Commission notice on remedies acceptable under Council Regulation (EC) No 139/2004 and under Commission Regulation (EC) No 802/2004 (Text with EEA relevance)
Date: 2008-10-22
Institutions: European Commission
Subjects: European Commission, administrative procedure, competition law, economic concentration, merger control

22.10.2008

EN

Official Journal of the European Union

C 267/1

II

(Information)

INFORMATION FROM EUROPEAN UNION INSTITUTIONS AND BODIES

COMMISSION

Commission notice on remedies acceptable under Council Regulation (EC) No 139/2004 and under
Commission Regulation (EC) No 802/2004

(Text with EEA relevance)

(2008/C 267/01)

I. INTRODUCTION

1. Council Regulation (EC) No 139/2004 of 20 January 2004 on the control of concentrations between
undertakings (1) (hereinafter referred to as ‘the Merger Regulation’) in Articles 6(2) and 8(2) expressly
provides that the Commission may decide to declare a concentration compatible with the common
market following modification by the parties (2), both before and after the initiation of proceedings. To
that end, the Commission may attach to its decision conditions and obligations intended to ensure
that the undertakings concerned comply with the commitments they have entered into vis-à-vis the
Commission with a view to rendering the concentration compatible with the common market (3).

2. The purpose of this Notice is to provide guidance on modifications to concentrations, in particular
commitments by the undertakings concerned to modify a concentration. Such modifications are more
commonly described as ‘remedies’ since their object is to eliminate the competition concerns (4) identi-
fied by the Commission. The guidance set out in this Notice reflects the Commission's evolving experi-
ence with the assessment, acceptance and implementation of remedies under the Merger Regulation
since its entry into force on 21 September 1990. The revision of the Commission's 2001 Notice on
remedies (5) is entailed by the entry into force of the recast Merger Regulation (EC) No 139/2004 (6)

(1) OJ L 24, 29.1.2004, p. 1-22.
(2) The references to ‘parties’ and ‘merging parties’ also cover situations with one notifying party.
(3) Articles 6(2) and 8(2), second subparagraphs respectively. See also Recital 30 of the Merger Regulation which states that
‘where the undertakings concerned modify a notified concentration, in particular by offering commitments with a view to
rendering the concentration compatible with the common market, the Commission should be able to declare the concen-
tration, as modified, compatible with the common market. Such commitments should be proportionate to the competition
problem and entirely eliminate it’. Recital 30 further explains that ‘it is also appropriate to accept commitments before the
initiation of proceedings where the competition problem is readily identifiable and can easily be remedied’.

(4) Save where the contrary is indicated, in the following, the term ‘competition concerns’ corresponds, according to the stage
of the procedure, to serious doubts or preliminary findings that the concentration is likely to significantly impede effective
competition in the common market or in a substantial part of it, in particular as a result of the creation or strengthening of
a dominant position.

(5) Commission Notice on remedies acceptable under Council Regulation (EEC) No 4064/89 and under Commission Regu-

lation (EC) No 447/98 (OJ C 68, 2.3.2001, p. 3).

(6) Regulation replacing Council Regulation (EEC) No 4064/89 (OJ L 395, 30.12.1989, corrected version in OJ L 257,

21.9.1990, p. 13.

C 267/2

EN

Official Journal of the European Union

22.10.2008

and of Commission Regulation (EC) No 802/2004 (the ‘Implementing Regulation’) (1) on 1 May 2004,
case-law of the Court of Justice and the Court of First Instance, the conclusions drawn from the
systematic ex post review of the Commission of past remedies case (2), and decisional practice of the
Commission in cases involving remedies in recent years. The principles contained herein will be
applied and further developed and refined by the Commission in individual cases. The guidance
provided in this Notice is without prejudice to the interpretation which may be given by the Court of
Justice or by the Court of First Instance of the European Communities.

3. This Notice sets out the general principles applicable to remedies acceptable to the Commission, the
main types of commitments that may be accepted by the Commission in cases under the Merger
Regulation, the specific requirements which proposals of commitments need to fulfil in both phases of
the procedure, and the main requirements for the implementation of commitments. In any case, the
Commission will take due account of the particular circumstances of the individual case.

II. GENERAL PRINCIPLES

4. Under the Merger Regulation, the Commission assesses the compatibility of a notified concentration
with the common market on the basis of its effect on the structure of competition in the Com-
munity (3). The test for compatibility under Article 2(2) and (3) of the Merger Regulation is whether or
not a concentration would 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.
A concentration that significantly impedes effective competition as described above is incompatible
with the common market and the Commission is required to prohibit it. For the creation of a joint
venture, the Commission will also examine the concentration under Article 2(4) of the Merger Regu-
lation. The principles set out in this Notice will generally also apply to remedies submitted to eliminate
competition concerns identified under Article 2(4).

5. Where a concentration raises competition concerns in that it could significantly impede effective
competition, in particular as a result of the creation or strengthening of a dominant position, the
parties may seek to modify the concentration in order to resolve the competition concerns and
thereby gain clearance of their merger. Such modifications may be fully implemented in advance of a
clearance decision. However, it is more common that the parties submit commitments with a view to
rendering the concentration compatible with the common market and that those commitments are
implemented following clearance.

6. Under the structure of the Merger Regulation, it is the responsibility of the Commission to show that
a concentration would significantly impede competition (4). The Commission communicates its
competition concerns to the parties to allow them to formulate appropriate and corresponding reme-
dies proposals (5). It is then for the parties to the concentration to put forward commitments; the
Commission is not in a position to impose unilaterally any conditions to an authorisation decision,
but only on the basis of the parties' commitments (6). The Commission will inform the parties about

(1) Commission Regulation (EC) No 802/2004 of 7 April 2004 implementing Council Regulation (EC) No 139/2004 on the
control of concentrations between undertakings (OJ L 133, 30.4.2004, p. 1). This Regulation replaces Commission Regu-
lation (EC) No 447/98 implementing Council Regulation (EEC) No 4064/89 on the control of concentrations between
undertakings (OJ L 61, 2.3.1998, p. 1).

(2) DG COMP, Merger Remedies Study, October 2005.
(3) Recital 6 of the Merger Regulation.
(4) In phase I and before the issuance of a Statement of Objections, this corresponds to serious doubts as to the significant impe-

diment to effective competition.

(5) The Merger Regulation provides for formal steps where the parties are informed of the competition concerns identified by
the Commission (Article 6(1)(c) decision, Statement of Objections). In addition, the DG COMPETITION Best Practices on
the conduct of EC merger control proceedings foresee that ‘state of play’ meetings will normally be offered at key stages of
the procedure where the Commission will explain its concerns to the parties in order to allow them to respond with reme-
dies proposals.

(6) Judgment of the CFI in Case T-210/01 General Electric v Commission [2005] ECR II-5575, paragraph 52; see judgment of the

CFI in Case T-87/05 EDP v Commission [2005] ECR II-3745, paragraph 105.

22.10.2008

EN

Official Journal of the European Union

C 267/3

its preliminary assessment of remedies proposals. If, however, the parties do not validly propose reme-
dies adequate to eliminate the competition concerns, the only option for the Commission will be to
adopt a prohibition decision (1).

7. The Commission has to assess whether the proposed remedies, once implemented, would eliminate
the competition concerns identified. Only the parties have all the relevant information necessary for
such an assessment, in particular as to the feasibility of the commitments proposed and the viability
and competitiveness of the assets proposed for divestiture. It is therefore the responsibility of the
parties to provide all such information available that is necessary for the Commission's assessment of
the remedies proposal. To this end, the Implementing Regulation obliges the notifying parties to
provide, with the commitments, detailed information on the content of the commitments offered, the
conditions for their implementation and showing their suitability to remove any significant impedi-
ment of effective competition, as set out in the annex to the Implementing Regulation (‘Form RM’).
For commitments consisting in the divestiture of a business, parties have to describe in detail in par-
ticular how the business to be divested is currently operated. This information will enable the Commis-
sion to assess the viability, competitiveness and marketability of the business by comparing its current
operation to its proposed scope under the commitments. The Commission can adapt the precise
requirements to the information necessary in the individual case at hand and will be available to
discuss the scope of the information required with the parties in advance of submission of Form RM.

8. Whereas the parties have to propose commitments sufficient to remove the competition concerns and
submit the necessary information to assess them, it is for the Commission to establish whether or not
a concentration, as modified by commitments validly submitted, must be declared incompatible with
the common market because it leads, despite the commitments, to a significant impediment of effec-
tive competition. The burden of proof for a prohibition or authorisation of a concentration modified
by commitments is therefore subject to the same criteria as an unmodified concentration (2).

Basic conditions for acceptable commitments

9. Under the Merger Regulation, the Commission only has power to accept commitments that are
deemed capable of rendering the concentration compatible with the common market so that they will
prevent a significant impediment of effective competition. The commitments have to eliminate the
competition concerns entirely (3) and have to be comprehensive and effective from all points of
view (4). Furthermore, commitments must be capable of being implemented effectively within a short
period of time as the conditions of competition on the market will not be maintained until the
commitments have been fulfilled.

10. Structural commitments, in particular divestitures, proposed by the parties will meet these conditions
only in so far as the Commission is able to conclude with the requisite degree of certainty that it will
be possible to implement them and that it will be likely that the new commercial structures resulting
from them will be sufficiently workable and lasting to ensure that the significant impediment to effec-
tive competition will not materialise (5).

11. The requisite degree of certainty concerning the implementation of the proposed commitments may
in particular be affected by risks in relation to the transfer of a business to be divested, such as condi-
tions attached by the parties to the divestiture, third party rights in relation to the business or the

(1) See Case COMP/M.2220 — GE/Honeywell of 3 July 2001, confirmed by judgment of the CFI in Case T-210/01 General
Electric v Commission [2005] ECR II-5575, paragraph 555 et seq., 612 et seq.; Case COMP/M.3440 — EDP/ENI/GDP of
9 December 2004, confirmed by judgment of the CFI in Case T-87/05 EDP v Commission [2005] ECR II-3745,
paragraphs 63 et seq., 75 et seq.; Case IV/M.469 — MSG Media Service of 9 November 1994; Case IV/M.490 — Nordic
Satellite Distribution of 19 July 1995; Case IV/M.553 — RTL/Veronica/Endemol of 20 September 1995; Case IV/M.993 —
Bertelsmann/Kirch/Prèmiere of 27 May 1998; Case IV/M.1027 — Deutsche Telekom BetaResearch of 27 May 1998; Case
IV/M.774 — St Gobain/Wacker Chemie of 4 December 1996; Case IV/M.53 — Aerospatiale/Alenia/De Havilland of
2 October 1991; Case IV/M.619 — Gencor/Lonrho of 24 April 1996, confirmed by judgment of the CFI in Case T-102/96
Gencor v Commission [1999] ECR II-753.

(2) See judgment of the CFI in Case T-87/05 EDP v Commission [2005] ECR II-3745, paragraphs 62 ff.
(3) See recital 30 of the Merger Regulation and judgment of the CFI in Case T-282/02 Cementbouw v Commission [2006]

ECR II-319, paragraph 307.

(4) CFI, Case T-210/01 General Electrics v Commission [2005] ECR II-5575, paragraph 52; Case T-87/05 EDP v Commission

[2005] ECR II-3745, paragraph 105.

(5) CFI, Case T-210/01 General Electric v Commission [2005] ECR II-5575, paragraphs 555, 612.

C 267/4

EN

Official Journal of the European Union

22.10.2008

risks of finding a suitable purchaser, as well as risks in relation to the degradation of the assets until
the divestiture has taken place. It is incumbent on the parties to remove such uncertainties as to the
implementation of the remedy when submitting it to the Commission (1).

12. In assessing the second condition, whether the proposed commitment will likely eliminate the compe-
tition concerns identified, the Commission will consider all relevant factors relating to the proposed
remedy itself, including, inter alia, the type, scale and scope of the remedy proposed, judged by refer-
ence to the structure and particular characteristics of the market in which the competition concerns
arise, including the position of the parties and other players on the market.

13. In order for the commitments to comply with these principles, there has to be an effective implemen-
tation and ability to monitor the commitments (2). Whereas divestitures, once implemented, do not
require any further monitoring measures, other types of commitments require effective monitoring
mechanisms in order to ensure that their effect is not reduced or even eliminated by the parties. Other-
wise, such commitments would have to be considered as mere declarations of intention by the parties
and would not amount to binding obligations, as, due to the lack of effective monitoring mechanisms,
any breach of them could not result in the revocation of the decision according to the provisions of
the Merger Regulation (3).

14. Where, however, the parties submit remedies proposals that are so extensive and complex that it is
not possible for the Commission to determine with the requisite degree of certainty, at the time of its
decision, that they will be fully implemented and that they are likely to maintain effective competition
in the market, an authorisation decision cannot be granted (4). The Commission may reject such reme-
dies in particular on the grounds that the implementation of the remedies cannot be effectively moni-
tored and that the lack of effective monitoring diminishes, or even eliminates, the effect of the
commitments proposed.

