 in Case M.1126 – Cargill / Vandermoortele , paragraph 12.  
58   Commission decision of 8 May 2015, COMP/M.7682 – Goldman Sachs / Altor / Hamle t, paras. 19 -24. 
59   Commission decision of 8 May 2015, COMP/M.7682 – Goldman Sachs / Altor / Hamlet , paras. 20 -24. 
 
11 due to changing consumer preferences and is increasingly used as a source for 
Plant -based Protein . 
(47) From a supply -side perspective, the Parties argue that several large companies 
are increasingly active in both soy and pea proteins. In  addition, they contend 
that soy protein production facilities can be used for the production of pea 
proteins.  
(48) Further, t he Parties submit that segmentation by protein type (isolated, textur ed, 
concentrated , flour ) would not be appropriate , given the degre e of demand -side 
substitutability  between  the individual  product  types .  
(49) They contend that this  is particularly  true for protein concentrates and protein 
isolates such as SPC, SPI, pea protein concentrates (“PPC”),  and pea protein 
isolates (“ PPI”) since  these  products  are applied  in a similar  fashion  and for similar 
end uses. They argue that, as a result, the majority of SPI sold globally is sold in 
direct competition with SPC and that therefore, SPC pricing dynamics impact  
SPI.  
(50) Finally, t he Parties submit that the Plant -based Protein s market generally should not 
be divided into segments by application due to the following considerations on 
demand -side and supply -side substitutability . 
(51) From a demand -side perspective, the Parties argue that Plant -based Proteins can 
be used across several applications. For example, Plant -based Protein  
concentrates and isolates  can be used  for meat  and meat  substitute  applications,  
for snacks  and beverages for Active Nutrition, and for other applications such as 
instant meals, bakery applications, etc.  
(52) From a supply -side perspective, the Parties argue that many sophisticated  
suppliers  such  as Archer  Daniels  Midland  (“ADM ”), Cosucra, and Roquet te as 
well as an increasing number of Chinese suppliers such as Gushen  and Goldensea  
already  currently  supply  protein  products  across  most or all major end 
applications.  In addition, they contend that many competitors in the SPC / SPI 
segment have the capabilities to upgrade their portfolio and enter additional 
segments such as Active Nutrition.  If one were to consider separate segments 
based on a distinction by end application, the Parties would consider , mainly because 
of limited demand -side substitut ability,  a potential segmentation of the Plant -based 
Protein  market  between : (i) animal feed, (ii) meat and meat substitute applications, 
(iii) Active Nutrition, (iv) bakery, and (v) others.   
(53) As regards Plant -based Protein s for Active Nutrition the Parties  submit that , for 
reasons of demand -side and supply -side substitutability they should not be further 
segmented between products used in bev erages and those used in snacks : there is 
limited difference between the Plant -based Protein s used in beverage applic ations 
and snack applications  and customers of Plant -based Protein s for Active Nutrition  
typically buy the same ingredient for use in protein bars and protein shakes . 
(54) In any event , the Parties submit that the exact product market definition can be left 
open on the ground that  the Transaction does not give rise to any competitive 
concerns under any plausible product market definition.  
 
12 4.2.1.3.  The Commission’s assessment  
(55) The outcome of the market investigation suggests  that the market for the supply of 
Plant -based Proteins could  be segmented by source of Plant -based P rotein,  by type 
of Plant -based P rotein , and by end application.  
(56) As regards the source of Plant -based Protein , overall, a  vast majority of respondents 
expressing an opinion in the market investigation indicated  that Plant -based Proteins 
from soybean  constitute d a separate market due to limited demand and supply 
substitutability.  
(57) A majority of customers expressing an opinion indicated that Soy-based Proteins  are 
not interchangeable with Plant -based Protein s from other sources in terms of their  
characteristics, modes of action  and intended use .60 The majority of competitors took 
the same view .61 
(58) One customer pointed out  in this respect  that “[e]ach specific protein source has its 
specific nutritional profile, functionality as flavor .”62, while another explained that 
“[t]he interchangeability is pretty much associated with final product application, 
meaning that proteins from different sources will deliver diff erent product 
characteristics and characteristics will need to be modified in the rest of the 
formulation. ”63 
(59) While one competitor commented that “[s]ome proteins are interchangeable but it 
depends upon the application and properties required. Each protein has pros and 
cons. ”64, another explained that  “[s]oy provides a broad range of functionalities at a 
competitive price. While functionalities partly have been matched by other plant 
proteins those usually have a weak point regarding price competitiveness. Fr om a 
purely technological reason it is therefore difficult to replace soy. Considering 
additional aspects such as sustainability, labelling there are alternatives to soy .”65 
(60) The majority of customers expressing an opinion indicated that suppliers of Plant -
based Protein s are not able to switch production between the different plant -protein 
sources in a limited period of time and without incurring into significant additional 
costs .66 The majority of competitors took the same view.67 
(61) On this point, a  custo mer replied: “ Technicall y Yes but cross contamination 
(Allergen control) is huge and therefore manufacturing sites are generally specific 
and only manufacturing sites are generally specific and only manufacture one type 
in a facility to avoid costly clean  downs and testing to ensure no potential for cross 
contamination. ”68, while another commented that “ the proteins have different 
behaviour and thus typically require a fundamentally new recipe development with 
                                                 
60  Q1 – Questionnaire to customers, replies to question D.A.1.  
61  Q2a and Q2b – Questionnaires to competitors, replies to question D.A.1.  
62  Q1 – Questionnaire to customers, reply to question D.A.1.1.  
63  Q1 – Questionnaire to customers, reply to question D.A.1.1.  
64  Q2a – Questionnaire to customers, reply to question D.A.1.1.  
65  Q2b – Questionnaire to customers, reply to question D.A.1.1.  
66  Q1 – Questionnaire to customers, replies to question D.A.2.  
67  Q2a and Q2b – Questionnaires to competitors, replies to question D.A.2.  
68  Q1 – Questionnaire to customers, reply to question D.A.1.1.  
 
13 all associated cost. Plus, prices of different plant -based proteins differ 
significantly .”69 
(62) For its part, a  competitor commented : “To the best of my knowledge, suppliers are 
usually focused on one protein so their equipment is usually set up to process that. In 
addition, here may be issues with accessi ng raw materials to process ”70, whereas 
another competitor indicated  that “[s]witching between the different proteins within a 
short time is not feasible. While similar processes are applied significant 
adjustments need to be made which requires time and mo ney”, while acknowledging 
that “[a]dapting an existing plant and fully switching to a different raw material is 
possible. A direct switch may be considered for protein sources that are very closely 
related (e.g. pea and faba bean) ”.71  
(63) As regards a segmentation by type of Plant -based Proteins (isol ates, concentrate s, 
texture d and flour ), respondents to the market investigation generally submitted that 
this was warranted , due to limited demand and supply substitutability.  
(64) The majority of  customers expressing an opinion stated that different types  of 
Plant -based Protein s are not  interchangeable with one another, taking into 
consideration their intended use .72 The majority of competitors took the same view.73 
(65) A customer commented  on this issu e that “[a]ll the mentioned products have unique 
properties and functionalities and perform very differently in application .”74, while 
another explained that “[t]he protein content and purity levels are different between 
these ingredients and will limit the  interchangeability of each .”75 
(66) One competitor explained that “[w]hile not fully interchangeable certain 
replacement of one by the other is possible if the application is adapted 
accordingly ”76, while another commented: “ Each protein type has its own specifi c 
uses.”77 Another remarked: “ In my view, they have different functionality and 
applications ”78. 
(67) While a large majority of customers replied that they did not know the answer to th is 
question, the majority of those expressing an opinion indicated  that suppli ers of 
Plant -based Proteins are not able to switch production between the different plant -
protein sources in a limited period of time and without incurring significant 
additional costs .79 The majority of competitors took the same view.80 
                                                 
69  Q1 – Questionnaire to customers, reply to question D.A.1.1.  
70  Q2a – Questionnaire to customers, reply to question D.A.2.1.  
71  Q2b – Questionnaire to customers, reply to question D.A.2.1.  
72  Q1 – Questionnaire to customers, replies to question D.A.5.  
73  Q2a and Q2b – Questionnaires to competitors, repli es to question D.A.1.  
74  Q1 – Questionnaire to customers, reply to question D.A.5.1.  
75  Q1 – Questionnaire to customers, reply to question D.A.5.1.  
76  Q2b – Questionnaire to competitors, reply to question D.A.5.1.  
77  Q2a – Questionnaire to competitors, reply to question D.A.5.1.  
78  Q2a – Questionnaire to competitors, reply to question D.A.5.1.  
79  Q1 – Questionnaire to customers, replies to question D.A.6.  
80  Q2a and Q2b – Questionnaires to competitors, replies to que stion D.A.6.  
 
14 (68) A customer commented  on this point : “Set up costs will be significant to change ”81. 
A competitor explained: “ Flours and concentrates are generally made together (a 
dry process). Isolates (a wet process) are made on completely different equipment. 
Either flours, concentrates or  isolates (or combinations) can be used as the 
feedstock for texturised proteins. ”82, while another stated: “ It can be expected that 
the know -how is sufficient to enter a new category. Switching from one to the other 
is not feasible as different technologie s are involved ”83. 
(69) As regards a segmentation by application of Plant -based Protein s, such as meat 
substitutes  or active nutrition , the replies from respondents to the market 
investigation generally indicated that this would be warranted .  
(70) On the question whether the manufacturing processes and quality and safety 
requirements differ across the various  applications of Plant -based Protein s a majority 
of customers replied that they did not know the answer, but a majority of those 
expressing the ir opinion s said that  this was the case .84 A majority of competitors 
took the same view.85  
(71) A customer explained : “Cross contamination is a big issue and manufacturers have 
to go to great length to ensure the product is free from "Contamination". Quality 
and testing plays a big role. Manufacturing set ups could be similar for multiple raw 
materials. ”86, while another specified:  “Quality and safety requirements are different 
between food, feed and infant nutrition for example .”87 A competitor commented: 
“Manufac turing process strongly impacts the performance in application. The  
requirements on manufacturing and quality are stricter for critical applications 
where technical performance is key or applications which target special target 
groups ”.88 
(72) On the question  whether a supplier could switch its production to serve a different 
application in a short period of time and without incurring significant additional 
costs , the majority of customers replied that they did not know the answer to the 
question, but themajority of those expressing their opinion said that  this was not 
possible.89 The majority of competitors took the same view.90  
(73) A customer explained: “ It would never be advised. Food nutrition is and will always 
have very strict parameters and manufacturing  a food ingredient in the same 
location as animal ingredients would not be or should not be allowed .”91 A 
competitor commented: “ Cost to change from feed protein to food -grade can be very 
high - potentially a complete re -build .”92 , while another explained “ Changing from 
                                                 
81  Q1 – Questionnaire to customers, reply to question D.A.6.1.  
82  Q2a – Questionnaire to customers, reply to question D.A.6.1.  
83  Q2a – Questionnaire to customers, reply to question D.A.6.1.  
84  Q1 – Questionnaire to customers, replies to question D.A.4.  
85  Q2a and Q2b – Questionnaires to competitors, replies to question D.A.4.  
86  Q1 – Questionnaire to customers, reply to question D.A.4.1.  
87  Q1 – Questionnaire to customers, reply to question D.A.4.1.  
88  Q2b – Questionnaire to competitors , reply to question D.A.4.1. [  
89  Q1 – Questionnaire to customers, replies to question D.A.4.2  
90  Q2a and Q2b – Questionnaires to competitors, replies to question D.A.4.2  
91  Q1 – Questionnaire to customers, replies to question D.A.4.2  
92  Q2a – Questionnai re to customers, replies to question D.A.4.2  
 
15 feed to food production will require significant adaptations to process as well as 
safety/quality requirements. Active nutrition will therefore be significantly more 
difficult to target ”.93 
(74) The results of the market investigation suggest a deg ree of supply -side 
substitutability among various applications based on the source of protein. On the 
question  whether each source  of Plant -based Protein  such as  soy or peas can be used 
in different applications  such as  meat/meat substitutes, active  nutrit ion, bakery  or 
animal feed , the majority of customers indicated  that this was the case.94 A majority 
of competitors expressing their opinion s took the same view.95 
(75) A customer indicated that different Plant -based Protein  sources may be used for the 
same appli cation but that Soy-based Proteins are not substitutable by other sources in 
certain applications: “ Soy Based proteins have unique properties both nutritionally 
and functionally. it is possible that in certain applications they are not 
interchangeable. But  in certain applications they can be substituted .”96, while a 
competitor commented “ It is possible to use the different protein sources in all/most 
applications. Differences may include taste - which can be helped with flavours / 
taste modulators .”97 
(76) It follows from the above , and in the light of the results of the market investigation ,  
that within the area of Plant -based Proteins it is appropriate to distinguish separate 
markets for the supply of Plant -based Proteins, segmented by source, type, and 
application . 
(77) In conclusion, the Commission considers that, for the purposes of this Decision, it is 
appropriate to assess the market for Plant -based Proteins, distinguishing between  
(i) separate markets for the supply of Plant -based Proteins, segmented by type, in 
particular Soy -based and Pea -based Isolates and Concentrates; (ii) separate markets 
for the supply of Soy -based Proteins, segmented by type, in particular SPI, SPC and 
TSP; and (iii) separate markets for the supply of Plant -based Proteins, segmented b y 
application, in particular meat substitutes and active nutrition, including snacks and 
beverages.  In any event, for the purpose s of this D ecision , the exact scope  of the  
product market definition with respect to Plant -based Proteins  can be left open, since 
the Transaction would not raise serious doubts as to its compatibility with the 
internal market under any plausible alternative product market definition . 
4.2.2.  Relevant Geographic Market  
(78) In previous decisions, the Commission found the market for Plant -based Proteins to 
be at least EEA -wide  in scope . While for certain products transport costs may limit 
                                                 
93  Q2b – Questionnaire to customers, replies to question D.A.4.2  
94  Q1 – Questionnaire to customers, replies to question D.A.3.  
95  Q2a and Q2b – Questionnaires to competitors, replies to question D.A.3.  
96  Q1 – Questionnaire to customers, replies to question D.A.3.1  
97  Q2a – Questionnaire to competitors, replies to question D.A.3.1  
 
