Commission européenne, DG COMP MERGER REGISTRY, 1049 Bruxelles, BELGIQUE  
Europese Commissie, DG COMP MERGER REGISTRY, 1049 Brussel,   BELGIË  
 
Tel: +32 229 -91111. Fax: +32 22 9-64301. E -mail: COMP -MERGER -REGISTRY@ec.europa.eu . 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information omitted has been replaced by 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.   EUROPEAN COMMISSION  
Brussels, 31.10.2019  
C(2019 ) 7988 final  
PUBLIC VERSION  
 
To the notifying parties  
Subject : Case M. 9450  – PPG/TIL/JV  
Commission decision pursuant to Article 6(1)(b) of Council Regulation 
No 139/20041 and Article 57 of the Agreement on the European Economic 
Area2 
Dear Sir or Madam,  
(1) On 26 September 2019 , the European Commission received notification of a 
proposed concentration pursuant to Article 4 of the Merger Regulation by which 
Peel Ports Group Limited (United Kingdom, ‘PPG’) and Terminal Investments 
Limited S.a.r.l (Switzerland, ‘TIL’) acquire , within the meaning of Article s 3(1)(b) 
and 3(4) of the Merger Regulation , joint control of The Mersey Docks and Harbour 
Company (L2) Limited (United Kingdom, ‘MD HCL2’) (‘ Transaction’)3. PPG and 
TIL are designated hereinafter as the 'Notifying P arties' . 
                                                 
1  OJ L 24, 29.1.2004, p. 1 (the “Merger Regulation”). With effect from 1 December 2009,  the Treaty on the 
Functioning of the European Union (“TFEU”) has introduced certain changes, such as the replacement of 
“Community” by “Union” and “common market” by “internal market”. The terminology of the TFEU will 
be used throughout this decision.  
2  OJ L 1, 3.1.1994, p. 3 (the “EEA Agreement”).  
3  Publication in the Official Journal of the European Union No C 332, 3.10.2019 , p.18. 

 
2 1. THE PARTIES  
(2) PPG is a port group that provides ports, shipping and marine support services. PPG 
operates in various locations in the United Kingdom, Ireland, the Net herlands and 
Australia. PPG is jointly controlled by The Peel Group (UK) and Deutsche Bank AG 
(Germany). PPG owns and operates the two container terminals in the Port of 
Liverpool, namely the Royal Seaforth Container Terminal (‘RSCT’)4 and the L2 
Terminal. In the United Kingdom and Ireland, PPG also owns the Greenock Ocean 
Terminal in Clydeport, Scotland; the Marine Terminals Ltd. (South Quays Container 
Terminal), Dublin, Ireland; and the Irlam Container Terminal in Manchester, 
England.  
(3) TIL is a te rminal operating company jointly controlled by MSC Mediterranean 
Shipping Company S.A. (Switzerland, ‘MSC’) and by certain equity funds managed 
by Global Infrastructure Management, LLC , and associated with Global 
Infrastructure Partners  (USA). TIL invests in, develops and manages container 
terminals in various parts of the world, for example terminals in Antwerp and 
Rotterdam, but operates pre -Transaction no terminal in the United Kingdom or 
Ireland. MSC provides worldwide container transport services and t erminal services, 
and is also active as a cruise operator and in maritime ancillary activities.  
(4) MDHCL2 is a newly established entity that currently does not have operating  
business activities. PPG established MDHCL2 for the purpose of this Transaction 
and will transfer the operation of the L2 Terminal  to MDHCL2. Post -Transaction, 
MDHCL2 will be come the  operating  entity of the  L2 T erminal in the port of 
Liverpool.  
2. THE CONCENTRATION  
(5) TIL will acquire 50% of the shares in MDHCL2 from PPG. The Transaction 
compri ses of the acquisition of joint control over MDHCL2, the future operating 
entity of the L2 T erminal in the port of Liverpool.  
(6) TIL and PPG will have the right to appoint an equal number of members to the 
Board of Directors of MDHCL2, which, amongst others,  will have the right to adopt 
strategic decisions such as the annual business plan and budget. Decisions will be 
taken by simple majority and neither TIL nor PPG has a casting vote. The deadlock 
resolution mechanism provides that PPG and TIL shall meet and  seek to resolve in 
good faith the dispute underlying the deadlock situation. No shareholder has a 
casting vote. This demonstrates that TIL and PPG must reach a common 
understanding in determining the commercial policy including strategic decisions of 
MDHC L2 and are required to cooperate.5 
(7) As a result , TIL and PPG will be jointly controlling MCHCL2 post -Transaction. 
Therefore, the Transaction constitutes a concentration within the meaning of Article 
3 (1)(b) of the Merger Regulation.  
                                                 
4  Also known as the “L1 Terminal”.  
5  Form CO, para. 69 et seq ., Annex 3.1.4 Shareholders ’ Agreement of 5 September 2019.  
 