Appropriateness of different types of remedies

15. According to the case law of the Court, the basic aim of commitments is to ensure competitive
market structures (5). Accordingly, commitments which are structural in nature, such as the commit-
ment to sell a business unit, are, as a rule, preferable from the point of view of the Merger Regulation's
objective, inasmuch as such commitments prevent, durably, the competition concerns which would be
raised by the merger as notified, and do not, moreover, require medium or long-term monitoring
measures. Nevertheless, the possibility cannot automatically be ruled out that other types of commit-
ments may also be capable of preventing the significant impediment of effective competition (6).

16. The Commission stresses that the question of whether a remedy and, more specifically, which type of
remedy is suitable to eliminate the competition concerns identified, has to be examined on a
case-by-case basis.

17. Nevertheless, a general distinction can be made between divestitures, other structural remedies, such as
granting access to key infrastructure or inputs on non-discriminatory terms, and commitments relating
to the future behaviour of the merged entity. Divestiture commitments are the best way to eliminate
competition concerns resulting from horizontal overlaps, and may also be the best means of resolving

(1) Depending on the nature of the risks, specific safeguards may aim at compensating for them. For example, the risk arising
from third party rights in relation to the assets to be divested may be compensated by the proposal of an alternative divesti-
ture. Such safeguards will be discussed in more detail below.

(2) CFI, Case T-177/04 easyJet v Commission [2006] ECR II-1931, paragraph 188.
(3) CFI, Case T-177/04 easyJet v Commission [2006] ECR II-1931, paragraph 186 et seq.; CFI, judgment in Case T-87/05 EDP v

Commission [2005] ECR II-3745, paragraph 72.

(4) See, as an example for such a complex and inappropriate remedy, Case COMP/M.3440 — ENI/EDP/GDP of 9 December
2004; confirmed by CFI, judgment in Case T-87/05 EDP v Commission [2005] ECR II-3745, paragraph 102; Case
COMP/M.1672 — Volvo/Scania of 15 March 2000.

(5) See recital 8 of the Merger Regulation; judgment of CFI in Case T-102/96 Gencor v Commission [1999] ECR II-753, at para-
graph 316; ECJ in Case C-12/03 P Commission v Tetra Laval [2005] ECR I-987, paragraph 86; judgment of CFI in Case
T-158/00 ARD v Commission [2003] ECR II-3825, at paragraphs 192 et seq.

(6) ECJ, judgment in Case C-12/03 P Commission v Tetra Laval [2005] ECR I-987, paragraph 86; CFI, judgment of 25 March
1999 in Case T-102/96 Gencor v Commission [1999] ECR II-753, paragraphs 319 et seq.; CFI, judgment of 30 September
2003 in Case T-158/00 ARD v Commission [2003] ECR II-3825, paragraph 193; CFI in Case T-177/04 easyJet v Commission
[2006] ECR II-1931, paragraph 182; CFI, judgment in Case T-87/05 EDP v Commission [2005] ECR II-3745, para-
graph 101.

22.10.2008

EN

Official Journal of the European Union

C 267/5

problems resulting from vertical or conglomerate concerns (1). Other structural commitments may be
suitable to resolve all types of concerns if those remedies are equivalent to divestitures in their effects,
as explained in more detail below in paragraphs 61 et seq. Commitments relating to the future beha-
viour of the merged entity may be acceptable only exceptionally in very specific circumstances (2). In
particular, commitments in the form of undertakings not to raise prices, to reduce product ranges or
to remove brands, etc., will generally not eliminate competition concerns resulting from horizontal
overlaps. In any case, those types of remedies can only exceptionally be accepted if their workability is
fully ensured by effective implementation and monitoring in line with the considerations set out in
paragraphs 13-14, 66, 69, and if they do not risk leading to distorting effects on competition (3).

Procedure

18. The Commission may accept commitments in either phase of the procedure (4). However, given the
fact that an in-depth market investigation is only carried out in phase II, commitments submitted to
the Commission in phase I must be sufficient to clearly rule out ‘serious doubts’ within the meaning
of Article 6(1)(c) of the Merger Regulation (5). Pursuant to Article 10(2) of the Merger Regulation, the
Commission has to take a clearance decision as soon as the serious doubts referred to in
Article 6(1)(c) of the Merger Regulation are removed as a result of commitments submitted by the
parties. This rule applies to commitments proposed in phase II-proceedings before the Commission
issues a Statement of Objections (6). If the Commission reaches the preliminary view that the merger
leads to a significant impediment to effective competition and issues a Statement of Objections, the
commitments must be sufficient to eliminate such a significant impediment to effective competition.

19. Whilst commitments have to be offered by the parties, the Commission will ensure the enforceability
of commitments by making the authorisation of the merger subject to compliance with the commit-
ments. A distinction must be made between conditions and obligations. The requirement for achieve-
ment of the structural change of the market is a condition — for example, that a business is to be
divested. The implementing steps which are necessary to achieve this result are generally obligations
on the parties, e.g. such as the appointment of a trustee with an irrevocable mandate to sell the busi-
ness.

20. Where the undertakings concerned commit a breach of an obligation,

the Commission may
revoke clearance decisions issued either under Article 6(2) or Article 8(2) of the Merger Regulation,
acting pursuant to Article 6(3) or Article 8(6), respectively. In case of a breach of an obligation, the
parties may also be subject to fines and periodic penalty payments as provided in Article 14(2)(d)
and 15(1)(c) respectively of the Merger Regulation. Where, however, a condition is breached, e.g. a
business is not divested in the time-frame foreseen in the commitments or afterwards re-acquired, the
compatibility decision is no longer applicable. In such circumstances, the Commission may, first, take
to
interim measures
Article 8(5)(b) of the Merger Regulation. Second, it may, if the conditions of Article 8(4)(b) are met,
order any appropriate measure to ensure that the undertakings concerned dissolve the concentration
or
to
take a decision pursuant
Article 8(1)-(3). In addition, the parties may also be subject to fines as provided in Article 14(2)(d).

take other restorative measures or, according to Article 8(7),

to maintain conditions of

competition pursuant

appropriate

effective

(1) See divestiture of storage facilities in Case COMP/M.3868 — DONG/Elsam/Energi E2 of 14 March 2006,
paragraphs 170 et seq.; Case COMP/M.3696 — E.ON/MOL of 21 December 2005, paragraphs 735 et seq., for an example
of ‘ownership unbundling’ to eliminate structural links between the parties in the gas storage sector; further Case
COMP/M.4314 — Johnson&Johnson/Pfizer of 11 December 2006, Case COMP/M.4494 — Evraz/Highveld of 20 February
2007.

(2) See, in relation to conglomerate effects of a concentration, ECJ, judgment of 15 February 2005 in Case C-12/03 P

Commission v Tetra Laval [2005] ECR I-987, paragraphs 85, 89.

(3) For example, commitments regarding a certain pricing behaviour such as price caps which contain the risk to lead to an

anticompetitive alignment of prices among competitors.

(4) As foreseen in recital 30 of the Merger Regulation, the Commission will ensure transparency and effective consultation of

Member States in both phases of the procedure.

(5) Commitments in phase I can only be accepted in certain types of situations; see below in paragraph 81.
(6) See,

inter alia, Case COMP/M.2972 — DSM/Roche Vitamins of 23 July 2003; Case COMP/M.2861 —
Siemens/Drägerwerk/JV of 30 April 2003; Case IV/JV.15 — BT/AT & T of 30 March 1999; Case IV/M.1532 — BP Amoco/
Arco of 29 September 1999.

C 267/6

EN

Official Journal of the European Union

22.10.2008

Model Texts for divestiture commitments

21. The Commission services have issued Best Practice Guidelines for divestiture commitments, consisting
of a Model Text for Divestiture Commitments and a Model Text for Trustee Mandates (1). These model
texts are neither intended to provide an exhaustive coverage of all issues that may become relevant in
all cases, nor are they legally binding upon parties in a merger procedure. They complement the
present Notice as they outline the typical arrangements for divestiture commitments in a format which
can be used by the parties. At the same time, the model texts leave the flexibility to adapt them to the
requirements of the specific case.

III. DIFFERENT TYPES OF REMEDIES

1. Divestiture of a business to a suitable purchaser

22. Where a proposed concentration threatens to significantly impede effective competition the most
effective way to maintain effective competition, apart from prohibition, is to create the conditions for
the emergence of a new competitive entity or for the strengthening of existing competitors via divesti-
ture by the merging parties.

1.1. Divestiture of a viable and competitive business

23. The divested activities must consist of a viable business that, if operated by a suitable purchaser, can
compete effectively with the merged entity on a lasting basis and that is divested as a going
concern (2). For the business to be viable, it may also be necessary to include activities which are
related to markets where the Commission did not identify competition concerns if this is required to
create an effective competitor in the affected markets (3).

24. In proposing a viable business for divestiture, it is necessary to take into account the uncertainties and
risks related to the transfer of a business to a new owner. These risks may limit the competitive
impact of the divested business, and, therefore, may lead to a market situation where the competition
concerns at stake will not necessarily be eliminated.

Scope of the business to be divested

25. The business has to include all the assets which contribute to its current operation or which are neces-
sary to ensure its viability and competitiveness and all personnel which is currently employed or
which is necessary to ensure the business' viability and competitiveness (4).

26. Personnel and assets which are currently shared between the business to be divested and other busi-
nesses of the parties, but which contribute to the operation of the business or which are necessary to
ensure its viability and competitiveness, also have to be included. Otherwise, the viability and competi-
tiveness of the business to be divested would be endangered. Therefore, the divested business has to
contain the personnel providing essential functions for the business such as, for instance, group R & D
and information technology staff even where such personnel is currently employed by another busi-
ness unit of the parties — at least in a sufficient proportion to meet the on-going needs of the
divested business. In the same way shared assets have to be included even if those assets are owned by
or allocated to another business unit.

(1) See website of DG COMP, released in May 2003, available at:

http://ec.europa.eu/comm/competition/mergers/legislation/legislation.html. The model
up-dated and, if there should be a need, further best practice guidelines in the field of remedies may be issued.

texts may be continuously

(2) This includes, under certain conditions, businesses that have to be carved out from a party's business or individual assets;

see below paragraphs 35 ff.

(3) Case IV/M.913 — Siemens/Elektrowatt of 18 November 1997; Case IV/M.1578 — Sanitec/Sphinx of 1 December 1999, at
paragraph 255; Case COMP/M.1802 — Unilever/Amora-Maille of 8 March 2000; Case COMP/M.1990 — Unilever/
Bestfoods of 28 September 2000.

(4) Notifying parties will have to undertake in the commitments that the business to be divested includes all those assets and
personnel. Where the detailed description of the business, to be provided by the parties as set out in paragraph 27, will at a
later point in time appear to be incomplete in that respect and the parties do not complement the business with the neces-
sary additional assets or personnel, the Commission may consider revoking the conditional clearance decision.

22.10.2008

EN

Official Journal of the European Union

C 267/7

27. In order for the Commission to be able to identify the scope of the business to be divested, the
parties have to include a precise definition of the scope of the divested business in the commitments
(the ‘description of the business’). The description of the business has to be adapted to the indi-
vidual case at hand and should contain all the elements that are part of the business to be divested:
tangible (e.g. R & D, production, distribution, sales and marketing activities) and intangible assets
(such as intellectual property rights, know-how and goodwill); licences, permits and authorisations by
governmental organisations granted to the business; contracts, leases and commitments (e.g. arrange-
ments with suppliers and customers) for the benefit of the business to be divested; and customer,
credit and other records. In the description of the business, the parties have to include the personnel
to be transferred in general terms, including staff seconded and temporary employees, and to insert a
list of the key personnel, i.e. the personnel essential for the viability and competitiveness of the busi-
ness. The transfer of those employees is without prejudice to the application of the Council Directives
on collective redundancies (1); on safeguarding employees' rights in the event of transfers of undertak-
ings (2); and on informing and consulting employees (3) as well as national provisions implementing
those Directives and other national laws. The remedy has to include a non-solicitation commitment by
the parties with regard to the key personnel.

28. In the description of the business, the parties also have to set out the arrangements for the supply of
products and services by them to the divested business or by the divested business to them. Such
on-going relationships of the divested business may be necessary to maintain the full economic viabi-
lity and competitiveness of the divested business for a transitional basis. The Commission will only
accept such arrangements if they do not affect the independence of the divested business from the
parties.

29. In order to avoid any misunderstanding about the business to be divested, assets or personnel that are
used within or employed by the business but that should not, according to the parties, be transferred
with the divestiture, have to be expressly excluded by the parties in the commitments text. The
Commission will only be able to accept such exclusion of assets or personnel if the parties can clearly
show that this does not affect the viability and competitiveness of the business.