16 the distance over which they can be transported at economically viable costs, they 
are traded on international commodity markets and are not subject to trade b arriers.98 
(79) The Parties submit that these considerations remain valid today and that the markets 
for Plant -based Protein may be global in scope. In any event, the Parties submit that 
the exact geographic market definition can be left open as the Transaction does not 
give rise to any competitive concerns irrespective of the exact market definition.  
(80) The outcome of the market investigation on the question whether an EEA or 
worldwide geographic market definition for Soy-based Proteins  is appropriate, is not 
entirely conclusive , but provides certain  indications suggesting a global scope . 
(81) As regards  the geographic scope in which the conditions of competition (such as 
suppliers, quality and price) are generally the same  with regard to Soy-based 
Proteins , a majority o f customers replied that they did not know the answer to the 
question . Among the customers who express ed an opinion an equal number 
considered this to be EEA -wide and to be global.99 Similarly, while a majority of 
competitors replied that they did not know the answer to the question, an equal  
number of competitors expressing an opinion considered the geographic scope of 
Soy-based Proteins markets to be EEA -wide and to be global.100 
(82) With regard to Plant -based Protein overall o ne customer commented: “For all 
ingredients (with the exception of Plant Proteins) there is competition available on a 
worldwide basis. For plant based proteins, the suppliers tend to use a regional 
specific portfolio and pricing strategy ”101, while a  competitor  explained: “Plant 
protein p roducers compete on global level with additional smaller local producers 
in certain areas ”102. However, a nother  competitor considered Soy-based Proteins 
markets to be  global in contrast to Plant -based Protein markets  in general , deemed 
more regional : “Most m arkets are global with the exception of proteins which tend to 
be more regional. Soy proteins, lecithin are global ”.103  
(83) As regards their own procurement of Soy-based Protein a majority of customers 
replied that they did not know, but a majority of those exp ressing their opinion said 
that they purchase such ingredients  on a global scale.104  Similarly, as regards their 
own sales of Soy-based Proteins, a majority of competitors replied that they did not 
know, but a majority of those expressing an opinion stated that they sold those 
ingredients  on a worldwide basis.105 One competitor commented that it “ markets 
plant -based proteins (soy and pea) and lecithin globally ”.106  
                                                 
98  Case COMP.7682 – Goldman Sachs / Altor / Hamlet , para. 29.  See also Case COMP/M.941 –   ADM / 
Actos & Hutcheson – Soya Mainz , paras. 18 et seq. ; Case COMP/M.1126 – Cargill / Vandermoortele , 
para.  13. 
99  Q1 – Questionnaire to customers, replies to question B.1.  
100  Q2a and Q2b – Questionnaires to competitors, replies to question B.1.  
101  Q1 – Questionnaire to customers, replies to question B.1.  
102  Q2a – Questionnaire to customers, replies to question B.1.  
103  Q2b – Questionnaire to customers, replies to question B.1.  
104  Q1 – Questionnaire to customers, replies to question B.2.  
105  Q2a and Q2b – Questionnaire to customers, replies t o question B.2.  
106  Q2a – Questionnaire to customers, replies to question B.2  
 
17 (84) In the light of th ose responses, the outcome of the market investigation provides 
certain  indication s suggesting that a worldwide rather than an EEA -wide geographic 
market definition is appropriate as regards Soy-based Proteins .  
(85) In any event, for the purposes of this Decision, the exact scope of the geographic 
market definition with respect t o Soy-based Proteins  can be left open, as the 
Transaction would not raise serious doubts as to its compatibility with the internal 
market under any plausible alternative geographic market definition.  
4.3. Gums  
(86) Gums are a type of h ydrocolloids , which  are additiv es that react with water to form 
gels, pastes, and emulsions. They are used to impart creaminess, thickness, and 
viscosity, in a variety of industries including food and beverage and personal care. In 
particular, Gums are used  to improve the texture and / or mouth feel of the end 
product . 
(87) N&B manufactures and sells guar gum, locust bean gum , xanthan gum and gellan 
gum. IFF does not manufacture any gums but purchases […] locust bean gum  
[details on IFF’s purchases and supply sources]  for application in its S ystems  and 
Food Inclusions.  
4.3.1.  Relevant Product Market  
4.3.1.1.  The Commission’s decisional practice  
(88) The Commission has not previously considered possible market definitions for  
Gums.  
4.3.1.2.  The Parties’ views  
(89) The Parties  submit  that all sources  of gum should be included in the same market 
and that a further segmentation of the gum market by different sources  is not 
warranted . In any case, they contend that  the exact  product  market  definition  for 
gums  can be left open  as the Transaction  does not give rise to any competitive 
concerns irrespective of the exact market definition.  
(90) From a demand -side perspective, the Parties submit that Gums from different 
sources serve the same function, i.e., to improve the texture and / or mouth feel of 
the end product. While there may be certa in differences in the price and specific 
properties of Gums  from different sources , they contend that customers can and do 
substitute Gum s from different sources  for different applications. They submit that  
while there are certain niche applications, e.g.,  non-regurgitation milk for babies 
where only one source of G um is used, generally Gums  from different sources  share 
the same function.  The Parties contend that e ven in these niche applications, gums 
may compet e with other texturants such as  starches and g elatin.  
(91) From a supply -side perspective, the Parties contend that suppliers of Gums are 
typically active in Gums  from several sources . They submit that m ultinational 
suppliers with diversified portfolios such as the N&B Business, Tate & Lyle and 
Cargill and even niche players such as LBG Sicilia, Polygal and CPKelco typically 
supply Gums  from various sources . 
 
18 4.3.1.3.  The Commission’s assessment  
(92) The outcome of the market investigation suggests  that the market for the supply of 
Gums  should be segmented by source of gum, in particular locust bean , and provides 
some indications that a segmentation by end application , in particular infant 
nutrition,  could be warranted .  
(93) As regards the source of gum, a majority of respondents expressing an opinion in the 
market investigati on submitted that gums  from locust bean  constituted a separate 
market due to limited demand and supply substitutability.  
(94) A majority of customers expressing an opinion indicated that Locust Bean G ums 
(LBG) are not interchangeable with gums from other sources  (e.g. guar gum, 
xanthan gum and gellan gum) in terms of properties, intended use, mode of action 
and/or price .107 A majority of competitors considered that Locust Bean Gum  is 
interchangeable , but only  with certain other gums .108 
(95) One customer pointed ou t that “[t]he functional characteristics of LBG are very 
specific, also synergy possibilities with other hydrocolloids are very specific for this 
product group ” 109 while another explained that “ LBG is not interchangeable due its 
specific abilities in the st abilization process of a fruit preparation .”110 
(96) A competitor stated: “ In certain application s substitution is fully or partially 
possible ”111, while another explained: “ The interchange is rarely 1 to 1. It is 
application dependent. LBG can be replaced by a com bination of other gums such as 
Tara, if customer is willing to adjust their formulation and differences in texture and 
stability are acceptable. ”112 
(97) A majority of customers expressing their opinion said that suppliers of hydrocolloids 
gums are not able to switch production between Gums from different sources  (locust 
bean, guar, xanthan and gellan gums) within a short period of time and without 
incurring significant additional costs .113 A majority of competitors took the same 
view.114 
(98) A customer replied: “ Not ne cessarily, since extraction process can differ quite a lot 
– from cleaning, separation to extraction itself. Also feedstocks origination differ, 
and it’s an advantage to have to production closer to farming area. ”115, while 
another commented that “ switching between guar and locust bean gum would be 
possible to our best knowledge. Others are not possible due to other technology .”116 
                                                 
107  Q1 – Questionnaire to customers, replies to question E.A.1.  
108  Q2a and Q2b – Questionnaires to competitors, replies to question E.A.1.  
109  Q1 – Questionnaire to customers, reply to question E.A.1.1.  
110  Q1 – Questionnaire to customers, reply to question E.A.1.1.  
111  Q2a – Questionnaire to competitors, reply to question E.A.1.1.  
112  Q2a – Questionnaire to competitors, reply to question E.A.1.1.  
113  Q1 – Questionnaire to customers, replies to question D.A.2.  
114  Q2a and Q2b – Questionnaires to competitors, replies to question D.A.2.  
115  Q1 – Questionnaire to customers, reply to question D.A.1.1.  
116  Q1 – Questionnaire to customers, reply to question D.A.1.1.  
 
19 (99) A competitor commented: “ Gums come from different sources. Manufacturing 
plants and process lines are built and adapted to the spec ific hydrocolloid you are 
trying to produce ”. 117 
(100)  On the question whether other texturants such as starches and gelatin can be used 
instead of Locust Bean Gum  for certain applications , the results of the market 
investigation are inconclusive. There was no ma jority among  customers or 
competitors expressing their opinion to confirm or reject this possibility, nor to 
suggest that other substitutes may exist.118   
(101)  One customer indicated that [starch and gelatin are “ very different raw material, 
which does not give the same outcome of stability/consistency/desired outcome ”119, 
whereas another stated: “ When LBG is combined with guar or xanthan gum for 
gelling properties, it could be replaced by gelatin, for general thickening reasons. 
The functionality of LBG could be s ubstituted by using certain starches ”.120 
(102)  As regards a further segmentation of Locust Bean Gum by end application , such as 
infant nutrition, the results of  the market investigation generally suggest  that this is 
warranted due to limited demand -side and supply -side substitutability.  
(103)  A majority of customers expressing their opinion said that the market for Locust 
Bean Gum  should be further segmented by end applications, such as  infant nutrition , 
eithe r because not all Locust Bean Gum  can be used for the same application  or 
because suppliers need specific technology and/or know -how and there are different 
certification processes.121 Among the very few  competitors  who expressed an 
opinion , there was no maj ority  to confirm or reject such further segmentation .122 
(104)  A customer stated: “ IFT [infant nutrition] application requires different handling 
than non IFT ”, while another commented: “ Suppliers need specific technology 
and/or know -how and there are different ce rtification processes .”123 
(105)  A competitor explained: “ There is refined lbg on the market as well that is different 
than crude lbg targeting specific applications (e.g water gels that need clarity); 
N&B manufacture lbg and refined lbg .”124 
(106)  In the light of the abo ve considerations and taking account of the results of the 
market investigation, it is appropriate to distinguish separate markets for the supply 
of Gums, segmented by source and separate markets for the supply of Locust Bean 
Gum, segmented by application.  
(107)  In conclusion, the Commission considers that, for the purposes of this Decision, it is 
appropriate to assess the market for Gums, distinguishing between separate markets  
                                                 
117  Q1 – Questionnaire to customers, reply to question D.A.1.1.  
118  Q1 – Questionnaire to custo mers, replies to question E.A.3 ; Q2a and Q2b – Questionnaires to 
competitors, replies to  question E.A.3.  
119  Q1 – Questionnaire to customers, replies to question E.A.3.1  
120  Q1 – Questionnaire to customers, replies to question E.A.3.1  
121  Q1 – Questionnaire to customers, replies to question E.A.4.  
122  Q2a and Q2b – Questionnaires to competitors , replies to question E.A.4.  
123  Q1 – Questionnaire to customers, replies to question E.A.4.1  
124  Q2a– Questionnaires to competitors, replies to question E.A.4.1  
 
20 for the supply of Gums , namely: (i) a separate market , segmented by source, in 
partic ular for the supply of  Locust Bean Gum; and (ii) a separate market for the 
supply of Locust Bean Gum, segmented by application, in particular  for the supply 
of infant nutrition.  In any event, for the purposes of this Decision , the exact scope of 
the product market definition with respect to Gums can be left open, since the 
Transaction would not raise serious doubts as to its compatibility with the internal 
market under any plausible alternative product market definition.  
4.3.2.  Releva nt Geographic Market  
(108)  In previous cases where the Commission examined the possible market definition for 
hydrocolloids, it found that the markets were at least EEA -wide, in some cases 
worldwide in scope.125 
(109)  The Parties submit that the relevant geographic mark et for Hydrocolloids and any 
potential sub -segments is at least EEA -wide, if not worldwide in scope.  
(110)  In any event, the Parties submit that the exact product market definition can be left 
open as the Transaction does not give rise to any competitive concerns irrespective 
of the exact market definition.  
(111)  The outcome of the market investigation on the question whether an EEA or 
worldwide geographic market definition for Locust Bean Gum  is appropriate  is not 
entirely conclusive , but provides indications s uggesting a global scope . 
(112)  Asked about the geographic scope in which the conditions of competition (such as 
same suppliers, quality and price) are generally the same  with regard Locust Bean 
Gum , while the majority of customers replied that they did not know  the answer to 
the question, a majority of customers expressing their opinion considered this to be 
global.126 Similarly, the majority of competitors replied that they did not know the 
answer to the question, while the majority of competitors expressing thei r opinion 
considered the geographic scope of Locust Bean Gum  markets to be global.127 
(113)  One customer commented  on this poi nt: “Within the area of cultures and enzymes 
the global players are limited an d thereby present in the entire world with more or 
less equa l conditions.  Locust bean gum and emulsifiers are located in the same 
manner as cultures and enzymes and are therefore also equal in setup ”128. 
(114)  As regards their own procurement of Locust Bean Gum  the majority of customers 
replied that they did not know, but the vast  majority of those expressing their 
opinion said that they purchase such ingredients  on a global scale.129  One customer 
commented  on this point : “LBG, guar gum and enzymes are bought for all global 
affiliates on all continents ”.130 
                                                 
125  See Case  COMP/M.4550  – Dow  Chemical  Company  / Wolff  Walsrode , para.  23; Case  COMP/M.8440 – 
DuPont / FMC , paras. 43, 133, 147 -148, 161 -162; Case COMP/M.3975 – Cargill / Degussa Food 
Ingredients , para. 92; Case COMP/M.3337 – Best Agrifund / Nordfleisch , paras. 118 -119. 
126  Q1 – Questionnaire to customers, replies to question B.1.  
127  Q2a and Q2b – Questionnaires to competitors, replies to question B.1.  
128  Q1 – Questionnaire to customers, replies to question B.1.1  
129  Q1 – Questionnaire to customers, replies to question B.2.  
130  Q1 – Questionnaire to customers, replies to question B.2.1  
 
21 (115)  As regards their own sales of Locust Bean Gum , a large majority of competitors 
replied that they did not know, while a small majority of those expressing an opinion 
stated that they sold those ingredients on a basis other than global or EEA -wide.131  
(116)  , In th e light o f the above responses, the Commission considers that the market 
investigation has provide d valid   indications suggesting that a worldwide rather than 
an EEA -wide geographic market definition is appropriate as regards the supply of 
Locust Bean Gum .  
(117)  In any event, for the purposes of this Decision, the exact scope of the geographic 
market definition with respect to Gums  can be left open, as the Transaction would 
not raise serious doubts as to its compatibility with the internal market under any 
plaus ible alternative geographic market definition.  
4.4. Microcrystalline Cellulose  
4.4.1.  Relevant Product Market  
(118)  Microcrystalline cellulose (‘MCC’), also known as cellulose gel, is manufactured 
from pure, depolymerized alpha cellulose. The gel is then dried to produce a powder. 
MCC is used primarily in pharmaceuticals, as an excipient, but also in food 
applications as a stabilizer, opacifier, to add viscosity and texture. N&B 
manufactures and sells MCC for both pharmaceutical and food applications.  IFF 
only uses MCC for f ood applications in the manufacturing of its Functional 
Ingredient Systems and F lavours.  
(119)  In a previous decision, the C ommission considered that MCC was part of a 
pharmaceutical excipients market.132 More recently, the Commission considered 
whether there was a distinct product market for all  different  kinds of MCC but 
ultimately left the product market definition open.133 
(120)  The Parties acknowledge that for food ingredient manufacturers colloidal and non -
colloidal are not interchangeable, as the later does perform the function that food 
ingredient manufacturers look for. Non -colloidal MCC is mainly used in the 
pharmaceutical applications and/or nutraceuticals.134 Based on supply substitutability 
reasons, the Parties  however submit  that there is one single MCC product market 
comprising both MCC for pharmaceutical and food applications.135  
(121)  The market investigation results are however not conclusive. W hile some customers 
and competitors indicated that  it is possible for suppliers to switch production 
without incurring in s ignificant additional costs and withi n a limit period of time, 
others suggested that a switch from food to pharmaceutical applications is more 
difficult  than from pharmaceutical to food applications given the more stringent 
                                                 
131  Q2a and Q2b  – Questionnaire to customers, replies to question B.2.  
132  Commission decision of 13 July 1999, COMP/M.1517 – Rhodia/Donau Chemie/Albright & Wilson, 
para. 32.  
133  Commission decision of 27 July 2017, COMP/M.8440 – DuPont / FMC (Health and Nutrition 
Business ), paras. 158 -160. 
134  Form CO, para.6.509.  
135  Form CO, paras. 6.510 and 6.511.  
 
