Commission européenne, DG COMP MERGER REGISTRY, 1049 Bruxelles, BELGIQUE  
Europese Commissie, DG COMP M ERGER REGISTRY, 1049 Brussel,   BELGIË  
 
Tel: +32 229 -91111. Fax: +32 229 -64301. E -mail: COMP -MERGER -REGISTRY@ec.europa.eu .  EUROPEAN COMMISSION  
Brussels, 19.7.2021  
C(2021 ) 5494 final   
PUBLIC VERSION  
 
 Mayr -Melnhof Karton AG  
 Brahmsplatz 6  
 A-1040 Vienna  
Austria  
Subject : Case M. 10206  ― Mayr -Melnhof Karton/International Paper (Poland ) 
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 14 June 2021 , the European Commission received notification of a proposed 
concentration pursuant to Article 4 of the Merger Regulation and following a referral 
pursuant to Article 4(5) of Council Regulation (EC) No 139/2004 by which  Mayr -
Melnhof Cartonboard International GmbH (Austria), belonging to the group Mayer -
Melnhof Karton AG (“MM”  or the “Notifying Party” ) intends to acquire within the 
meaning of Article 3(1)(b) of the Merger Regulation control of the whole of Internal 
Paper (Poland) Holding Sp.z.o.o. (together with its subsidiaries “IP Poland”, Poland) 
(the “Transaction”)3. MM and IP Poland  are designated as the “Parties”.  
                                                 
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 244 , 22.6.2021, p. 25.  
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 sho wn thus […]. Where 
possible the information omitted has been 
replaced by ranges of figures or a general 
description.  
 
 
2 1. THE PARTIES  
(2) MM is a producer of both cartonboard , in particular folding box board (“ FBB ”) and 
packaging products, in particular folding cartons (also referred to as “folding 
boxes”). To a limited extent, MM also produces (mechanical) pulp. MM is based in 
Vienna, Austria, and is active worldwide.  On 11 June 2021, the Commission 
approved the acquisition by MM of Kotkamills, a cartonboard manufacturer based in 
Finland.4  
(3) IP Poland operates an integrated pulp and pape r plant in Kwidzyn, Poland. Its 
products comprise uncoated woodfree paper, FBB, kraft paper and pulp. The focus 
of IP Poland’s business activities is Europe.  
2. THE OPERATION  
(4) The Transaction consists of the acquisition of 100% of the shares in, and sole control 
over, IP Poland  by MM. The Transaction therefore is a concentration within the 
meaning of Article 3(1)(b) of the Merger Regulation . 
3. UNION  DIMENSION  
(5) On 30 March 2021 , the Commission received, by means of a reasoned submission, a 
referral request pursuant to Article 4(5) of the Merger Regulation with respect to the 
Transaction.  
(6) The Commission transmitted this submission to all Member States on 30 March 
2021. The Member Stat es competent to examine the concentration5 did not express 
their disagreement to the request of referral within 15 working days.  
(7) The case is therefore deemed to have an EU dimension.  
4. MARKET DEFINITION  
(8) The Parties’ activities overlap with regard to the prod uction and supply of 
cartonboard  and pulp . Moreover, MM is active in the production and supply of 
folding boxes, which are made out of cartonboard. Therefore, this section will assess 
the market definition of (i) cartonboard , (ii) pulp  and (ii i) folding bo xes. 
4.1. Cartonboard  
(9) Cartonboard is the main raw material used to manufacture folding cartons. A first 
broad distinction can be made between cartonboard for liquid packaging (“LPB”) 
and cartonboard for non -liquid packaging (NLPB”).6 Within non -liquid packaging  
board, a distinction is normally made between four main categories of cartonboard: 
white lined chipboard (“WLC”) which is made from recycled fibre; solid bleached 
                                                 
4  M.10122 Mayr -Melnhof Karton / Kotkamills.  
5  According to the Parties, the Transaction would have been subject to merger control review under the 
national laws of Austria, Germany, Poland, the Czech Republic, Hungary and Lithuania.  
6  Form CO, paragraph 95.  
 
 
3 sulphate board (“SBB” or “SBS”); solid unbleached sulphate board (“SUS”); and 
FBB, which are  all made from virgin fibre.7 
(10) In some cases, large brand -owners procure cartonboard directly from manufacturers 
by means of tenders, and then separately procure conversion services to produce 
their boxes.  
(11) As regards cartonboard, MM only manufactures and sells FBB and WLC and IP 
Poland only manufactures and sells FBB . The refore, the  only horizontal overlap  as 
regards cartonboard  between the Parties’ activities is in FBB.8 
4.1.1.  Product market  
4.1.1.1.  The Commission’s decisional practice  
(12) Cartonboard is the main raw mater ial for the manufacturing of cartons. It is made 
from cellulose fibres that are produced either from timber (pulp) or by reusing 
recovered fibre. A combination of the two can be used and there are various types of 
fibre that produce different characteristi cs.  
(13) The Commission has in the past considered a distinction between FBB, WLC, SBS, 
SUS as well as coated natural kraft (“CNK”) in its case practice9,  but has ultimately 
left this open. The Commission in its most recent decision concerning the FBB 
market  also considered but ultimately left open whether the market for the supply of 
cartonboard could potentially be sub -segmented on the basis of relevant end -
application  i.e. food, pharmaceuticals, tobacco, cosmetics, graphical and “other non -
food” or by sub -grade of FBB i.e. GC1 and GC2.10   
4.1.1.2.  The Notifying Party’s view  
(14) The Notifying Party submit s that the main different types of cartonboard are FBB, 
WLC, SBS and SUS. According to the Notifying Party , the relevant market 
comprises all types of cartonboard, for th e following reasons.   
(15) From a demand -side perspective, customers can switch  to a significant degree 
between the various types of cartonboard, and often do so.11 From a supply -side 
perspective, there is significant supply -side substitutability between LPB on the one 
hand and (certain) non -liquid cartonboard grades on the other. This applies in 
particular to FBB. Generally, FBB can be, and is, also produced on machines used 
for LPB (by contrast, the same flexibility does not exist in the other direction). 
Suppl y-side substitution also exists between FBB and other NLPB grades.12 
                                                 
7  Form CO, paragraph 98.  
8  Both Parties also sell pulp, but MM sell s mechanical pulp whereas IP Poland sells chemical pulp. These 
are not affected markets and will not be considered further in the horizontal competitive assessment.  
9  M.8421 - Westrock/MPS, paras. 6-8; M.4057 - Korsnäs/Assidoman Cartonboard, paras. 13 an d 22; 
M.1225 - Enso/Stora, paras. 18, 42 and 43.  
10  M.10122 - Mayr -Melnhof Karton / Kotkamills, paragraph 25.  
11  Form CO, paragraph 166.  
12  Form CO, paragraph 166.  
 
 
4 (16) The Notifying Party  further argue s that, even if FBB is considered separately, the 
market should not be further sub -segmented, e.g. on the basis of different end -uses 
or grades/qualities. The characteristics of FBB do not significantly vary depending 
on end -use applications or grades, and customers can use the same type of FBB for a 
variety of different end -uses.13 
4.1.1.3.  The Commission’s assessment  
(17) The Commission’s market investigation supported the findings in the Commission’s  
recent M.10122 MM/Kotkamills decision. In particular, from a supply -side 
perspective, competitors indicated that while the type of fibre and fibre preparation 
was different a ccording to the categories of cartonboard (notably WLC has a very 
different fibre prepara tion to the other categories),14 the remainder of the production 
process was similar. Adjustments can be made to the board machine, according to 
the category of cartonb oard being manufactured.15   
(18) However, from a demand -side perspective, a majority of respondents indicated that 
the different categories of cartonboard were not all substitutable, although this 
typically depended on the end application.16  Examples of differe nt end applications 
could include, packaging for food, pharmaceut icals, cosmetics or cigarettes.17 For 
example, one customer noted that “ Generally, in the normal course of business, the 
answer is no. There may be limited occasions where board types could be  substituted 
[…]. The board grades have differing technical, physical, visual and commercial 
characteristics, rendering them fit for a certain purpose for certain applications and 
not for fit for purpose for others .”18 A competitor similarly noted that: “ It is very 
much depending on the end use segment. For some of them all can be used, for 
some, only selected ones. Also the price/m2 factor is decisive. There can be a big 
difference e.g. in between SBS and WLC .”19   
(19) A majority of respondents also highlighted that different end uses required specific 
types of cardboard, with food packaging in particular requiring virgin -fibre grade 
cartonboard where food contact was required. For example, one competitor noted 
that: “ Some difference exists for the grades used fo r tobacco packaging. Due to a 
specific printing method and high -speed packing lines not all FBB products are 
suitable for tobacco packaging. WLC cannot normally be used in applications that 
are in direct contact with food without an additional barrier as t he recycled fibers 
may create a risk of food contamination .”20   
(20) The market investigation therefore tended to support the Commission’s previous 
practice to consider a distinction between the different categories of cartonboard 
(FBB, WLC, SBS, SUS).  
                                                 