30. The business to be divested has to be viable as such. Therefore, the resources of a possible or even
presumed future purchaser are not taken into account by the Commission at the stage of assessing the
remedy. The situation is different if already during the procedure a sale and purchase agreement with a
specific purchaser is concluded whose resources can be taken into account at the time of the assess-
ment of the commitment. This situation will be dealt with in more detail below in paragraphs 56 ff.

31. Once a purchaser is identified after adoption of an authorisation decision, some of the assets or
personnel included in the divested business may not be needed by the proposed purchaser. In the
purchaser approval process, the Commission may, upon request by the parties, approve the divestiture
of the business to the proposed purchaser without one or more assets or parts of the personnel if this
does not affect the viability and competitiveness of the business to be divested after the sale, taking
account of the resources of the proposed purchaser.

1.2. Stand-alone business and conditions for acceptability of alternatives

32. Normally, a viable business is a business that can operate on a stand-alone-basis, which means inde-
pendently of the merging parties as regards the supply of input materials or other forms of coopera-
tion other than during a transitory period.

(1) Council Directive 98/59/EC of 20 July 1998 on the approximation of the laws of the Member States relating to collective

redundancies (OJ L 225, 12.8.1998, p. 16).

(2) Council Directive 2001/23/EC of 12 March 2001 on the approximation of the laws of the Member States relating to the
safeguarding of employees' rights in the event of transfers of undertakings, businesses or parts of undertakings or busi-
nesses (OJ L 82, 22.3.2001, p. 16).

(3) Council Directive 94/45/EC of 22 September 1994 on the establishment of a European Works Council or a procedure in
Community-scale undertakings and Community-scale groups of undertakings for the purposes of informing and
consulting employees (OJ L 254, 30.9.1994, p. 64); Directive 2002/14/EC of the European Parliament and of the Council
of 11 March 2002 establishing a general framework for informing and consulting employees in the European Community
(OJ L 80, 23.3.2002, p. 29).

C 267/8

EN

Official Journal of the European Union

22.10.2008

33. The Commission has a clear preference for an existing stand-alone business. This may take the form
of a pre-existing company or group of companies, or of a business division which was not previously
legally incorporated as such.

34. Where the competition concern results from a horizontal overlap, the parties may be able to choose
between two businesses. In cases involving a hostile bid, a commitment to divest activities of the
target company may, in such circumstances of limited information available to the notifying parties
about the business to be divested, increase the risk that this business might not, after a divestiture,
result in a viable competitor which could effectively compete in the market on a lasting basis. It may
therefore be more appropriate for the parties to propose to divest activities of the acquiring company
in such scenarios.

Carve-outs

35. Even though normally the divestiture of an existing viable stand-alone business is required, the
Commission, taking into account the principle of proportionality, may also consider the divestiture of
businesses which have existing strong links or are partially integrated with businesses retained by the
parties and therefore need to be ‘carved out’ in those respects. In order to reduce the risks for the
viability and competitiveness to a minimum in such circumstances, an option for the parties is to
submit commitments proposing to carve out those parts of an existing business which do not necessa-
rily have to be divested. In effect, an existing, stand-alone business is being divested in those circum-
stances although, by way of a ‘reverse carve-out’, the parties may carve-out the limited parts which
they may keep.

36. In any case, the Commission will only be able to accept commitments which require the carve-out of
a business if it can be certain that, at least at the time when the business is transferred to the
purchaser, a viable business on a stand-alone basis will be divested and the risks for the viability and
competitiveness caused by the carve-out will thereby be reduced to a minimum. The parties therefore
have to ensure, as set out in detail below in paragraph 113, that the carve-out is started in the interim
period, i.e. the period between the adoption of the Commission decision up to the completion of the
divestiture (meaning the legal and factual transfer of the business to the purchaser). Consequently, at
the end of this period, a viable business on a stand-alone basis will be divested. If this should not be
possible or if the carve-out should be particularly difficult, parties may provide the requisite degree of
certainty for the Commission by proposing an up-front buyer solution, as further detailed below in
paragraph 55.

Divestiture of assets, in particular of brands and licences

37. A divestiture consisting of a combination of certain assets which did not form a uniform and viable
business in the past creates risks as to the viability and competitiveness of the resulting business. This
is in particular the case if assets from more than one party are involved. Such an approach may be
accepted by the Commission only if the viability of the business is ensured notwithstanding the fact
that the assets did not form a uniform business in the past. This may be the case if the individual
assets can already be considered a viable and competitive business (1). Similarly, only in exceptional
cases a divestiture package including only brands and supporting production and/or distribution assets
may be sufficient to create the conditions for effective competition (2). In such circumstances, the
package consisting of brands and assets must be sufficient to allow the Commission to conclude that
the resulting business will be immediately viable in the hands of a suitable purchaser.

38. Divestitures of a business generally appear preferable to the granting of licenses to IP rights, as the
granting of a license involve more uncertainties, will not enable the licensee to compete immediately
in the market, requires an on-going relationship with the parties which may allow the licensor to
influence the licensee in its competitive behaviour and may give rise to disputes between the licensor

(1) Case COMP/M.1806 — AstraZeneca/Novartis of 26 July 2000; COMP/M.1628 — TotalFina/Elf of 9 February 2000; Case

IV/M.603 — Crown Cork & Seal/CarnaudMetalbox of 14 November 1995.

(2) Case COMP/M.2544 — Masterfoods/Royal Canin of 15 February 2002; Case COMP/M.2337 — Nestlé/Ralston Purina of
27 July 2001; Case IV/M.623 — Kimberly-Clark/Scott Paper of 16 January 1996; Case COMP/M.3779 — Pernod
Ricard/Allied Domecq of 24 June 2005.

22.10.2008

EN

Official Journal of the European Union

C 267/9

and the licensee over the scope and the terms and conditions of the license. The granting of a license
will therefore generally not be considered appropriate where a divestiture of a business seems feasible.
Where the competition concerns arise from the market position held for such a technology or such
IP rights, a divestiture of the technology or the IP rights is the preferable remedy as it eliminates a
lasting relationship between the merged entity and its competitors (1). However, the Commission may
accept licensing arrangements as an alternative to divestiture where, for instance, a divestiture would
impede efficient, on-going research or where a divestiture would be impossible due to the nature of
the business (2). Such licences will have to enable the licensee to compete effectively with the parties in
a similar way as if a divestiture had taken place. They will normally be exclusive licences and have to
be without any field-of-use and any geographical restrictions on the licensee. Where there might be
any uncertainty as regards the scope of the licence or its terms and conditions, the parties will have to
divest the underlying IP right, but may obtain a licence back. If there is uncertainty that the license
will actually be granted to a suitable licensee, the parties may consider to propose an up-front licensee
or a fix-it-first solution according to the considerations set out below in paragraphs 56, in order to
enable the Commission to conclude with the requisite degree of certainty that the remedy will be
implemented (3).

Re-branding

39. In exceptional cases, the Commission has accepted commitments to grant an exclusive, time-limited
licence for a brand with the purpose of allowing the licensee to re-brand the product in the period
foreseen. After the first licence phase of these so-called re-branding commitments, the parties commit
in a second phase to abstain from any use of the brand (blackout phase). The goal of such commit-
ments is to allow the licensee to transfer the customers from the licensed brand to its own brand in
order to create a viable competitor, without the licensed brand being permanently divested.

40. A re-branding remedy carries substantially higher risks for restoring effective competition than a dives-
titure, including the divestiture of a brand as there is considerable uncertainty whether the licensee
will succeed in establishing itself as an active competitor in the market on the basis of the re-branded
product. A re-branding remedy may be acceptable in circumstances where the brand at stake is widely
used and a high proportion of its turnover is generated in markets outside those in which competition
concerns have been identified (4). In those circumstances, a re-branding remedy has to be defined in
such a way as to ensure that the granting of the licence will effectively maintain competition in the
market on a lasting basis and that the licensee will be an effective competitor after re-branding the
products.

41. As the success of re-branding commitments is substantially linked to the viability of the licensed
brand a number of preconditions have to be met for the design of such commitments. Firstly, the
brand to be transferred must be well-known and one of considerable strength to guarantee both
in the re-branding period.
immediate viability of
Secondly, part of the assets related to the production or the distribution of the products marketed
under the licensed brand or the transfer of know-how may be necessary to ensure the viability of the
remedy (5). Thirdly, the licence has to be exclusive and normally comprehensive, i.e. not limited to a

the licensed brand and its economic survival

(1) See Case COMP/M.2972 — DSM/Roche Vitamins of 23 July 2003; Case IV/M.1378 — Hoechst/Rhône-Poulenc of
9 August 1999; Case COMP/M.1601 — Allied Signal/Honeywell of 1 December 1999; Case COMP/M.1671 — Dow/UCC
of 3 May 2000.

(2) Case COMP/M.2949 — Finmeccanica/Alenia Telespazio of 30 October 2002; Case COMP/M.3593 — Apollo/Bakelite of
11 April 2005, commitment on carbon bond refractory licence; for cases from the pharmaceutical industry see Case
COMP/M.2972 — DSM/Roche Vitamins of 23 July 2003; Case IV/M.555 — Glaxo/Wellcome of 28 February 1995.

(3) Case COMP/M.2972 — DSM/Roche Vitamins of 23 July 2003.
(4) However, even in these conditions a divestiture of the brand may be more appropriate, especially if the resulting split in the
ownership of the brand corresponds to common practice in the industry, see for the pharmaceutical industry Case
COMP/M.3544 — Bayer Healthcare/Roche (OTC) of 19 November 2004, paragraph 59 concerning the divestiture of the
Desenex brand.

(5) COMP/M.3149 — Procter&Gamble/Wella paragraph 60; IV/M.623 — Kimberly-Clark/Scott Paper of 16 January 1996,
paragraph 236(i). This is particularly important during the licence phase in which the licensee has to prepare for the launch
of a new competitive brand. Such a launch of a new brand appears to not be feasible if the purchaser had to spend consider-
able resources on the production process, marketing and distribution of the licensed brand; COMP/M.2337 — Nestlé/
Ralston Purina of 27 July 2001, paragraphs 67 et seq.; COMP/M.2621 — SEB/Moulinex of 8 January 2002, paragraph 140.

C 267/10

EN

Official Journal of the European Union

22.10.2008

certain range of products within a specific market, and has to include the intellectual property rights
to ensure that customers will acknowledge the familiarity of the re-branded product. The parties will
not be allowed to use similar words or signs as this could undermine the effect of the re-branding
exercise (1). Fourthly, both the licence and the black-out period have to be sufficiently long, account
being taken of the particularities of the case, so that the re-branding remedy is in its effects similar to
a divestiture (2).

42. The identity of the potential licensee will be a key factor for the success of the commitment. If there is
uncertainty that a number of suitable licensees are available, being able and having strong incentives
to carry out the re-branding exercise, the parties may consider proposing an up-front or fix-it-first
solution, in line with the considerations set out in paragraph 53 below.

1.3. Non-reacquisition clause

43. In order to maintain the structural effect of a remedy, the commitments have to foresee that the
merged entity cannot subsequently acquire influence (3) over the whole or parts of the divested busi-
ness. The commitments will normally have to foresee that no re-acquisition of material influence is
possible for a significant period, generally of 10 years. However, the commitments can also provide
for a waiver allowing the Commission to relieve the parties from this obligation if it subsequently
finds that the structure of the market has changed to such an extent that the absence of influence over
the divested business is no longer necessary to render the concentration compatible with the common
market. Even in the absence of an explicit clause, a re-acquisition of the business would violate an
implicit obligation on the parties under the commitments as this would affect the effectiveness of the
remedies.

1.4. Alternative divestiture commitments: Crown Jewels

44. In certain cases, the implementation of the parties' preferred divestiture option (of a viable business
solving the competition concerns) might be uncertain in view, for example, of third parties' pre-
emption rights or uncertainty as to the transferability of key contracts, intellectual property rights, or
the uncertainty of finding a suitable purchaser. Nevertheless, the parties may consider that they would
be able to divest this business to a suitable purchaser within a very short time period.

45. In such circumstances, the Commission cannot take the risk that, in the end, effective competition will
not be maintained. Accordingly, the Commission will only accept such divestiture commitments under
the following conditions: (a) absent the uncertainty, the first divestiture proposed in the commitments
would consist of a viable business, and (b) the parties will have to propose a second alternative divesti-
ture which the parties will be obliged to implement if they are not able to implement the first commit-
ment within the given time frame for the first divestiture (4). Such an alternative commitment
normally has to be a ‘crown jewel’ (5), i.e. it should be as least as good as the first proposed divestiture
in terms of creating a viable competitor once implemented, it should not involve any uncertainties as
to its implementation and it should be capable of being implemented quickly in order to avoid that
the overall implementation period exceeds what would normally be regarded as acceptable in the
conditions of the market in question. In order to limit the risks in the interim period, it is indispen-
sable that interim preservation and holding separate measures apply to all assets included in both
divestiture alternatives. Furthermore, the commitment has to establish clear criteria and a strict time-
table as to how and when the alternative divestiture obligation will become effective and the Commis-
sion will require shorter periods for its implementation.