3 (8) Post-Transaction, MDHC L2 will be a full -function joint venture in the meaning of 
Article 3 (4) of the Merger Regulation  since it has sufficient resources , activities 
beyond one specific function for the parents,6 access to the market and operates on a 
lasting basis.7   
3. EU DIMENSION  
(9) The undertakings concerned have a combined aggregate world -wide turnover of 
more than EUR 5 000 million8 (PPG: […] EUR million, TIL: […] million) . Each of 
them has a n EU-wide turnover in excess of EUR 250 million  (PPG: […] million, 
TIL: […] millio n), but they do not achieve more than two -thirds of their aggregate 
EU-wide turnover within one and the same Member State. The notified operation 
therefore has an EU dimension.   
4. MARKET DEFINITION  
4.1. Introduction  
(10) TIL operates terminals in Northern Europe, but not in the United Kingdom or 
Ireland. PPG only operates terminals in the U nited Kingdom and Ireland. The 
Transaction therefore gives rise to a horizontal overlap on the market for container 
terminal services  in Northern Europe .  
(11) TIL is vertically integrate d with the containerised shipping company MSC. MSC 
provides short -sea container liner shipping services via its subsidiary W.E.C. Lines. 
W.E.C. Lines operates schedules between Belgium, Germany, the Netherlands, 
Portugal, Spain and the United Kingdom. W.E. C. Lines calls at the Liverpool RSCT 
terminal with its Brit ish Isles -Iberia trade .9 MSC also provid es deep -sea container 
liner shipping services on various trades to and from Northern Europe.10 
(12) The Transaction therefore gives rise to vertical link s between MSC’s activities in the 
market for containerised liner shipping services and the market for container 
terminal services.  
                                                 
6  MSC’s current throughput at the port of Live rpool container terminals accounts for [<40]% of the current 
capacity of the L2 Terminal. The L2 Terminal will be expanded in the next 18 months. All permits and 
regulatory approvals for the expansion were obtained, the additional land is owned, the necess ary cranes 
have been purchased and are partly already shipped to the United Kingdom, see Form CO paragraph 21 et 
seq. and reply to RFI 3, question 4.  The Notifying Parties therefore expect the expansion of the L2 
Terminal to be completed in [early]  2021. F ollowing completion of this expansion, MSC will occupy 
around [<50]% of the L2 Terminal’s capacity. All terminal services for MSC will remain at arm’s length. 
Therefore, the turnover achieved with third parties is sufficient to conclude that MDHCL2 is gear ed to 
play an active role on the market and can be considered economically autonomous from an operational 
viewpoint in the meaning of para. 98 of the Consolidated Jurisdictional Notice.  
7  Form CO, para. 74 et seq.  
8  Turnover calculated in accordance with Article 5 of the Merger Regulation.  
9  Form CO, para. 260 et seq . 
10  Form CO, para. 247.  
 
4 4.2. Container terminal services  
4.2.1.  Relevant product market  
(13) In its prior decisional practice, the Commission has defined a separate m arket for 
container terminal services, and has considered a possible distinction between 
hinterland traffic ( containers transported directly onto/from a container vessel 
from/to the hinterland via barge, truck or train) and transhipment traffic ( containers  
destined for the onward transportation to other ports or other vessels ).11  
(14) The Notifying Parties do not dispute the above mentioned market definition or its 
plausible segmentations.12  
(15) For the purpose of this Decision, the question of whether the market for container 
terminal services should be segmented between hinterland and transhipment traffic 
can be left open, as the Transaction would not raise serious doubts  as to the 
Transaction’s compatibility with the internal market  under any such product market  
definition.   
4.2.2.  Relevant geographic market  
(16) The Commission has considered in its prior decisional practice that the geographic 
market for container terminal services is determined by the geographic scope  of the 
container terminal  services (catchment area).13 
(17) For container terminal services for transhipment traffic , the Commission has 
considered in its prior decisional practice that the relevant geographic dimension is, 
in its broadest scope, region al, such as Northern Europe including the United 
Kingdom and I reland.14   
(18) The Notifying Parties agree with the Commission’s market definition for container 
terminal services for transhipment traffic.15 
(19) The Commission therefore considers that, for the purpose of this case, the 
geographic scope of the market for container terminal services for transhipment 
traffic is Northern Europe including the United Kingdom and Ireland.  
(20) For hinterland traffic , the Com mission has considered in previous cases the 
catchment area of the ports in a certain range, such as Hamburg -Antwerp, and 
possibly an even narrower  geographic market , comprising the ports of a single 
Member State only.16 
                                                 
11  See e.g. Cases M.9093 – DP World Investments/Unifeeder , para. 12; M.9016 – CMA CGM/Container 
Finance , para. 51.  
12  Form CO, para. 157.  
13  See e.g. Case M. 8120  – Hapag -Lloyd / United Arab Shipping Company , para. 22.  
14  See e.g. Cases M.9093 – DP World Investments/Unifeeder , para. 15; M.9016 – CMA CGM/Container 
Finance , para. 54; M.5066 – Eurogate/APMM , para. 16. 
15  Form CO, para. 240.  
16  See e.g. Cases M.9093 – DP World Investments/Unifeeder , para. 15; M.9016 – CMA CGM/Container 
Finance , para. 54; M.5066 – Eurogate/APMM , para. 16. 
 