13 Form CO, paragraph 166.  
14  Replies to questions 8 and 10 of Questionnaire to competitors.  
15  Replies to questions 8 and 10 of Questionnaire to competitors.  
16  Replies to questions 6 and 8 of Questionnaire to customers and replies to questions 8 and 9 of 
Questionnaire to competitors.  
17 Form CO, paragraph 167.  
18  Replies to questions 6 and 8 of Q uestionnaire to customers.  
19  Replies to questions 8 and 9 of Questionnaire to competitors.  
20  Reply to questions 8 and 11 of Questionnaire to competitors.  
 
 
5 (21) Within t he category of FBB, there are different sub -grades, namely GC1 and GC2. 
These terms are derived from the DIN Standard 193030 “Paperboard – Terms and 
Grades” that defines different grades of paperboard based on the surface treatment, 
the main finish and the  colour or bulk.21 GC1 is a fully coated board with a coated 
reverse and GC2 is a fully coated board with an uncoated reverse.22 GC1 is brighter 
in appearance, more expensive and tends to be used for more luxury applications and 
for good quality printing res ults and GC2 is less bright and a little cheaper, and tends 
to be used for cheaper applications such as food packaging.23 The different sub -grade 
of FBB used may therefore vary according to the different end application. Different 
end applications could inc lude: food, tobacco and pharmaceutical applications.24   
(22) The market investigation results were however mixed regarding the question of 
whether there should be separate product markets according to the type of  sub-grade 
of FBB , or according to the type of en d-application.  While a majority of customers 
said that there were specific end -applications that required a specific sub -grade of 
FBB, the reasons given for this differed.  Some converters referred to the fact that 
their own customers specified the sub -grade to be used, while others referred to the 
particular function of the packaging . For example,  one customer noted that: “ E.g. in 
case one would like to print on the reverse side of a board, one might want to have 
the board pigment coated also on the reverse side. In case one would like to put in 
hot liquid, the board needs to fulfill thi s temperature requirement etc .”25 The replies 
did not indicate a consensus around any possible further distinctions within FBB; the 
needs of each customer varied. For e xample, one converter noted: “ Some end 
customer prefer a special board for their product it could be product safety, product 
appearance or price and other commercial/operational demands that defines the 
need .”26 The responses in the market investigation the refore tend to indicate that 
customer preferences drive  the type of FBB and th ese can vary from customer to 
customer.  
(23) The majority of competitors in the market investigation however confirmed that it 
would be possible to switch between production of GC1 a nd GC2 without significant 
investments of time or cost and that the production process was similar.  However, it 
is easier to switch from GC1 to GC2 than vice -versa. As noted by one competitor: 
“Switching from GC2 or FSB to GC1 typically requires an invest ment into a reverse 
side coater (if the machine does not already have one), but the technical properties 
of GC1 (white reverse) can also be achieved through adjusting the pulps in the 
middle and reverse layer ”;27 and “ If the machine does not have a coating unit on 
reverse side the investment could be 5 -10 M€ .”28 
(24) For the purpose of this decision, as in M.10122 MM/Kotkamills, the exact product 
market definition can be left open between an overall market for cartonboard or 
                                                 
21  Form CO, paragraph 99.  
22  Form CO, paragraph 99.  
23  Replies to question 8 and 13 of Questionnair e to competitors and replies to questions 10 and 11 of 
Questionnaire to customers.  
24  Form CO, paragraph 217.  
25  Reply to question 11 of Questionnaire to customers.  
26  Reply to questions 6 and 9 of Questionnaire to customers.  
27  Reply to question 8 and 16 of Questionnaire to competitors.  
28  Reply to question 8 and 16 of Questionnaire to competitors.  
 
 
6 FBB, and between an overall FBB market or sub -segments for FBB according to end 
use or sub -grade of FBB . This is because the Transaction does not raise serious 
doubts as to its compatibility with the internal market or the functioning of the EEA 
Agreement under any plausible market definition.  
(25) In conclusion, the Commission will analyse the effects of the Transaction both on 
the overall FBB market and also on the basis that the market for FBB is segmented 
either by end -application i.e. food, pharmaceuticals, tobacco, cosmetics, g raphical 
and “oth er non -food”, or by sub -grade of FBB i.e. GC1 and GC2. No affected 
markets arise considering an overall cartonboard market and so th is will not be 
analysed further in this decision.  
4.1.2.  Geographic market  
4.1.2.1.  The Commission’s decisional practice  
(26) The Commission has previously defined the market for FBB as at least EEA -wide, 
including in its most recent decision s concerning the FBB market.29  
4.1.2.2.  The Notifying Party’s view  
(27) The Notifying Party consider s the market for cartonboard to be at least EEA -wide 
and potentially worl dwide, for the following reasons:   
(28) First, FBB is traded cross -border within the EEA (and beyond). Within the EEA, 
FBB production sites in Finland and Sweden account for 71% of the EEA -wide 
maximum production capacity of FBB. At the same time, Finland and Sweden 
correspond to only 2% of the EEA demand for FBB in 2019.30  
(29) Second, European cartonboard producers also face significant competitive pressure 
from outside the EEA. Producers o utside Europe fulfil approximately 10 -12% of the 
European demand for FBB.31   
(30) Third, each of the Parties’ sales distribution supports the existence of significant 
cross -border trade across the EEA (and beyond) . [Share] % of MM’s EEA -wide FBB 
sales are delive red outside of its countries of production (ie. Germany, Netherlands 
and Slovenia). [Share]  IP Poland’s worldwide FBB sales are also made outside of 
Poland.32   
(31) However, the Notifying Party submit s that the exact market definition can be left 
open between E EA-wide and global since no significant impediment of effective 
competition is to be expected even by the narrowest definition.  
                                                 
29  M.10122 - Mayr -Melnhof Karton/Kotkamills, paragraphs 33 -34, M.8951 – Suzano Papel e 
Celulose/Fibria Celulose, paragraph 82 and M.8421 –Westrock/MPS, paragraph 28.  
30  Form CO, paragraph 183.  
31  Form CO, paragraph 188.  
32  Form CO, paragraph 185.  
 
 
7 4.1.2.3.  The Commission’s assessment  
(32) The Commission’s market investigation supported the findings in the Commission’s  
recent M.10122 MM/ Kotkamills decision . In particular, the vast majority of 
customers confirmed that their suppliers were located in th e EEA or worldwide,33 
with a majority of competitors also confirming that their customers were located at  
either EEA or worldwide level.34 Similarly, the majority of both customers and 
competitors indicated that they either requested bids, or participated in bids, at least 
at EEA level, if not worldwide.35 While a majority of respondents confirmed that 
transport c osts were however significant in  the EEA,36 the results of the market 
investigation indicate that this has not prevented customers from sourcing, and 
competitors from supplying, across the EEA and beyond.  
(33) For the purpose of this decision, as in M.10122 MM/Kotkamills, the exact 
geographic market definition can be left open between EEA -wide and worldwide as 
the Transaction does not raise serious doubts as to its compatibility with the internal 
market or the functioning of the EEA Agreement under any of these two plausible 
market definitions.   
(34) In conclusion, the Commission will analyse the effects of the Transaction on the 
basis that the market for FBB is EEA -wide. No affected markets arise at worldwide 
level so this will not be analysed further in this decision.  
4.2. Pulp  
4.2.1.  Product market  
4.2.1.1.  The Commission’s decisional practice  
(35) The Commission has in the past considered different markets based on distinctions 
between “virgin fibre vs recycled fibre pulp”, “chemical vs mechanical pulp”, 
“dissolving pulp vs other types of chemical wood pulp”, “Fluff pulp vs other types 
of chemical wood pulp”, “bleached vs unbleached wood pulp”, “hardwood vs 
softwood pulp”, and “ Bleached Eucalyptus Kraft Pulp (“ BEKP ”) vs other types of 
hardwood pulp”. The exact market definition was ultimately left open.37 
4.2.1.2.  The Notifying  Party’s view  
(36) The Parties submit that the exact definition of the relevant pulp market can be left 
open in the present case since the Transaction does not give rise to competition 
concerns under any plausible market definition.  
                                                 
33  Replies to questions 6 and 17 of Questionnaire to customers.  
34  Replies to questions 8 and 17 of Questionnaire to competitors.  
35  Repli es to questions 8 and 18 of Questionnaire to competitors and replies to questions 6 and 18 of 
Questionnaire to customers.  
36  Replies to questions 8 and 19 of Questionnaire to competitors and replies to questions 6 and 19 of 
Questionnaire to customers.  
37  M.6682 - Kinnevik/Billerud/Korsnäs, M.8951 – Suzano Papel e Celulose/Fibria Celulose.  
 