(1) COMP/M.3149 — Procter&Gamble/Wella of 30 July 2003, paragraph 61; COMP/M.2337 — Nestlé/Ralstone Purina of
27 July 2001, paragraph 68; COMP/M.2621 — SEB/Moulinex of 8 January 2002, paragraph 141; IV/M.623 —
Kimberly-Clark/Scott Paper of 16 January 1996, paragraph 236(ii).

(2) For example taking into account the life cycle of products, c.f. COMP/M.2621 — SEB/Moulinex of 8 January 2002, para-
graph 141, where effectively the duration of the commitments covered a period equal to about three product life cycles;
confirmed by judgment of CFI in Case T-119/02 Royal Philips Electronics NV v Commission [2003] ECR II-1433,
paragraphs 112 et seq.

(3) An influence by the previous owner of the business in the competitive behaviour of the divested business risking to frus-

trate the objective of the remedy.

(4) See judgment of

the CFI
COMP/M.1453 — AXA/GRE of 8 April 1999.

in Case T-210/01 General Electric v Commission [2005] ECR II-5575, paragraph 617;

(5) The alternative may consist of an entirely different business or, in case of uncertainty as to finding a suitable buyer, of addi-

tional businesses and assets that are added to the initial package.

22.10.2008

EN

Official Journal of the European Union

C 267/11

46. If there is uncertainty as to the implementation of the divestiture due to third party rights or as to
finding a suitable purchaser crown jewel commitments and up-front buyers as discussed below in
paragraphs 54 address the same concerns, and the parties may therefore choose between both struc-
tures.

1.5. Transfer to a suitable purchaser

47. The intended effect of the divestiture will only be achieved if and once the business is transferred to a
suitable purchaser in whose hands it will become an active competitive force in the market. The poten-
tial of a business to attract a suitable purchaser is an important element already of the Commission's
assessment of the appropriateness of the proposed commitment (1). In order to ensure that the busi-
ness is divested to a suitable purchaser, the commitments have to include criteria to define its suit-
ability which will allow the Commission to conclude that the divestiture of the business to such a
purchaser will likely remove the competition concerns identified.

(a) S u i t a b i l i t y o f a p u r c h a s e r

48. The standard purchaser requirements are the following:

— the purchaser is required to be independent of and unconnected to the parties,

— the purchaser must possess the financial resources, proven relevant expertise and have the incen-
tive and ability to maintain and develop the divested business as a viable and active competitive
force in competition with the parties and other competitors, and

— the acquisition of the business by a proposed purchaser must neither be likely to create new
competition problems nor give rise to a risk that the implementation of the commitments will be
delayed. Therefore, the proposed purchaser must reasonably be expected to obtain all necessary
approvals from the relevant regulatory authorities for the acquisition of
the business to be
divested.

49. The standard purchaser requirements may have to be supplemented on a case-by-case basis. An
example is the requirement, where appropriate, that the purchaser should be an industrial, rather than
a financial purchaser (2). The commitments will normally contain such a clause where, due to the
specific circumstances of the case, a financial buyer might not be able or might not have the incentives
to develop the business as a viable and competitive force in the market even considering that it could
obtain the necessary management expertise (e.g. by recruiting managers experienced in the sector at
stake) and therefore the acquisition by a financial buyer would not remove the competition concerns
with sufficient certainty.

(b) I d e n t i f i c a t i o n o f a s u i t a b l e p u r ch a s e r

50. In general, there are three ways to ensure that the business is transferred to a suitable purchaser. First,
the business is transferred within a fixed time-limit after adoption of the decision to a purchaser
which is approved by the Commission on the basis of the purchaser requirements. Second, in addition
to the conditions set out for the first category, the commitments foresee that the parties may not
complete the notified operation before having entered into a binding agreement with a purchaser for
the business, approved by the Commission (so-called ‘up-front-buyer’). Third, the parties identify a
purchaser for the business and enter into a binding agreement already during the Commission's proce-
dure (3) (so-called ‘fix-it-first’ (4) remedy). The main difference between the two latter options is that in
the case of an up-front buyer, the identity of the purchaser is not known to the Commission prior to
the authorisation decision.

51. The choice of the category depends on the risks involved in the case and therefore on the measures
which enable the Commission to conclude with the requisite degree of certainty that the commitment
will be implemented. This will depend on the nature and the scope of the business to be divested, the
risks of degradation of the business in the interim period up to divestiture and any uncertainties
inherent in the transfer and implementation, in particular the risks of finding a suitable purchaser.

(1) Case IV/M.913 — Siemens/Elektrowatt of 18 November 1997.
(2) See commitments in Case COMP/M.2621 — SEB/Moulinex of 8 January 2002, which foresee that the licensee needs to
have its own trademark used in the sector concerned. Certain markets may require a sufficient degree of recognition by
customers for a purchaser to be able to translate the business to be divested into a competitive force on the market.

(3) The transfer of the business may be implemented after the Commission decision.
(4) This terminology might be used differently in other jurisdictions.

C 267/12

EN

Official Journal of the European Union

22.10.2008

1. Sale of the divested business within a fixed time-limit after the decision

52. In the first category, the parties may proceed with the sale of the divested business on the basis of the
purchaser requirements within a fixed time-limit after the adoption of the decision. This procedure is
likely to be appropriate in the majority of cases, provided that a number of purchasers can be envi-
saged for a viable business and that no specific issues complicate or stand in the way of the divestiture.
Where the purchaser needs to have special qualifications, this procedure may be appropriate if there
are sufficient interested potential purchasers available which fulfil the specific purchaser requirements
to be included in the commitments in such cases. In these circumstances the Commission may be able
to conclude that the divestiture will be implemented and that there are no reasons for the implementa-
tion of the notified concentration to be suspended after the Commission decision.

2. Up-front buyer

53. There are cases where only the proposal of an up-front buyer will allow the Commission to conclude
with the requisite degree of certainty that the business will be effectively divested to a suitable
purchaser. The parties therefore have to undertake in the commitments that they are not going to
complete the notified operation before having entered into a binding agreement with a purchaser for
the divested business, approved by the Commission (1).

54. First, this concerns cases where there are considerable obstacles for a divestiture, such as third party
rights, or uncertainties as to finding a suitable purchaser (2). In such cases, an up-front buyer will
allow the Commission to conclude with the requisite degree of certainty that the commitments will be
implemented, as such a commitment creates greater incentives for the parties to close the divestiture
in order to be able to complete their own concentration. In these circumstances, parties may choose
between proposing an up-front buyer and an alternative divestiture commitment, as set out above in
paragraph 46.

55. Second, an up-front buyer may be necessary in cases which cause considerable risks of preserving the
competitiveness and saleability of the divestment business in the interim period until divestiture. This
category comprises cases where the risks of a degradation of the divestment business appear to be
high, in particular due to a risk of losing employees being key for the business, or where the interim
risks are increased as the parties are not able to undertake the carve-out process in the interim period,
but the carve-out process can only take place once a sales and purchase agreement with a purchaser is
entered into. The up-front buyer provision may accelerate the transfer of the business to be divested
— given the increased incentives for the parties to close the divestiture in order to be able to complete
their own concentration — to such an extent that the commitments may allow the Commission to
conclude with the requisite degree of certainty that those risks are limited and the divestiture will be
effectively implemented (3).

3. Fix-it-first remedies

56. The third category involves cases where the parties identify and enter into a legally binding agreement
with a buyer outlining the essentials of the purchase during the Commission procedure (4). The
Commission will be able to decide in the final decision whether the transfer of the divested business
to the identified purchaser will remove the competition concerns. If the Commission authorises the
notified concentration, no additional Commission decision for the purchaser approval will be needed
and the closing of the sale of the divested business may take place shortly afterwards.

57. The Commission welcomes fix-it-first remedies in particular in cases where the identity of

the
purchaser is crucial for the effectiveness of the proposed remedy. This concerns cases where, given the
in particular as the
circumstances, only very few potential purchasers can be considered suitable,
divested business is not a viable business in itself, but its viability will only be ensured by specific

(1) Case COMP/M.3796 — Omya/Huber PCC of 19 July 2006; Case COMP/M.2972 — DSM/Roche Vitamins of 23 July 2003;
Case COMP/M.2060 — Bosch/Rexroth of 13 December 2000; Case COMP/M.2337 — Nestlé/Ralston Purina of 27 July
2001; Case COMP/M.2544 — Masterfoods/Royal Canin of 15 February 2002; Case COMP/M.2947 — Verbund/Energie
Allianz of 11 June 2003.

(2) See Case COMP/M.2060 — Bosch/Rexroth of 13 December 2000, paragraph 92.
(3) See Case COMP/M.2060 — Bosch/Rexroth of 13 December 2000, paragraph 95.
(4) Such agreements are normally conditional to the final Commission decision accepting the remedy in question.

22.10.2008

EN

Official Journal of the European Union

C 267/13

assets of the purchaser, or where the purchaser needs to have specific characteristics in order for the
remedy to solve the competition concerns (1). If the parties choose to enter into a binding agreement
with a suitable purchaser during the procedure by way of a fix-it-first solution, the Commission can in
those circumstances conclude with the requisite degree of certainty that the commitments will be
implemented with a sale to a suitable purchaser. In these situations, an ‘upfront buyer’ solution
containing specific requirements as to the suitability of a buyer will generally be considered equivalent
and acceptable.

2. Removal of links with competitors

58. Divestiture commitments may also be used for removing links between the parties and competitors in
cases where these links contribute to the competition concerns raised by the merger. The divestiture of
a minority shareholding in a joint venture may be necessary in order to sever a structural link with a
major competitor (2), or, similarly, the divestiture of a minority shareholding in a competitor (3).

59. Although the divestiture of such stakes is the preferable solution, the Commission may exceptionally
accept the waiving of rights linked to minority stakes in a competitor where it can be excluded, given
the specific circumstances of the case, that the financial gains derived from a minority shareholding in
a competitor would in themselves raise competition concerns (4). In such circumstances, the parties
have to waive all the rights linked to such a shareholding which were relevant for behaviour in terms
of competition, such as representations on the board, veto rights and also information rights (5). The
Commission may only be able to accept such a severing of the link with a competitor if those rights
are waived comprehensively and in a permanent way (6).

60. Where competition concerns result from agreements with companies supplying the same products or
providing the same services, a suitable remedy may be the termination of the respective agreement,
such as distribution agreements with competitors (7) or agreements resulting in the coordination of
certain commercial behaviour (8). However, the termination of a distribution agreement alone will
only remove the competition concerns if it is ensured that the product of a competitor will also be
distributed in the future and exercise effective competitive pressure on the parties.

3. Other remedies

61. Whilst being the preferred remedy, divestitures or the removal of links with competitors are not the
only remedy possible to eliminate certain competition concerns. However, divestitures are the bench-
mark for other remedies in terms of effectiveness and efficiency. The Commission therefore may
accept other types of commitments, but only in circumstances where the other remedy proposed is at
least equivalent in its effects to a divestiture (9).

(1) See Case COMP/M.3916 — T-Mobile Austria/tele.ring of April 2006, the divestiture of certain mobile telephony sites and
frequencies, not constituting a viable business, could only take place to a competitor which was likely to play a similar role
in the market as tele.ring; Case COMP/M.4000 — Inco/Falconbridge of 4 July 2006, the divestiture of a nickel processing
business could only take place to a competitor vertically integrated into the supply of nickel; Case COMP/M.4187 —
Metso/Aker Kvaerner of 12 December 2006, only one purchaser was suitable for acquiring the businesses to be divested as
it was the only one with the necessary know-how and the necessary presence in neighbouring markets; Case
COMP/M.3436 — Continental/Phoenix of 26 October 2004, only the partner in the distribution joint venture was able to
render the divested business viable; Case COMP/M.3136 — GE/Agfa of 5 December 2003.

(2) Case IV/M.942 — VEBA/Degussa of 3 December 1997.
(3) Case COMP/M.3653 — Siemens/VA Tech of 13 July 2005, paragraphs 491, 493 ff.
(4) See Case COMP/M.3653 — Siemens/VA Tech of 13 July 2005, paragraphs 327 ff., where effects from the minority stake in

financial respect could be excluded as a put option for the sale of this stake had already been exercised.

(5) Case COMP/M.4153 — Toshiba/Westinghouse of 19 September 2006.
(6) See Case COMP/M.3440 — ENI/EDP/GDP of 9 December 2004, paragraphs 648 f., 672.
(7) See for the termination of distribution agreements Case COMP/M.3779 — Pernod Ricard/Allied Domecq of 24 June 2005;

Case COMP/M.3658 — Orkla/Chips of 3 March 2005.