22 regulatory requirements regarding MCC for pharmaceutical applications .136 More 
importantly one customer stresse d that “ there is more competition in the supply of 
MCC used in the food industry  and prices are lower .”137  
(122)  In any event, for the purpose s of this Decision, the exact scope of product market 
definition with respect to MCC can be left open, since the Transaction would not 
raise serious doubts as to its compatibility with the internal mar ket under any 
plausible alternative product market definition.  
4.4.2.  Relevant Geographic Market  
(123)  In a previous decision, the Commission considered that the pharmaceutical 
excipients market including MCC was essentially EEA -wide.138 Later, the 
Commission considered that a MCC product market was at least EEA wide  in scope , 
if not worldwide, but ultimately left the exact geographic definition open.  
(124)  The Parties  submit that the geographic market  is worldwide.  A small majority of 
customers and competitors who expressed a view considered also the market to be 
worldwide in scope. 139 In any event, for the purpose s of this Decision, the exact 
scope of the geographic  market def inition with respect to MCC  can be left open, as 
the Transaction would not raise serious doubts as to its compatibility with the 
internal market under any plausible alternative geographic  market definition.  
4.5. Emulsifiers  
(125)  An emulsifier is a substance that prevents the separation of immiscible compounds 
by increasing the kinetic stability of a mixture.  Emulsifiers have the ability to 
stabilise emulsions, i.e., a mix of hydrophilic (e.g., water) and hydrophobic (e.g., oil) 
substances. Emulsifiers can be synthetic (e.g. sourced from vegetable oils, sugar 
alcoho ls, organic acids and glycerol) or natural. The most common natural 
Emulsifiers are Lecithin -derived.  
(126)  N&B manufactures and supplies Lecithin -derived and synthetic Emulsifiers , 
primarily for food applications . IFF sources Emulsifiers including natural 
Emuls ifiers like Lecithin, but also synthetic Emulsifiers like Distilled 
Monoglycerides (‘DISMO’) and Diacetyl Tartaric Esters of Monoglycerides 
(‘DATEM’). IFF only sources food grade Emulsifiers.  
                                                 
136  Q1-Questionnaire to Customers, replies to question F.A.1.  Q2a and Q2b  - Questionnaire to 
Competitors, replies to question F .A.2. 
137  Q1-Questionnaire to Customers, replies to question F.A.1.  
138  Commission decision of 13 July 1999, COMP/M.1517 – Rhodia/Donau Chemie/Albright & Wilson, 
para. 46.  
139  Q1-Questionnaire to Customers, replies to question B.1 and Q2a - Questionnaire to Competitors, 
replies to question B.1.  
 
23 4.5.1.  Relevant Product Market  
4.5.1.1.  The Commission’s decisional practice  
(127)  In a previous decision, the Commission considered synthetic Emulsifiers and 
Lecithin -derived Emulsifiers to belong to separate product markets.140 
(128)  With respect to synthetic Emulsifiers, the Commission has in a previous decision 
considered possible separate p roduct markets for the following types of synthetic 
Emulsifiers: DATEM, mono -diglycerides and DISMO.141 The product market 
definition was however ultimately left open.  
(129)  With respect to Lecithin -derived Emulsifiers, the Commission has in a previous 
decision co nsidered a distinction between ‘Special’ Fluid Lecithin ( destined for 
specific applications ), De -Oiled Lecithin (typically used in food applications (oil and 
fat spreads, instant products, bakery) and the health and nutrition segments (food 
additives, spor ts nutrition)), and Fractioned Lecithin (mainly used for sophisticated 
non-food applications such as pharmaceuticals, cosmetics, and personal care 
products). It has further distinguished between genetically modified (‘GM’) and non -
GM Lecithin -derived Emuls ifiers.142 
4.5.1.2.  The Parties’ views  
(130)  Aside of the product market distinction’s discussed in the Commission’s precedent 
decisions, the Part ies explain that with respect to synthetic Emulsifiers a distinction 
by chemical class could be considered: Esters Emulsifiers  (including DATEM) , 
DISMO, Fatty acids Emulsifiers, Other Synthetic Emulsifiers  (including mono -
diglycerides) .143 
(131)  The Parties submit that the product market definition with respect to Emulsifiers can 
be left open, as the Transaction does not give rise to comp etition concerns 
irrespective of the exact market definition .144 
4.5.1.3.  The Commission’s assessment  
(132)  While a majority of customers responding to the market investigation answered with 
‘I do not know’, a majority of customers expressing their view consider that 
synth etic Emulsifiers and Lecithin -derived Emulsifiers belong to separate markets.145 
A majority of competitors expressing their opinion also endorse this distinction.146 In 
this context a customer dissents and states that ‘ [b]oth product groups are used in 
similar  applications ’.147 However another customer states that in its ‘ experience the 
two category[ies] are different for performance in our application and cannot be 
                                                 
140  Commission decision of 29 March 2006 in Case M.3975 – Cargill/Degussa Food Ingredients , 
paragraphs 22 -29. 
141  Commission decision of 15 July 2008 in Case M.5109 – Danisco/Abitec , paragraphs 13 -26. 
142  Commission decision of 29 March 2006 in Case M.3975 – Cargill/Deguss a Food Ingredients , 
paragraphs 30 -74. 
143  Form CO para 6.407.  
144  Form CO para 6.409.  
145  Q1 – Questionnaire to customers, replies to question G.A.1.  
146  Q2a and Q2b – Questionnaires to competitors, replies to question G.A.1.  
147  Q1 – Questionnaire to customers , reply to question G.A.1.1.  
 
24 interchange[d] ’.148 A competitor explains that ‘ synthetic emulsifiers and the lecithin -
driven emulsi fiers have a completely different chemistry (chemical molecule classes) 
with different functionalities, and thus related production processes and value 
chains and scope of application are completely different ’.149 A further competitor 
states that ‘ [c]ustomer s don’t use them interchangeably ’.150 
(133)  With respect to Lecithin -derived Emulsifiers, while majorities of customers and 
competitors answered with ‘I do not know’, majorities of customers and competitors 
expressing their opinion consider it appropriate to disti nguish between Special Fluid 
Lecithin, De -Oiled Lecithin and Fractioned Lecithin Emulsifiers.151 A customer in 
this context submits that ‘ [t]hey are indeed used for specific applications as 
mentioned ’.152 
(134)  With respect to synthetic Emulsifiers, while a majority  of respondents answered ‘I 
do not know’, small majorities of customers and competitors expressing their 
opinion consider a further distinction by chemical class (e.g. Esters Emulsifiers, 
DISMO, Fatty acids Emulsifiers) appropriate.153 In this context, one c ustomer states 
that ‘ different type[s] of emulsifiers provide for different functionalities ’.154 
However, another customer explains that while ‘ [t]he products are not 
interchangeable (different functionalities) [they] are all used in the same and similar 
market segments ’.155  
(135)  While replies from customers are inconclusive, a majority of competitors expressing 
their opinion consider that suppliers of a given chemical class of synthetic Emulsifier 
are not able to switch their production to another chemical class w ithout incurring 
significant additional costs and to do so in a short period of time.156 In this context 
one competitor explains that the ‘ [p]roduction set -up for different emulsifiers can be 
very different; e.g. related to corrosiveness of acids used in est erification; 
distilliation temperatures etc ’.157 Another customer states that ‘ [i]n many cases the 
manufacture of these ingredients utilise different equipment and chemistry making it 
difficult to switch ’.158 
(136)  Therefore, on the basis of the responses to the mar ket investigation, it appears that a 
distinction between different types of Lecithin -derived remains appropriate and 
further that a distinction be tween different chemical classes of synthetic Emulsifiers 
is likely appropriate.   
                                                 
148  Q1 – Questionnaire to customers, reply to question G.A.1.1.  
149  Q2a – Questionnaire to competitors, reply to question G.A.1.1.  
150  Q2a – Questionnaire to competitors, reply to question G.A.1.1.  
151  Q1 – Questionnaire to cus tomers, replies to question G.A.2., and Q2a and Q2b – Questionnaires to 
competitors, replies to question G.A.2.  
152  Q1 – Questionnaire to customers, reply to question G.A.2.1.  
153  Q1 – Questionnaire to customers, replies to question G.A.3., and Q2a and Q2b – Questionnaires to 
competitors, replies to question G.A.3.  
154  Q1 – Questionnaire to customers, reply to question G.A.3.1.  
155  Q1 – Questionnaire to customers, reply to question G.A.3.1.  
156  Q1 – Questionnaire to customers, replies to question G.A.4., and Q2a and Q2b – Questionnaires to 
competitors, replies to question G.A.4.  
157  Q2a – Questionnaire to competitors, reply to question G.A.4.1.  
158  Q2a – Questionnaire to competitors, reply to question G.A.4.1.  
 
25 (137)  In any event, for the purpos es of this Decision, the exact scope of product market 
definition with respect to Emulsifiers can be left open, since the Transaction would 
not raise serious doubts as to its compatibility with the internal market under any 
plausible alternative product ma rket definition  
4.5.2.  Relevant Geographic Market  
(138)  In previous decisions,  discussion synthetic Emulsifiers,  the Commission found the 
geographic market  to be  at least EEA -wide.159 With respect to GM ‘Special’ Fluid 
Lecithin Emulsifiers  and GM De -Oiled Lecithin Emulsifiers , the Commission 
considered a worldwide market, while with respect to non-GM ‘Special’ Fluid 
Lecithin Emulsifiers and non -GM De -Oiled Lecithin Emulsifiers it considered an 
EEA -wide market.160 
(139)  While the Commission has not previously considered a ge ographic market for 
Fractioned Lecithin, the Parties  submit that it should similarly be at least EEA -wide 
if not worldwide in scope. In any event, the Parties submit that the geographic 
market definition with respect to Emulsifiers can be left open, as the  Transaction 
does not give rise to competition concerns irrespective of the exact market 
definition.161 
(140)  The outcome of the market investigation on the question whether an EEA or 
worldwide geographic market definition for Emulsifiers  is appropriate, is 
inconc lusive.  
(141)  While a large majority of customers answered ‘I do not know’, the majority of 
customers expressing their opinion submit that for synthetic Emulsifiers and for 
Lecithin -derived Emulsifiers the geographic area where conditions of competition 
are gene rally the same is worldwide. While a large majority of competitors answered 
‘I do not know’, a majority of competitors expressing their opinion considers the 
conditions for competition to be generally the same in the EEA for synthetic 
Emulsifiers and world wide for Lecithin -derived Emulsifiers.162 
(142)  Considering the scope of their own procurement of synthetic and Lecithin -derived 
Emulsifiers, while a majority of customers answered ‘I do not know’, a majority of 
customers expressing their opinion consider it to be  worldwide.  Those competitors 
providing substantive answers also consider their sales to have a worldwide scope.163 
(143)  Therefore, on the basis of the responses to the market investigation, it appears that a 
worldwide geographic market definition with respect to  Emulsifiers may be most 
appropriate.  
(144)  In any event, for the purposes of this Decision, the exact scope of the geographic 
market definition with respect to Emulsifiers can be left open, as the Transaction 
                                                 
159  Commission decision of 15 July 2008 in Case M.5 109 – Danisco/Abitec , paragraphs 27 -30. 
160  Commission decision of 29 March 2006 in Case M.3975 – Cargill/Degussa Food Ingredients , 
paragraphs 84 -91. 
161  Form CO para 6.410.  
162  Q1 – Questionnaire to customers, replies to question B.1., and Q2a and Q2b – Questionnaires to 
competitors, replies to question B.1.  
163  Q1 – Questionnaire to customers, replies to question B.2., and Q2a and Q2b – Questionnaires to 
competitors, replies to question B.2.  
 