 
8 4.2.1.3.  The Commission’s assessment  
(37) The Commission considers that the exact market definition can be left open since no 
competition concerns  arise under any plausible market definition.  For the purpose of 
this Decision, the Commission will analyse the effects of the Transaction on the 
plausi ble markets for (i) pulp, (ii) chemical pulp, (iii) mechanical pulp, (iv) bleached 
pulp, (v) unbleached pulp, (vi) hardwood pulp, and (vii) softwood pulp.38 
4.2.2.  Geographic market  
4.2.2.1.  The Commission’s decisional practice  
(38) The Commission has in the past considered it to be at least EEA -wide in scope, but 
ultimately left the exact definition of the relevant geographic market open.39 
4.2.2.2.  The Notifying Party’s view  
(39) The Parties submit that the exact definition of the relevant geographic market can be 
left open also in the prese nt case.  
4.2.2.3.  The Commission’s assessment  
(40) The Commission considers that the exact market definition can be left open since no 
competition concerns  arise under any plausible market definition.  For the purpose of 
this Decision, the Commission will analyse the eff ects of the Transactions on an 
EEA -wide and a worldwide market.  
4.3. Folding boxes  
4.3.1.  Product market  
4.3.1.1.  The Commission’s decisional practice  
(41) In previous cases, the Commission has defined folding boxes as multi -layered 
paperboard cartons which are printed/coated and c ut into carton blanks. The carton 
blanks also incorporate creases, which enable the carton to be formed for packaging 
the customer's product. Folding boxes can be used to pack a wide range of products, 
such as cosmetics, tobacco, pharmaceuticals, etc. The Commission established that 
these products have different requirements for packaging, therefore the folding box 
market could be further subdivided by end -use application.40 In its most recent 
decision , the Commission ultimately left open whether the market for folding boxes 
should be further segmented by end -use and  considered separate markets for 
packaging for (i) food,  (ii) beverages , (iii) tobacco, (iv) cosmetics and personal 
hygiene, (v) pharmaceuticals, and (vi) household .41  
                                                 
38  The Parties are not active in other types of pulp. Form CO, Table 16.  
39  M.8951 – Suzano Papel e Celulose/Fibria Celulose, paras.67 et seq.  
40  M.8421 – Westrock/MPS, p ara 6 and cases cited therein.  
41  M.10122 – MM/Kotkamills, para 39. 
 
 
9 4.3.1.2.  The Notifying Party’s view  
(42) The Notifying Party submit s that the exact definition of the product market can be 
left open in the present case since the Transaction does not give rise to competition 
concerns based on any plausible market definition.42  
4.3.1.3.  The Commission’s assessment  
(43) The Co mmission’s market investigation supported the findings in the Commission’s  
recent M.10122 MM/Kotkamills decision. In particular, i n the market investigation, 
a majority of respondents replied that production processes of folding boxes differ 
depending on the end -application.43 However, a majority of respondents also replied 
that it is feasible both economically and technically to switch production of folding 
boxes for one end -application to another end -application.44 There are some 
exceptions where switching  is not possible in the short -term. Notably, several 
respondents mentioned that this is the case when producing folding boxes for the 
food and pharmaceutical sectors where special certification and approval systems 
require time (in addition to switching th e production process, where required). 
Overall, the market investigation did not provide clear evidence for the definition of 
an overall market for folding boxes, nor for separate markets for folding boxes per 
end-use.  
(44) In case the folding box market was f urther segmented by end -use, the relevant end -
uses appear to be (i) food, (ii) beverages, (iii) tobacco, (iv) cosmetics and personal 
hygiene, (v) pharmaceuticals, and (vi) household. These segments account for 
[share] % of MM’s folding carton sales.45 The re spondents in the market 
investigation also mentioned these sub -segments when asked for which end -
applications they produce folding boxes.46 
(45) Overall, the market investigation did not provide clear evidence for the definition of 
an overall market for folding boxes, nor for separate markets for folding boxes per 
end-use.  
(46) For the purpose of this decision the exact product market definition can be  left open 
between an overall market for folding boxes and sub -segments for (i) food, (ii) 
beverages, (iii) tobacco, (iv) cosmetics and personal hygiene, (v) pharmaceuticals, 
and (vi) household, as the Transaction does not raise serious doubts as to its 
compatibility with the internal market or the functioning of the EEA Agreement 
under any plausible market definition.  
(47) In conclusion, the Commission will analyse the effects of the Transaction both for an 
overall market for  folding boxes and separate segment s by end -application, notably 
folding boxes for the end -uses (i) food, (ii) beverages, (iii) tobacco, (iv) cosmetics 
and personal hygiene, (v) pharmaceuticals, and (vi) household.  
                                                 
42  Form CO, paragraph 200.  
43  Replies to question 6 and 15 of Questionnaire to customers.  
44  Replies to question 6 and 15 of Questionnaire to customers.  
45  Form CO, footnote 60.  
46  Replies  to question 14 of Questionnaire to customers.  
 
 
10 4.3.2.  Geographic market  
4.3.2.1.  The Commission’s decisional practice  
(48) In the past, the Com mission left open whether the market for folding boxes is 
national or EEA -wide, based on the level at which sourcing of folding cartons takes 
place.47 
4.3.2.2.  The Notifying Party’s view  
(49) The Notifying Party submit s that customers source folding cartons from supplier s 
across Europe (and beyond) and there are no particular barriers to cross -border 
trading in folding cartons. Therefore, individual national markets would not 
adequately reflect the competitive dynamics in the folding cartons market. 
Consequently, the Transaction should be analysed on the basis of an (at least) EEA -
wide market for folding cartons.48 
4.3.2.3.  The Commission’s assessment  
(50) The Commission’s market investigation supported the findings in the Commission’s  
recent M.10122 MM/Kotkamills decision. In particula r, in the market investigation, 
a minority of suppliers replied that their customers of folding boxes are located in 
the same country as their folding box production. The largest group of customers 
supply folding boxes at cross -border regional level, i.e. beyond their own country, 
followed by several customers who supply in all EEA -countries and some who 
supply at worldwide level .49 Notably, none of the respondents who replied only 
participate in tenders in their own country. A vast majo rity of respondents participate 
in tenders at EEA -level and some at worldwide level, which indicates that the market 
for folding boxes has moved further towards an (at least ) EEA -wide market.50 
Although a majority of respondents consider that transport cost s for folding boxes 
are significant,51 this does not appear to limit sales to other national markets.  
(51) In any case, for the purpose of this decision the exact geographic market definition 
can be left open as the Transaction does not raise serious doubts as to its 
compatibility with the internal market or the functioning of the EEA Agreement 
under any plausible market definition.  
(52) In conclusion, the Commission will analyse the effects of the Transaction on the 
market for folding boxes at EEA and national leve l.   
5. COMPETITIVE ASSESSMENT  
(53) The Transaction gives rise to horizontally affected markets in the plausible markets 
for the overall supply of FBB ( [20-30]%) and further possible sub -markets for food 
applications ( [20-30]%), pharma applications ( [20-30]%), cos metic applications 
([20-30]%) and graphical applications ( [20-30]%) and one other affected market in 
                                                 
47  M.8421 - Westrock/MPS, paras 29 et seq.  
48  Form CO, paragraph 202.  
49  Replies to question 6 and 20 of Questionnaire to customers.  
50  Replies to question 6 and 21 of Questionnaire to customers.  
51  Replies to  question 6 and 22 of Questionnaire to customers.  
 