(8) See particularly the sea transport sector, Case COMP/M.3829 — Maersk/PONL of 29 July 2005 and Case COMP/M.3863
— TUI/CP Ships of 12 October 2005. In those cases, the parties committed to withdraw from certain liner conferences and
consortia.

(9) Case COMP/M.3680 — Alcatel/Finmeccanica/Alcatel Alenia Space & Telespazio of 28 April 2005, where a divestiture was

impossible.

C 267/14

EN

Official Journal of the European Union

22.10.2008

Access remedies

62. In a number of cases, the Commission has accepted remedies foreseeing the granting of access to key
infrastructure, networks, key technology, including patents, know-how or other intellectual property
rights, and essential inputs. Normally, the parties grant such access to third parties on a non-discrimi-
natory and transparent basis.

63. Commitments granting access to infrastructure and networks may be submitted in order to facilitate
market entry by competitors. They may be acceptable to the Commission in circumstances where it is
sufficiently clear that there will be actual entry of new competitors that would eliminate any significant
impediment to effective competition (1). Other examples of access commitments are commitments
granting access to pay-TV platforms (2) and to energy via gas release programs (3). Often, a sufficient
reduction of entry barriers is not achieved by individual measures, but by a package comprising a
combination of divestiture remedies and access commitments or a commitments package aimed at
overall facilitating entry of competitors by a whole range of different measures. If those commitments
actually make the entry of sufficient new competitors timely and likely, they can be considered to have
a similar effect on competition in the market as a divestiture. If it cannot be concluded that the
lowering of the entry barriers by the proposed commitments will likely lead to the entry of new
competitors in the market, the Commission will reject such a remedies package (4).

64. Commitments granting non-discriminatory access to infrastructure or networks of the merging parties
may also be submitted in order to ensure that competition is not significantly impeded as a result of
foreclosure. In past Commission decisions, commitments have foreseen the granting of access to pipe-
lines (5) and to telecom or similar networks (6). The Commission will only accept such commitments
if it can be concluded that these commitments will be effective and competitors will likely use them
so that foreclosure concerns will be eliminated. In specific cases, it may be appropriate to link such a
commitment with an up-front or fix-it-first provision in order to allow the Commission to conclude
with the requisite degree of certainty that the commitment will be implemented (7).

65. Similarly, the control of key technology or IP rights may lead to concerns of foreclosure of competitors
which depend on the technology or IP rights as essential input for the activities in a downstream
market. This, for example, concerns cases where competition problems arise as the parties may with-
hold information necessary for the interoperability of different equipment. In such circumstances,
commitments to grant competitors access to the necessary information may eliminate the competition
concerns (8). Similarly, in sectors where players commonly have to cooperate by licensing patents to
each other, concerns that the merged entity would no longer have the incentive to provide licences to
the same extent and under the same conditions as before may be eliminated by commitments to grant

(1) See judgment of the CFI in Case T-177/04 easyJet v Commission [2006] ECR II-1931, at paragraphs 197 et seq.
(2) See Case COMP/M.2876 — Newscorp/Telepiù of 2 April 2003, paragraphs 225 et seq., where the commitments package
included access of competitors to all essential elements of a pay-TV network, such as 1. access to the necessary content;
2. access to the technical platform as well as 3. access to the necessary technical services. Similarly, in Case COMP/JV.37 —
BskyB/Kirch Pay TV of 21 March 2000, confirmed by judgment of CFI in Case T-158/00 ARD v Commission [2003]
ECR II-3825, the Commission accepted a commitments package which allowed other operators comprehensive access to
the pay-TV market.

(3) See Case COMP/M.3696 — E.ON/MOL of 21 December 2005; Case COMP/M.3868 — DONG/Elsam/Energi E2 of

14 March 2006.

(4) In air transport mergers, a mere reduction of barriers to entry by a commitment of the parties to offer slots on specific
airports may not always be sufficient to ensure the entry of new competitors on those routes where competition problems
arise and to render the remedy equivalent in its effects to a divestiture.

(5) Case COMP/M.2533 — BP/E.ON of 20 December 2001, access to pipelines in addition to divestiture of shares in a pipeline

company; Case COMP/M.2389 — Shell/DEA of 20 December 2001, access to an ethylene import terminal.

(6) For access to telecom networks, see Case COMP/M.2803 — Telia/Sonera of 10 July 2002; Case IV/M.1439 — Telia/Telenor
of 13 October 1999; Case COMP/M.1795 — Vodafone/Mannesmann of 12 April 2000. See also Case COMP/M.2903 —
DaimlerChrysler/Deutsche Telekom/JV of 30 April 2003, where the Commission accepted a commitments package to
grant third parties access to a telematics network and to reduce the entry barriers by allowing them to use parts of a tele-
matics device, designed for toll collection, provided by the parties.

(7) See the ‘qualitative moratorium’ in Case COMP/M.2903 — DaimlerChrysler/Deutsche Telekom/JV of 30 April 2003, para-

graph 76.

(8) Case COMP/M.3083 — GE/Instrumentarium of 2 September 2003; Case COMP/M.2861 — Siemens/Draegerwerk of

30 April 2003.

22.10.2008

EN

Official Journal of the European Union

C 267/15

licenses on the same basis also in the future (1). In those cases, commitments should foresee non-
exclusive licences or the disclosure of information on a non-exclusive basis to all third parties which
depend on the IP rights or information for their activities. It has to be further ensured that the terms
and conditions under which the licenses are granted do not impede the effective implementation of
such a license remedy. If no clearly determined terms and conditions for the granting of licenses exist
in the market at stake, the terms and conditions, including the pricing, should be clearly apparent
from the commitments (e.g. by way of pricing formulas). An alternative solution may be to rely on
royalty-free licences. Furthermore, depending on the case, the granting of licenses may also transmit
sensitive information to the licensor on the competitive behaviour of the licensees which are active as
competitors in the downstream market, e.g. by transmitting the number of licenses used in the down-
stream market. In such cases, in order for the remedy to be suitable, the commitments will have to
exclude such confidentiality problems. Generally, as set out in the preceding paragraph, the Commis-
sion will only accept such commitments if it can be concluded that they will be effective and competi-
tors will likely use them.

66. Access commitments are often complex in nature and necessarily include general terms for deter-
mining the terms and conditions under which access is granted. In order to render them effective,
those commitments have to contain the procedural requirements necessary for monitoring them, such
as the requirement of separate accounts for the infrastructure in order to allow a review of the costs
involved (2), and suitable monitoring devices. Normally, such monitoring has to be done by the
market participants themselves, e.g. by those undertakings wishing to benefit from the commitments.
Measures allowing third parties themselves to enforce the commitments are in particular access to a
fast dispute resolution mechanism via arbitration proceedings (together with trustees) (3) or via arbitra-
tion proceedings involving national regulatory authorities if existing for the markets concerned (4). If
the Commission can conclude that the mechanisms foreseen in the commitments will allow the
market participants themselves to effectively enforce them in a timely manner, no permanent moni-
toring of the commitments by the Commission is required. In those cases, an intervention by the
Commission would only be necessary in cases where the parties do not comply with the solutions
found by those dispute resolution mechanisms (5). However, the Commission will only be able to
accept such commitments where the complexity does not lead to a risk of their effectiveness from the
outset and where the monitoring devices proposed ensure that those commitments will be effectively
implemented and the enforcement mechanism will lead to timely results (6).

Change of long-term exclusive contracts

67. The change in the market structure resulting from a proposed concentration can cause existing
contractual arrangements to be inimical to effective competition. This is in particular true for exclusive
long-term supply agreements if such agreements foreclose either, up-stream, the input for competitors
or, down-stream, their access to customers. Where the merged entity will have the ability and the
incentives to foreclose competitors in this way, the foreclosure effects resulting from existing exclusive
agreements may contribute to significantly impeding effective competition (7).

68. In such circumstances, the termination or change of existing exclusive agreements may be considered
appropriate to eliminate the competition concerns (8). However, the available evidence must allow the

(1) See Case COMP/M.3998 — Axalto/Gemplus of 19 May 2006.
(2) See e.g. Case COMP/M.2803 — Telia/Sonera of 10 July 2002; Case COMP/M.2903 — DaimlerChrysler/Deutsche Telekom/

JV of 30 April 2003.

(3) As to the effects of arbitration clauses, see judgment of CFI in Case T-158/00 ARD v Commission [2003] ECR II-3825, para-

graphs 212, 295, 352; CFI judgment in Case T-177/04 easyJet v Commission [2006] ECR II-1931, paragraph 186.

(4) See Case COMP/M.2876 — Newscorp/Telepiù; Case COMP/M.3916 — T-Mobile Austria/tele.ring.
(5) CFI, judgment in Case T-158/00 ARD v Commission [2003] ECR II-3825, paragraphs 212, 295, 352.
(6) See judgments of the CFI in Case T-87/05 EDP v Commission [2005] ECR II-3745, at paragraphs 102 et seq.; and Case

T-177/04 easyJet v Commission [2006] ECR II-1931, at paragraph 188.

(7) See Commission Notice on non-horizontal mergers […]; Case IV/M.986 — AGFA Gevaert/DuPont of 11 February 1998.
(8) Case COMP/M.2876 — Newscorp/Telepiù of 2 April 2003, paragraphs 225 et seq., granting unilateral termination rights
to suppliers of TV content, limiting the scope of the exclusivity clauses and limiting the duration of future exclusive agree-
ments relating to supply of content; Case COMP/M.2822 — ENI/EnBW/GVS of 17 December 2002, granting of early
termination rights to all
local gas distributors concerning long-term gas supply agreements; Case IV/M.1571 —
New Holland of 28 October 1999; Case IV/M.1467 — Rohm and Haas/Morton of 19 April 1999.

C 267/16

EN

Official Journal of the European Union

22.10.2008

Commission to clearly determine that no de facto exclusivity will be maintained. Furthermore, such
change of long-term agreements will normally only be sufficient as part of a remedies package to
remove the competition concerns identified.

Other non-divestiture remedies

69. As indicated above in paragraph 17, non-structural types of remedies, such as promises by the parties
to abstain from certain commercial behaviour (e.g. bundling products), will generally not eliminate the
competition concerns resulting from horizontal overlaps. In any case, it may be difficult to achieve the
required degree of effectiveness of such a remedy due to the absence of effective monitoring of its
implementation, as already set out above in paragraph 13(f) (1). Indeed, it may be impossible for the
Commission to verify whether or not the commitment is complied with and even other market parti-
cipants, such as competitors, may not be able to establish at all or with the requisite degree of
certainty whether the parties meet the conditions of the commitment in practice. In addition, competi-
tors may also not have an incentive to alert the Commission as they do not directly benefit from the
commitments. Therefore, the Commission may examine other types of non-divestiture remedies, such
as behavioural promises, only exceptionally in specific circumstances, such as in respect of competition
concerns arising in conglomerate structures (2).

Time limit for non-divestiture remedies

70. The Commission may accept that non-divestiture remedies are limited in their duration. The accept-
ability of a time limit and the duration will depend on the individual circumstances of the case and
cannot be pre-defined in a general manner in the present Notice.

4. Review Clause

71. Irrespective of the type of remedy, commitments will usually include a review clause (3). This may
allow the Commission, upon request by the parties showing good cause, to grant an extension of
deadlines or, in exceptional circumstances, to waive, modify or substitute the commitments.

72. Modifying commitments by extending the deadlines

for divestiture
commitments. Parties have to submit a request for an extension within the deadline. Where parties
apply for an extension for the first divestiture period, the Commission will only accept that they have
shown good cause if the parties were not able to meet the deadline for reasons outside their responsi-
bility and if it can be expected that the parties subsequently will succeed in divesting the business
within a short time-frame. Otherwise, the divestiture trustee may be better placed to undertake the
divestiture and to fulfil the commitments for the parties.

in particular

relevant

is

73. The Commission may grant waivers or accept modifications or substitutions of the commitments only
in exceptional circumstances. This will very rarely be relevant for divestiture commitments. As divesti-
ture commitments have to be implemented within a short time-frame after the decision, it is very unli-
kely that changes of market circumstances will have occurred in such a short time-frame and the
Commission will normally not accept any modifications under the general review clause. For specific
situations the commitments normally foresee more targeted review clauses (4).

(1) See, as an example for such remedies, Case COMP/M.3440 — ENI/EDP/GDP of 9 December 2004, paragraphs 663, 719.
(2) See, in relation to conglomerate effects of a concentration, ECJ, judgment of 15 February 2005 in Case C-12/03 P

Commission v Tetra Laval [2005] ECR I-987, paragraphs 85, 89.

(3) However, the review clause is of particular relevance for access remedies, which systematically should include such a clause;

see below paragraph 74.

