Commission notice pursuant to Article 23(3) of Regulation (EEC) No 4056/86 concerning Case IV/MAR/36.253 - P&O Stena Line
Date: 1998-02-06
Institutions: European Commission
Subjects: competition, ferryboat, joint venture, maritime transport

6.2.98

EN

Official  Journal  of  the  European  Communities

C  39/21

Commission  notice  pursuant  to  Article  23(3)  of  Regulation  (EEC)  No  4056/86  concerning  Case
IV/MAR/36.253  -  P&O  Stena  Line

(98/C  39/06)

(Text  with  EEA  relevance)

submitted 

1.(cid:217)On  31  October  1996,  The  Peninsular  and  Oriental
Steam  Navigation  Company  ("P&O’)  and  Stena  Line
("Stena’) 
Limited 
the  Commission
to 
pursuant 
to  Article  12(1)  of  Regulation  (EEC)
4056/86  an  application  in  accordance  with  the  MAR
form  for  negative  clearance  pursuant  to  Article  85(1)
or,  in  the  alternative,  exemption  pursuant  Article
85(3)  in  respect  of  a  proposed  joint  venture  merging
their  respective  ferry  operations  on  the  Short  French
Sea  and  Belgian  Straits.

medium  term,  and  the  differences  in  cost  structure  of
the  joint  venture  and  Eurotunnel  mean  that  they  can
reasonably  be  expected  to  compete  with  each  other.
The  Commission  therefore  considers  that  a  duopoly
would  not  be  brought  about  by  the  creation  of  the
joint  venture.  The  agreement  can 
thus  not  be
regarded  as  affording  the  parties  the  possibility  of
eliminating 
the
competition.  However, 
abolition  of  duty(cid:220)free  sales  within  the  EU  in  1999,
there 
is  uncertainty  about  the  evolution  of  the
market.

after 

(EEC) 

2.(cid:217)On  13  March  1997,  pursuant  to  Article  12(2)  of
Regulation 
the  Commission
in  the
published  a  summary  of  the  application 
Official  Journal  of  the  European  Communities  and
invited  interested  parties  to  submit  their  comments
within  30  days(cid:216)(˛).

4056/86 

3.(cid:217)On  10  June  1997,  before  the  expiry  of  the  90(cid:220)day
deadline  provided  for  in  Article  12(3)  of  Regulation
(EEC)  4056/86, 
the
parties  that  there  existed  serious  doubts  within  the
meaning  of  that  Article  as  to  the  applicability  of
Article  85(3)  to  the  agreement  in  question(cid:216)(ˇ).

the  Commission 

informed 

4.(cid:217)The  Commission  intends  to  take  decision  finding
infringes
that  the  parties’  proposed 
Article  85(1)  but  is  capable  of  exemption  within  the
meaning  of  Article  85(3).

joint  venture 

lead 

to  a  duopolistic  market 

5.(cid:217)In  its  letter  of  serious  doubts  the  Commission  stated
its  concern  that  the  creation  of  the  joint  venture
could 
structure
conducive  to  parallel  behaviour  of  the  joint  venture
and  Eurotunnel  on  the  Short  Sea  tourist  market.
Following  detailed  examination  of  the  agreement
and  its  likely  effects  in  a  market  into  which  new
entry  cannot  be  expected,  the  Commission  considers
that  despite  a  high  degree  of  concentration  in  the
market  after 
the
significance  and  the  similarity  of  market  shares  for
both  the  joint  venture  and  Eurotunnel,  the  absence
in  the  short  to
of  capacity  constraints,  at 

the  operation,  and  despite 

least 

(˛)(cid:217)OJ  C  80,  13.3.1997,  p.  3.
(ˇ)(cid:217)See  press  release  IP/97/511  of  11  June  1997.