 
11 the plausible market for the supply of GC2 (a type of FBB) ( [30-40]%) at EEA level . 
The Commission does not consider it necessary to analyse separately the se plausible 
markets as the conditions of competition and the position of the Parties in all of these  
markets are similar.  
(54) Moreover, MM is active in the production and supply of folding boxes, which are 
made out of cartonboard. This vertical link gives ris e to several  vertically affected 
markets, as MM’s m arket share  in the market for GC2 is [30-40]% at EEA level . As 
the Parties are also active in pulp (with a combined market shares of <15%  at EEA 
level ) which is an input for GC2, this results in further vertically affected markets. 
Moreover MM’s market shares in the downstream markets for folding boxes for the 
cosmetics and personal hygiene  industry in Poland, folding boxes for the pharma 
industry in Fr ance and folding boxes for the tobacco industry in Germany exceed 
30% (with <35%, <40% and <50% respectively).  
5.1. Assessment of h orizontal ly affected markets  
(55) According to the Commission’s Guidelines on the assessment of horizontal mergers 
under the Council Re gulation on the control of concentrations between undertakings 
(“Horizontal Merger Guidelines”)52, mergers between actual or potential competitors 
can result in horizontal non -coordinated effects which are harmful to competition.53 
The Horizontal Merger Guid elines list a non -exhaustive number of factors which can 
influence whether or not significant horizontal non -coordinated effects are likely to 
result from a merger, such as the large market shares of the merging firms, the fact 
that the merging firms are c lose competitors and the limited possibilities for 
customers to switch suppliers.54 
5.1.1.  The Notifying Party’s view  
(56) The Notifying Party submits that the Transaction does not raise competition 
concerns w ith regard to the supply of FBB, its further possible sub -markets and the 
supply of GC2 in the EEA for the following reasons.  
(57) First, the Parties’ combined market shares remain moderate post -merger.55 The 
current market leaders (Stora Enso and Metsä Board) have  higher market shares in 
terms of revenue in the market f or the supply of FBB  56 and its submarkets for the 
supply of FBB for food applications, pharma applications and cosmetic 
                                                 
52  OJ C 31, 05.02.2004.  
53  See Horizontal Merger Guidelines, paragraph 24: “ A merger may significantly impede effective 
competition in a market by removing important competitive constraints on one or more s ellers who 
consequently have increased market power. The most direct effect of the merger will be the loss of 
competition between the merging firms. For example, if prior to the merger one of the merging firms had 
raised its price, it would have lost some sales to the other merging firm. The merger removes this 
particular constraint. Non -merging firms in the same market can also benefit from the reduction of 
competitive pressure that results from the merger, since the merging firms’ price increase may switc h 
some demand to the rival firms, which, in turn, may find it profitable to increase their prices. The 
reduction in these competitive constraints could lead to significant price increases in the relevant 
market ”. 
54  Horizontal Merger Guidelines, paragraph 26 et seq.  
55  Form CO, paragraph 221.  
56  Form CO, paragraph 216.  
 
 
12 applications .57 In the submarket for the supply of FBB for graphical applications , 
Stora Enso would have slightly lower market shares;58 in the submarket  for the 
supply of GC2, Stora Enso and Mets ä Board would have slightly lower market 
shares.59 
(58) Second, the Parties are not close competitors since (i) they offer different FBB 
product portfolios;60 (ii) they do not compete closely in tenders organised by 
customers;61 and they consider Metsä Board and Stora Enso as their real rivals and 
close substitutes.62 
(59) Third, the Transaction does not result in the elimination of an important competitive 
force, as IP Poland  does not influence the competitive process to a greater extent 
than their respective market shares would suggest. The competitive constraints on 
the Parties come primarily from Metsä Board and Stora Enso .63 
(60) Fourth , switching costs/times are generally low/short in the market, as contract 
durations are usually short, namely in the range of three months for converters and 
one year for end -users.64  
(61) Finally , suppliers in the EEA have spare capacity and there are various other sources 
for significant additional (potential) capacity in the market. A ny attempt of 
increasing prices by reducing supply post -merger would, therefore, immediately be 
met by an increase in supply by competitors.65  
5.1.2.  The Commission’s assessment  
(62) On the basis of the information available to it and in the light of the results of th e 
market investigation, the Commission considers that the Transaction is unlikely to 
raise competition concerns for the following reasons.  
(63) First, the Parties have combined market share s below or only slightly above [20-
30]% in all plausible markets  except GC2 , as shown in Tables 1 – 6 below.66 Post-
Transaction, the Parties’ combined market share will be [20-30]% in the overall FBB 
market in the EEA, between [20-30]% in the production and supply of FBB for food, 
pharmaceutical, cosmetic and graphical applications in the EEA. The Parties’ 
combined market share would be [30-40]% in the production and supply of GC2 in 
the EEA.   
  
                                                 
57  Form CO, Annex 6.4 -1. 
58  Form CO, Annex 6.4 -1. 
59  Response to RFI 3 of 24 June 2021.  
60  Form Co, paragraph 224.  
61  Form CO, paragraph 227.  
62  Form CO, paragraph 235.  
63  Form CO, paragraph  239. 
64  Form CO, paragraph 242.  
65  Form CO, paragraph 244 et seq.  
66  All the market shares presented in this Decision are calculated by volumes sold. The Commission notes 
that, given the high capacity utilisation rates of most of the FBB suppliers (includ ing the Parties) and 
Metsä Board’s plans to expand capacity in the short term (see recital (68)), the Parties’ combined capacity 
market shares would n ot be materially higher than their sales market shares.  




 
 
17 indicated that there would be sufficient suppliers should the merged entity stop 
supplying FBB.73 
(66) Fourth, although there is a qualification process required to switch FBB suppliers,74 
the vast majority of the customers wh o replied to the market investigation indicated 
that they already multisource from various FBB suppliers, mostly in order to secure 
supply and not to depend on a single supplier.75 Therefore, if a given customer were 
to stop sourcing from one of its supplie rs, it could start the qualification process with 
a new supplier while sourcing from existing qualified suppliers.  
(67) Fifth, although half of the competitors who replied to the market investigation 
indicat ed that there are significant b arriers to enter the FB B market, such as 
environmental permits, building a new mill and building customer relationships 
(including the qualification process ),76 the majority of competitors identified market 
players having entered the FBB market in the previous years such as Kotka mills and 
Sappi.77 Moreover, KAMA (Russia) confirmed that it is entering the market in 
2021.78  
(68) Sixth, although the market investigation revealed that most of the FBB suppliers 
have high capacity utilisation rates,79 competitors indicated that new capacity wo uld 
come to the market in the short term.  In addition to KAMA in Russia, Dobrush 
(Belarus) will start operating a new machine later in 2021.80 Moreover, several 
competitors replied that the market is balanced or there is over capacity.81 The 
majority of resp ondents submitted that the market for the supply of FBB is expected 
to grow steadily in the coming years.82 In this regard, there are some plans  by 
competitors  to expand capacity in the short term, including Metsä Board by 2023.83  
(69) Seventh, as regards the impact of the Transaction, although a number of customers 
indicated that prices might rise and competition might decrease post-Transaction,84 
these concerns were not justified and were not supported by other elements derived 
from the  market investigation since the Parties are not close competitors and there 
are a number of credible alternative suppliers.   
5.1.3.  Conclusion  
(70) In view of the above, the Commission concludes that the Transaction does not raise 
serious doubts as to its compatibilit y with the internal market and the functioning of 
the EEA Agreement in relation to the overall supply of FBB , the supply of FBB for  
food applications , the supply of FBB for  pharma  applications , the supply of FBB for  
                                                 
73  Replies to question 43 of Questionnaire to customers.  
74  Replies to question 29 of Questionnaire to customers.  
75  Replies to question 26 of Questionnaire to customers.  
76  Replies to question 25 of Questionnaire to competitors.  
77  Replies to question 26 of Questionnaire to competitors.  
78  Replies to question 1 of Questionnaire to competit ors. 
79  Replies to question 28 of Questionnaire to competitors.  
80  Replies to question 27.1 of Questionnaire to competitors.  
81  Replies to question 28 of Questionnaire to competitors.  
82  Replies to question 33 of Questionnaire to competitors.  
83  Replies to  question 29 of Questionnaire to competitors.  
84  Replies to question 44 of Questionnaire to customers.  
 