26 would not raise serious doubts as to its compatibil ity with the internal market under 
any plausible alternative geographic market definition.  
4.6. Enzymes  
4.6.1.  Relevant Product Market  
(145)  Enzymes are biological catalysts that regulate  the rate at which chemical reactions 
proceed  in living organisms. They can be used as ingredients and as processing aids 
in a variety of applications.  
(146)  The Parties submit that Industrial E nzymes and naturally extracted enzymes (known 
as Specialty E nzymes ) belong to different product markets. Accordi ng to the Parties, 
these two types of enzymes are used by different types of customers: Industrial 
Enzymes are used as ingredients and/or processing aids in the home and personal 
care, food, beverage and animal feed industries; whereas Specialty E nzymes ar e used 
in human health supplements. Unlike Industria l Enzymes, Specialty E nzymes have 
effects during (and after) the consumption of the finished product to which they are 
added. Generally, Specialty E nzymes are also sold at higher prices.164  
(147)  The Parties have also considered a segmentation of the Industrial E nzymes by end 
application  into industrial, food and beverage, home and personal care, and animal 
nutrition applications . According to the Parties,  while the same enzyme backbone 
might be broadly applicabl e across a number of industries, the format of the enzyme 
needs to be tailored to the needs of the relevant industry. In addition, different regulatory 
and registration requirements apply depending on the end application. The Parties 
however underlined tha t Industrial E nzymes suppliers are generally active  across several 
end applicati ons, can leverage on their knowledge in one industry to another and the 
equipment required is broadly the same across the different end applications.165  
(148)  The Parties also submitted that a further segmentation of the Industrial E nzymes for 
food applications market is not warranted. According to the Parties, Enzymes  for 
food applications generally interchangeable and there is a significant supply -side 
substit utability as already today suppliers are active across the various end 
applications: bakery,  bakery, dairy, brewing,  carbohydrate processing, fish processing, 
meat and culinary processing .166  
(149)  In the market investigation, a majority of customers and competit ors who expressed a 
view consider ed that indeed Industrial  and Specialty E nzymes belong to separate 
markets.167 A majority of respondents also agreed  with the segmentation of Industrial 
Enzymes by end application168 but, as the Parties, they said that no further segmentation 
is warranted, either because they considered the Enzymes in the food industry to be 
                                                 
164  Form CO, para. 6.199  
165  Form CO, paras 6.461 to 6.463  
166  Form CO, paras 6.466 and 6.667.  
167  Q1-Questionnaire to Customers, replies to questions H.A.1. and H.A.2; Q2a - Questionnaire to 
Competitors, replies to questions H.A.1 and H.A.2.  
168  Q1-Questionnaire to Customers, replies to question H.A.3; and Q2a - Questionn aire to Competitors, 
replies to question H.A.3.  
 
27 interchangeable, either because they considered that suppliers can easily switch between 
the production of the different subtypes, or both .169  
(150)  In any event, for the purpose s of this Decision, the exact scope of product market 
definition with respect to Enzymes  can be left open, since the Transaction would not 
raise serious doubts as to its compatibility with the internal market under any 
plausible alternative product market definition.  
4.6.2.  Relevant Geographic Market  
(151)  The Parties submit that the relevant geographic market for Enzymes (including for 
each of the Industrial  and Speciality E nzyme markets) is  at least EEA -wide if not 
worldwide in scope a s raw materials a re generally readily available, transportation 
costs are low, and there are no trade barriers except for product registration 
requirements for supplement ingr edients, food, and feed enzymes.170 
(152)  The market investigation results were not concl usive, while a small majority of 
customers who expressed a view considered the geographic market to be EEA wide 
in scope , in particular for industrial enzymes for feed , a small majority of 
competitors who expressed a view considered the geographic market to be 
worldwide.171 
(153)  In any event, for the purpose s of this Decision, the exact scope of the geographic  
market definition with respect to Enzymes  can be left open, as the Transaction would 
not raise serious doubts as to its compatibility with the internal mar ket under any 
plausible alternative geographic  market definition.  
4.7. Probiotics  
4.7.1.  Relevant Product Market  
(154)  Probiotics are live beneficial bacteria that are naturally created by the process of  
fermentation  in foods like yogurt, sauerkraut, miso soup, kimchi, and  others. 
Probiotics are consumed for their health benefits, especially gut health. Probiotics 
are sold as nutritional dietary supplement products. They are also used as active 
pharmaceutical ingredients and as functional ingredients in food and beverage 
products.  
(155)  The Parties submit there is a high demand -side and supply -side substitutability 
between Probiotics used in dietary supplements and in food and beverages 
applications, and therefore the relevant product market should include all probiotics 
used in h uman health . N&B argues that it sells the same Probiotics to both food and 
dietary supplement manufacturers. Probiotics for both these application have the 
same sources and follow the same development and formulation processes. 
Moreover, according to the P arties, for the end customer there is no significant 
difference with respect to the desired health effect between intake of probiotics from 
                                                 
169  Q1-Questionnaire to Customers, replies to question H.A.4; and Replies to Q2a - Questionnaire to 
Competitors, replies question H.A.4  
170  Form CO, para. 6.200.  
171  Q1-Questionnaire to Customers, replies to que stion B.1. and Q2a - Questionnaire to Competitors, 
replies to question B.1  
 
28 food and/or beverages compared to dietary supplements. From the supply -side 
perspective, the Parties submit that the  manufacturing assets are the same and there 
are a few differences in the regulatory requirements .172 
(156)  The results of the market investigation were however not conclusive. W hereas 
a majority of competitors who expressed a view consider that Probiotics used by  
dietary supplement and food and beverage manufacturers are the same, customers 
were divided on whether or not these two products are interchangeable, although a 
small majority of customers considered that suppliers can easily change production 
from one to  another use without incurring into significant costs.173 
(157)  In any event, for the purpose s of this Decision, the exact scope of product market 
definition with respect to Probiotic s can be left open, since the Transaction would 
not raise serious doubts as to its compatibility with the internal market under any 
plausible alternative product market definition.  
4.7.2.  Relevant Geographic Market  
(158)  The Parties submit that the geographic market should be worldwide in  scope. 
According to the Parties, manufacturers of probiotics supply customers worldwide, 
they do not need a local presence, transportation costs do not represent a significant 
fraction of overall costs, and there are no relevant trade barriers.174 
(159)  The marke t investigation results also point out for a worldwide scope, in particular 
as regards the Probiotics for use in dietary supplements.175 
(160)  In any event, for the purpose s of this Decision, the exact scope of the geographic  
market definition with respect to Prob iotics can be left open, as the Transaction 
would not raise serious doubts as to its compatibility with the internal market under 
any plausible alternative geographic  market definition.  
5. COMPETITIVE ASSESSMEN T 
5.1. Legal Framework  
(161)  Under Article 2(2) and (3) of the Merger Regulation, the Commission must assess 
whether a proposed concentration would significantly impede effective competition 
in the internal market or in a substantial part of it, in particular through the creation 
or strengthening of a dominant pos ition.  Depending on the position of the Parties in 
the supply chain, a concentration may entail horizontal and/or non -horizontal effects.  
(162)  Horizontal effects arise when the parties to a concentration are actual or potential 
competitors in one or more of the  relevant markets concerned. The Commission 
                                                 
172  Form CO paras. 6.492 and 6.493  
173  Q1-Questionnaire to Customers, replies to questions I.A.1 and I.A.2; and Q2a - Questionnaire to 
Competitors, replies to question I.A.1 and I.A.2 . 
174  Form CO, para.494.  
175  Q1-Questionnaire to Customers, replies to questions B.1 and B.2; and Q2a - Questionnaire to 
Competitors, replies to questions B.1 and B.2.  
 
29 appraises horizontal effects in accordance with the guidance set out in the Horizontal 
Merger Guidelines.176 
(163)  Non-horizontal effects arise when the parties to a concentration operate in different 
levels of the suppl y chain in certain relevant markets (vertical effects) or when the 
Parties operate in closely related markets (conglomerate effects). The Commission 
appraises non-horizontal effects in accordance with the guidance set out in the 
Non-Horizontal Merger Guide lines.177 
(164)  Both Horizontal and Non -Horizontal Merger Guidelines distinguish between two 
main ways in which mergers between actual or potential competitors on the same 
relevant market may significantly impede ef fective competition, namely 
non-coordinated and coordinated effects.   
(165)  In horizontal mergers, n on-coordinated effects may significantly impede effective 
competition by eliminating the competitive constraint imposed by each merger party 
on the othe r, as a result of which the merged entity  would have increased market 
power, without resorting to coordinated behaviour. In that regard, the Horizontal 
Merger Guidelines consider not only the direct loss of competition between the 
merging firms, but also the reduction in competitive pressure on n on-merging firms 
in the same market that could be brought about by the merger.178  
(166)  The Horizontal Merger Guidelines list a number of factors which may influence 
whether  or not significant non -coordinated effects are likely to result from a merger, 
such as  the large market s hares of the merging firms, the fact that the mergi ng firms 
are close competit ors, the limited possibilities for customers to switch suppliers  or 
the fact that the merger would eliminate an important competitive force .179 
Furthermore, in acco rdance with the Horizontal Merger Guidelines, a merger with a 
potential competitor can also have horizontal anti -compe titive effects w here the 
potential competitor constrains the behaviou r of firms active in the market.180 Not all 
these factors need to be pr esent for significant non -coordinated effects to be likely. 
The list of factors is also not an exhaustive list.  
(167)  In non-horizontal mergers , non -coordinated affects may arise when the concentration 
gives rise to foreclosure.  In vertical mergers, foreclosure can take the form of  input 
foreclosure, where the merger is likely to raise costs of downstream rivals by 
restricting the ir access to an important input;  and/or of  customer foreclosure, where 
the merger is likely to foreclose upstream rivals by restricting  their access to 
a sufficient customer base.181  
(168)  In addition, the Non -Horizontal Merger Guidelines also state that a concentration 
may entail c onglomerate  effects. Conglomerate effects may arise in a concentration 
where the undertakings involved are active o n closely related markets  and may also 
                                                 
176  Guidelines on the assessment of horizontal mergers under the Council Regulation on the control of 
concentrations between undertakings (“Horizontal Merger Guidelines”), OJ C 31, 05.02,2014  
177  Guidelines on the assessment of non -horizontal mergers under the Council Regulation on the control 
of concentrations between undertakings (“Non -Horizont al Merger Guidelines”) (2008/C 265/07).  
178  Horizontal Merger Guidelines, paragraph 24  
179  Horizontal Merger Guidelines, paragraph 26  
180  Horizontal Merger Guidelines, paragraph 59.  
181  Non-Horizontal Merger Guidelines, para 30  
 
30 lead to the foreclosure of rivals, by allowing the merged entity to leverage  a strong 
market position from one market to another by means of tying, bundling or other 
exclusionary practice.182 
(169)  In accordance with the abov e legal framework, the Commission has carried out an 
extensive competitive assessment of the Transaction in order to assess whether the 
Transaction would impede effective competition within the internal market on 
accoun ts of: 
(a) possible horizontal non -coordi nated effects in the relevant markets for  the 
manufacture and supply of Cultures and Plant -based Proteins ;  
(b) possible vertical non -coordinated effects in the relevant markets for the 
supply of Locust Bean Gum, Plant -based Proteins for Active Nutrition, SPI,   
MCC for Food Applications, Synthetic Emulsifiers overall, Ester Emulsifiers, 
DISMO, Fatty Acid Emulsifiers, Other Synthetic Emulsifiers, De -Oiled 
Lecithin Emulsifiers overall, GM De -Oiled Lecithin, and Non -GM De -Oiled 
Lecithin, in particular  by assessing  the likelihood of foreclosure scenarios  
and, in particular , whether the merged entity would have the (i) ability and 
(ii) the economic incentive to foreclose its rivals, as well as (iii) whether such 
foreclosure strategy would have a detrimental effect on  competition, causing 
harm to consumers183; and  
(c)  possible conglomerate effects in clos ely related markets.  
5.2. Horizontal non -coordinated effects  
(170)  Affected markets arise due to the horizontal overlap between  the Parties ’ activities in 
the manufacture and sale of Cultures and Plant -based Protein s.184   
5.2.1.  Cultures  
(171)   The Parties only overlap in the manufacture and supply of Dairy Cultures and 
Cultures for Meat.  Therefore, horizontally affected markets with respect to Cultures 
only arise in Dairy Cultures and Cultures for Meat, as well as in certain 
sub-segments thereof. […]. Table 1 shows the horizontally affected markets in 
Cultures.  
                                                 
182  Non-Horizontal Merger Guideli nes, para 93.  
183  Non-Horizontal Merger Guidelines, paras 32 and 94.  
184  As mentioned above the Transaction gives rise to other de minimis overlaps that do not amount to 
affected markets. In the market investigation, one company referred to one of these mark ets. The 
company considered that the “[t] he size and scope of the business is very concerning as it will distort 
competition, hinder innovation and create barriers to entry” in the natural antioxidants and 
antimicrobial markets. While the Parties have a co mbined market share of [0-5]% worldwide and [5-
10]% in the EEA in the natural antioxidants market, N&B does not manufacture natural antioxidants, 
it only resells them in blends or as stand -alone ingredients. Only in a very narrow market definition 
by compo und, the Parties would have a combined share of [20-30]% in the supply of rosemary extract 
in the EEA. However, in this case the increment, brought by N&B, is below [0-5]%. The Parties also 
do not overlap in the supply of natural microbial control agents, where only N&B is present. In the 
view of these facts, the Commission considers that the concerns voiced by the Company are not 
substantiated.  

 
32 (around [0-5]%). While N&B has considerable activities in Dairy Cultures and 
considers itself a significant innovator in that market, IFF is not a relevant player in 
Dairy Cultures [details on IFF’s activities and production process ]. Finally, there are 
a number of strong competitors in Dairy Cultures overall as well as in the segment of 
acidifying Cultures – most prominently the market leader Chr. Hansen.187 
(174)  The market investigation largely confirms the arguments  brought forward by the 
Parties . While N&B is named by many customers and competitors responding to the 
market investigation as an important supplier of Dairy Cultures, IFF is only named 
by two customers and no competitors.188 None of the replying customers or 
competitors consider N&B and IFF to be among the top five of each other’s  closest 
competitors in Dairy Cultures.189 Further, customers and competitors generally 
consider manufacturers such as N&B, Chr. Hansen, CSK and DSM to be the most 
capable in Dairy C ultures when considering parameters such as quality, R&D 
capabilities or portfolio. IFF by contrast is not ascribed any capabilities by the 
majority of respondents.190  
(175)  All customers expressing their opinion consider that the Transaction will not have an 
impact on their company with respect to the procurement of Dairy Cultures.191 While 
the majority of competitors answered ‘I do not know’, a large majority of 
competitors expressing their opinion also do not consider the Transaction to have an 
impact on their co mpany with respect to the supply of Dairy Cultures.192 Overall, no 
customer or competitor expressed a substantiated concern with respect to the market 
for the manufacture and supply of Dairy Cultures, or a segment thereof (in particular 
acidifying Cultures o r Cultures for Cheese).   
(176)  It follows from the foregoing  that irrespective of whether an EEA or worldwide 
market is considered, and whether Dairy Cultures overall or segments such as 
acidifying Cultures or Cultures for Cheese are considered, the Transaction would 
lead to the combination of a well -established supplier (N&B) with another supplier 
with only a very minor market presence and limited capabilities (IFF).  
(177)  In the light of the above considerations , and, in particular, in the light of the 
moderate combined market share and the very small increment brought about by the 
Transaction  (around [0-5]% by IFF)  and taking account of the results of the market 
investigation , the Commission considers that the horizontal overlap brought about by 
the Transaction in the manufacture and supply of Dairy Cultures overall, acidifying 
Cultures and Cultures for Cheese  is not such as to raise serious doubts as to its 
compatibility with the internal market.  
                                                 
187  Form CO paras 6.69, 6.71 and 6.77.  
188  Q1 – Questionnaire to customers, replies to question C.B.1., and Q2a and Q2b – Questionnaires to 
competitors, replies to question C.B.1.  
189  Q1 – Questionnaire to customers, replies to questions C.B.2. and C.B.3, and Q2a and Q2b – 
Questionnaires to competitors, replies to questions C.B.2. and C.B.3.  
190  Q1 – Questionnaire to customers, replies to question C.B.4., and Q2a and Q2b – Questionnaires to 
competitors, replies to question C.B.4.  
191  Q1 – Questionnaire to customers, replies to question J.1.  
192  Q2a and Q2b – Questionnaires to competitors, replies to question J.1.  
 