(4) As mentioned in paragraph 30, the Commission may approve a purchaser without some of the assets or personnel fore-
seen if this does not affect the competitiveness and viability of the divested business. Similarly, the non-requisition clause,
as explained in paragraph 43, prohibits the re-acquisition of control over the assets divested only if the Commission has
not previously found that that the market structure has changed to such an extent that the divestiture is no longer neces-
sary.

22.10.2008

EN

Official Journal of the European Union

C 267/17

74. A waiver, modification or substitution of commitments may be more relevant for non-divestiture
commitments, such as access commitments, which may be on-going for a number of years and for
which not all contingencies can be predicted at the time of the adoption of the Commission decision.
Exceptional circumstances justifying a waiver, modification or substitution may, first, be accepted for
such commitments if parties show that market circumstances have changed significantly and on a
permanent basis. For showing this, a sufficient long time-span, normally at least several years, between
the Commission decision and a request by the parties is required. Second, exceptional circumstances
may also be present if the parties can show that the experience gained in the application of the
remedy demonstrates that the objective pursued with the remedy will be better achieved if modalities
of the commitment are changed. For any waiver, modification or substitution of commitments, the
Commission will also take into account the view of third parties and the impact a modification may
have on the position of third parties and thereby on the overall effectiveness of the remedy. In this
regard, the Commission will also consider whether modifications affect the right already acquired by
third parties after implementation of the remedy (1).

75. If at the time of the adoption of the decision the Commission for particular reasons cannot anticipate
all contingencies in relation to the implementation of such commitments, it may also be appropriate
for the parties to include a clause in the commitments, allowing the Commission to trigger a limited
modification to the commitments. Such modifications may be necessary if the original commitments
do not achieve the envisaged results set out in those commitments, and therefore do not effectively
remove the competition concerns. Procedurally, the parties may be obliged in such cases to propose a
change to the commitments in order to achieve the result defined in those commitments, or the
Commission may itself, after hearing the parties, modify the conditions and obligations to this end.
This type of clause will typically be limited to cases where specific modalities risk to jeopardise effec-
tive implementation of the commitments. Such clauses have been used, for example, in relation to the
modalities of gas release programs (2).

76. The Commission may, upon request, adopt a formal decision for any waiver, modification or substitu-
tion of commitments or simply take note of satisfactory amendments of the remedy by the parties,
where such amendments improve the effectiveness of the remedy and result in legally binding obliga-
tions of the parties, e.g. by contractual arrangements. A change of the commitments will normally
only be effective ex nunc. Consequently, a modification of the commitments will not heal retroactively
any breach of the commitments which has been committed before the time of the modification. The
Commission may therefore, where appropriate, further pursue a breach under Articles 14, 15 of the
Merger Regulation.

IV. ASPECTS OF PROCEDURE FOR SUBMISSION OF COMMITMENTS

1. Phase I

77. Pursuant to Article 6(2) of the Merger Regulation the Commission may declare a concentration
compatible with the common market also before the initiation of proceedings, where it is confident
that following modification a notified concentration no longer raises serious doubts within the
meaning of paragraph 1(c).

78. Parties can submit proposals for commitments to the Commission on an informal basis, even before
notification. Parties have to submit commitments within not more than 20 working days from the
date of the receipt of the notification (3). The Commission informs the parties about its serious doubts
in due time before that deadline (4). Where the parties submit commitments, the deadline for the
Commission's decision pursuant to Article 6(1) of the Merger Regulation is extended from 25 to
35 working days (5).

(1) See examples in judgment of CFI in Case T-119/02 Royal Philips Electronics NV v Commission [2003] ECR II-1433, para-

graph 184.

(2) See Case COMP/M.3868 — DONG/Elsam/Energi E2 of 14 March 2006, paragraph 24 of the Annex.
(3) Article 19(1) of the Implementing Regulation.
(4) The notifying parties will normally be offered the opportunity of attending a state of play meeting in such circumstances,

see point 33 of the DG COMPETITION Best Practices on the conduct of EC merger control proceedings.

(5) Article 10(1), subparagraph 2 of the Merger Regulation.

C 267/18

EN

Official Journal of the European Union

22.10.2008

79. In order to form the basis of a decision pursuant to Article 6(2), proposals for commitments must

meet the following requirements:

(a) they shall fully specify the substantive and implementing commitments entered into by the parties;

(b) they shall be signed by a person duly authorised to do so;

(c) they shall be accompanied by the information on the commitments offered as provided for in the

Implementing Regulation (as explained above in paragraph 7); and

(d) they shall be accompanied by a non-confidential version of the commitments (1) for the purposes
of market testing them with third parties. The non-confidential version of the commitments must
allow third parties to fully assess the workability and the effectiveness of the proposed remedies to
remove the competition concerns.

80. Proposals submitted by the parties in accordance with these requirements will be assessed by the
Commission. The Commission will consult the authorities of the Member States on the proposed
commitments and, when considered appropriate, also third parties in the form of a market test,
including in particular those third parties and the recognised representatives (2) of those employees
whose positions are directly affected by the proposed remedies. In markets with national regulatory
authorities the Commission may also, if appropriate, consult the competent national regulatory autho-
rities (3). In addition, in cases involving a geographic market that is wider than the European Economic
Area (‘EEA’) or where, for reasons related to the viability of the business, the scope of the business to
be divested is wider than the EEA territory, the non-confidential version of the proposed remedies
may also be discussed with non-EEA competition authorities in the framework of the Community's
bilateral cooperation agreements with these countries.

81. Commitments in phase I can only be accepted where the competition problem is readily identifiable
and can easily be remedied (4). The competition problem therefore needs to be so straightforward and
the remedies so clear-cut that it is not necessary to enter into an in-depth investigation and that the
commitments are sufficient to clearly rule out ‘serious doubts’ within the meaning of Article 6(1)(c) of
the Merger Regulation (5). Where the assessment confirms that the proposed commitments remove
the grounds for serious doubts on this basis, the Commission clears the merger in phase I.

82. Due to the time-constraints in phase I, it is particularly important for the parties to submit in a timely
manner to the Commission the information required in the Implementing Regulation to properly
assess the content and workability of the commitments and their suitability to maintain conditions of
effective competition in the common market on a permanent basis. If the parties do not comply with
the obligation in the Implementing Regulation, the Commission may not be able to conclude that the
proposed commitments will remove the grounds for serious doubts.

83. Where the assessment shows that the commitments offered are not sufficient to remove the competi-
tion concerns raised by the concentration, the parties will be informed accordingly. Given that phase I
remedies are designed to provide a clear-cut answer to a readily identifiable competition concern, only
limited modifications can be accepted to the proposed commitments. Such modifications, presented as
an immediate response to the result of the consultations, may include clarifications, refinements
and/or other improvements designed to ensure that the commitments are workable and effective.
However, such modifications may only be accepted in circumstances where it is ensured that the
Commission can carry out a proper assessment of those commitments (6).

(1) Article 20(2) of the Implementing Regulation.
(2) Cf. Article 2(1)(c) of Council Directive 2001/23/EC of 12 March 2001 on the approximation of the laws of the Member
States relating to the safeguarding of employees' rights in the event of transfers of undertakings, businesses or parts of
undertakings or businesses (OJ L 82, 22.3.2001, p. 16). See also Article 2(1)(g) of Council Directive 94/45/EC of
22 September 1994 on the establishment of a European Works Council or a procedure in Community-scale undertakings
and Community-scale groups of undertakings for the purposes of informing and consulting employees (OJ L 254,
30.9.1994, p. 64).

(3) For the role of national regulatory authorities in a dispute resolution mechanism, see paragraph 66.
(4) See recital 30 of the Merger Regulation.
(5) See judgment of CFI in Case T-119/02 Royal Philips Electronics NV v Commission [2003] ECR II-1433, paragraphs 79 et seq.
(6) See recital 17 of the Implementing Regulation and judgment of the CFI, Case T-119/02 Royal Philips Electronics NV v

Commission [2003] ECR II-1433, paragraphs 237 et seq.

22.10.2008

EN

Official Journal of the European Union

C 267/19

84. If the Commission's final assessment of a case shows that there are no competition concerns in one or
more markets, the parties will be informed accordingly and may withdraw the unnecessary commit-
ments for such markets. If the parties do not withdraw them, the Commission will normally ignore
them in the decision. In any event, such commitment proposals do not constitute a condition for
clearance.

85. Where the parties are informed that the Commission intends to maintain in its final decision that the
transaction raises competition concerns for a specific market, it is for the parties to propose commit-
ments. The Commission is not in a position to impose unilaterally any conditions to an authorisation
decision, but only on the basis of the parties' commitments (1). However, the Commission will review
whether the commitments submitted by the parties are proportionate to the competition problem
when assessing whether to attach them as conditions or obligations to its final decision (2). Neverthe-
less, it has to be stressed that, in a commitments proposal, all those elements which are required to
fulfil the basic conditions for acceptable commitments as set out above in paragraphs 9 et seq. will be
considered necessary. This paragraph as well as the previous one also applies to commitments in
phase II.

86. If the Commission concludes that the commitments offered by the parties do not remove the serious

doubts, it will issue an Article 6(1)(c) decision and open proceedings.

2. Phase II

87. Pursuant to Article 8(2) of the Merger Regulation, the Commission must declare a concentration
compatible with the common market, where following modification a notified concentration does no
longer significantly impede effective competition within the meaning of Article 2(3) of the Merger
Regulation.

88. Commitments proposed to the Commission pursuant to Article 8(2) must be submitted to the
Commission within not more than 65 working days from the day on which proceedings were
initiated. Where the deadlines for the final decision have been extended according to Article 10(3) of
the Merger Regulation, also the deadline for remedies is automatically extended by the same number
of days (3). Only in exceptional circumstances, the Commission may accept that commitments are
submitted for the first time after the expiry of this period. The request by the parties for an extension
of the deadline must be received within the period and has to set forth the exceptional circumstances
which, according to the parties, justify it. In addition to the existence of exceptional circumstances, an
extension is only possible where there is sufficient time to make a proper assessment of the proposal
by the Commission and to allow adequate consultation with Member States and third parties (4).

89. The question whether or not submitting remedies will extend the deadline for the Commission to take
a final decision depends on the time in the procedure when the commitments are submitted. Where
the parties submit commitments within less than 55 working days after the initiation of proceedings,
the Commission has to take a final decision within not more than 90 working days of the date of
initiation of proceedings (5). Where the parties submit commitments on working day 55 or afterwards
(even after working day 65, if those commitments should be acceptable due to exceptional circum-
stances as described above in paragraph 88), the period for the Commission to take a final decision is
increased to 105 working days according to Article 10(3), subparagraph 2. Where the parties submit
commitments within less than 55 working days, but submit a modified version on day 55 or there-
after, the period to take a final decision will also be extended to 105 working days.

(1) See above paragraph 6.
(2) See judgment of ECJ of 18 December 2007 in Case C-202/06 P Cementbouw v Commission [2007], paragraph 54.
(3) Article 19(2), subparagraph 2 of the Implementing Regulation.
(4) Article 19(2), subparagraph 3 of the Implementing Regulation. See Case COMP/M.1439 — Telia/Telenor of 13 October

1999; Case IV/M.754 — Anglo American Corporation/Lonrho of 23 April 1997.

(5) Where the deadlines for the final decision have been extended according to Article 10(3) subparagraph 2 of the Merger

Regulation before working day 55, this period is also extended.

C 267/20

EN

Official Journal of the European Union

22.10.2008

90. The Commission is available to discuss suitable commitments well

in advance of the end of the
65 working day period. The parties are encouraged to submit draft proposals dealing with both
substantive and implementation aspects which are necessary to ensure that the commitments are fully
workable. If the parties are of the opinion that more time is needed for the investigation of the
competition concerns and for the corresponding design of appropriate commitments, they may also
suggest to the Commission to extend the final deadline under Article 10(3), subparagraph 1. Such a
request will have to be made before the end of the 65 working day period. Indeed, the Commission
will normally not extend the period for adopting a final decision according to Article 10(3), sub-
paragraph 1 where the request for extension is presented after the deadline for submitting remedies
foreseen in the Implementing Regulation, i.e. after working day 65 (1).

91. In order to meet the requirements for a decision pursuant to Article 8(2), commitments must meet

the following requirements:

(a) they shall address all competition concerns raised by the concentration and shall fully specify the

substantive and implementing commitments entered into by the parties;

(b) they shall be signed by a person duly authorised to do so;

(c) they shall by accompanied by the information on the commitments offered as provided for in the

Implementing Regulation (as explained above in paragraph 7); and

(d) they shall be accompanied by a non-confidential version of the commitments (2) for the purposes
of market testing them with third parties, fulfilling the requirements set out above in paragraph 79.

92. Proposals submitted by the parties in accordance with these requirements will be assessed by the
Commission. If the assessment confirms that the proposed commitments remove the serious doubts
(if no Statement of Objection has been issued yet by the Commission) or the competition concerns
raised in the Statement of Objections, following the consultations as set out in paragraph 80 above,
the Commission will adopt a conditional clearance decision.