 
18 cosmetic applications and the supply of  FBB for graphical  applications and the 
supply of GC2 in the EEA.   
5.2. Assessment of v ertical ly affected markets  
(71) According to the Commission’s Guidelines on the assessment of non -horizontal 
mergers under the Council Regulation on the control of concentrations  between 
undertakings (“Non -horizontal Merger Guidelines”), foreclosure effects may occur 
where actual or potential rivals' access to supplies or markets is hampered or 
eliminated as a result of the merger, thereby reducing these companies' ability and/or 
incentive to compete.85  
(72) In assessing the likelihood of an anticompetitive customer foreclosure  scenario, the 
Commission examines:  first, whether the merged entity would have the ability to 
foreclose access to downstream markets by reducing its purchase s from its upstream 
rivals;  second, whether it would have the incentive t o reduce its purchases upstream;  
and third, whether a foreclosure strategy would have a significant detrimental effect 
on consumers in the downstream market.86  
(73) In assessing the likeliho od of an anticompetitive input foreclosure  scenario, the 
Commission examines:  first, whether the merged entity would have, post -merger, 
the ability to substanti ally foreclose access to inputs;  second, whether it wo uld have 
the incentive to do so;  and third , whether a foreclosure strategy would have a 
significant detrimental effect on competition downstream.  
(74) In addition to the Parties’ activities in the FBB market, MM is active in the 
production and sale of folding boxes, which are made of FBB and other typ es of 
cartonboard. This vertical link thus gives rise to the following vertically affected 
markets  as set out in Table 7 below.  
Table 7: Overview of vertically affected markets  
Market where the 
Parties’ shares 
exceed 30%  Combined market 
shares in the 
market where 
market shares 
exceed 30%  Relevant 
upstream/downstr
eam market(s)  Combined market 
shares in the 
relevant 
upstream/downstr
eam market  
GC2 (EEA)  [30-40]% Downstream:  
Folding boxes 
(EEA)  
Folding boxes for 
food packaging  
 
Folding boxes for  
[10-20]% 
 
[10-20]%  
[0-5]% 
                                                 
85  Non-horizontal Merger Guidelines, paragraph 18.  
86  Non-horizontal Merger Guidelines, para.59.  
 
 
19 Market where the 
Parties’ shares 
exceed 30%  Combined market 
shares in the 
market where 
market shares 
exceed 30%  Relevant 
upstream/downstr
eam market(s)  Combined market 
shares in the 
relevant 
upstream/downstr
eam market  
beverage 
packaging  
Folding boxes for 
cosmetics and 
personal hygiene 
packaging  
Folding boxes for 
pharmaceuticals 
packaging  
Folding boxes for 
tobacco packaging  
Folding boxes for 
household 
packaging  
Sub-segments for 
national markets 
(see Annex I)   
[5-10]% 
 
 
[5-10]% 
[20-30]% 
 
[10-20]%  
<30% in all 99 
national markets  
GC2  [30-40]% Upstream:  
Pulp (EEA or 
worldwide)  
Chemical pulp 
(EEA or 
worldwide)  
Mechanical pulp 
(EEA or 
worldwide)  
Bleached pulp 
(EEA or 
worldwide)  
Unbleached pulp 
(EEA or 
worldwide)  
Softwood pulp 
(EEA or  
<15%  
 
<5%  
 
<15%  
 
<20%  
 
<20%  
 
<20%  
 
 
20 Market where the 
Parties’ shares 
exceed 30%  Combined market 
shares in the 
market where 
market shares 
exceed 30%  Relevant 
upstream/downstr
eam market(s)  Combined market 
shares in the 
relevant 
upstream/downstr
eam market  
worldwide)  
Hardwood pulp 
(EEA or 
worldwide)   
<20%  
Folding boxes for 
cosmetics and 
personal hygiene 
industry in Poland  <35%  Upstream:  
FBB (EEA)  
FBB for cosmetic 
applications (EEA)  
GC2 (EEA)   
[20-30]% 
[20-30]%  
[30-40]% 
Folding boxes for 
pharmaceuticals 
packaging in 
France  <40%  Upstream:  
FBB (EEA)  
FBB for pharma 
applications (EEA)  
GC2 (EEA)   
[20-30]%[20 -30]%  
[30-40]% 
Folding boxes for 
tobacco packaging 
in Germany87 <50%  Upstream:  
FBB (EEA)  
GC2 (EEA)   
[20-30]% 
[30-40]% 
Source:  Form CO, Annex 6.4 -1, Response to RFI 3 of 24 June , Response to RFI 4 of 28 June , 
Response to RFI 5 of 13 July.  
(75) Table 8 below illustrates the competitive landscape in the downstream market for the 
sale of folding  boxes in the EEA , as well as the segments by end -application  in 
Tables 9 -14: 
  
                                                 
87  As IP Poland does not produce FBB for the tobacco ind ustry, the vertical relationship of this segment is 
pre-existing and does not change as a result of the Transaction. This vertical link is therefore not analysed 
further as it is not merger -specific.  
 
 
21 Table 8: Folding boxes – EEA (2018 -2020)  
 2018 2019  2020 
 Revenue 
(m EUR ) Market 
share  Revenue 
(m EUR)  Market 
share  Revenue 
(m EUR)  Market 
share  
MM […] [10-20]% […] [10-20]%  […] [10-20]%  
Graphic 
Packaging  […] [5-10]%  […] [5-10]%  […] [5-10]%  
AR 
Packaging  […] [5-10]%  […] [5-10]%  […] [5-10]%  
Westrock  […] [5-10]%  […] [5-10]%  […] [5-10]%  
van 
Genechte
n […] [0-5]% […] [0-5]% […] [0-5]% 
Amcor  […] [0-5]% […] [0-5]% […] [0-5]% 
Edelmann  […] [0-5]% […] [0-5]% […] [0-5]% 
DS Smith  […] [0-5]% […] [0-5]% […] [0-5]% 
Essentra  […] [0-5]% […] [0-5]% […] [0-5]% 
Autajon  […] [0-5]% […] [0-5]% […] [0-5]% 
STI […] [0-5]% […] [0-5]% […] [0-5]% 
Others88 […] [50-60]% […] [50-60]%  […] [50-60]%  
Estimated 
total […] 100%  […] 100%  […] 100%  
Source: Response to RFI 4 of 28 June 2021  
  
                                                 
88  According to the Notifying Party, a large portion of  the market is accounted for by a very high number of 
medium -sized or smaller players. These are consolidated in the “others” category in the table below and 
include (but are not limited to) Hammer Verpackungswerke (GE), Baypack (GE), Cardbox (AT), FP Pack  
(FR), Posson Packaging (FR), Glossop Cartons (UK), Qualvis (UK), Dot2dot (PL), Dako (PL), and 
Bestprint (RO), each with market shares below -[0-5]%. Reply to RFI 4 of 28 June 2021.  
 
 
22 Table 9: Folding boxes for tobacco packaging  – EEA (2018 -2020)  
 2018 2019  2020 
 Revenue 
(m EUR)  Market 
share  Revenue 
(m EUR)  Market 
share  Revenue 
(m EUR)  Market 
share  
MM […] [30-
40]% […] [20-
30]% […] [20-
30]%  
Amcor  […] [30-
40]%  […] [30-
40]%  […] [30-
40]%  
AR Packaging  […] [20-
30]%  […] [20-
30]%  […] [20-
30]%  
Persiehl  […] [0-5]% […] [0-5]% […] [0-5]% 
PMI own 
production  […] [0-5]% […] [0-5]% […] [0-5]% 
Yuri Gagarin  […] [0-5]% […] [0-5]% […] [0-5]% 
Gundlach  […] [0-5]% […] [0-5]% […] [0-5]% 
Grafobal  […] [0-5]% […] [0-5]% […] [0-5]% 
Right Pack  […] [0-5]% […] [0-5]% […] [0-5]% 
Unipack  […] [0-5]% […] [0-5]% […] [0-5]% 
Bernholz 
Verpackungen  […] [0-5]% […] [0-5]% […] [0-5]% 
Others  […] [0-5]% […] [0-5]% […] [0-5]% 
Estimated 
total […] 100%  […] 100%  […] 100%  
Source: Response to RFI 4 of 28 June 2021  
Table 10: Folding boxes for pharmaceuticals packaging  – EEA (2018 -2020)  
 2018 2019  2020 
 Revenue 
(m 
EUR)  Market 
share  Revenue 
(m EUR)  Market 
share  Revenue 
(m 
EUR)  Market 
share  
MM […] [5-10]%  […] [5-10]%  […] [5-10]%  
Faller  […] [5-10]%  […] [5-10]%  […] [5-10]%  
 
