Opinion of the Advisory Committee on Concentrations given at its 150th meeting on 10 May 2007 concerning a draft decision relating to Case COMP/M.4404 — Universal/BMG Music Publishing
Date: 2007-09-01
Institutions: Advisory Committee on Restrictive Practices and Dominant Positions
Subjects: Internet, audiovisual industry, competition, copyright, economic concentration, merger control, music

C 204/6

EN

Official Journal of the European Union

1.9.2007

Opinion of the Advisory Committee on Concentrations given at its 150th meeting on 10 May 2007
concerning a draft decision relating to Case COMP/M.4404 — Universal/BMG Music Publishing

(2007/C 204/03)

1. The Advisory Committee agrees with the Commission that the notified operation constitutes a concentra-
tion within the meaning of Article 3(1)(b) of the EC Merger Regulation and that it has a Community
dimension pursuant to Article 1(3) of that Regulation.

2. The Advisory Committee agrees with the Commission that the relevant product markets can be charac-

terised as follows:

(a) Markets for the exploitation of music publishing rights

The relevant product markets need to be defined along the following categories of rights since the
customer needs, the prices as well as the overall economic conditions differ significantly:

— mechanical rights,

— performance rights,

— synchronisation rights,

— print rights,

— online rights;

(b) Market for music publishing services to authors.

3. The Advisory Committee agrees with the Commission that the geographic scope of the relevant product

markets is:

(a) Markets for the exploitation of music publishing rights

— mechanical and performance rights: national,

— print and synchronisation rights: largely national,

— online rights: currently national, but it is possible that it will develop to an EEA-wide scope.
However, there is no need to strictly define the geographic scope of the market for online rights
as the competitive assessment will remain unchanged under a national or EEA wide dimension;

(b) Market for music publishing services to authors

— the geographic scope of the market appears to be national. The exact geographic scope may,
however, be left open since the conclusions of the analysis will be the same under any geographic
dimension.

4. The Advisory Committee agrees with the Commission that the proposed concentration will not signifi-

cantly impede effective competition on the market for music publishing services for authors.

5. The Advisory Committee agrees with the Commission that the proposed concentration will not signifi-
cantly impede effective competition on the market for the exploitation of synchronisation rights, on the
market for the exploitation of print rights, on the market for the exploitation of mechanical rights and
on the market for the exploitation of performance rights.

6. The Advisory Committee agrees with the Commission's view that it is very likely that Universal will
post-merger, on the basis of non-coordinated effects, have the possibility and the incentive to increase
prices for its repertoire of Anglo-American mechanical rights for online applications. The Advisory
Committee agrees that the merger therefore raises serious doubts with respect to the market for online
rights (which are composed of mechanical and performance rights for online applications) both on an
EEA-wide level and in the countries Austria, the Czech Republic, Germany, Poland and the UK.

1.9.2007

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Official Journal of the European Union

C 204/7

7. The Advisory Committee agrees with the Commission that the Final Remedies Package submitted on

23 April 2007 which comprises the following catalogues and contracts:

(a) BMG MP catalogues

— Zomba Music Publishers Limited

— 19 Music Limited

— 19 Songs Limited

— BBC music publishing catalogue

— Zomba U.S. (EEA-wide licence)

(b) Universal catalogues

— Rondor Music (London) Limited

is sufficient to remove the competition concerns on the market for publishing rights for online applica-
tions, both under an EEA-wide or national geographic market definition.

8. The Advisory Committee agrees with the Commission that, the proposed concentration as modified by
the Commitments does not significantly impede effective competition in the common market or a
substantial part of it, in particular as a result of the creation or strengthening of a dominant position,
and that pursuant to Articles 8(2) and 10(2) of the Merger Regulation and Article 57 of the EEA Agree-
ment the proposed concentration is therefore to be declared compatible with the Common Market and
with the EEA Agreement, subject to full compliance with the commitments offered by the notifying
party.

9. The Advisory Committee asks the Commission to take into account all the other points raised during the

discussion.