93. Conversely, where the assessment leads to the conclusion that the proposed commitments appear not
to be sufficient to resolve the competition concerns raised by the concentration, the parties will be
informed accordingly (3).

94. The Merger Regulation does not impose any obligation on the Commission to accept commitments
after the legal deadline for remedies, unless the Commission voluntarily undertakes to assess commit-
ments in specific circumstances (4). In view of this, where parties subsequently modify the proposed
commitments after the deadline of 65 working days, the Commission will only accept these modified
commitments where it can clearly determine — on the basis of its assessment of information already
received in the course of the investigation, including the results of prior market testing, and without
the need for any other market test — that such commitments, once implemented, fully and unambigu-
ously resolve the competition concerns identified and where there is sufficient time to allow for an
adequate assessment by the Commission and for proper consultation with Member States (5) (6). The
Commission will normally reject modified commitments which do not fulfil those conditions (7).

(1) The Court of First Instance confirmed that the Merger Regulation and the Implementing Regulation do not impose any
obligations on the Commission to accept commitments which are submitted after the legal deadline, as set out below in
paragraph 94, see Case T-87/05 EDP v Commission [2005] ECR II-3745, at paragraph 161. Therefore, the Commission is
not bound to consider any remedies which are submitted by the parties after the deadline for remedies, even if the parties
were to agree to extend the final deadline. Moreover, this would not correspond to the purpose, as explained in recital 35 of
the Merger Regulation, of the extensions foreseen in Article 10(3). The extension foreseen in Article 10(3), subparagraph 1
is to allow for sufficient time for the investigation of the competitive concerns, whereas it is the purpose of the extension
laid down in Article 10(3), subparagraph 2 to allow for sufficient time for the analysis and market testing of commitments.

(2) Article 20(2) of the Implementing Regulation.
(3) See paragraphs 30 ff. of the DG Competition Best Practices on the conduct of EC merger proceedings which provide for

several state of play meetings between the Commission and the parties throughout the procedure.

(4) See judgment of CFI in Case T-87/05 EDP v Commission [2005] ECR II-3745, at paragraphs 161 et seq. See also judgement

of CFI in case T-290/94 Kaysersberg SA v Commission [1997] ECR II-2137.

(5) Case COMP/M.3440 — ENI/EDP/GDP of 9 December 2004, paragraphs 855 et seq.; confirmed by Judgment of CFI in Case
T-87/05 EDP v Commission [2005] ECR II-3745, at paragraphs 162 et seq.; Case COMP/M.1628 — TotalFina/Elf of 9 March
2000, at paragraph 345.

(6) This consultation normally requires that the Commission has to be able to send a draft of the final decision, including an
assessment of the modified commitments, to the Member States not less than 10 working days before the Advisory
Committee with Member States. This period may only be shortened in exceptional circumstances (Article 19(5) of the
Merger Regulation).

(7) See Case COMP/M.3440 — ENI/EDP/GDP of 9 December 2004, paragraph 913.

22.10.2008

EN

Official Journal of the European Union

C 267/21

V. REQUIREMENTS FOR IMPLEMENTATION OF COMMITMENTS

95. Commitments are offered as a means of securing a clearance, with the implementation normally
taking place after the decision. Commitments therefore require safeguards to ensure their effective and
timely implementation. These implementing provisions will normally form part of the commitments
entered into by the parties vis-à-vis the Commission.

96. In the following, detailed guidance is given on the implementation of divestiture commitments, as the
most typical commitment. Afterwards, some aspects of the implementation of other types of commit-
ments are discussed.

1. Divestiture process

97. The divestiture has to be completed within a fixed time period agreed between the parties and the
Commission. In the Commission's practice, the total time period is divided into a period for entering
into a final agreement and a further period for the closing, the transfer of legal title, of the transaction.
The period for entering into a binding agreement is further normally divided into a first period in
which the parties can look for a suitable purchaser (the ‘first divestiture period’) and, if the parties do
not succeed to divest the business, a second period in which a divestiture trustee obtains the mandate
to divest the business at no minimum price (the ‘trustee divestiture period’).

98. The Commission's experience has shown that short divestiture periods contribute largely to the
success of the divestiture as, otherwise, the business to be divested will be exposed to an extended
period of uncertainty. The time periods should therefore be as short as feasible. The Commission will
normally consider a period of around six months for the first divestiture period and an additional
period of
further
three months is normally foreseen for closing the transaction. These periods may be modified on a
case-by-case basis. In particular, they may have to be shortened if there is a high risk of degradation of
the business' viability in the interim period.

three months for the trustee divestiture period as appropriate. A period of

99. The deadline for the divestiture shall normally start on the day of the adoption of the Commission
decision. An exception might be justified for a transaction via public bid where the parties commit to
divest a business belonging to the target. Where in such circumstances the parties cannot prepare for
the divestiture of the target's business before closing of the notified concentration, the Commission
might accept that the periods for such a divestiture only start with the date of closing the notified
transaction. Similarly, such a solution may be considered if the date of closing of the concentration is
not under the control of the parties as it, e.g. requires state approval (1). In return, it may be appro-
priate to shorten the deadlines in order to reduce the time of uncertainty for the business to be
divested.

100. Whereas for up-front buyer solutions the above-described procedure applies, the procedure will be
different for fix-it-first solutions. In general, a binding agreement with a purchaser will already be
entered into during the procedure so that after the decision only a further period for the closing of
the transaction has to be foreseen. If before the decision only a framework agreement has been
concluded with the purchaser, the periods to be foreseen for entering into a full agreement and the
closing afterwards will have to be decided on a case-by-case basis (2).

2. Approval of the purchaser and of the sale and purchase agreement

101. In order to ensure the effectiveness of the commitment, the sale to a proposed purchaser is subject to
prior approval by the Commission. When the parties (or the divestiture trustee) have reached a final
agreement with a purchaser, they have to submit a reasoned and documented proposal to the
Commission. The parties or the divestiture trustee, as the case may be, will be required to demonstrate
to the satisfaction of the Commission that the proposed purchaser meets the purchaser requirements,
and that the business is divested in a manner consistent with the Commission's decision and the
commitments. Where the commitments allow that different purchasers are being proposed for
different parts of the package, the Commission will assess whether each individual proposed purchaser
is acceptable and that the total package solves the competition concern.

(1) However, also in those circumstances, other provisions in the commitments, in particular the provisions establishing the

safeguards in the interim period, should start running on the date of the adoption of the decision.

(2) See Case COMP/M.3916 — T-Mobile Austria/tele.ring of 20 April 2006.

C 267/22

EN

Official Journal of the European Union

22.10.2008

102. In assessing any proposed purchaser, the Commission will interpret the purchaser requirements in the
light of the purpose of the commitments, to immediately maintain effective competition in the market
where competition concerns had been found, and of the market circumstances as set out in the deci-
sion (1). Generally, the basis for the Commission's assessment of the purchaser requirements will be
the submission of the parties, the assessment of the monitoring trustee and, in particular, discussions
with the proposed purchaser and its business plan. The Commission will further analyse whether the
underlying assumptions of the purchaser appear plausible according to the market circumstances.

103. The requirement that the purchaser has to have the necessary financial resources extends in particular
to the way the acquisition is financed by the proposed purchaser. The Commission will normally not
accept any financing of the divestiture by the seller, and, in particular, any seller financing if this were
to give the seller a share in the profits of the divested business in the future.

104. In assessing whether the proposed purchaser threatens to create competition problems, the Commis-
sion will undertake a prima facie assessment in the light of the information available to the Commis-
sion in the purchaser approval process. Where the purchase results in a concentration that has a Com-
munity dimension, this new operation will have to be notified under the Merger Regulation and
cleared under normal procedures (2). Where this is not the case, the Commission's approval of a
proposed purchaser is without prejudice to the merger control jurisdiction of national authorities. In
addition, the proposed purchaser must be expected to obtain all other necessary approvals from the
relevant regulatory authorities. Where it can be foreseen, in the light of the information available to
the Commission, that difficulties in obtaining merger control clearance or other approvals may unduly
delay the timely implementation of the commitment, it will be considered that the proposed purchaser
does not meet the purchaser requirements. Otherwise, the competition concerns identified by the
Commission would not be removed in the appropriate time-frame.

105. The requirement for an approval by the Commission does usually not only extend to the identity of
the purchaser, but also to the sale and purchase agreement and any other agreement entered into
between the parties and the proposed purchaser, including transitory agreements. The Commission
will verify whether the divestiture according to the agreements is in line with the commitments (3).

106. The Commission will communicate its view as to the suitability of the proposed purchaser to the
parties. If the Commission concludes that the proposed purchaser does not meet the purchaser
requirements,
it will adopt a decision that the proposed purchaser is not a purchaser under the
commitments (4). If the Commission concludes that the sale and purchase agreement (or any ancillary
agreements) does not foresee a divestiture in line with the commitments, the Commission will
communicate this to the parties without necessarily rejecting the purchaser as such. If the Commission
concludes that the purchaser is suitable under the commitments and that the contracts agree a divesti-
ture in line with the commitments, the Commission will approve the divestiture to the proposed
purchaser (5). The Commission will issue the necessary approvals as expeditiously as possible.

3. Obligations of the parties in the interim period

107. Parties have to fulfil certain obligations in the interim period (as defined above in paragraph 36). The
following should normally be included in the commitments in this respect: (i) safeguards for the
interim preservation of the viability to the business; (ii) the necessary steps for a carve-out process, if
relevant; and (iii) the necessary steps to prepare the divestiture of the business.

(1) See judgment of the CFI in Case T-342/00 Petrolessence v Commission [2003] ECR II-1161.
(2) Case IV/M.1383 — Exxon/Mobil of 29 September 1999 and the follow-up Cases COMP/M.1820 — BP/JV Dissolution of

2 February 2000 and COMP/M.1822 — Mobil/JV Dissolution of 2 February 2000.

(3) As discussed above, the parties may apply to the Commission to approve the divestiture of the business to the proposed
purchaser without one or more assets or parts of the personnel if this does not affect the viability and competitiveness of
the Divestment Business after the sale, taking account of the resources of the proposed purchaser.

(4) COMP/M.1628 — TotalFina/Elf of 9 February 2000, motorway service stations; confirmed by judgment of the CFI in Case

T-342/00 Petrolessence v Commission [2003] ECR II-1161.

(5) Depending on the circumstances of the divestiture, the parties may also have to ensure, for example through appropriate
provisions in the purchase agreement, that the purchaser will maintain the divested business as a competitive force in the
market and will not sell on the business within a short time-span.

22.10.2008

EN

Official Journal of the European Union

C 267/23

Interim preservation of the divested business

108. It is the parties' responsibility to reduce to the minimum any possible risk of loss of competitive
potential of the business to be divested resulting from the uncertainties inherent in the transfer of a
business. Up to the transfer of the business to the purchaser, the Commission will require the parties
to offer commitments to maintain the independence, economic viability, marketability and competi-
tiveness of the business. Only such commitments will allow the Commission to conclude with the
requisite degree of certainty that the divestiture of the business will be implemented in the way as
proposed by the parties in the commitments.

109. Generally, these commitments should be designed to keep the business separate from the business
retained by the parties, and to ensure that it is managed as a distinct and saleable business in its best
interest, with a view to ensuring its continued economic viability, marketability and competitiveness
and its independence from the businesses retained by the parties.

110. The parties will be required to ensure that all assets of the business are maintained, pursuant to good
business practice and in the ordinary course of business, and that no acts which might have a signifi-
cant adverse impact on the business are carried out. This relates in particular to the maintenance of
the
fixed assets, know-how or commercial
customer base and the technical and commercial competence of the employees. Furthermore, the
parties must maintain the business in the same conditions as before the concentration, in particular
provide sufficient resources, such as capital or a line of credit, on the basis and continuation of existing
business plans, the same administrative and management functions, or other factors relevant for main-
taining competition in the specific sector. The commitments also have to foresee that the parties
should take all reasonable steps,
to encourage all key
personnel to remain with the business, and that the parties may not solicit or move any personnel to
their remaining businesses.

information of a confidential or proprietary nature,

including appropriate incentive schemes,

111. The parties should further hold the business separate from its retained business and ensure that the
key personnel of the business to be divested do not have any involvement into the retained businesses
and vice versa. If the business to be divested is in corporate form and a strict separation of the corpo-
rate structure appears necessary, the parties' rights as shareholders, in particular the voting rights,
should be exercised by the monitoring trustee which should also have the power to replace the board
members appointed on behalf of the parties. In relation to information, the parties must ring-fence
the business to be divested and take all necessary measures to ensure that the parties do not obtain
any business secrets or other confidential information. Any documents or information confidential to
the business obtained by the parties before adoption of the decision have to be returned to the busi-
ness or destroyed.