 
23  2018 2019  2020 
 Revenue 
(m 
EUR)  Market 
share  Revenue 
(m EUR)  Market 
share  Revenue 
(m 
EUR)  Market 
share  
Edelmann  […] [5-10]%  […] [5-10]%  […] [5-10]%  
Essentra  […] [5-10]%  […] [5-10]%  […] [5-10]%  
LGR  […] [5-10]%  […] [5-10]%  […] [5-10]%  
Westrock  […] [5-10]%  […] [5-10]%  […] [5-10]%  
AR 
Packaging  […] [0-5]% […] [0-5]% […] [5-10]%  
Autajon  […] [0-5]% […] [0-5]% […] [0-5]% 
Kroha  […] [0-5]% […] [0-5]% […] [0-5]% 
Graphic 
Packaging  […] [0-5]% […] [0-5]% […] [0-5]% 
Rattpack  […] [0-5]% […] [0-5]% […] [0-5]% 
Others89 […] [50-60]% […] [50-60]%  […] [50-60]%  
Estimated 
total […] 100%  […] 100%  […] 100%  
Source: Response to RFI 4 of 28 June 2021  
 
Table 11: Folding boxes for beverage packaging – EEA (2018 -2020)  
 2018 2019  2020 
 Revenue 
(m EUR)  Market 
share  Revenue 
(m 
EUR)  Market 
share  Revenue 
(m 
EUR)  Market 
share  
MM […] [0-5]% […] [0-5]% […] [0-5]% 
Graphic 
Packaging  […] [40-50]%  […] [40-50]%  […] [40-50]%  
Westrock  […] [30-40]% […] [30-40]%  […] [30-40]%  
                                                 
89  See footnote 88. 
 
 
24  2018 2019  2020 
 Revenue 
(m EUR)  Market 
share  Revenue 
(m 
EUR)  Market 
share  Revenue 
(m 
EUR)  Market 
share  
Van 
Genechten  […] [5-10]%  […] [5-10]%  […] [5-10]%  
STI […] [0-5]% […] [0-5]% […] [0-5]% 
DS Smith  […] [0-5]% […] [0-5]% […] [0-5]% 
Seda  […] [0-5]% […] [0-5]% […] [0-5]% 
AR 
Packaging  […] [0-5]% […] [0-5]% […] [0-5]% 
Model  […] [0-5]% […] [0-5]% […] [0-5]% 
Smurfit  […] [0-5]% […] [0-5]% […] [0-5]% 
Mondi  […] [0-5]% […] [0-5]% […] [0-5]% 
Others  […] [0-5]% […] [0-5]% […] [0-5]% 
Estimated 
total […] 100%  […] 100%  […] 100%  
Source: Response to RFI 4 of 28 June 2021  
Table 12: Folding boxes for food packaging – EEA (2018 -2020)  
 2018 2019  2020 
 Revenue 
(m EUR)  Market 
share  Revenue 
(m EUR)  Market 
share  Revenue 
(m EUR)  Market 
share  
MM […] [10-20]%  […] [10-20]%  […] [10-
20]%  
Graphic 
Packaging  […] [5-10]%  […] [5-10]%  […] [5-10]%  
Westrock  […] [5-10]%  […] [5-10]%  […] [5-10]%  
AR 
Packaging  […] [0-5]% […] [5-10]%  […] [5-10]%  
Van 
Genechten  […] [0-5]% […] [5-10]%  […] [5-10]%  
 
 
25  2018 2019  2020 
 Revenue 
(m EUR)  Market 
share  Revenue 
(m EUR)  Market 
share  Revenue 
(m EUR)  Market 
share  
DS Smith  […] [0-5]% […] [0-5]% […] [0-5]% 
STI […] [0-5]% […] [0-5]% […] [0-5]% 
Autajon  […] [0-5]% […] [0-5]% […] [0-5]% 
Model  […] [0-5]% […] [0-5]% […] [0-5]% 
Persiehl  […] [0-5]% […] [0-5]% […] [0-5]% 
Grafobal  […] [0-5]% […] [0-5]% […] [0-5]% 
Others 90 […] [60-
70]%  […] [60-
70]%  […] [50-
60]%  
Estimated 
total […] 100%  […] 100%  […] 100%  
Source: Response to RFI 4 of 28 June 2021  
Table 13: Folding  boxes for household packaging – EEA (2018 -2020)  
 2018 2019  2020 
 Revenue 
(m 
EUR)  Market 
share  Revenue 
(m EUR)  Market 
share  Revenue 
(m EUR)  Market 
share  
MM […] [10-20]%  […] [10-20]%  […] [10-20]%  
Graphic 
Packaging  […] [0-5]% […] [5-10]%  […] [5-10]%  
Westrock  […] [0-5]% […] [0-5]% […] [0-5]% 
AR 
Packaging  […] [0-5]% […] [0-5]% […] [5-10]%  
Van 
Genechten  […] [0-5]% […] [0-5]% […] [0-5]% 
DS Smith  […] [0-5]% […] [0-5]% […] [0-5]% 
STI […] [0-5]% […] [0-5]% […] [0-5]% 
                                                 
90  See footnote 88. 
 
 
26  2018 2019  2020 
 Revenue 
(m 
EUR)  Market 
share  Revenue 
(m EUR)  Market 
share  Revenue 
(m EUR)  Market 
share  
Autajon  […] [0-5]% […] [0-5]% […] [0-5]% 
Model  […] [0-5]% […] [0-5]% […] [0-5]% 
Persiehl  […] [0-5]% […] [0-5]% […] [0-5]% 
Grafobal  […] [0-5]% […] [0-5]% […] [0-5]% 
Others91 […] [60-70]% […] [60-
70]%  […] [60-
70]%  
Estimated 
total […] 100%  […] 100%  […] 100%  
Source: Response to RFI 4 of 28 June 2021  
Table 14: Folding boxes for cosmetics and personal hygiene  packaging – EEA 
(2018 -2020)  
 2018 2019  2020 
 Revenu
e (m 
EUR)  Market 
share  Revenue 
(m 
EUR)  Market 
share  Revenue 
(m 
EUR)  Market 
share  
MM […] [5-10]%  […] [5-10]%  […] [5-10]%  
Edelmann  […] [5-10]%  […] [5-10]%  […] [5-10]%  
AR 
Packaging  […] [5-10]%  […] [5-10]%  […] [5-10]%  
Essentra  […] [5-10]%  […] [5-10]%  […] [5-10]%  
Autajon  […] [5-10]%  […] [5-10]%  […] [5-10]%  
DS Smith  […] [0-5]% […] [0-5]% […] [0-5]% 
Graphic 
Packaging  […] [5-10]%  […] [5-10]%  […] [5-10]%  
Westrock  […] [0-5]% […] [0-5]% […] [0-5]% 
                                                 