5 (21) The Notifying Parties submit  that th e geographic range of container terminal services 
for hinterland traffic should comprise at least all container ports in mainland Great 
Britain and claim that a narrower range would “ ignore the commercial and logistical 
reality of the existing hinterland c onnections, which connect mainland Great Britain 
quickly and efficiently ”.17 In any event , the Notifying Parties consider that at least the 
ports of Southampton, Felixstowe, London Gateway and Liverpool are substitutable 
and that all four ports could handle  large containerships with more than 20  000 
TEUs.18, 19 
(22) The majority of respondents to the Commission’s  market investigation in this case 
confirmed that from a demand -side perspective, the ports of Southampton , London 
Gateway and Felixstowe could be consider ed as  substitutable with the port of 
Liverpool.20 However, t he majority of respondents to the market investigation 
indicated that other ports in mainland Great Britain such as  Bristol, Clydeport 
(Glasgow and surroundings ), Manchester, Newport or Cardiff would not be an 
alternative to the port of Liverpool , because t hese ports would either not have the 
facilities for larger containerships or because they lack the required hinterland 
connections.21   
(23) For the purpose of this De cision, the exact geographic scope of the market for 
container terminal services for hinterland traffic can be left open, as no  serious 
doubts would  arise  as to the Transaction’s compati bility with the internal market also 
under the narrower plausible geog raphic market definition  comprising only the four 
ports of Southampton, Felixstowe, London Gateway and Liverpool .  
(24) The Commission will assess the effects of the Transaction on the markets for 
container terminal services in its broadest scope (Northern Euro pe including the 
United Kingdom and Ireland)  and in its narrowest possible scope ( the ports of 
Liverpool, Southampton, London and Felixstowe  as well as ports in mainland Great 
Britain  for hinterland traffic).  
4.3. Deep -sea container  liner shi pping services  
4.3.1.  Relevant product market  
(25) In its prior decisional practice, the Commission has defined separate product markets 
for deep -sea container liner shipping services and short -sea container liner shipping 
services.22 
                                                 
17  Form CO, para. 233.  
18  See the Notifying Parties ’ reply to RFI 1 of 30 September 2019, question 4.  
19  TEU refers to twenty -foot equivalent unit.  
20  See agreed non -confidential minutes of a conference call of 30 September 2019 with a terminal customer  
A, para. 7 and 8; agreed non -confidential minutes of a conference call of 2 October 2019 with a terminal 
customer, para. 5; agreed no n-confidential minutes of a conference call of 10 October 2019 with a 
terminal customer, para. 5.  
21  See agreed non -confidential minutes of a conference call of 30 September 2019 with a terminal customer  
A, para. 8; agreed non -confidential minutes of a con ference call of 30 September 2019 with a terminal 
customer  B, paras. 4 and 6; agreed non -confidential minutes of a conference call of 2 October 2019 with a 
terminal customer, para. 6.  
22  See e.g. Case M.  8330 – Maersk Line/HSDG , para. 19.  
 
6 (26) Deep-sea container liner shipping services comprise  the offer of regular, scheduled 
services for the sea transportation of containerised cargo.23  
(27) A possible narrower product market for deep -sea container liner shipping services is 
that for the transport of refrigerated goods, which could be limited to refrigerated 
(reefer) containers only or could include transport in conventional reefer vessels. In 
past cases, the Commission looked separately at the plausible narrower markets for 
reefer containers and non -refrigerated (warm) containers only when the share of the 
reefer containers in relation to all containerised cargo was 10% or more on both legs 
of trade.24 In the present Transaction, t his is the case for three trades  on which MSC 
is providing deep -sea c ontainer liner shipping services, namely the Northern Europe 
– Australia/New Zealand , the Northern Europe – West Africa  and the Northern 
Europe – Caribbean & Central America  trade .25  
(28) While the Notifying Parties do not dispute the abo ve mentioned market definition, 
they argue that a reefer market would not be relevant for the purpose of assessing the 
Transaction.26 The Notifying Parties have nonetheless provided the Commission 
with the information necessary to assess the effects of the Transaction.  
(29) The Commission notes that the volume of reefer cargo shipped to and from the port 
of Liverpool on the legs of trade of the three trades mentioned above is basically 
non-existent and amounts to at most 0.007% of the overall reefer cargo volume  on 
each leg of trade.27 This D ecision assesses the competitive effects of the acquisition 
of joint control over the L2 T erminal in the port of  Liverpool. Therefore, for the 
purpose of assessing the vertical link between container terminal services and deep -
sea container shipping services  created by the Transaction , the Commission 
considers it not meaningful to assess a narrower market  segment  for reefer 
containers only.  
(30) The Commission will therefore, for the purpose of this Decision, assess only the 
overal l market for deep -sea container liner shipping services.  
4.3.2.  Relevant geographic market  
(31) While the Commission has in its prior decisional practice left open whether the 
geographic scope should comprise trades, defined as the range of ports which are 
served at both ends of the service (e.g. Northern Europe – North America) or each 
leg of trade ( each direction of the route separately, e.g. westbound and eastbound 
within a given trade), in its more recent practice, the Commission concluded that 
container liner shi pping services are geographically defined on the basis of the legs 
of trade (e.g. Northern Europe -North America eastbound and Northern Europe -North 
America westbound).28  
                                                 
23  See e.g. Case M.8330 – Maersk Line/HSDG , para. 10.  
24  See e.g. Cases M.8594 – COSCO Shipping/OOIL , para. 13; M.8120 – Hapag -Lloyd/United Arab Shipping 
Company , para. 11.  
25  Form CO, para. 376, table 64.  
26  Form CO, para. 172 et seq .  
27  See the Notifying Parties’ reply to RFI 3 of 11 October 2019, question 3.  
28  See e.g. Cases M.8594 – COSCO Shipping/OOIL , para. 14; M.8330 – Maersk Line/HSDG , para. 15.  
 