33 5.2.1.2.  Cultures for Meat  
(178)  With respect to the market for the manufacture a nd supply of Cultures for Meat as 
well as segments thereof, the Parties submit that the combined shares of the Parties 
remain moderate and that the merged entity trails significantly behind the clear 
market leader in all relevant Culture for Meat Segments,  Chr. Hansen. They further 
state that the Parties are not close competitors, that the Transaction would not 
eliminate an important competitive force, and would not combine two important or 
competing innovators. Further, there are several strong competitors  and barriers to 
entry are insignificant, and customers can switch and have significant buyer 
power.193 
(179)  Specifically, the merged entity’s combined share in Cultures for Meat overall would 
remain below 20% ( [10-20]% worldwide and [10-20]% in the EEA).  Only wh en 
considering certain sub -segments of Cultures for Meat, would combined market 
shares exceed 20%, namely in acidifying Cultures ( [20-30]%  in the EEA), surface 
Cultures ( [20-30]% worldwide and [20-30]% in the EEA),194 Dried & Semi -Dried 
Fermented Sausages No rthern European style ( [20-30]% worldwide) and Dried 
Cured Ham ( [20-30]% worldwide and [20-30]% in the EEA).  
(180)  The Parties further argue that within Cultures for Meat, both Parties currently only 
have […] within their top 20 worldwide and EEA customers. In a ddition, the Parties 
submit that the Parties have generally different customer basis in Cultures for Meat, 
with N&B mainly supplying large food companies across multiple regions 
worldwide, and IFF mainly small - and medium -sized companies mostly located in 
the EEA.195 Overall, Chr. Hansen would remain the market leader in Cultures for 
Meat, and while the merged entity would become the second largest supplier, there 
would be a number of other competitors who at least globally have a competitive 
position similar  to that of the Parties (e.g. Kerry or Lallemand) and who could easily 
expand their activities in the EEA.196 
(181)  The Commission notes that according to data submitted by the Parties and with 
respect to acidifying Cultures for Meat, the merged entity would have an EEA 
market share of [20-30]%, while Chr. Hansen would be the clear market leader with 
[60-70]%. With respect to surface Cultures for Meat, the merged entity would have a 
worldwide share of at most [20-30]% and an EEA share of at most [20-30]%, while 
Chr. Hansen would have a worldwide share of [20-30]% and an EEA share of [30-
40]%. Lallemand would be another strong player in this segment with a [20-30]% 
share worldwide and a [20-30]% share in the EEA. With respect to Cultures for 
Dried & Semi -Dried Fermented Sausages Norther European style, the merged entity 
would have a worldwide share of [20-30]%, while Chr. Hansen would be the clear 
market leader with [60-70]%. With respect to Cul tures for Dried Cured Ham, the 
merged entity would have a worldwide share of [20-30]% and an EEA share of [20-
30]%, while Chr. Hansen would be the clear market leader with a worldwide share 
of [50-60]% and an EEA share of [50-60]%. It therefore appears tha t first and 
foremost Chr. Hansen would remain by far the market leading player across all 
affected potential  markets.  
                                                 
193  e.g. Form CO paras 6.67, 6.69, 6.71, 6.72 -73, 6.76 and 6.90.  
194  IFF sales in surface Cultures relate to  [details on IFF’s activities] . 
195  Form CO para 6.69.  
196  Form CO para 6.71.  
 
34 (182)  Further, t he market investigation largely confirms the arguments  brought forward by 
the Parties. While N&B is mentioned by a majority of c ustomers responding to the 
market investigation as an important supplier of Cultures for Meat, IFF is only 
mentioned by one customer and by one competitor.197 The majority of respondents 
to the market investigation expressing their opinion do not consider N& B and IFF to 
be close competitors with respect to Cultures for Meat. While two customer s 
consider N&B to be the closest competitor of IFF in Cultures for Meat, overall, a 
majority of respondents expressing their opinion s consider Chr. Hansen to be the 
closest competitor of both N&B and IFF in Cultures for Meat.198 When asked 
whether IFF has a competitive advantage in the supply of Cultures for Meat, one 
competitor remarks that ‘ [a]cquiring Frutarom has increased IFF[‘s] competitive 
position ’.199 However , anothe r competitor submits that IFF does not have a 
competitive advantage ‘ compared to other suppliers such as e.g. Kerry, N&B and 
Chr. Hansen ’.200 
(183)  While the majority of customers replied ‘I do not know’, a ll customers expressing 
their opinion s consider that the T ransaction will not have an impact on their 
company with respect to the procurement of Cultures for Meat.201 Further, while a 
majority of competitors replied ‘I do not know’, a majority of competitors 
expressing their opinion s also consider that the Transact ion will not have an impact 
on their company with respect to the supply of Cultures for Meat. One competitor to 
the Parties in Cultures for Meat submits that ‘ [g]iven that N&B and IFF are some of 
the main competitors of [the Company] within meat cultures, the transaction will 
potentially have some negative influence on [the Company] and the market 
dynamics more generally in this segment. However, it does not raise a material 
concern for [the Company] ’.202 This concern however does not relate to the market 
for the manufacture and supply of Cultures for Meat specifically, but rather to the 
circumstance that the Parties are active in meat -related ingredients also outside the 
field of Cultures, whereas the competitor in question is only active in Cultures.203 
(184)  It the refore appears that irrespective of whether an EEA or worldwide market is 
considered, and whether Cultures for Meat overall or segments such as acidifying 
Cultures, surface Cultures, Dried & Semi -Dried Fermented Sausages Northern 
European style or Dried Cu red Ham are considered, the Transaction would combine 
two not particularly close players in the market and create an entity with moderate 
market shares , significantly lagging behind the clear market leader Chr. Hansen.  
(185)  In the light of the above considerati ons, and, in particular, in the light of the 
moderate combined market shares and the presence of a clearly market leading 
competitor, and taking account of the results of the market investigation , the 
Commission considers that the horizontal overlap brough t about by the Transaction 
in the manufacture and supply of  Cultures for Meat  overall, acidifying Cultures, 
                                                 
197  Q1 – Questionnaire to customers, replies to question C.B.1., and Q2a and Q2b – Questionnaires to 
competitors, replies to question C.B.1.  
198  Q1 – Questionnaire to customers, repl ies to questions C.B.2. and C.B.3, and Q2a and Q2b – 
Questionnaires to competitors, replies to questions C.B.2. and C.B.3.  
199  Q2b – Questionnaire to competitors, reply to question C.B.11.  
200  Q2a – Questionnaire to competitors, reply to question C.B.11.  
201  Q1 – Questionnaire to customers, replies to question J.1.  
202  Q1 – Questionnaire to customers, replies to question J.1.1.  
203  Minutes of a call with a competitor, 8 September 2020.  
 
35 surface Cultures, Dried & Semi -Dried Fermented Sausages Northern European style 
and Dried Cured Ham is not such as to raise serious doubts as to its  compatibility 
with the internal market.  
5.2.1.3.  Cultures for Plant-based food  
(186)  The Parties […] do not overlap in the manufacture and supply of Cultures for Plant-
based food. N &B has a global market share of [10-20]% and an EEA market share 
of [30-40]%. IFF is […] not active in the manufacture and supply of Cultures for 
Plant-based food.  […]. 
(187)  The merged entity will in any case continue to be constrained worldwide and in the 
EEA by other established competitors active in Cultures for Plant-based food, such 
as Kerry, Chr. Hansen and Sabinsa. All customers and competitors expressing their 
opinion consider that the Transaction will not have an impact on their company with 
respect to the procurement or sale of Cultures for Plant-based food.204 
(188)  In the light of the foregoing and taking account  of the results of the market 
investigation, t he Co mmission considers that the Transaction does not raise serious 
doubts as to its compatibility with the internal market  in relation to the manufacture 
and supply of Cultures for Plant-based food.  
5.2.1.4.  Conclusion on Cultures  
(189)  Even if considering a  market for the manufacture and supply of Cultures overall, the 
merged entity would only have a market share of [20-30]% worldwide and [20-30]% 
in the EEA, with small increments from IFF ( [0-5]% and [0-5]% respectively). The 
fact that IFF is not a significant presence in Cultures overall is confirmed by a major 
competitor in Cultures stating that it ‘ does not compete with IFF ’.205 
(190)  In the market investigation, and  in contrast to submissions by the Pa rties, customers 
consider there to be significant barriers to enter the supply of cultures .206 Otherwise,  
respondents to the market investigation largely confirm the submissions by the  
Parties. In addition to the aspects specific to Dairy Cultures, Cultures for Meat and 
Cultures for Plant-based food discussed above, respondents to the market 
investigation submit that they are not aware of any particular culture only supplied 
by N&B, IFF and possibly a limited number of competitors.207  
(191)  Overall, significant majo rities of respondents to the market investigation expressing 
their opinion consider that the Transaction will not have an impact on their Company 
with respect to Dairy Cultures, Cultures for Meat and Cultures for Plant-based 
                                                 
204  Q1 – Questionnaire to customers, replies to question J.1., and Q2a and Q2b – Questionnaires to 
competitors, replies to questions J.1. and J.1.1. While one competitor describes a ‘minor concern’ in 
relation to Cultures for plant -based food’, this concern does not relate to the Parties’ position in the 
market for the manufactur e and supply of Cultures for plant -based food as such, but rather to the 
Parties’ activities also in other plant -based food ingredient segments outside of the market for 
Cultures.  
205  Minutes of a call with a competitor on 8 September 2020.  
206  Q1 – Questio nnaire to customers, replies to question C.B.10.  
207  Q1 – Questionnaire to customers, replies to question C.B.7., and Q2a and Q2b – Questionnaires to 
competitors, replies to question C.B.7.  

 
37 have significant buyer power . Moreover, they argue that  barriers to entry are 
moderate  and that several strong competitors will constrain the Parties post -
Transaction .  They submit that  competitors in soy producing regions such as China 
are important and account for much of the global Plant -based Protein sales.  In 
addition , they submit that the degree o f market concentration in Plant -based Proteins 
is generally low.  They argue that in addition to the larger international players such 
as ADM, CJ Selecta and Goldensea, there are  numerous smaller suppliers who 
compete particul arly strongly for regional small or medium -sized customers.  
(195)  As regards Plant -based Proteins overall, the market investigation confirms that IFF is 
not viewed as a strong competitor. Customers and competitors generally consider 
manufacturers N&B and ADM to  be the most capable in Plant -based Proteins when 
considering parameters such as quality, R&D capabilities or portfolio. IFF by 
contrast is not awarded any capabilities by any respondents except one customer.210 
(196)  Market feedback confirms the presence of vario us competitors, including from Asia. 
Several Chinese companies were cited among the top three suppliers of Plant -based 
Proteins, including Gushen, Shansong and Goldensea.211 A competitor commented: 
“According to the Company, the market for plant -based proteins, which are 
primarily used as an alternative for meat, is competitive. The Company considers 
that there are many players in the plant -based protein market who are able to 
produce with high -quality standards. Indeed, the Company faces competition 
worldwide, from Asia (Chinese players in particular), America and Europe ”.212 
5.2.2.1.  Soy-based Proteins  
(197)  As regards Soy -based Proteins in particular , the Parties submit that they face 
strong competition from various suppliers, in particular from competitors in soy 
producing regions  such as  Asia,  who are actively and effectively competing 
globally and in the EEA.  They contend that  Chinese competitors have 
significantly improved their product quality and consistency over recent years 
and account for c. [30-40]% of the gl obal market by value . In addition,  they 
contend that alternative  protein  sources  such as pea and rice are gaining 
increasing importance, which has led to the entry of new competitors, putting 
significant pressure on traditional soy protein  producers.  
(198)  The Commission notes that according to data submitted by the Parties and with 
respect to Soy-based Proteins overall , the merged entity would have a worldwide 
market share of [20-30]%, with ADM in second position at [10-20]%. With respect 
to a market compri sing SPI and SPC, the merged entity would have a worldwide 
market share of [20-30]%, with ADM in second position at [10-20]%. As regards 
SPI as a separate market, the combined entity would have a [40-50]% market share 
in the EEA, with ADM in third  position  at [5-10]%, while o n a worldwide basis it 
would have  a [30-40]% market share, with ADM in second position at [10-20]%. 
With respect to TSP, the merged entity would have an EEA share of [20-30]%, with 
Sojaprotein as the market leader at [30-40]% and ADM th e third supplier at [10-
                                                 
210  Q1 – Questionnaire to customers, replies to question C.B.4., and Q2a and Q2b – Questionnaires to 
competitors, replies to question C.B.4.  
211  Q1 – Questionnaire to customers, replies to question D.B.2., and Q2a and Q2b – Questionnaires to 
competitors, replies to question D.B.2.  
212  Minutes of a call wi th a competitor on 20 August 2020  
 