91  See footnote 88. 
 
 
27  2018 2019  2020 
 Revenu
e (m 
EUR)  Market 
share  Revenue 
(m 
EUR)  Market 
share  Revenue 
(m 
EUR)  Market 
share  
STI […] [0-5]% […] [0-5]% […] [0-5]% 
Van 
Genechte
n […] [0-5]% […] [0-5]% […] [0-5]% 
Others 92 […] [40-50]% […] [40-50]%  […] [40-50]%  
Estimated 
total […] 100%  […] 100%  […] 100%  
Source: Response to RFI 4 of 28 June 2021  
(76) As the tables indicate, the transaction gives rise to 22 vertically affected markets at 
EEA level, and an additional 99 vertically affected when considering national 
markets for the downstream market for folding boxes (see  Annex I).  
(77) The Parties’ combined market shares in FBB overall, as well as for potential sub 
segments of the FBB market, remain below 30%, with the exception of GC2 where 
the Parties’ combined market shares is [30-40]%. For any other plausible definition 
of the FBB market, the Parties’ market shares do not reach 30%.93 Therefore, input 
foreclosure seems unlikely fo r FBB or any sub -segment of FBB , as the Parties do 
not represent a sufficiently important source of inputs. This Decision will discuss in 
more deta il why input foreclosure also does not seem likely in the market for GC2 in 
the EEA, where the Parties’ combined market share is [30-40]%. 
(78) As for the downstream markets  for folding boxes , MM’s market shares in all 
plausible  market s for folding boxes remain  below 30% , with the exception of three 
markets in which MM’s market share exceeds 30% on a national level if segmented 
by end -application. For the remaining downstream markets, MM’s market shares 
remain below 30% even under the narrowest plausible product  and geographic 
market definition. Therefore, customer foreclosure does not seem likely, as MM 
does not represent a sufficiently important customer in the downstream market. This 
Decision will discuss in more detail why customer foreclosure also does not s eem 
likely in the markets for folding boxes for cosmetics and personal hygiene packaging 
in Poland, for pharma ceutical s packaging  in France and for tobacco packaging in 
Germany, where  market shares of MM exceed 30% in these downstream markets.  
(79) As the Parti es are also active in pulp, an input to GC2 where the Parties’ combined 
market shares reach [30-40]%, this Decision will also discuss customer foreclosure 
for this vertical relationship. In the market for pulp, the Parties’ combined market 
                                                 
92  See footnote 88. 
93  The Non -Horizontal Merger Guidelines note that Commission is  unlikely to find concern in non -
horizontal mergers where the market share post -merger of the new entity in each of the markets concerned 
is below 30% (Non -Horizontal Merger Guidelines, para 25).  
 
 
28 shares for pulp remain below 20% under any plausible product and geographic 
market definition. Therefore, input foreclosure does not seem likely, as the merged 
entity does not represent a sufficiently important source of inputs .  
5.2.1.  No input foreclosure for folding box producers as a result of the Parties’ activity in 
GC2  
5.2.1.1.  The Notifying Party’s view  
(80) The Notifying Party submits that input foreclosure concerns as a result of the 
Transaction can be excluded, given that the merged entity will not have market 
power  in the FBB market and will lack the ability to foreclose competitors from 
access to FBB. The Parties' combined market share in FBB will remain below 25% 
and large competitors with much broader capacity and product offering, especially 
Metsä Board and Stor a Enso, will remain in the market. In contrast, IP Poland only 
offers a limited product offering which other FBB suppliers could easily replicate.94 
5.2.1.2.  The Commission’s assessment  
(81) The Commission considers that input foreclosure for folding box producers as a 
result of the Parties’ activity in GC2  appear s unlikely to arise, for the following 
reasons.  
(82) First, the Parties do not have the ability  to foreclose access to GC2, as this would 
require a significant degree of market power in the upstream market.95 However, the 
Parties’ market shares in the upstream markets for GC2 only just reach [30-40]% and 
a number of strong competitors are active in GC2 production (see table 6), limiting 
the Parties’ ability to succeed with an input foreclosure strategy. In the market 
investigation, a majority of customers replied that in case MM stopped supplying 
GC2 to them, they would still have sufficient alternative suppliers to source GC2.96 
As customers multisource (see paragraph (66)), they could react to price increases by 
increasing their orders from their other suppliers . While the market for FBB in the 
EEA is currently operating at close to full capacity , the market investig ation 
indicated that new capacity will come to the market in the short term  (see paragraph 
(68)). Moreover, as explained in paragraph (23), there is a high degree of supply -side 
substitutability, so that not only the current competitors active in GC2 could supply 
customers, but also  some  GC1 suppliers could switch their production to produce 
more GC2.  
(83) Second, the Parties do not have the incentive  to foreclose access to GC2 in the 
downstream market, as MM would give up its sales to customers for FBB in case it 
stopped supplying compe ting firms downstream , which are an essential part of 
business strategy.  Customers could also retaliate and stop buying other types of FBB 
or cartonboard from MM in case it stopped supplying GC2.  Given that MM has sold 
more than [share] % of its FBB to thir d parties in the past three years,97 it seems 
unlikely that MM would give up these sales.  
                                                 
94  Form CO, paragraph 264.  
95  Non-horizontal Merger Guidelin es, paragraph 35.  
96  Replies to question 43 of Questionnaire to competitors.  
97  Form CO, paragraph 11.  
 
 
29 (84) In view of the above, the Commission considers that the Parties will likely have 
neither the  ability, nor the incentive to foreclose access to GC2. E ven if MM stopped 
supplying GC2 to other folding box manufacturers or converters downstream, a 
foreclosure strategy would have no detrimental effects  on competition in these 
downstream markets, as a number of strong competitors remain active in the 
upstream GC2 market (see Section 5.1.2 ).  
5.2.2.  No customer foreclosure for competing FBB producers as a result of MM’s activity 
in national folding box markets  
5.2.2.1.  The Notifying Party’s view  
(85) The Notifying Party further submits that customer foreclosure concerns as a result of 
the Transaction can be excluded, given the intense competition in the folding box 
market in the EEA. MM accounts for a limited share of FBB demand with a mar ket 
share of [10-20]% in the EEA folding box market  in 2020.  FBB suppliers have and 
will continue to have the ability to sell cartonboard to a large number of converters, 
brand owners and merchants.98 
(86) Moreover, the Transaction will enable MM to supply FBB t o brand -owners, which 
request large back -up machines or have other specific needs and therefore 
predominantly source from the two industry leaders, Stora  Enso and Metsä Board. 
According to the Notifying Party, the Transaction will therefore increase compet ition 
in deliveries to brand -owners.99 
5.2.2.2.  The Commission’s assessment  
(87) The Commission considers that customer foreclosure for competing FBB producers 
as a result of MM’s activity in national folding box markets appear s unlikely to 
arise, for the following reaso ns. 
(88) First, the Parties do not have the ability  to foreclose access to customers in the 
downstream market s for folding boxes for cosmetics and personal hygiene 
packaging in Poland, for pharma ceutical s packaging  in France and for tobacco 
packaging in Germany , as this would require a significant degree of market power in 
the downstream market.100 Although MM’s market share s exceed 30% in these three 
markets , MM faces competition from numerous strong competitors active in the 
folding box market in other countries  and sub -segments  (see tables 8-14). Given that 
FBB producers sell throughout the EEA (see paragraph (32)), they do not depend on 
sales in a particular country or sub -segment. Also most folding box producers who 
replied to the market investigation are active in all sub -segments and participate in 
tenders throughout the EEA (see paragraph (50)), so significant competitive 
constraints exist  which limit  MM’s ability  to successfully engage in customer 
foreclosure . Finally, in the market investigation, a vast majority stated that in case 
MM stopped buying from them, they would still have sufficient customers for all 
types of FBB.101 According to one competitor “ The European converter industry is 
                                                 
98  Form CO, paragraph 265.  
99  Form CO, paragraph 266.  
100  Non-horizontal Merger Guidelines, paragraph 61.  
101  Replies to question 37 of Questionnaire to competitors.  
 
 
30 still very fragmented and there would be several alternative sources of demand 
left.”102 
(89) Second, the Parties also do not have the  incentive  to foreclose access to customers in 
the downstream markets  for folding boxes for cosmetics and personal hygiene 
packaging in Poland, for pharma ceutical s packaging  in France and for tobacco 
packaging in Germany . In the unlikely event that MM stopped buying inputs from 
other FBB producers for its production of folding boxes for cosmetics and personal 
hygiene packaging in Poland , for pharm aceuticals packaging  in France and for 
tobacco  packaging  in Germany, it would be at risk of supply interruptions, as it 
would depend on one supply source. As explained in paragraph 17(66), customers of 
FBB multi -source to prevent such dependency. In view of the above, the 
Commission considers that the P arties will likely have no ability, nor an incentive, to 
foreclose access to customers in the downstream markets for folding boxes for 
cosmetics and personal hygiene packaging in Poland, for pharma ceuticals packaging  
in France and for tobacco  packaging  in Germany . Even in case MM stopped 
sourcing FBB for its production of folding boxes for cosmetics and personal hygiene 
packaging in Poland, for pharma ceutical packaging  in France and for tobacco 
packaging in Germany  from other competitors upstream, a foreclosure strategy 
would have no detrimental effects  on competition in the downstream folding box 
market. Upstream FBB suppliers could locate alternative customers in Poland, 
France and Germany  (not only in cosmetics a nd hygiene  packaging , pharma ceuticals 
packaging and tobacco  packaging but other sectors) and also in other EEA countries.  
5.2.3.  No customer  foreclosure for competing pulp  producers as a result of the Parties’ 
activity in GC2  
(90) The Commission considers that custom er foreclosure concerns appear unlikely to 
arise even under the narrowest plausible product and geographic market definition, 
as the Parties do not have the ability  to foreclose access to customers in the 
downstream markets for GC2, as this would require a  significant degree of market 
power in the downstream market.103 Although MM’s market shares reach [30-40]% 
in the market for GC2, MM faces competition from numerous strong competitors 
active in GC2 production (see table  6) to which pulp producers can sell. Moreover, 
pulp suppliers do not depend on sales to GC2 producers, but can sell to cartonboard 
manufacturers producing products other than GC2. In an overall cartonboard market, 
the Parties’ market share remains below 20%,104 indicating that they do not have the 
required market power to foreclose pulp manufacturers from access to the 
cartonboard market.  
5.2.4.  Conclusion on customer and input foreclosure in relation to folding boxes and FBB  
(91) In view of the above, the Commission concludes that the Transaction does not  raise 
serious doubts as to its compatibility with the internal market and the functioning of 
the EEA Agreement in relation to the vertical links between market s for FBB 
upstream and marke ts for folding boxes downstream, under any plausible geographic 
and product market definition .  
                                                 