7 (32) The Notifying Parties do not dispute the above mentioned market definition,29 and 
submit that the following ranges of ports constitute distinct ends of legs of trade:30  
 Northern Europe;  
 Australia and New Zealand;  
 West Africa;  
 South Africa;  
 East Africa;  
 Central America and Caribbean;  
 South America East Coast;  
 South America West Coast;  
 Far East;  
 Indian Subcontinent;  
 Middle East;  
 North America.  
(33) In line with the Commission’s prior decisional practice, the geographic market for 
deep -sea container liner shipping services is defined on the basis of legs of trades  as 
set out in the pr evious paragraph .  
4.4. Short -sea container liner shipping services  
4.4.1.  Relevant product market  
(34) Short -sea container liner shipping services involve the provision of regular, 
scheduled intra -continental (usually costal trade) services for the carriage of cargo by 
container liner shipping companies.31  
(35) In its prior decisional practice related to the short -sea shipping services, the 
Commission concluded as regards the type of cargo transported, that short -sea 
container  liner shipping services should be distinguished fro m non -containerised 
shipping, such as bulk shipping, but it has ultimately left open whether wheeled 
cargo and short -sea container liner shipping services should be considered as 
belonging to the same  product  market.32 The Commission considered in its prior  
decisional practice in short -sea container liner shipping, in trades with a share of 
reefer containers in relation to all containerized cargo below 10% in both directions, 
                                                 
29  Form CO, para. 252.  
30  Form CO, para. 245 and 249.  
31  See e.g. Case M.9016 – CMA CGM/Container Finance , para. 29. 
32  See e.g. Cases M. 9016 – CMA CGM/Container Finance , para. 31 et seq .; M.8330 –  Maersk Line/HSDG , 
para. 19.  
 
8 transport in reefer containers is not assessed separately, but as part of the overa ll 
market for container liner shipping services.33  
(36) The Notifying Parties do not dispute the above mentioned market definition and 
submit that the precise market definition can be left open.34 Concerning re efer 
container transport , the Notifying Parties submit that MSC’s short -sea container line r 
shipping company W.E.C. Lines does not have any reefers in its container fleet and  
that an analysis of the reefer segment would not be relevant.35 
(37) Considering that the L2 T erminal is a container terminal36 and W.E. C. Lines does 
not have reefers in its container fleet, for the purposes of this Decision , the 
Commission will assess the effects of the Transaction on the market for short -sea 
container shipping services  and will not  assess a market for the transport of re efer 
containers only.    
4.4.2.  Relevant geographic market  
(38) In its prior decisional practice, the Commission considered that the relevant 
geographic market for short -sea container liner shipping services should be defined 
on the basis of (i) either single trades or  corridors, defined by the range of ports 
which are served at both ends of the service ;37 or (ii) single legs of trade.38 In a prior 
decision concerning a horizontal overlap in short -sea container liner shipping 
services on the trade between the British Isle s and the Iberian Peninsula, the 
Commission, while ultimately leaving the  market definition open, also considered 
Spain and Portugal as well as Ireland and the United Kingdom separately.39  
(39) The Notifying Parties  consider that the geographic market for short -sea container 
liner shipping services should be defined on the basis of single trades. The Notifying 
Parties submit that considering Spain and Portugal as well as the United Kingdom 
alone would be too narrow.40 The Notifying Parties have nonetheless provid ed the 
Commission with the necessary informatio n to assess the effects of the T ransaction.  
(40) Given that the Transaction does not raise serious doubts as to its compatibility with 
the internal market under any plausible geographic market definition, the exact scope 
of the geographic market for the purposes of this Decision can be left open .  
                                                 
33  See e.g. Case M.9016 – CMA CGM/Container Finance , para. 33; M.7523 – CMA CGM/OPDR , para. 40; 
M.3829 – Maersk/PONL , para. 10; M.3973 – CMA  CGM/Delmas , para. 7.  
34  Form CO, para. 193.  
35  See the Notifying Parties’ reply to RFI 3 of 11 October 2019, question 1.  
36  Form CO, para. 2.  
37  See e.g. Cases M.9016 – CMA CGM/Container Finance , para. 40 et seq.; M.7523 – CMA CGM/OPDR , 
para. 59. 
38  See e.g. Case M. 9016 – CMA CGM/Container Finance , para. 44 et seq.; M.8330 - Maersk Line/HSDG , 
para. 20; M.7523 – CMA CGM/OPDR , para. 60.  
39  See Case M.7523 – CMA CGM/OPDR, paras. 61 and 88  et seq .  
40  See the Notifying Parties’ reply to QP2 of 24 Septem ber, question 8; reply to RFI 2 of 2 October, question 
1c. 
 
9 5. COMPETITIVE ASSESSMENT  
(41) The Transaction gives ris e to both a horizontal  overlap in the  market for container 
terminal services and vertical links between MSC’s activities in the market for 
containerised liner shipping services and the market for container terminal services.  
5.1. Horizontal overlap: c ontainer terminal services  
(42) In addition to the L2 Terminal and the RSCT  in the port of Liverpool, at the time of 
this Decision, PPG owns and operates the following terminals:  Greenock Ocean 
Terminal at the Clyde river in Glasgow (part of PPG’s  Clydeport  subsidiary , 
Scotland ), the Marine Terminals Ltd. ( South Quays Container Terminal) in Dublin, 
Ireland,  and the Irlam Container Terminal in Manchester, England.41 (see Figure 1 
below)  
(43) TIL currently operates several container terminals in Northern Europe , namely  
Terminals Normandie MSC and Porte Océane S.A. in Le Havre, France , MSC Gate 
in Bremerhaven, Germany,  DMT B.V. terminal in Rotterdam , the Netherlands,  and 
MSC PSA European Terminal N.V. in Antwerp , Belgium.42 (see Figure 1 below)  
Figure 1. Major container ports in Northern Europe43 
 
 
(44) The market shares of PPG and TIL on the market for container terminal  services and 
its plausible segments are shown in Table 1 below.  
                                                 
41  Form CO, para. 9.  
42  Form CO, para. 39. 
43  A significant number of smaller container ports are not included, as this map shows only the most 
significant container ports in Northern Europe. Sourc e: Form CO, Figure 5.  