38 20]%. In each of these markets IFF’s share does not exceed [0-5]%, except in SPI, 
where it reaches  [0-5]% on a global basis.  It therefore appears that the combined 
entity’s market shares  would generally remain moderate , that the inc rement from IFF 
is limited and that  strong competitors, in particular ADM, would remain present  
across all affected potential markets.  
(199)  Contrary to what  the Parties  claim, customers replying to the market investigation do 
consider barriers to enter the supp ly of Soy-based Proteins  to be moderately 
significant.213 Otherwise, respondents to the market investigation largely confirm the 
submissions by the Parties.  While N&B is named by many customers and 
competitors responding to the market investigation as an important supplier of 
Soy-based  Protein, including SPC, SPI and TSP, IFF is named by no customers or 
competitors.214 Only one customer and one competitor reply ing to the market 
investigation consider N&B and IFF to be among the top five of each other’s  closest 
competitor s in SPC , SPI or TSP.215  
(200)  Market feedback and the results  of the market investigation confirm  the presence of 
competitors from Asia. Both customer s and competitors cited several Chinese 
companies among the top three suppliers of SPC, SPI and TSP, including Gushen, 
Shansong and Goldensea.216 A customer commented: “ Other important suppliers are 
ADM in the USA and the Chinese suppliers [Confidential] ADM  and the Chinese 
suppliers are primarily active in the supply of soy protein isolates .”217 According to 
the same customer, a s regards the Plant -based Proteins market  “[…] there is no 
difference in the quality offered by Chinese suppliers and western supplier s. 
[Confidential]. The Company has concluded supply agreements with all these 
[Confidential] suppliers ”.218 
(201)  A large majority of respondents confirm that there is an increasing demand for non -
soy-based proteins, in particular for pea protein .219 A customer comm ented: “ Soy is 
seen as old technology and has over many years been tainted due to GMO issues. 
The trends are for "other" protein sources and Pea is just one of them. ”220 
(202)  No customers expressing their opinion consider that the Transaction will have a 
negative  impact  on their company with respect to the procurement of Soy-based 
Proteins .221 A large majority of customers expressing their opinion considered that 
the Transaction would have no impact on price, quality and/or innovation of the 
supply  of Soy -based Prot eins.222 While the majority of competitors answered ‘I do 
not know’, a majority of those  expressing their opinion also do not consider the 
                                                 
213  Q1 – Questionnaire to customers, replies to question C.B.10.  
214  Q1 – Questionnaire to customers, replies to question C.B.1., and Q2a and Q2b – Questionnaires to 
competitors, replies to question C.B.1.  
215  Q1 – Questionn aire to customers, replies to questions C.B.2. and C.B.3, and Q2a and Q2b – 
Questionnaires to competitors, replies to questions C.B.2. and C.B.3.  
216  Q1 – Questionnaire to customers, replies to question D.B.2., and Q2a and Q2b – Questionnaires to 
competitor s, replies to question D.B.2.  
217  Minutes of a call with a customer on 19 August 2020  
218  Minutes of a call with a customer on 19 August 2020  
219  Q1– Questionnaire to customers, replies to question D.B.7; Q2a and Q2b – Questionnaires to 
competitors, replies  to question D.B.7  
220  Q1– Questionnaire to customers, replies to question D.B.7  
221  Q1 – Questionnaire to customers, replies to question J.1.  
222  Q1 – Questionnaire to customers, replies to question J.2.2.  
 
39 Transaction to have an impact on their company with respect to the supply of 
Soy-based Proteins .223 Overall, no customer or competitor expressed a substantiated 
concern with respect to the market for the manufacture and supply of Soy-based 
Protein , or a ny sub segment.  
(203)  It therefore appears that irrespective of whether an EEA or worldwide market is 
considered, and whether Soy-based Proteins  overall or segments for SPC/SPI, SPI or 
TSP are considered, the Transaction would lead to the combination of a well -
established supplier (N&B) with another supplier whose  market presence and 
capabilities are very limited (IFF).  
(204)  In view of th e above, and, in particular the very small increment s brought about by 
the Transaction ( not more than [0-5]% by IFF), the Commission considers that the 
horizontal overlap brought about by the Transaction in the manufacture and supply 
of Soy-based Protein  overall, SPC/SPI, SPI  and TSP  is not such as to raise serious 
doubts as to its compatibility with the internal market.  
5.2.2.2.  Plant -based Proteins for Meat Substitutes  
(205)  The Parties argue  that m any companies are active in the hypothetical sub -segment 
for meat and meat substitutes , including  the large multinational ADM, pea protein 
producer Roquette, and low cost Chinese competitors such as  Gushen, Goldensea, 
and Yuwang. They contend that i n the EEA, there are also strong regional players 
such as the Belgian Cosucra  and the Serbian Sojaprotein. In addition, they submit  
that in this subsegment t here are also a large number of other, smaller competitors 
with higher shares than IFF.   
(206)  The Commission notes that according to data submitted by the Parties and with 
respect Plant-based Proteins for Meat Substitutes , the merged entity would have an 
EEA share of [20-30]%, with IFF bringing a small increment of [0-5]%. ADM 
would remain  the second supplier  at [10-20]% and Sojaprotein the third supplier at 
[10-20]%. It therefore ap pears that the combined entity’s combined market shares 
would remain m oderate, that th e increment from IFF is limited, a nd that strong 
competitors, in particular ADM, would remain present.  
(207)  Overall, no customer or competitor expressed a substantiated concer n with respect to 
the market for Plant -based Protein s, including any segment for Meat Substitutes .  
(208)  It therefore appears that irrespective of whether an EEA or worldwide market is 
considered, when  a segment for Plant -based Proteins for Meat Substitutes  is 
considered, the Transaction would lead to the combination of a well -established 
supplier (N&B) with another supplier whose  market presence and capabilities are 
very limited (IFF).  
(209)  In view of the above, and, in particular, in light of the moderate combined  market 
share and the very small increment brought about by the Transaction ( [0-5]% by 
IFF), the Commission considers that the horizontal overlap brought about by the 
Transaction in the manufacture and supply of Plant -based Protein for Meat 
Substitutes  is not such as to raise serious doubts as to its compatibility with the 
internal market.  
                                                 
223  Q2a and Q2b – Questionnaires to competitors, rep lies to question J.1.  
 
40 5.2.2.3.  Plant -based Proteins for Active Nutrition  
(210)  The Parties contend that IFF is barely active in Plant -based Proteins for Active 
Nutrition , including snack and beverage applica tions , and is more focused on the  
segment for meat and meat substitutes, [details on IFF’s business plans and strategy] . 
They contend that in this potential sub -segment for Active Nutrition, IFF is not 
active at all in the EEA and only to a negligible exte nt at worldwide level . They 
further submit that many strong  competitors are also able to deliver the product 
quality and consistency required for beverage and snack applications , such as the 
multinational ADM , the Japanese Fuji Oil, European -based competit ors such as the 
Belgian Cosucra and the Serbian Sojaprotein , but also Chinese producers  including 
Gushen, Goldensea, and Yuwang , which they claim have improved their product 
consistency over the last years and offer aggressive prices. They submit that there  
are also a large number of other, smaller competitors with higher shares than IFF  
present in this segment . 
(211)  The Parties further  contend  that the market for  Protein beverages and protein 
fortified snack bars is growing , and that a ll suppliers have spare capacity , which they 
have  an incentive to use for this segment in light of the higher prices compared to the 
meat and meat substitutes segment. They submit  by way of example  that there have 
been  recent capacity increases for pea protein which were mostly  target ed at  Active 
Nutrition . They further submit that  pea protein was historically not used in beverage 
applications due to its taste profile, but is now increasingly being used, to the 
detriment of the growth of soy protein beverages.  
(212)  In addition, they submit that dairy protein (whey protein) is the traditional protein 
source for Active Nutrition and exercises significant competitive pressure on plant -
proteins for this application.  They contend that d airy protein sources are the 
longstanding preferred pr otein due to their familiar taste and strong nutritional 
profile.  
(213)  The Commission notes that according to data submitted by the Parties and with 
respect Plant -based Proteins for Active Nutrition  including snacks and beverages , 
the merged entity would have a worldwide share of [40-50]%, with IFF bringing a 
small increment of less than [0-5]%. ADM would remain the second supplier at [5-
10]% and Fuji Oil the third supplier at [0-5]%. It therefore appears that the increment 
from IFF is limited, and that strong c ompetitors, in particular ADM, would remain 
present.  
(214)  Overall, no customer or competitor expressed a substantiated concern with respect to 
the market for Plant -based Proteins, including any segment for Active Nutrition .  
(215)  It therefore appears that irrespective of whether an EEA or worldwide market is 
considered, when  a segment for Plant -based Proteins for Active Nutrition  is 
considered, the Transaction would lead to the combination of a well -established 
supplier (N&B) with another supplier whose  market presence and capabilities are 
very limited (IFF).  
(216)  In view of the above, and, in particular, in light of the very small increments brought 
about by the Transaction (not more than [0-5]% by IFF), the Commission considers 
that th e horizontal overlap brought about by the Transaction in the manufacture and 
supply of Plant -based Protein for Active Nutrition  is not such as to raise serious 
doubts as to its compatibility with the internal market.  
 
41 5.2.2.4.  Plant-based P rotein Isolates and Concen trates  
(217)  The Commission notes that according to data submitted by the Parties and with 
respect to Plant -based Protein Isolates and Concentrates comprising SPC, SPI, PPC 
and PPI , the merged entity would have a worldwide share of [20-30]%, with IFF 
bringing a small increment of [0-5]%. ADM would remain the second supplier at 
[10-20]% and CJ Selecta the third supplier at [5-10]%. It therefore appears that the 
combined entity’s market shares would remain moderate, that th e increment from 
IFF is limited, and that strong competitors, in particular ADM, would remain 
present.  
(218)  Overall, no customer or competitor expressed a substantiated concern with respect to 
the market for Protein Isolates and Concentrates .  
(219)  It therefore appears that irrespective of whether an EEA or  worldwide market is 
considered, and whether Plant -based Proteins overall or a segment for Protein 
Isolates and Concentrates is considered, the Transaction would lead to the 
combination of a well -established supplier (N&B) with another supplier whose  
marke t presence and capabilities are very limited  (IFF).  
(220)  In view of the above, and, in particular, in light of the moderate combined market 
share and the very small increment brought about by the Transaction ( [0-5]% by 
IFF), the Commission considers that the ho rizontal overlap brought about by the 
Transaction in the manufacture and supply of Plant -based Protein Isolates and 
Concentrates  is not such as to raise serious doubts as to its compatibility with the 
internal market.  
5.2.2.5.  Conclusion on Plant -based Proteins  
(221)  The results of the market investigation indicate that N&B is a leading competitor in 
the markets  for Plant -based Proteins, in particular Soy -based proteins, where  IFF’s 
presence is hardly mentioned by respondents.  In the Plant -based Protein markets 
where the  Transaction gives rise an affected market, the increment from IFF is very 
limited, ranging from < [0-5]% to [0-5]%. N&B’s market share does not exceed [50-
60]% in any  of those markets : in Soy-based Proteins overall, the merged entity 
would have a market sh are of [20-30]% worldwide, with a small increment from IFF 
([0-5]%). In addition,  the replies to the market investigation do not suggest that any 
supplier of Plant -based Protein s offers a product that  could not be supplied by 
competitors.224  
(222)   Overall, signi ficant majorities of respondents to the market investigation expressing 
their opinion s consider that the Transaction will not have an impact on their 
compan ies with respect to Soy-based Proteins .225 In addition, significant majorities 
of respondents to the m arket investigation expressing an opinion submit that they do 
                                                 
224  Q1 – Questionnaire to customers, replies to question C.B.7., and Q2a and Q2b – Questionnaires to 
competitors, replies to question D.B.6.  
225  Q1 – Questionnaire to customers, replies to question J.1., and Q2a and Q2b – Questionnaire s to 
competitors, replies to questions J.1.  
 
42 not expect the Transaction to have an impact on the market for the supply of Soy-
based Protein  in terms of price , quality, or innovation.226 
(223)  In conclusion, in the light of the foregoing and taking  account of the results of the 
market investigations  the Commission considers that the Transaction does not raise 
serious doubts as to its compati bility with the internal market in relation to the 
manufacture and supply of Plant -based Proteins . 
5.2.3.  Overall R&D  efforts/ innovation  
(224)  The Parties’ R&D efforts and strategies [details on the Parties’ R&D strategies] .227 
In addition, a majority of respondents to the market investigation considered that the 
combination of the Parties’ R&D capabilities will allow the merge d entity to 
compete better with its rivals,228 and to bring new and/or better products into the 
markets.229 Moreover , the majority of respondents is of the view that the 
combination of the Parties’ R&D capabilities will not hamper innovation, including 
by hind ering the rivals ability or incentive to innovate.230 
5.3. Vertical non -coordinated effects  
(225)  The Transaction gives ris e to vertical links between N&B’s manufacture and supply 
of Gums  and Plant -based Proteins  and IFF’s purchases of these ingredients as inputs 
for its food inclusions  and systems production and between N&B’s manufacture and 
supply of MCC and Emulsifiers and IFF’s purchases of these ingredients as inputs 
for its flavours and systems production.  These actual vertical l inks give rise to the 
following vertically affected markets:  the markets for the supply of Locust Bean 
Gum, Plant -based Proteins for Active Nutrition, SPI,  MCC for Food Applications, 
Synthetic Emulsifiers overall, Ester Emulsifiers, DISMO, Fatty Acid Emulsifiers, 
Other Synthetic Emulsifie rs, De -Oiled Lecithin Emulsifiers overall,  GM De -Oiled 
Lecithin, and  Non -GM De -Oiled Lecithin . 
5.3.1.  Gums  
(226)  As mentioned above in paragraph (126) , N&B manufactures and supp lies Locust 
Bean Gum . Vertically affected markets arise due to IFF’s purchase s of c. EUR […] 
of Locust Bean Gum  in 2019 , [details on IFF’s purchases] . 
                                                 
226  Q1 – Questionnaire to customers, replies to question J.2., and Q2a and Q2b – Questionnaires to 
competitors, replies to questions J.2.  
227  Form CO, Section V and Parties’ internal documents submitted as Annexes to Section V.  
228  Q1 – Questionnaire to customers, replies to question L.5; and Q2a and Q2b – Questionnaires to 
competitors, replies to questions L.5.  
229  Q1 – Questionnaire to customers, replies to question L.6; and Q2a and Q2b – Questionnaires to 
competit ors, replies to questions L.6.  
230  Q1 – Questionnaire to customers, replies to question L.4; and Q2a and Q2b – Questionnaires to 
competitors, replies to questions L.4.  