102  Non-confidential reply to question 37.1 of Questionnaire to competitors.  
103  Non-horizontal Merger Guidelines, paragraph 61.  
104  Form Co, Table 14.  
 
 
31 5.3. Assessment of coordinated effects  
(92) A merger in a concentrated market  may significantly impede effective competition, 
through the creation  or a strengthening of a collectively  dominant position, by 
increasing  the likelihood  that firms are able to coordinate their behaviour and raise 
prices , without entering into an agreement  or concerted practice within the meaning 
of Article 10 1 TFEU . A merger may also make coordination easier, more stable or 
more effective for firms which were coordinating prior to the merger , either by 
making the coordination more robust or by permitting firms to coordinate on even 
higher prices .105 
5.3.1.  The Notifying Party’s view  
(93) The Notifying Party submit s that the conditions for coordinated effects are not met , 
in particular due to the characteristics of the FBB market.106 It argue s that FBB is a 
highly competitive product segment which is undergoing significant growth, driven 
primarily by the switch from plastic to cartonboard for consumer packaging  and 
cannot t herefore lead to a stable economic environment .107 The Notifying Party  also 
submit s that the re is a lack of symmetry between the players in the market: MM 
Group and IP Poland are very different to the market leaders Stora Enso and Metsä 
Board in terms of cap acity, capacity utilisation, cost structure, level of vertical 
integration, product range and the geographic presence, amongst other factors.108 
There is a lack of market transparency, due to the fact that supply contracts in the 
FBB industry are typically c oncluded on the basis of bilateral negotiations. 
Cartonboard producers do not know their competitors’ prices and in any event, 
cartonboard producers charge different prices to different customers, depending also 
on the particular product specifications. Th e methodology for applying discounts 
also varies depending on the customer or size of the contract.109 Finally, the 
Notifying Party submits that IP Poland is not an industry “maverick” with a history 
of preventing or disrupting coordination.110  
5.3.2.  The Commission’s assessment  
(94) The Commission does not consider that the Transaction gives rise to serious doubts 
on the basis of horizontal coordinated effects for the reasons set out below.  
(95) First, the Commission observes that the FBB market has been subje ct to relatively 
recent new entry and, due in particular to the shift from plastic to more sustainable 
sources of packaging, has been growing and will continue to grow. For example, o ne 
respondent  in the market investigation noted that: “FBB is the most co mmon 
paperboard used in Europe and its consumption, according to CEPI public 
statistics, has been steadily increasing year by year in the last 10 years. It is 
generally expected that it will grow even further. This is felt not only in the order 
inflow from  our customers but also, in a much wider perspective, for example from 
EU Green Deal initiative and increasing public awareness for more sustainable 
                                                 
105  Horizontal Merger Guidelines, paragraph 39.  
106  Form CO, paragraph 251.  
107  Form CO, paragraph 252.  
108  Form CO, paragraph 253.  
109  Form CO, paragraph 254.  
110  Form CO, paragraph 255.  
 
 
32 packaging solutions. Discussions regarding replacing plastic packaging with more 
environmental friendly alt ernatives has become also a political topic (for example, 
banning of Single -Use plastic straws & cutlery, plates & cups) , which is why, it is 
expected that in those segments where plastic foils & packaging are widely used, 
will be gradually replaced by pa per & board, further facilitating the growth of 
FBB.”111 It is also in the context of the transition from plastic to cartonboard 
packaging that certain market players have been identified as particularly innovative, 
for example Kotkamills (part of MM) was ob served to be “ innovative with barrier 
coatings ”112 which is used for example in the manufacture of paper cups. No 
evidence surfaced during the market investigation suggesting a particularly stable  
economic environment , which would  render coordination more likely.  
(96) Second, there is no evidence in the Commission’s file showing that the market is 
particularly transparent , making it easier for market players to monitor deviations. 
For instance, contracts are normally negotiated on a bilateral basis with customers.113 
These negotiations are confidential and competitors do not therefore have insight 
regarding the terms concluded by their competitors.114  
(97) Third, in the market investigation no customer raised concerns based on actual or 
potential coordination. Moreover, th ere is no evidence in the file indicating that any 
deterrent strategy would be particularly effective.   
(98) In view of the above, the Commission concludes that the Transaction does not raise 
serious doubts as to its compatibility with the internal market and t he functioning of 
the EEA Agreement in relation to horizontal coordinated effects.  
6. CONCLUSION  
(99) 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 th e 
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  
                                                 
111  Reply to question 23 and question 30 of Questionnaire to customers.  
112  Reply to question 35 of Questionnaire to customers.   
113  Replies to question 28 of Que stionnaire to customers and replies to question 21 of Questionnaire to 
competitors.  
114  Replies to questions 20 and 22 -24 of Questionnaire to competitors.  
 
 
1 Annex I – MM’s market shares in the downstream markets for folding boxes 
at national level  (2020)  
EEA 
country  Folding 
boxes  (all 
end-uses)  Folding 
boxes for 
food  Folding 
boxes for 
tobacco   Folding 
boxes for 
pharma  Folding 
boxes f or 
cosmetics 
and 
personal 
hygiene   Folding 
boxes for 
household  
Austria  [5-10]% <20%  <30%  <5%  <5%  <10%  
Belgium  [10-20]% <15%  - - <15%  - 
Bulgaria  <30%  <30%  - - <30%  - 
Croatia  <30%  <30%  <10%  - - - 
Czech 
Republic  <30%  <30%  <30%  - <30%  <30%  
Denmark  <30%  <30%  - - - <30%  
Finland  <30%  - - - - - 
France  [10-20]% <15%  <30%  <40%  <30%  <10%  
Germany  [10-20]% <15%  <50%  <10%  <5%  <15%  
Greece  <30%  <30%  <5%  - - - 
Hungary  <30%  <30%  <30%  <30%  <30%  <30%  
Ireland  <30%  <30%  - <30%  - <30% 
Italy [0-5]% <5%  <30%  <5%  <5%  <10%  
Lithuania  <30%  <30%  <30%  - - - 
Luxembou
rg <30%  - <30%  - - - 
Netherland
s [0-5]% <5%  <30%  - <10%  <10%  
Norway  <30%  - - - - - 
Poland  [10-20]% <20%  <30%  <5%  <35%  <20%  
Portugal  <30%  - <15%  - - <30%  
Romania  <30%  <30%  <20%  - <30%  <30%  
Slovakia  <30%  <30%  - - <30%  <30%  
 
 
2 EEA 
country  Folding 
boxes  (all 
end-uses)  Folding 
boxes for 
food  Folding 
boxes for 
tobacco   Folding 
boxes for 
pharma  Folding 
boxes f or 
cosmetics 
and 
personal 
hygiene   Folding 
boxes for 
household  
Slovenia  <30%  - - - <30%  - 
Spain  [5-10]% <5%  <20%  <5%  <5%  <15%  
Sweden  <30%  <30%  - - <30%  - 
UK [5-10]% <10%  - <5%  <5%  <30%  
 Source: Form CO, Annex 6.4 -5, Reply to RFI 4 of 28 June 2021