 
11 Commission considers that the Transaction only has an immaterial effect on this 
market.  
(46) Therefore, in this this Decision, the Commission will further assess  only the vertical 
links between the container terminal services and containerised liner shipping 
services.  
5.2. Vertical links  between the container terminal services and container liner 
shipping service s  
5.2.1.  Legal framework  
(47) The Commission will examine whether the Transaction is likely to result in 
foreclosure in any of the markets that are vertically affected by the Transaction.  
(48) According to the Non -Horizontal Merger Guidelines,50 foreclosure occurs when 
actual or potential rivals' access to markets is hampered, thereby reducing those 
companies' ability and/or incentive to compete.51 Such foreclosure can take two 
forms: (i) input foreclosure, when access of downstream rivals to supplies is 
hampered;52 and (ii) customer foreclosure, when access of upstream rivals to a 
sufficient customer base is hampered.53  
(49) For input or customer foreclosure to be a concern, three conditions need to be met 
post-transaction: (i) the merged entity needs to have the ability  to foreclose its rivals; 
(ii) the merged entity needs to have the incentive to foreclose its rivals; and (iii) the 
foreclosure strategy needs to have a significant detrimental effect on competition on 
the downstream market (input foreclosure) or on custom ers (customer foreclosure).54 
In practice, these factors are often examined together since they are closely 
intertwined.  
5.2.2.  Analytical framework  
(50) Shipping companies provide their services either individually with their own vessels 
(owned or charted) or through  co-operation agreements with third party  shipping 
companies.55  
(51) Under a slot charter agreement, a shipping company “rents” a predetermined number 
of container slots on a vessel of another shipping company in exchange for cash 
(normal or regular slot charte r) or slots on its own vessels (slot -exchange). Slot 
charter agreements do not normally involve joint decision making concerning 
marketing, ports of call, schedule or the use of the same port terminals.56 
(52) Consortia are operational agreements between shippin g companies established on 
individual trades for the provision of a joint service. Alliances are matrices of vessel 
                                                 
50  Guidelines on the assessment of non -horizonta l mergers under the Council Regulation on the control of 
concentrations between undertakings, OJ C 265, 18.10.2008, p. 7.  
51  Non-Horizontal Merger Guidelines, para. 29.  
52  Non-Horizontal Merger Guidelines, para. 31.  
53  Non-Horizontal Merger Guidelines, para. 58.  
54  Non-Horizontal Merger Guidelines, paras. 32 and 59.  
55  See e.g. Case M.8594 – COSCO Shipping/OOIL , para. 26.  
56  See e.g. Case M.8594 – COSCO Shipping/OOIL , para. 27.  
 
12 sharing agreements that cover multiple trades rather than one trade, as opposed to 
consortia.  In its prior decisions relating to container l iner shipping services, the 
Commission considered that shipping companies that are members of 
alliances/consortia (the latter are also called vessel sharing agreements, “VSAs”) 
jointly agree on the capacity that will be offered by the service, on its sched ule and 
ports of call. Generally, each party provides a number of vessels for operating the 
joint service and in exchange receives a number of container slots across all vessels 
deployed in the joint service based on the total vessel capacity that it contr ibutes. 
The allocation of containers is usually predetermined and shipping companies are 
not compensated if the slots attributed to them are not used. The costs for the 
operation of the service are generally borne by the vessel providers individually so 
that there is limited to no sharing of costs between the participants in a consortium.57 
(53) In previous cases, the Commission also considered that it is not appropriate to assess 
the effects of the concentration only on the basis of the parties’ individual marke t 
shares. Such an approach would not adequately take into account the fact that a 
member of an alliance/consorti um can have a significant influence on operational 
decisions determining service characteristics. This influence can have a dampening 
effect on competition on the trade/s serviced by the alliance s/consortia in question. 
Hence, the competitive assessment should also be based on the aggregate shares of 
the parties’ alliances/consortia.58  
(54) The Notifying Parties argue that the competitive analysis of the vertical links created 
by the Transaction should be based only on MSC’s market shares and should not 
include the market shares of MSC’s consortia partners.59  
(55) In line with its prior decisional practice,60 the Commission will assess the effects of 
the Tra nsaction by taking into account the aggregate market shares of MSC and of 
its partners in the respective consortia.  
5.2.3.  Vertical link – market for container terminal services and d eep-sea container liner 
shipping services  
(56) MSC is providing deep -sea container liner shipping services on various trades to and 
from Northern Europe. MSC’s market share (including its consortia partners) is 
shown in Table 2 below.  
  
                                                 
57  See e.g. Case M.8594 – COSCO Shipping/OOIL , paras. 28 -29.  
58  See e.g. Cases M.8594 – COSCO Shipping/OOIL , paras. 32 -33; M.8330 – Maersk Line/HSDG , para. 60.  
59  Form CO, paras. 173; 283; 330 et seq.  
60  See also Case M.8459 – TIL/PSA/PSA DGD , para . 52. 

