WRITTEN QUESTION E-1118/00

by Luis Berenguer Fuster (PSE) to the Commission

(11 April 2000)

Subject: Mergers in the electricity sector

The Commission has recently expressed reservations regarding the Spanish authorities' limited independence as regards competition. This lack of independence is particularly apparent where mergers are concerned, in which field the relevant procedure is carried out under the supervision of the Anti-Trust Department (part of the Treasury). Cases are approved by the government itself, whilst the Anti-Trust Tribunal merely issues a report.

According to sources within Spain's ruling party, Hidrocantábrico shares are to be publicly offered for sale to Unión Fenosa. This would reduce competition in the electricity sector and would increase the power of the third-largest operator in Spain. In addition there are rumours of a merger between Endesa, Fecsa and Sevillana de Electricidad, although no application has been made to the Spanish competition authorities.

Under these circumstances the Spanish authorities are unlikely to exercise any control over mergers within the electricity sector. Is the Commission therefore planning any action to control merger operations within the Spanish electricity sector?

Answer given by Mr Monti on behalf of the Commission

(8 June 2000)

In its recommendation for the 2000 broad economic guidelines of the economic policies of the Member States and the Community(1), the Commission stated that Spain should give priority to continuing the 1999 reform of the competition law and within this reform should give particular attention to reinforcing the capacity of the independent competition authority to investigate cases.

The Commission is only entitled to control merger operations which have Community dimension in the meaning of the Merger Regulation(2).

The operations mentioned by the Honourable Member, according to the information received by the Commission, did not have Community dimension and were or are being assessed by the Spanish competition authorities.

(1) Ecfin 209/00, http://europa.eu.int/comm/economy_finance/document/econeur/berg/gope2000_en.pdf.

(2) A concentration has a Community dimension where: (a) the combined aggregate world-wide turnover of all the undertakings concerned is more than 5 000 million; and (b) the aggregate Community-wide turnover of each of at least two of the undertakings concerned is more than 250 million, unless each of the undertakings concerned achieves more than two thirds of its aggregate Community-wide turnover within one and the same Member State. A concentration that does not meet the thresholds laid down above has a Community dimension where: (a) the combined aggregate world-wide turnover of all the undertakings concerned is more than 2 500 million; (b) in each of at least three Member States, the combined aggregate turnover of all the undertakings concerned is more than 100 million; (c) in each of at least three Member States included for the purpose of point (b), the aggregate turnover of each of at least two of the undertakings concerned is more than 25 million; and (d) the aggregate Community-wide turnover of each of at least two of the undertakings concerned is more than 100 million; unless each of the undertakings concerned achieves more than two-thirds of its aggregate Community-wide turnover within one and the same Member State.