2001/143/EC: Commission Decision of 29 December 2000 relating to a proceeding pursuant to Article 81 of the EC Treaty and Article 53 of the EEA Agreement (Case No COMP/36.841 — Unisource) (Text with EEA relevance) (notified under document number C(2000) 4094)
Date: 2000-12-29
Institutions: European Commission
Subjects: competition law, joint venture, merger control, shareholder, telecommunications

L 52/30

EN

Official Journal of the European Communities

22.2.2001

COMMISSION DECISION

of 29 December 2000

relating to a proceeding pursuant to Article 81 of the EC Treaty and Article 53 of the EEA
Agreement

(Case No COMP/36.841 — Unisource)

(notified under document number C(2000) 4094)

(Only the Dutch, English and Swedish texts are authentic)

(Text with EEA relevance)

(2001/143/EC)

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty establishing the European
Community,

Having regard to the Agreement on the European Economic
Area,

Having regard to Council Regulation No 17 of 6 February
1962, first Regulation implementing Articles 85 and 86 of the
EC Treaty (1), as last amended by Regulation (EC) No 1216/
1999 (2), and in particular Articles 2 and 8(3)(a) thereof,

(2)

Having regard to Commission Decision 97/780/EC of 29
October 1997 relating to a proceeding pursuant to Article 85
of the EC Treaty and Article 53 of the EEA Agreement (3) (Case
No IV/35.830 — Unisource),

Having regard to the application filed on 23 December 1999
by Unisource NV (Unisource) and its three shareholders, Konin-
klijke KPN NV (KPN), Swisscom AG (Swisscom) and Telia Ab
(Telia) (collectively: ‘the Parties’), for a review of the need for
the conditions and obligations contained in Decision 97/780/
EC,

Having regard to the summary of the application and noti-
fication published (4) pursuant to Article 19(3) of Regulation
No 17,

After consultation with the Advisory Committee for Restrictive
Practices and Dominant Positions,

Whereas:

I. THE FACTS

subsidiary, Unisource NV, as the joint venture for
conducting
expansion strategy.
Consequently, they have taken the irreversible decision
to reduce Unisource's scope.

international

their

A. Creation of Unisource and related agreements

that

is to say,

The decision of the shareholders is to abandon the stra-
tegic alliance articulated through Unisource. They will,
their expiry the Unisource
however, maintain until
agreements,
the instruments creating
Unisource and the individual contractual restrictions
contained therein. Unisource will continue to exist as a
holding company for the joint ownership by KPN, Telia
and Swisscom of AUCS communication services vof
the AUCS communication
(AUCS). Management of
in
services, which offers
(in which
is now undertaken by Infonet
Europe,
Unisource's parent companies have a 56 % stake).

to multinationals

services

B. Reduced scope of Unisource's activities

(3)

According to the Parties, the only activity that remains
of the Unisource activities described in Decision 97/
780/EC is the provision of value added telecommunica-
tions services to multinational corporate customers (5).
carried through AUCS (formerly
This business
Uniworld). On 29 May 1999, Unisource acquired 100 %
of the shares of AUCS by taking over AT&T's shares.
This
transaction was declared compatible with the
common market by Commission decision of 8 July
1999 in Case COMP/M.1581 (6).

is

(1)

According to the Parties, market developments over the
past years as well as the losses accumulated during those
years have forced them to abandon their wholly-owned

(4)

All the other activities described in Decision 97/780/EC
have been abandoned. As a result, the only remaining
subsidiary owned by Unisource is AUCS vof.

(1) OJ 13, 21.2.1962, p. 204/62.
(2) OJ L 148, 15.6.1999, p. 5.
(3) OJ L 318, 20.11.1997, p. 1.
(4) OJ C 217, 29.7.2000, p. 35.

(5) Namely, the provision of seamless, value added international voice,
internet and messaging services to multinational companies

data,
operating in Europe.

(6) OJ C 328, 17.11.1999, p. 7.

(5)

(6)

(7)

(8)

(9)

(10)

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Official Journal of the European Communities

L 52/31

Non-compete provisions

E. Comments of interested parties

As a consequence of the divestitures, all non-compete
provisions contained in the original agreements have
disappeared. There are no non-compete agreements
between AUCS and Unisource's parent companies. KPN,
Swisscom and Telia can compete with Unisource on the
market for corporate telecommunications services or in
any other market. The parent companies declare that
their interest in Unisource is strictly financial.

(11) No comments were received from third parties in
response to the Commission's notice pursuant to Article
19(3) of Regulation 17.

II. LEGAL ASSESSMENT

Exclusive distributorship

The exclusive distribution agreements between certain
Unisource subsidiaries and the Unisource shareholders
referred to in Decision 97/780/EC have become obsolete
since those subsidiaries have been sold or their activities
have been discontinued.

(12)

C. Presence in the market

As was stated above, the presence of Unisource in the
relevant markets described in Decision 97/780/EC is
reduced in scope to the provision of value added tele-
communications services via AUCS/Infonet.

The competitive situation in the market for the provi-
telecommunications services to multi-
sion of global
national corporate customers was assessed by the
Commission in its decision of 21 February 2000 in Case
M.1741 — MCI WorldCom/Sprint (1). According to
1999 data, the market share of AUCS/Infonet in that
market would be between 4 % and 11 %.