 
14 Northern Europe – South America East Coast  [20-30]% [40-50]%68 
South America East Coast – Northern Europe  [20-30]% [30-40]%69 
Northern Europe – South America West Coast  [20-30]% -  
South America West Coast – Northern Europe  [30-40]% -  
 
(57) As shown in Table 2 above , MSC (including its consortia partners) has a market 
share of above 30% on the following 13 legs of trade: Northern Europe – South 
Africa, South Africa – Northern Europe, East Africa – Northern Europe, Northern 
Europe – Far East, Far East – Northern Europe, Northern Europe – Indian 
Subcontinent, Indian Subcontinent – Northern Europe, Northern Europe – North 
America, North America – Northern Europe, Northern Europe – South America East 
Coast, South America East Coast – Northern Europe, Northern Europe -South 
America West Coast, South America West Coast – Northern Europe .  
(58) If an overall market for container terminal services or a market for container terminal 
services for hinterland traffic are considered  on which the Notifying Parties’ market 
shares are below 30% , these legs of trade are vertically affected by the Transa ction.  
(59) If a market for container terminal services for transhipment traffic is considered, on 
which the Notifying Parties’ combined market share is above 30% , all legs of trade 
mentioned in the table above are vertically affected markets.  
(60) Therefore, the Commission will assess in the following all of the above legs of trade 
as vertically affected markets.  
5.2.3.1.  Foreclosure  of competing container liner shipping companies from procuring 
container terminal services  
(61) The Commission considers that the Transaction wo uld not lead to any foreclosure  
strategy, aimed at foreclosure of competing container liner shipping companies  from 
procuring container terminal services.  
(62) The Notifying Parties would not have the ability to engage in such a strategy. The 
vertical link between different legs of trades and container terminal services based 
on the established geographic market definitions does not seem to reflect the 
business reality, as no terminal, let alone a single harbour, is specific to any 
individu al trade in this Transaction. Every container terminal serves vessels sailing 
on a variety of trades. The relevant end of trade in this Transaction for the deep -sea 
container liner shipping services, Northern Europe, encompasses the full range of 
harbours from the Atlantic coast of the Iberian Peninsula to the Baltic Sea. Any high 
market share of MSC, including its consortia partners as the case may be, on an 
affected leg of trade does not mean that it can foreclose the remaining container liner 
shipping co mpanies active on that trade because it has also a substantial market share 
in the market for terminal services i n a given harbour, here the L2 T erminal in the 
                                                                                                                                                      
partners on this leg of trade  are overstated since they  include also the SCAs; see the Notifying Parties’ 
reply to RFI 4  of 24 October 2019.  
68  VSA with Hapag Lloyd.  
69  VSA with Hapag Lloyd.  
 
15 port of Liverpool. Instead, competing container liner shipping companies serving 
Northern Europe  as one relevant end of a trade could procure port terminal services 
from several alternative providers. Following the Transaction, the c ompeting 
container liner shipping companies  will continue to be able to source container 
terminal services from alterna tive providers in the p orts belonging to the same 
catchment area as the port of Liverpool. In England alone, deep -sea container liner 
shipping companies have the ports of London, Southampton and Felixstowe  which 
are not controlled by any of the  Notifying  Parties  as an alternative, which seem  to be 
the closest competitors to the port of Liverpool.70  
(63) Moreover, i n the Commission’s view, the Notifying Parties  will not have the 
incentive to discontinue  providing container terminal services to competing liner 
shipping companies in the L2 T erminal  due to the following reasons .71 First, as the 
Commission has found in previous cases, the profit margins that terminal operators 
obtain from the provision of container terminal services are usually higher than those 
that vessels operators derive from their liner shipping activities .72 Therefore, the 
Commission considers that the Notifying Parties post -Transaction do not have an 
incentive to foreclose container liner shipping companies competing with MSC from 
procuring cont ainer terminal services at L2 Terminal. Second, w hile it is intended 
that MSC incr eases its throughput at the L2 T erminal,  following expansion of the L2 
Terminal in 2021, MSC’s throughput at the L2 Terminal would amount to [<50]% at 
most.73 It is therefore intended to achieve the vast majority  of the throughput at the 
L2 Terminal with third -party shipping lines. Moreover, Global Infrastructure 
Management (‘GIP’), the other shareholder in TIL, is an institutional investor, with 
no activities in the container liner shipping business in the EEA. GIP will not have 
an incentive to block access of MSC's rivals or to give preferential treatment to 
MSC, but would insist on arm's length dealings.  
(64) During the Commission’s market investigation, one liner shipping compan y 
currently calling at the RSCT in the port of Liverpool voiced concerns that PPG 
post-Transaction could potentially discontinue or reduce investments in the RSCT  or 
its maintenance which would negatively affect the quality of services.74 However, on 
the basis of the evidence submitted by the Notifying Parties and the Commission’s 
market investigation, the Commission is of the view that these concerns are not 
substantiated.  
(65) In particular, the majority of respondents to the Commission’s mar ket investigation 
expressing an opinion on this question considered it unlikely that the Transaction 
would have a negative impact on the operation at the RSCT.  For example , one 
respondent considered that the quality of service would remain the same post -
                                                 
70  See Section 4.1.2 of the  Decision.  
71  As explained above in paragraph 49 of this Decision, for input or customer foreclosure to be a concern, 
three conditions need to be met: (i) the  merged entity needs to have the ability to foreclose its rivals; (ii) 
the merged entity needs to have the incentive to foreclose its rivals; and (iii) the foreclosure strategy needs 
to have a significant detrimental effect on competition. These three cond itions are cumulative. Therefore, 
the conclusion that the merged entity lacks the ability to foreclose is already sufficient for the Commission 
to conclude that the transaction would not lead to a foreclosure strategy.  
72  See e.g. Case M.9093 – DP World In vestments/Unifeeder , para.  64. 
73  See also footnote 6.  
74  See agreed non -confidential minutes of a conference call of 30 September 2019 with a terminal custome r 
A, para. 14.  
 