 
44 product compared to guar  gum, in particular for certain grades and applications such 
as baby  food/infant nutrition.233 
(233)  A majority customers replying to the market investigation do consider barriers to 
enter the supply of Locust Bean Gum  to be moderately significant . However , several 
comments confirm that this  mainly relates  to the sourcing of locust bean kernels .234 
Customers do not report any recent entry or expect forthcoming entry in Locust Bean 
Gum  but several do mention th at there has been expansion of production capacity by 
N&B competitors in recent years.235 
(234)  A majority of customers submit that the merged entity would not have the ability or 
incentive to deteriorate supply conditions of Locust Bean Gum  or guar gum to 
certain  customers.236 On the question whether there would be sufficient alternative 
sources of supply available to customers, should the merged entity deteriorate supply 
conditions for Locust Bean Gum  and/or guar gum, the results of the market 
investigation were in conclusive.237 The replies from customers indicate that they 
would have enough alternative sources for supply of standard grades of both 
products  but a number of respondents stated  that they would have difficulties 
replacing N&B’s supply of cold -soluble Locu st Bean Gum  for infant nutrition.  
(235)  As regards any vertical concerns relating to N&B’s supply of Locust Bean Gum  for 
infant nutrition  in particular , the Parties submit that  IFF does not purchase any LBG 
for infant nutrition applications from N&B, or any oth er suppliers. On that basis , 
there is no vertical link between the Parties in this putative sub -segment.  
(236)  No customers expressing their opinion in the market investigation consider that the 
Transaction will have an impact on their company with respect to the procurement of 
Locust Bean Gum .238 Similarly, no competitors expressing their opinion consider 
that the Transaction will have an impact on their company as regards  the sup ply of 
Locust Bean Gum .239 A large majority of customers and competitors expressing their 
opinion s considered that the Transaction would have no impact on price, quality 
and/or innovation of the supply  of Locust Bean Gum .240  
(237)  As regards the risk of customer fo reclosure, the Commission considers that the 
merged entity would not have the ability to restrict access to a significant customer 
base due to the limited size of IFF ’s purchases. Even if IFF were to purchase all of 
its demand for Locust Bean Gu m from the N&B Business, rival suppliers would not 
be foreclosed from supplying these ingredients to downstream manufacturers of 
Systems, nor from supplying them to downstream food manufacturers or 
                                                 
233  Q1 – Questionnaire to cust omers, replies to question E.B.1.1. and Q2a and Q2b – Questionnaires to 
competitors, replies to question E.B.1.1  
234  Q1 – Questionnaire to customers, replies to question E.B.4.  
235  Q1 – Questionnaire to customers, replies to question E.B.5.  
236  Q1 – Questionn aire to customers, replies to question G.B.5., and Q2a and Q2b – Questionnaires to 
competitors, replies to question G.B.2.  
237  Q1 – Questionnaire to customers, replies to question G.B.6., and Q2a and Q2b – Questionnaires to 
competitors, replies to question G.B.3.  
238  Q1 – Questionnaire to customers, replies to question J.1.  
239  Q2a and Q2b – Questionnaires to competitors, replies to question J.1.  
240  Q1 – Questionnaire to customers, replies to question J.2 - and Q2a and Q2b – Questionnaires to 
competitors, repl ies to question J.2.  

 
46 addition, they argue that N&B does not have the incentive to deteriorate its supply of 
SPI to IFF’s rivals as IFF’s demand for SPI  only accounts for a fraction of the SPI 
sales of the N&B Business.  
(245)  They further submit that the Transaction does not give rise to any risk of customer 
foreclosure as the merged entity will not have the ability nor the incentive to 
foreclose other ingredie nts manufacturers from supplying IFF’s competitors with 
SPI, since IFF’s demand for SPI represents only a de minimis portion of the total 
global demand.  
(246)  The Commission notes that there are a number of established competitors active in 
SPI, which will conti nue to compete with N&B also after the Transaction. The data 
provided by the Parties indicate that N&B is the market leader in the supply of SPI 
on an EEA basis, with a [40-50]% market share, while  the next three competitors, 
including ADM and two Chinese players, have shares between [5-10] and [10-20]%. 
On a worldwide  basis, N&B is the market leader with [30-40]%, while  the next three 
competitors, including ADM and two Chinese players , have market shares  around 
[10-20]%.   
(247)  Given IFF’s very limited purchase s of SPI, IFF’s worldwide and EEA -wide share of 
demand is estimated by the Parties to be below [0-5]%. 
(248)  With regard to SPI, ADM and N&B are mentioned among the top three suppliers by 
the same number of both customers and competitors replying to the market 
investigation, while Cargill and Wilmar are also cited  by several respondents .241 This 
indicates that  there would be sufficient alternative sources of supply available to 
customers, should the merged entity deteriorate supply of SPI .242  
(249)  No customer having  expressed an opinion in response to the market investigation 
consider s that the Transaction will have a negative impact on their company with 
respect to the procurement of Soy -based Proteins.243 Conversely, a  large majority of 
customers expressing their opin ion considered that the Transaction would have no 
impact on price, quality and/or innovation of the supply  of Soy -based Proteins.244 
While the majority of competitors answered ‘I do not know’, a majority of those 
expressing their opinion do not consider that the Transaction will have an impact on 
their company with respect to the supply of Soy -based Proteins.245 Overall, no 
customer or competitor expressed a substantiated concern with respect to the market 
for the manufacture and supply of Soy -based Protein, or  any sub -segment  thereof .  
(250)  As regards the risk of customer foreclosure, the Commission considers that  the 
merged entity would not have the ability to restrict access to a significant customer 
base due to the limited size of IFF ’s purchases. Even if IFF wer e to purchase all of 
its demand for SPI from the N&B Business, rival suppliers would not be foreclosed 
from supplying these ingredients to downstream manufacturers of Systems, nor from 
                                                 
241  Q2a and Q2b – Questionnaires to competitors, replies to question C.B.1.  
242  Q1 – Questionnaire to customers, replies to question G.B.6., and Q2a and Q2b – Questionnaires to 
competitors, replies to question G.B.3.  
243  Q1 – Questionnair e to customers, replies to question J.1.  
244  Q1 – Questionnaire to customers, replies to question J.2.2.  
245  Q2a and Q2b – Questionnaires to competitors, replies to question J.1.  
 
47 supplying them to downstream food manufacturers or manufacturers in oth er 
industries.  A customer foreclosure strategy is therefore not likely.  
(251)  As regards the risk of customer foreclosure, the Commission considers that t he 
merged entity would also not have the ability or the incentive to stop or worsen 
supplies to downstream c ompetitors . Given IFF’s low share of demand for SPI the 
N&B Business has no incentive to deteriorate its supplies of SPI to  IFF’s 
competitors and other downstream food manufacturers.  In any case, several 
alternative suppliers of SPI will remain available t o IFF’s competitors post -
Transaction.  
(252)  Based thereupon, the Commission considers that the notified concentration does not 
entail risks of either customer foreclosure or input foreclosure in any of the potential 
markets for Plant -based Protein.  
(253)  In light of above  and in view of the results of the market investigation , the 
Commission concludes that the notified concentration does not raise serious doubts 
as to its compatibility with the internal market in relation to the vertical link between 
the supply of Pla nt-based Protein, in particular Plant -based Protein for Active 
Nutrition and SPI (upstream) and the manufacture of Systems and Food Inclusions 
(downstream).  
5.3.3.  MCC  
(254)  N&B manufactures and supplies MCC for both pharmaceutical and food 
applications. IFF only purc hases MCC for food applications, in particular for its 
Systems and Flavours. IFF does not purchase MCC for pharmaceutical applications.  
IFF purchases its MCC needs [details on IFF’s purchases and sources of supply].  
(255)  According to the Parties’ estimates, in 2019 N&B had a [30-40]% market share 
worldwide regarding the supply of MCC and of [40-50]% regarding specifically the 
supply of MCC for food applications. N&B  could not present data for the EEA but 
for the EMEA where  it has market share of  [20-30]% in the supply of MCC and [30-
40]% in the supply of MCC for food applications.  N&B however submitted that […] 
of its EMEA sales of MCC for food applications sales take place in the EEA  and that 
similarly […] of the EMEA sale s take place in the EEA .246 
(256)  N&B faces competition from a few other suppliers worldwide and in the EEA, 
including for MCC for food applications. In the EEA  and specifically for MMC for 
food,  the market leader according to the P arties is  JRS (with a share of a round [50-
60]%); other suppliers are Mingtai and Roquette  (Blanver) .  
(257)  IFF purchases of colloidal MCC are limited (less than EUR […] worldwide and less 
than EUR […] in the EEA). IFF’s share of the demand for MCC for food 
applications (colloidal MCC) is  therefore negligible ( below [0-5]% both worldwide 
and in the EEA ).  
                                                 
246  Form CO, Annex 7.9. Within EMEA, N&B supplies MCC for food applications in […] in addition to 
the EEA countries.  
 
48 (258)  Due to the size of IFF limited purchases, the merged entity would not have the 
ability to restrict access to a significant customer base. A customer foreclosure 
strategy is therefore not likel y. 
(259)  The merged entity wou ld also not have the ability or the incentive to adopt an input 
foreclosure strategy . In addition to the alternative suppliers of colloidal MCC, this 
product is not a critical  input for IFF’s  business, or for its competitors. The small 
quantities purchased by IFF also reflect the fact that IFF and other flavour and 
fragrance houses are not th e main customers of colloidal MC C products. These are 
generally purchased by food manufacturer s, which do not compete with IFF (or its 
rivals) downstream.  
(260)  The fact that the proposed Transaction does not have a material impact on N&B’s 
ability and incentives in the supply of MCC came also across in the market 
investigation. The  few custo mers that expressed a view , considered that post -
Transaction the merged entity would  not have the ability or incentive to deteriorate 
the supply conditions of MCC for food applications.247 
(261)  In light of above, and in view of the results of the market investigation , the 
Commission  concludes that the notified concentration does not raise serious doubts 
as to its compatibility with the internal market in relation to the vertical link between 
the supply of MCC for food applications (upstream) and the manufacture of 
Functional Ingredie nts Systems and Flavours (downstream).  
5.3.4.  Emulsifiers  
(262)  As mentioned above in paragraph (126) , N&B manufactures and supplies Lecithin -
derived and synthetic Emulsifiers, p rimarily for food applications. IFF sources only 
food-grade Emulsifiers, both synthetic and Lecithin -derived. Therefore, no actual or 
potential vertical links exist with respect to non -food grade Emulsifiers.  
(263)  IFF purchased around EUR […] of Emulsi fiers in 2019. Of this, EUR  [details on 
IFF’s purchases]  of Lecithin -derived Emulsifiers and around EUR […] of synthetic 
Emulsifiers  [details on IFF’s purchases] .248 
(264)  Table 5 shows the vertically affected markets in Emulsifiers.249 N&B has a market 
share of 30% or more both in Synthetic Emulsifiers and the potential distinct 
markets therein by chemical class (both wo rldwide and in EMEA). With respect to 
Lecithin -derived Emulsifiers, N&B’s share only exceeds 30% in De -Oiled Lecithin 
Emulsifiers worldwide.  N&B could not present data for the EEA but for the EMEA. 
N&B however submitted that for all potential markets conce rned, the split of N&B’s 
sales between the EEA and the rest of the EMEA would be similar to the one for the 
respective potential market overall .250 
                                                 
247  Q1-Questionnaire to Customers, replies to question F.B.5.  
248  Form CO para 6.411.  
249  Within Fractionated Lecithin Emulsifiers, the Notifying Parties estimate N&B to have a market share 
of less than [0-5]% worldwide a nd in the EEA.  
250  Share of N&B sales and of the overall potential market that relates to the EEA: synthetic Emulsifiers 
overall approx. […]%, Ester Emulsifiers approx. […]%, DISMO approx. […]%, Fatty Acid 
Emulsifiers approx. […]%, Other Synthetic Emulsifiers approx. […]%, Lecithin -derived Emulsifiers 
 

 
50 of Emulsifiers from N&B specifically mentions that these would be easy to 
replace.254 
(269)  Further, while a m ajority of customers and competit ors answered ‘I do not know’, 
a majority of customers and competitors expressing their opinion s submit that the 
merged entity would not have the ability and incentive to deteriorate supply 
conditions of synthetic Emulsifier s or De -Oiled Lecithin Emulsifiers to certain 
customers.255 Majorities of customers and competitors expressing their view s further 
submit that in any case, there would be sufficient alternative sources of supply 
available to customers, should the merged enti ty deteriorate supply conditions for 
synthetic Emulsifiers or De -Oiled Lecithin Emulsifiers.256 
(270)  Overall, a large majority of market respondents expressing their opinion s do not 
expect the Transaction to have an impact on their business in relation to 
Emulsif iers.257 
(271)  Based thereupon, the Commission considers that the notified concentration does not 
entail risks  of either customer foreclosure or input foreclosure in any of the potential 
markets for Emulsifiers . 
(272)  In light of above, and in view of the results of the  market investigation , the 
Commission concludes that the notified concentration does not raise serious doubts 
as to its compatibility with the internal market in relation to the vertical link between 
the supply of Emulsifiers (upstream) and the manufacture  of Functional Ingredients 
Systems  (downstream).  
5.4. Conglomerate effects  
5.4.1.  General considerations of the conglomerate effects of the Transaction  
(273)  In the present case, the possibility of conglomerate effects arises from t he 
complementary of the Parties’ product p ortfolios, N&B ’s significant market position 
in certain product segments,  and the fact that already today both Parties cross -sell 
and offer te chnical and commercial bundles . One of the rationale of the Transaction 
also seems to be the combination of portfolios to offer “full -set solutions” to respond 
to consumer preferences.258 However , based on the information gathered and on the 
outcome of the market investigation, it is unlikely that post -Transaction the merged 
entity will be able to engage in antico mpetitive foreclosure of  rivals by offering 
technical or commercial bundles or integrated solutions for food applications or for 
the personal and home care industries , for the following reasons.  
(274)  First, while the majority of respondents  to the market inves tigation  considers that the 
merged entity will have the largest product portfolio and the ability and incentive to 
                                                 
254  Minutes of a call with a customer on 10 September 2020.  
255  Q1 – Questionnaire to customers, replies to question G.B.5., and Q2a and Q2b – Questionnaires to 
competitors, replies to question G.B.2.  
256  Q1 – Questionnaire to customers, replies to qu estion G.B.6., and Q2a and Q2b – Questionnaires to 
competitors, replies to question G.B.3.  
257  Q1 – Questionnaire to customers, replies to question J.1., and Q2a and Q2b – Questionnaires to 
competitors, replies to question J.1.  
258  Form CO, paras.3.14.  
 