D. Regulatory safeguards

In contrast
to the regulatory situation when the
Commission exempted the Unisource agreements, tele-
communications markets in the Community are liberal-
ised and each Member State has national regulatory
authorities (NRAs) with wide powers to intervene in
those markets.

all

domestic

telecommunications

The Commission's view is that, while it is true that KPN,
Telia and Swisscom maintain very high market shares in
almost
services
markets in their respective home countries, telecommu-
nications are now fully liberalised in the Netherlands and
in Sweden. Indeed, in contrast to the market situation
when Decision 97/780/EC was adopted, competition is
taking place in those countries as well as in Switzerland
(see Commission's Fifth Implementation Report on the
implementation of the telecommunications regulatory
package (2).

A. Application of Article 81(1) of the EC Treaty and
to the

the EEA Agreement

Article 53(1) of

Unisource agreements

In Decision 97/780/EC, the Commission establishes that
the Unisource agreements fall within Article 81(1) of the
EC Treaty and Article 53(1) of the EEA Agreement.
Although the Parties will maintain those agreements
until they expire, they have notified to the Commission
their irreversible decision to abandon the Unisource alli-
ance as originally conceived and the irreversible char-
acter of the divestments, resulting in a discontinuation
of the Unisource group.

(13) As a result of that decision and those divestitures, the
scope of activities of Unisource described in the
Commission's decision of 29 October 1997 has been
reduced considerably. As was stated above, Unisource's
sole presence in the market is through AUCS/Infonet.
All the other subsidiaries listed in the Commission's
decision have been sold. All other activities apart from
the provision of value added telecommunication services
have been abandoned. Consequently, it can no longer be
considered that the parent companies pool a significant
number of assets in connection with the provision and
marketing of telecommunications services as listed in
recital 75 of Decision 97/780/EC.

(14) According to the Parties, the only remaining subsidiary
of Unisource, namely AUCS, would represent in terms
of 1999 figures less than 3 % of the revenues of any of
its parent companies. The declared intention of
the
Parties is to limit Unisource's relations with its parent
companies to a financial relationship. Given the nature
of the changes to Unisource's structure, the risk of coor-
dination of
the competitive behaviour between the
parent companies considered in Decision 97/780/EC
appears remote.

(15)

Furthermore, contrary to the original intentions of the
parent companies, the abandoning of the original scope
of the Unisource alliance means that each parent will
address the relevant markets listed in Decision 97/
780/EC on its own. In particular, KPN, Swisscom and
Telia will even compete with AUCS/Infonet
in the
market for the provision of global telecommunications
services
to multinational corporate customers. The
maintenance of AUCS/Infonet as an independent market
player will increase competition in that market, in which
only a reduced numbers of companies are active at
world-wide level (3).

(1) See Press Release IP/00/668.
(2) COM(1999) 537 final of 10 November 1999 — available at

http://europa.eu.int/ispo.

(3) See Commission's decision of 21 February 2000 in Case M.1741 —

MCI WorldCom/Sprint.

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Official Journal of the European Communities

22.2.2001

B. Application of Article 81(1) of the EC Treaty and
to the

the EEA Agreement

Article 53(1) of

contractual provisions

The contractual provisions identified in Decision 97/
780/EC as being caught by Article 81(1) of the EC
Treaty and Article 53(1) of
the EEA Agreement no
longer apply.

The only remaining activity of Unisource is the owner-
ship of AUCS. There is no non-compete agreement
between the parent companies and Unisource for the
service provided by AUCS. KPN, Telia and Swisscom are
free to compete with AUCS for the provision of value-
added telecommunications
to multinational
corporate customers. For instance, KPN has set up a
joint venture (KPN Qwest) that provides global telecom-
munications services. Swisscom and Telia both offer
such services to their respective customers,
in direct
competition with Unisource/AUCS.

services

The exclusive distribution agreements originally envis-
aged no longer exist and therefore do not affect the
conditions of competition within the EEA and Switzer-
land (1). No new exclusive forms of distribution have
been entered into between Unisource and its share-
holders in regard of AUCS services.

In view of the above,
Unisource
competition in the relevant markets,

agreements do not

it can be considered that the
appreciably restrict

(16)

(17)

(18)

(19)

the modified scope of cooperation between Koninklijke KPN
NV, Swisscom AG and Telia AB in regard of
their joint
subsidiary Unisource.

Article 3

This Decision is addressed to:

1. Koninklijke KPN NV
Telecomplein 5
2516 CK Den Haag
The Netherlands

2. Telia AB

Marbackagatan 11
S-123 86 Farsta

3. Swisscom AG

Lindenhofstrasse 1
CH-3048 Worblaufen

4. Unisource NV
‘Transpolis’
Polarisavenue 97
2137 JH Hoofddorp
The Netherlands

HAS ADOPTED THIS DECISION:

Decision 97/780/EC is hereby repealed.

Article 1

Article 2

On the basis of the facts in its possession, the Commission has
no grounds for further action under Article 81(1) of the EC
Treaty and Article 53(1) of the EEA Agreement in respect of

Done at Brussels, 29 December 2000.

For the Commission

Mario MONTI

Member of the Commission

(1) See recital 83 of Decision 97/780/EC.