16 Transaction at the RSCT. Another respondent explained that the L2 Terminal would 
rather be a supplement for deep -sea services than a replacement for the RSCT.75  
(66) PPG explained that the RSCT has been a profitable terminal with steady volumes 
which should conti nue post -Transaction.76 PPG submitted that  it expects its  
customers (with the exception of MSC) to continue calling at the RSCT and that  it 
had not made any proposal to its RSCT customers to switch volumes to the L2 
Terminal (with the exception of MSC).77 In addition, PPG’s five year business plan 
for the RSCT shows that [details about future investment plans] .78 Furthermore, PPG 
has a management team responsible for  the development and growth of the RSCT.79   
(67) The RSCT is solely controlled by PPG. Post -Transact ion, the L2 T erminal will be 
jointly controlled by PPG and TIL . Considering that PP G will achieve the profit 
from the RSCT alone, whereas the profit from the L2 will be split between PPG and 
TIL, the Commission considers that PPG would not have any incenti ve to 
discontinue its investments in the RSCT.   
5.2.3.2.  Foreclosure  of other terminal operators’ access to MSC’s demand of container 
terminal services  
(68) In the Commission’s view, the Notifying Parties would not have the ability or the 
incentive to foreclose access of the L2 Terminal’s  competitors to MSC’s demand of 
container terminal services  for deep -sea container liner shipping .  
(69) First, neither the marke t investigation nor the evidence submitted by the Notifying 
Parties provide any indication that post -Transaction the Notifying Parties would 
have the ability or  incentive to engage in foreclosure  strategies .80  
(70) Second, as regards ability, it is an industry practice that  as a member of consortia, 
MSC cannot unilaterally choose to divert its deep -sea trade volume to the terminal in 
which it has an equity stake, because its consortia partners have a say and may  have 
preferences for other ports .81 This is even le ss plausible to achieve at the  entire 
consortia  level  which would require even more compromises . The Transaction is 
therefore unlikely to lead to any significant changes in the competitive environment  
in this area.  
(71) Third, the Commission’s market investigat ion showed that liner shipping companies 
typically procure port terminal services from several alternative providers which are 
chosen on the basis of various practical considerations, including commercial 
                                                 
75  See agreed non -confidential minutes of a conference call of 30 Sept ember 2019 with a terminal customer  
B, para s. 11-12; agreed non -confidential minutes of a conference call of 10 October 2019 with a terminal 
customer, para. 10 . 
76  See  the Notifying Parties’ reply to RFI 1 of 30 September 2019, question 3b.  
77  See the Not ifing Parties’  reply to RFI 1 of 30 September 2019, question 3d.  
78  See the Notifying Parties’  reply to RFI 1 of 30 September 2019, question 3c and RFI 3 of 11 October 
2019, question 4.  
79  See the Notifying Parties’ reply to RFI 3 of 11 October 2019, question 4.  
80  See, for example, agreed non-confidential minutes of a conference call of 10 October  2019 with a terminal 
customer, para. 14 and agreed non -confidential minutes of a conference call of 2 October 2019 with a 
terminal customer, para.  8. 
81  See Drewry Annual Report 2018, Drewry Global Container Terminal Operations – Annual Review and 
Forecasts , Form CO, Annex 7.4.a, p. 20.  
 
17 conditions82 and transfer times.83 There is therefore  also no incentive for  MSC , as 
such a potential foreclosure strategy of competing terminals by concentrating its 
deep -sea services at the L2 Terminal would defeat the purpose of having access to 
various ports which is necessary in order to make sure that M SC is able to reach its 
customers at optimal transfer times.  
(72) Last, even if it were to engage in a foreclosure strategy, MSC’s deep -sea trade 
volume is not sufficiently large on the overall Northern European market in order to 
harm the other terminal operat ors competing with the L2 Terminal.  Indeed, MSC’s 
volum e on all Norther n European trade legs  combined was approximately […] 
million TEUs in 2018  (out of the estimated  total of  […] million  TEUs) , which 
amounted to less than [<40]%.84 
(73) The Commission therefore  considers that following the Transaction, the competing 
container terminal services providers will continue to have economic alternatives to 
avoid being foreclosed.  
5.2.3.3.  Conclusion  
(74) In light of the above considerations, the Commission concludes that the Transac tion 
would not raise serious doubts as to its compatibility with the internal market as a 
result of (input o r customer ) foreclos ure concerns  on the markets  for container 
terminal services and deep -sea container liner shipping services . 
5.2.4.  Vertical link – market for container terminal services and short -sea container liner 
services  
(75) The L2 Terminal  can accommodate the  short -sea container vessels .85 The Notifying 
Parties submit that  for short sea service, MSC  calls at the RSCT  through its  
subsidiary W.E.C. Lines that operates in short -sea container liner shipping service  
with its Brit ish Isles -Iberia trade .86 At present , MSC  has no plans to transfer the 
W.E.C. Lines ’ short -sea volumes  from the RSCT to the L2 T erminal,  however, there 
remains a po ssibility that  it might switch t o the L2 T erminal in the future.87  
(76) Given the market share data provided in Table 3 below , the Transaction  gives  rise to  
a vertically affected market  between the container terminal services and the short -sea 
container liner services on the Portugal -United Kingdom leg of trade.  
                                                 
82  Agreed non -confidential minutes of a conference call of 2 October 2019 w ith a terminal customer, para. 7.  
83  Agreed n on-confidential minutes of a conference call of 10 October 2019 w ith a terminal customer, para. 
5. 
84  Based on the information submitted by the Notifying Parties in Form CO, Table 38 and the  Notifying 
Parties’ reply to RFI 3 of 11 October, question 2.  
85  As explained by the Notifying Parties, the L2 Terminal can accommodate short -sea container vessels that 
are greater than approximately 2 000 TEUs. Smaller vessels cannot be accommodated at the L2 Terminal 
due to the tidal range of the river Mersey. See the Notifying Parties’ reply to RFI 2 of 2 October 2019, 
question 1. At present, approximately [20-30]% of the RSCT’s volumes are handled from vessels that are 
greater than 2 000 TEUs. See the Notifying Parties’ reply to RFI 3 of 11 October 2019, question 6b.  
86  See Form C O, paras. 260 -262. 
87  See the Notifying Parties’ reply to RFI 2 of 2 October, question 1b.  
 