51 cross -sell and offer technical bundles (blends/systems, integrated solutions) ,259 the 
majority of respondents to the market investigation also considers that 
post-Transaction there will remain several alternative sources of supply  for the 
products in question . As a customer put it “[t] o our best knowledge, there are 
sufficient alternative suppliers for all products concerned .” Another customer sa id 
“[t]he market is still fragmented with many other supplier ”.260 
(275)  The market investigation confirmed that already today competitors of IFF and of 
N&B, such as Givaudan, Symrise, Kerry, DSM, ADM, Cargill, Tate & Lyle, 
Ingredion, JRS, among other, offer blend s/systems of ingredients as well as 
integrated solutions. One competitor stated  that “[f]unctional systems, i.e. blends of 
different ingredients, are  widely used in the industry ”261. Whereas a majority of 
respondents referred that the capability of matching the bundles offered by the 
merged entity depended on the exact blend/integrated solution, several respondents 
confirmed the Parties’ claim that competitors also enter into partnerships and/or 
outsource certain ingredients to be able to offer a blend or int egrated solution.262 One 
customer indicated that  “[c]ompetitors of IFF/N&B will have possibilities to 
purchase the single products to combine it in bundles ”; a competitor mentioned “ in 
many situations, industry partnerships will be able to create joint solut ions, which 
can compete with IFF/N&B's integrated solutions ”.263 
(276)  Second, the market investigation indicated that one cannot talk about a market trend 
towards blends or integrated solutions and that not all customers prefer such 
offers.264 It seems the large cu stomers rather procure single ingredients and develop 
the blends/systems themselves. As a customer put it , “for small and mid -sized 
companies, there is often a growing demand for and/or supply of integrated 
solutions. For the large companies, this demand d oes often not exist. They prefer to 
buy the products separately to keep control on the recipe, suppliers and costs, except 
when there is functional benefit in the use of integrated solutions .” As a competitor 
described it , “[t]here is an industry desire to  sell more integrated solutions but from 
a market standpoint, there is no trend but rather some opportunities to deliver more 
value by the combination of ingredients or to support companies who do not have 
product development expertise or resources ”.265 
(277)  Third, the market investigation indicated that customers are not willing overall  to 
compromise on the quality of their end product, nor incur risk for their own 
production processes for savings in transaction costs. The vast majority of 
respondents considers t hat customers value the quality, performance and stability of 
                                                 
259  Q1 – Questionnaire to customers, replies to questions K.3. and K.8.2; and Q2a and Q2b – 
Questionnaires to competitors, replies to questions K.3. and K.9.  
260  Q1 – Questionnaire to customers, replies to question K.6.1.  
261  Q2a – Questionnaire to competitors, r eplies to question K.4.1.  
262  Q1 – Questionnaire to customers, replies to question K.7; and Q2a and Q2b – Questionnaires to 
competitors, replies to question K.7.  
263  Q1 – Questionnaire to customers, replies to question K.7.1; and Q2a and Q2b – Questionnaire s to 
competitors, replies to question K.7.1.  
264  Q1 – Questionnaire to customers, replies to question K.5; Q2a and Q2b – Questionnaires to 
competitors, replies to question K.5.  
265  Q1 – Questionnaire to customers, replies to question K.5.1; and Q2a and Q2b – Questionnaires to 
competitors, replies to question K.5.1.  
 
52 their supplies and do not switch suppliers based only on transaction costs .266 As 
a customer put it “[s] avings on transaction costs by reducing suppliers cannot 
compensate the risk assumption in t erms of product quality and production 
processes ”.267 
(278)  In fact, the majority of respondents considered that customers would not be locked in 
by the merged entity bundle offers and cross -selling practices, as they would be able 
to switch suppliers.268 One customer explained  that “[d]ue to the competitive 
landscape in the relevant product markets, customers are still able to switch 
suppliers .”269 Another customer mentioned  that “customers still would be able to 
switch suppliers and find alternative  sources ”.270 A further customer indicated that  
“they [customers] would be still able to find alternatives, but might have to open up 
the ingredient mix and source it from different suppliers or go to another "solution 
provider" .”271 A competitor said  that “[w]e expect cu stomers to be able to continue 
to switch suppliers like today”.272 Another competitor considered  “risk of a major 
lock-in of the customer base to be quite hypothetical .”273 
(279)  Similarly, a majority of respondents also considered that the  large portfolio of 
produc ts and the opportunity to cross -sell would not give the  merged entity the 
ability  to exclude rivals.274  
(280)  In the light of N&B’s significant position  (market share of at least [30-40]%) in 
some markets and market segments close ly related to the products offer ed by IFF, 
the Commission has investigated whether the merged entity could leverage its 
position from these markets to others by means of tying, bundling or other 
exclusionary practices . On balance , as explained bellow,  the results of the market 
investigation indicate  that the merged entity is unlikely to  have the ability and 
incentive to implement such foreclosure strategies . 
5.4.2.  Cultures  
(281)  N&B has a significant position in Fresh Dairy C ultures ( [30-40]% worldwide and 
[30-40]% in the EEA).275 However, N&B is not the market leader. It is not only 
constrained by the market leader, Chr. Hansen , but also by other established 
competitors such as DSM and Glanbia . More importantly , already today , other  
supplier s offer bundles of Fresh Dairy C ultures with flavours and/or colours , 
including  Chr. Hansen, the Kerry Group, DSM, Sacco, Lallemand, and Vivolac.276 
                                                 
266  Q1 – Questionnaire to customers, replies to question K.10; and Q2a and Q2b – Questionnaires to 
competitors, replies to question K.12.  
267  Q1 – Questionnaire to customers, replies to question K.10 . 
268  Q1 – Questionnaire to customers, replies to question K.8.3; and Q2a and Q2b – Questionnaires to 
competitors, replies to question K.9.2.  
269  Q1 – Questionnaire to customers, reply to question K.8.3 . 
270  Q1 – Questionnaire to customers, reply to question K. 8.3. 
271  Q1 – Questionnaire to customers, reply to question K.8.3 . 
272  Q2a– Questionnaires to competitors, reply to question K.9.2.  
273  Q2a– Questionnaires to competitors, replies to question K.9.2.  
274  Q1 – Questionnaire to customers, replies to question K.6; and to Q2a and Q2b – Questionnaires to 
competitors, replies to question K.6.  
275  Form CO, Table 64.  
276  Form CO, para.6.719.  
 
53 (282)  One of the cultures competitors mentioned that the merge d entity would have a 
significant product portfolio, particularly in p lant-based and meat ing redients, and 
that the merged entity would become a “one -stop shop” against which it may be 
more difficult to compete. However , the same competitor acknowledge d that the 
success of such one -stop shop strategy “ will very much depend on how customers 
will react to the Transaction. Whether they will still want a specialised product or 
will go for a bundle with a broader portfolio of products .” The c ompetitor also 
acknowledged  it “does not expect the Parties to leverage their reinforced market 
position post -transaction in an anti -competitive way. What is more [the competitor]  
is confident  about its strategy of being a player specialised in cultures and enzymes 
and will continue to foster innovation in relation to its services ”277 
5.4.3.  Soy-based Protein s 
(283)  As analysed a bove,  N&B holds a s trong market  position in Soy Protein Isolates ( [30-
40]% worldwide and [40-50]%), as well as in other product segmentations by end 
application such as Plant -based Protein s for Active Nutrition  ([40-50]% worldwide 
and [40-50]% in the EEA) and beverages ( [40-50]% worldwide and [40-50]% in the 
EEA).  However, these are  commoditised products and there are several other 
suppliers on the market : not only multinational players such as ADM but also 
Chinese players, which are selling globally . 
(284)  One c ompetitor in Plant -based Protein s referred to the difficulty of competing with a 
supplier with a large portfolio : “The combined product portfolio could make it 
tougher for competitors with a more limited product range ” and, in particular , 
referred  to the possibility that the merged entity would have to combine Plant -based 
Protein s with flavours  and masking agents .278 Today none of the Parties offer such 
bundle but other competitors do offer bundles of Soy-based Proteins and masking 
flavours for all t ypes of soy -based proteins , including  ADM, Kerry, Cargill, Symrise 
and Givaudan.279 
5.4.4.  Locust Bean G um 
(285)  N&B has a strong position in the Locust Bean G um market  ([30-40]% worldwide 
and [30-40]% in the EMEA).280 However, it faces competition from established 
supplie rs. In fact , the majority of the respondents in the market investigation 
considered that there will be alternatives sources of supply to the merged entity 
bundles anchored in Locust Bean Gum .281 As a customer explained: “ IFF/N&B is in 
a privileged condition,  since not many players will have the combined expertise of 
such entity. However many players are already structuring themselves within 
ecosystem network/open innovation, which means, partnering with other market 
players (non competitors) with different ex pertise to offer a holistic solution 
approach to consumers .”282 
                                                 
277  Minutes of call with a competitor held on 8 September 2020.  
278  Q2a – Questionnaires to competitors, replies to questions D.B.9 and  D.B.10.  
279  Parties’ response to RFI no. 1.  
280  Form CO, Table 64.  
281  Q1 – Questionnaire to customers, replies to question E.B.12; and Q2a and Q2b – Questionnaires to 
competitors, replies to question E.B.9 . 
282  Q1 – Questionnaire to customers, replies to ques tion E.B.12.  
 
54 5.4.5.  MCC  
(286)  N&B has a significant position in MCC for food applications ( [40-50]% worldwide 
and [30-40]% in the EEA) and in MCC for pharmaceutical applications ( [30-40]% 
worldwide and [20-30]% in the EEA)283. Despite its leading position in MCC for 
food applications, N&B faces competition from other well -established players such 
as JRS, Mingtai, Roquette, Asahi. These suppliers are also present in the segment for 
pharmaceutical applications where, JRS ta kes the lead.284 
(287)  In the market investigation, a MCC competitor mentioned it w ould be more difficult 
to compete with the merged entity as they can leverage on its wide portfolio of 
products.285 However, already today other suppliers are able to provide similar 
bundles of MCC and flavours  (Chr. Hansen ) and fragrances  (Firmenich )286. The 
Parties have also argued that MCC is a commoditised product readily available on 
the market , which  makes it a less interesting product to bundle . Other competitors 
could therefore  match the bundle, not giving the merged entity the opportunity to 
differentiate itself.287 
5.4.6.  Emulsifiers  
(288)  N&B has a significant position in Synthetic E mulsifiers ( [30-40]% worldwide and in 
the EEA)288 where it faces competition from Kerry Group, Palsgaard, Corbion, BASF, 
Oleon, and Lon .289 N&B has also a significant position in  De-oiled Lecithin 
Emulsifiers ( [30-40]% worldwide and [20-30]% in the EEA)290 but faces 
competition from well -established suppliers such as ADM, Cargill and smaller 
players such as Stern,  Lecico, Lasenor, Soya International.291 More importantly 
already today suppliers such as Kerry and AMD offer combinations of emulsifiers  
and flavours.292 
(289)  In the market investigation , no conglomerate  concerns were voiced in relation to 
these products.  
5.4.7.  Enzymes  
(290)  N&B has a significant position in Enzymes  for Carbohydrates P rocessing ( [30-40]% 
worldwide and [30-40]% in the EEA ).293 N&B faces however competition from the 
market leader Novozymes (c. [40-50]% worldwide and c. [40-50]% in the EEA), as 
well as from other players such as AB Enyzmes, Sensun, BASF.294 N&B has also a 
moderate position  in Enzymes  for Animal F eed ( [20-30]% worldwide and [20-30]% 
                                                 
283  Form CO, Table 64.  
284  Form CO, Annex 7.9  
285  Q2a– Questionnaires to competitors, replies to question J.1.1  
286  Form CO, para. 6.724.  
287  Parties’ reply to RFI no. 1.  
288  Form CO, Table 64.  
289  Form CO, para. 6.697 . 
290  Form CO, Table 64.  
291  Form CO, para. 6.698.  
292  Form CO, paras. 6. 672 and 6.673 . 
293  Form CO, Table 64.  
294  Form CO, para. 6.727.  
 
55 in the EEA)295 but faces competitions from several other players such as DSM, 
Huvepharma, Adisseo, Abvista and BASF.  
(291)  More importantly , a majority of respondents the market investigation did not 
consider  that the Transaction would give the merged entity the ability or incentive to 
leverage on these products to sell other products.296 As a competitor explained: 
“[t]he Transaction  does not, in [the competitor’s]  view, give the IFF/N&B entity any 
additional power [and]  incentive to bundle products .297 Moreover, the majority of 
respondents also considered that there would be other sources of supply to match the 
merged entity bundle off ers.298 
5.4.8.  Probiotics  
(292)  N&B has a significant position in Probiotics  for Dietary S upplements ( [30-40]% 
worldwide and [10-20]% in the EEA). However, N&B faces competition from 
established players such as Chr. Hansen, Lallemand, and Biogaia.  In addition , 
already to day, other suppliers have in their product portfolio probiotics and colours 
(Chr. Hansen) , and probiotics colours and flavours ( DSM ).299.  
(293)  More importantly, no respondent to the market investigation  voiced concerns  and 
some competitors expressly referred to the unlikely success of a bundle strategy. One 
competitor added “ we experience - and expect to continue to experience after the 
transaction - that customers source probiotic solutions primarily as a stand -alone 
product .”; another competitor explained “ [m]ost customers will look for the best 
offerings by each supplier, and the bundling effect possible from the new entity is 
considered modest in [the competitor ’s] view”.300 
(294)  In light of above , and in view of the result s of the market investigation , the 
Commission concludes that the possibility of conglomerate effects arising from the 
Transaction  does not result in  serious doubts as to its  compat ibility with the internal 
market . 
  
                                                 
295  Form CO, para. and footnote 448  
296  Q1 – Questionnaire to customers, replies to question H.B.7 and H.B.8; and Q2a and Q2b – 
Questionnaires to competitors,  replies to questions H.B.4 and H.B.5  
297  Q2a– Questionnaires to competitors, replies to questions H.B.4.1. H.B.5.1.  
298  Q1 – Questionnaire to customers, replies to question H.B.9; and lies to Q2a and Q2b – Questionnaires 
to competitors, replies to question H.B.6  
299  Form CO, para. 6.728.  
300  Q2a – Questionnaires to competitors, replies to questions I.B.2 and I.B.3.  
 
 
56 6. CONCLUSION  
(295)  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)  
Margrethe VESTAGER  
Executive Vice-President