6.(cid:217)With 

to 

regard 

the  Anglo/Continental 

freight
market,  the  Commission  considers  that  there 
is
sufficient  competition  from  other  operators  in  the
market  for  the  agreement  not  to  risk  affording  the
parties  the  possibility  of  eliminating  competition  and
that  the  other  conditions  for  the  exemption  within
the  meaning  of  Article  85(3)  are  fulfilled.

the 

parent 

companies 

the  evidence  suggests 

7.(cid:217)In  its  letter  of  serious  doubts  the  Commission  stated
its  concern  about  potential  spillover  effects  on  other
are
markets  where 
competitors,  which  could  occur  through  cooperation
in  various  forms,  including  joint  marketing.  After
detailed  examination, 
that
prices  on  the  Short  Sea  constrain  prices  on  the
Western  Channel  and  North  Sea  tourist  markets,  but
not  vice  versa.  Thus,  any  attempt  by  the  parties  to
co(cid:220)ordinate  behaviour  on  either  market  will  be
destabilised  by  competition  from  the  Short  Sea.  The
parties’  co(cid:220)operation  is  therefore  unlikely  to  spill
over  onto  their  activities  on  the  North  Sea  and
Western  Channel.  On  the  Irish  Sea,  it  is  only  on  the
northern  corridor  that  the  parties  compete  directly.
In  view  of  the  low  proportion  and  low  amount  of
inter(cid:220)State  traffic  on  the  northern  corridor,  it  can  be
concluded  that  there  is  no  appreciable  effect  on
trade  between  Member  States.

8.(cid:217)The  Commission  considers  that  in  view  of  the  effects
of  the  abolition  of  duty(cid:220)free  sales  being  uncertain
the  duration  of  the  exemption  should  be  limited  to
three  years  from  the  date  of  implementation  of  the
agreement.

C  39/22

EN

Official  Journal  of  the  European  Communities

6.2.98

9.(cid:217)The  Commission  does  not 

intend 

to  attach

conditions  or  obligations  to  the  exemption.

10.(cid:217)In  accordance  with  Article  23(3)  of  Regulation
(EEC)  4056/86,  before  the  Commission  adopts  a
decision  it  invites  interested  parties  to  send  their
comments  within  30  days  from  the  date  of  publi(cid:220)
cation 
reference
notice, 
of 
IV/MAR/36.253,  to:

quoting 

this 

European  Commission,
Directorate(cid:220)General  for  Competition,
Unit  IV/D2,
Rue  de  la  Loi/Wetstraat  200,
B(cid:220)1049  Brussels

Fax  (32(cid:220)2)  296(cid:216)98(cid:216)12.

Internet:  CharlesWilliams-dg4.cec.be

Non(cid:220)opposition  to  a  notified  concentration

(Case  No  IV/M.1059  -  Suez  Lyonnaise  des  Eaux/BFI)

(98/C  39/07)

(Text  with  EEA  relevance)

On  19  December  1997,  the  Commission  decided  not  to  oppose  the  above  notified  concen(cid:220)
tration  and  to  declare  it  compatible  with  the  common  market.  This  decision  is  based  on
Article  6(1)(b)  of  Council  Regulation  (EEC)  No  4064/89.  The  full  text  of  the  decision  is
available  only  in  French  and  will  be  made  public  after  it  is  cleared  of  any  business  secrets  it
may  contain.  It  will  be  available:

-(cid:217)as  a  paper  version  through  the  sales  offices  of  the  Office  for  Official  Publications  of  the

European  Communities  (see  list  on  the  last  page),

-(cid:217)in  electronic  form  in  the  "CFR’  version  of  the  Celex  database,  under  document  No
397M1059.  Celex  is  the  computerised  documentation  system  of  European  Community  law;
for  more  information  concerning  subscriptions  please  contact:

EUR(cid:220)OP,
Information,  Marketing  and  Public  Relations  (OP/4B),
2,  rue  Mercier,
L(cid:220)2985  Luxembourg.
Tel.  (352)  29(cid:216)29(cid:216)424(cid:216)55,  fax  (352)  29(cid:216)29(cid:216)427(cid:216)63.