18 Table 3. MSC’s market shares for various short -sea trades, 201888 
Leg of Trade  MSC’s market share89 
British Isles -Iberia trade  [5-10]% 
British Isles -Iberia leg of trade  [0-5]% 
Iberia -British Isles leg of trade  [10-20]% 
Spain – United Kingdom  leg of trade  [0-5]% 
United Kingdom – Spain  leg of trade  [0-5]% 
Portugal – United Kingdom  leg of trade  [50-60]% 
United Kingdom – Portugal  leg of trade  [20-30]% 
(77) In the Commission’s view, the Notifying Parties would not have the ability or the 
incentive to engage in foreclosure due to the following reasons.  
(78) First, the Transaction would not lead to any foreclosure  strategy aimed at foreclosure 
of competing container liner shipping companies  from procuring container terminal 
services as no terminal, let alone a single harbour, is specific for any individual 
trade, inc luding the Portugal – United Kingdom leg of trade, in this Transaction. 
Indeed,  there are many other ports in the  mainland Great Britain , which provide 
container terminal services to short -sea vessels, including the RSCT.  Therefore, 
following the Transacti on, the competing container liner shipping companies will 
continue to be able to source container terminal services for short -sea services from 
alternative providers.   
(79) Moreover, the L2 Terminal is only jointly -controlled by TIL which is then in turn 
jointl y controlled by MSC and GIP , an institutional investor, with no activities in the 
container liner shipping business in the EEA. GIP will not have an incentive to block 
access of MSC's rivals or to give preferential treatment to MSC, but would insist on 
arm's length dealings.  In addition, the other parent company of the L2 Terminal’s 
operating entity, PPG, would also not benefit from any foreclosure strategy as it 
operates other terminals in the mainland Great Britain.90 Therefore, PPG would be 
likely to bloc k any such foreclosure strategy.   
(80) In addition, t he Commission’s market investigation confirmed that the L2 Terminal 
might not be a preferred option to some customers due to big tidal swings, and 
strong current,91 therefore for such customers the RSCT or ot her competing 
terminals will remain a more viable option. Indeed, the L2 Terminal is directly at the 
riverside outside the lock and is made for larger vessels which are above 2 000 
TEUs,92 whereas the RSCT is inside the lock. In addition, the L2 Terminal is  
                                                 
88  These market shares are W.E.C. Lines’ own estimates and are based on volume in TEUs, see the 
Notifying Parties’ reply to QP2 of 24 September, questio n 8 and reply to RFI 2 of 2 October 2019, 
question 1c.  
89  W.E.C. Lines is not a member  of any consor tia or vessel sharing agreement, see Form CO, para. 271.  
90  For example, Greenock Ocean Terminal in Clydeport, Scotland  and the Irlam Container Terminal in 
Manchester, England.  
91  Agreed non-confidential minutes of a conference call of 30 September  2019 with a terminal customer  A, 
para. 11. 
92  Agreed non-confidential minutes of a conference call of 30 September  2019 with a terminal customer  B, 
para. 7; the No tifying Parties’ reply to RFI 3 of 11 October 2019, question 6a.  
 
19 equipped with bigger cranes, which are less suitable for smaller intra -regional 
vessels.93 
(81) The market investigation also showed  that for certain customers, the L2 Terminal 
will not be a viable option due to its technical specifications. The L2 Terminal has a 
straight berth, therefore it cannot accommodate vessels with stern ramps which need 
a pontoon or berth at the rear of the vessel in order to drop the ramp to load and 
discharge cargo.94 This technical incompatibility may prohibit certain short -sea 
customers from calling at the L2 Terminal for technical reasons.95 
(82) Second, in the Commission’s view, the Transaction would not lead to any strategy 
aimed at foreclosure of other terminal operators’ access to W.E.C. Lines’ demand of 
container terminal services  for short -sea container liner shipping . The Commission 
considers that there is close to no possibility that the Notifying Parties could  benefit 
from a potential foreclosure strategy of competing terminals by concentrating its 
short -sea services at the L2 Terminal, because it would defeat the purpose of the 
short -sea shipping operations. Indeed, short -sea container liner shipping is the 
provision of regular, scheduled costal trade services linking various ports located at 
different costal locations. Given this, it would not make economic sense for W.E.C. 
Lines to seek concentrating its business at a single port.  
(83) In light of the above consid erations, the Commission concludes that the Transaction 
would not raise serious doubts as to its compatibility with the internal market as a 
result of (input or  customer ) foreclosure  concerns in the market s for container 
terminal services and short -sea con tainer liner services . 
6. CONCLUSION  
(84) 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  
Member of the Commission  
 
 
                                                 
93  Agreed non-confidential minutes of a conference call of 30 September  2019 with a terminal customer  B, 
para. 7. 
94  See the Notifying Parties’ reply to RFI 3 of 11 October 2019, question 6a.  
95  See the Notifying Parties ’ reply to RFI 3 of 11 October 2019, question 6a.