112. The parties are further generally required to appoint a hold-separate manager with the necessary
expertise, who will be responsible for the management of the business and the implementation of the
hold-separate and ring-fencing obligations. The hold-separate manager should act under the supervi-
sion of the monitoring trustee who may issue instructions to the hold-separate manager. The commit-
ments have to provide that the appointment should take place immediately after the adoption of the
decision and even before the parties may close the notified concentration. Whereas the parties can
appoint the hold-separate manager on their own, the commitments have to foresee that the moni-
toring trustee is able to remove the hold-separate manager if s/he does not act in line with the
commitments or endangers their timely and proper implementation. A new appointment of a hold-
separate manager afterwards will be subject to the approval of the monitoring trustee.

Steps for a carve-out

113. As outlined above in paragraph 35, the Commission may accept in appropriate circumstances that the
divestiture of a business which needs to be carved out from the remaining businesses of the parties
can be considered a suitable remedy. Nevertheless, also in such circumstances only the transfer of a
viable business to a purchaser which can maintain and develop this business as an active competitive
force in the market will remove the Commission's competition concerns. Therefore, the parties have

C 267/24

EN

Official Journal of the European Union

22.10.2008

to commit to a result-oriented obligation to carry out, in the interim period, a carve-out of the assets
that contribute to the divested business. The result has to be that a viable and competitive business,
which is stand-alone and separate from the other businesses of the parties, can be transferred to a
suitable purchaser at the end of the interim period. The parties will have to bear the costs and risks of
such a carve-out in the interim period.

114. The carve-out will need to be carried out by the parties under the supervision of the trustee and in
cooperation with the hold-separate manager. First, those assets and parts of the personnel which are
shared between the business to be divested and remaining businesses of the parties have to be allo-
cated to the business to the extent that this is not excluded in the commitments (1). The allocation of
the assets and the personnel will be monitored and has to be approved by the monitoring trustee.
Second, the carve-out process may also require a replication for the business of assets held or func-
tions performed by other parts of the parties' businesses if this is necessary to ensure the viability and
competitiveness of the business to be divested. An example is the termination of the business' partici-
pation in a central information technology network and an installation of a separate IT system for the
business. In general, the major steps of such a carve-out process and the functions to be replicated
should be decided on a case-by-case basis and described in the commitments.

115. At the same time, it has to be ensured that the viability of the business to be divested is not affected
by such measures. In the interim period, the parties therefore have to maintain the use of shared assets
by and to continue to provide services to the business to the same extent as in the past as long as the
business is not yet viable on a stand-alone basis.

Specific obligations of the parties concerning the divestiture process

116. For the divestiture process, the commitments should foresee that potential purchasers can carry out a
due diligence exercise and obtain, dependent on the stage of the procedure, sufficient information
concerning the divested business to allow the purchaser to fully asses the value, scope and commercial
potential of the business, and have direct access to its personnel. The parties further have to submit
periodic reports on potential purchasers and developments in the negotiations. The divestiture will
only be implemented once the transaction is closed, that is the legal title has passed to the approved
purchaser, and the assets have been actually transferred. At the end of the process, the parties will
have to send a final report, confirming the closing and the transfer of the assets.

4. The monitoring and the divestiture trustee

Role of the monitoring trustee

117. As the Commission cannot, on a daily basis, be directly involved in overseeing the implementation of
the commitments, the parties have to propose the appointment of a trustee to oversee the parties'
compliance with the commitments, in particular with their obligations in the interim period and the
divestiture process (the so-called ‘monitoring trustee’). Thereby, the parties guarantee the effectiveness
of the commitments submitted by them and allow the Commission to ensure that the modification of
the notified concentration, as proposed by the parties, will be carried out with the requisite degree of
certainty.

118. The monitoring trustee will carry out its tasks under the supervision of the Commission and is to be
considered the Commission's ‘eyes and ears’. It shall be the guardian that the business is managed and
kept properly on a stand-alone basis in the interim period. The Commission may therefore give any
orders and instructions to the monitoring trustee in order to ensure compliance with the commit-
ments, and the trustee may propose to the parties any measures it considers necessary for carrying out
its tasks. The parties, however, may not issue any instructions to the trustee without approval by the
Commission.

(1) See paragraph 26 above for the question how shared assets have to be dealt with in commitments.

22.10.2008

EN

Official Journal of the European Union

C 267/25

119. The Commitments will generally set out the tasks of the monitoring trustee. Its duties and obligations
will be specified in detail in the trustee mandate, to be concluded between the parties and the trustee,
and its tasks shall be further detailed in a work-plan. The tasks of the monitoring trustee will normally
start immediately after the adoption of the Commission decision and last until the legal and actual
transfer of the business to the approved purchaser. Five main, non-exhaustive tasks can be distin-
guished which the monitoring trustee should carry out under the supervision of the Commission:

— first, the monitoring trustee will be called upon to oversee the safeguards for the business to be

divested in the interim period,

— second, in carve-out cases, the monitoring trustee has to monitor the splitting of assets and the
allocation of the personnel between the divested business and retained businesses by the parties as
well as the replication of assets and functions in the business previously provided by the parties,

— third, the monitoring trustee shall be responsible for overseeing the parties' efforts to find a poten-
tial purchaser and to transfer the business. In general, it shall review the progress of the divestiture
process and the potential purchasers included in the process. It shall verify that potential purcha-
sers receive sufficient information relating to the business — in particular by reviewing the infor-
mation memorandum (if available), the data room or the due diligence process. Once a purchaser
is proposed, the monitoring trustee shall submit to the Commission a reasoned opinion as to
whether the proposed purchaser fulfils the purchaser requirements in the commitments and
whether the business is sold in a manner consistent with the commitments. At the end of the
process, the monitoring trustee has to oversee the legal and actual transfer of the business to the
purchaser and make a final report, confirming the transfer,

— fourth, the monitoring trustee shall act as a contact point for any requests by third parties, in par-
ticular potential purchasers, in relation to the commitments. The parties shall inform interested
third parties of the identity and the tasks of the monitoring trustee,
including any potential
purchasers. In case of disagreement between the parties and third parties in relation to matters
dealt with by the commitments, the monitoring trustee shall discuss those matters with both sides
and report to the Commission. In order to be able to carry out its role, the monitoring trustee will
keep confidential any business secrets of the parties and third parties,

— fifth, the monitoring trustee shall report on these issues to the Commission in periodic compliance

reports and shall also submit additional reports upon request by the Commission.

120. The commitments will also comprehensively set out the monitoring trustee's needs for support by and
cooperation with the parties; the Commission will supervise the relationship between the parties and
the trustee also in this respect. In order to fulfil its tasks, the trustee shall have access to books and
records of the parties and of the divested business, insofar and as long as this is relevant for the imple-
mentation of the commitments, may ask for managerial and administrative support by the parties,
shall be informed of potential purchasers and all developments in the divestiture process, and shall be
provided with the information submitted to potential purchasers. In addition, the parties shall indem-
nify the trustee and allow the trustee to appoint advisors, if appropriate for the fulfilment of its tasks
under the commitments. The commitments will also enable the Commission to share the parties'
information with the monitoring trustee in order to allow the monitoring trustee to fulfil its tasks.
The monitoring trustee will be bound to keep this information confidential.

Role of the divestiture trustee

121. As for the monitoring trustee, the parties have to propose to appoint a divestiture trustee in order to
make the commitments submitted by them effective and allow the Commission to ensure that the
modification of the notified concentration, as proposed by them, will be carried out. If the parties do
not succeed in finding a suitable purchaser within the first divestiture period, then in the trustee dives-
titure period, the divestiture trustee will be given an irrevocable and exclusive mandate to dispose of
the business, under the supervision of the Commission, within a specific deadline at no minimum
price to a suitable purchaser. The commitments shall allow the divestiture trustee to include in the sale
and purchase agreement such terms and conditions as it considers appropriate for an expedient sale,
in particular customary representations, warranties and indemnities. The sale of the business by the
divestiture trustee is in the same way subject to the prior approval of the Commission as the sale by
the parties.

C 267/26

EN

Official Journal of the European Union

22.10.2008

122. The commitments will set out that the parties shall support and inform the divestiture trustee and
cooperate with the trustee in the same way as this is foreseen for the monitoring trustee. For the dives-
titure, the parties have to grant to the divestiture trustee comprehensive powers of attorney, covering
all stages of the divestiture.

Approval of the trustee and the trustee mandate

123. Depending on the commitment, the monitoring trustee may or may not be the same person or insti-
tution as the divestiture trustee. The parties shall propose one or several potential trustees to the
Commission, including the full terms of the mandate and an outline of a work-plan. It is of the
essence that the monitoring trustee is in place immediately after the Commission decision. Therefore,
the parties should propose a suitable trustee immediately after the Commission decision (1) and the
commitments normally have to foresee that the notified concentration can only be implemented once
the monitoring trustee is appointed, after being approved by the Commission (2). The situation is
different for the divestiture trustee who should be appointed well ahead of the end of the first divesti-
ture period (3) so that its mandate can take effect with the beginning of the trustee divestiture period.

124. Both types of trustees will be appointed by the parties on the basis of a trustee mandate, entered into
by the parties and the trustee. The appointment and the mandate will be subject to the approval by
the Commission which will have discretion in the selection of the trustee and will assess whether the
proposed candidate is suitable for the tasks in the specific case. The trustee shall be independent of the
parties, possess the necessary qualifications to carry out its mandate and shall not be, or become,
exposed to a conflict of interests.

125. The Commission will assess the necessary qualifications in the light of the requirements of the specific
case, including the geographic area and the sector concerned. According to the Commission's experi-
ence, auditing firms and other consulting firms may be particularly well placed to fulfil the tasks of a
monitoring trustee. Individuals who have worked in the specific industry may also be suitable candi-
dates for performing such a role if they have the necessary resources available to deal with the tasks at
stake. Investment banks seem to be particularly suitable for the role of a divestiture trustee. The inde-
pendence of the trustee is crucial in order to enable the trustee to properly fulfil its role of monitoring
the parties' compliance for the Commission and to ensure its credibility vis-à-vis third parties. In par-
ticular, the Commission will not accept persons or institutions as trustees which are at the same time
the parties' auditors or their investment advisors in the divestiture. However, no conflicts of interests
will arise by relations of the trustee with the parties if those relations will not impair the Trustee's
objectivity and independence in discharging its tasks. It is the parties' responsibility to supply the
Commission with adequate information for it to verify that the trustee fulfils the requirements. The
appointment of the trustee after approval by the parties is irrevocable unless the trustee is replaced
with the approval of or upon request by the Commission.

126. The trustee mandate shall define the tasks as specified in the commitments further and shall include
all provisions necessary to enable the trustee to fulfil its tasks under the commitments accepted by the
Commission. The parties are responsible for remuneration of the trustee under the mandate, and the
remuneration structure must be such as to not impede the trustee's independence and effectiveness in
fulfilling the mandate. The Commission will approve a trustee only together with a suitable mandate.
In appropriate cases, it may publish the identity of the trustee and a summary of its tasks.

127. When the specific commitments with which the trustee has been entrusted have been implemented
— that is to say, when legal title for the business to be divested has passed, the assets have been actu-
ally transferred to the purchaser and specific arrangements which may continue post-divestiture have
been fulfilled — the mandate will provide for the trustee to request the Commission for a discharge
from further responsibilities. Even after the discharge has been given, it may be necessary for the
if it
Commission to require the reappointment of the trustee on the basis of the commitments,
appears subsequently to the Commission that the relevant commitments might not have been fully
and properly implemented.

(1) Normally, the commitments should foresee that a monitoring trustee is proposed within two weeks of the date of the deci-

sion.

(2) See Case COMP/M.4180 — GdF/Suez of 14 November 2006; Case COMP/M.4187 — Metso/Aker Kvaerner of

12 December 2006; Case COMP/M.3916 — T-Mobile/tele.ring of 20 April 2006.

(3) The Commission will normally require an appointment at least one month ahead of the end of the first divestiture period.

22.10.2008

EN

Official Journal of the European Union

C 267/27

5. Obligations of the parties following implementation of the divestiture

128. The Commitments also have to foresee that for a period of 10 years after the adoption of the decision
accepting the commitments the Commission may request information from the parties. This will
allow the Commission to monitor the effective implementation of the remedy.

6. Implementation of other commitments

129. Many of the principles discussed above for the implementation of divestiture commitments can
equally be applied to other types of commitments if those commitments need to be implemented
subsequent to the Commission decision. For example, if it is foreseen that the beneficiary of a licence
needs to be approved by the Commission, the considerations regarding the purchaser approval can be
applied. Given the wide range of non-divestiture commitments, no general and comprehensive require-
ments for the implementation of non-divestiture commitments can be set out.

130. However, given the long duration of non-divestiture commitments and their frequent complexity, they
often require a very high monitoring effort and specific monitoring tools in order to allow the
Commission to conclude that they will effectively be implemented. Therefore, the Commission will
often require the involvement of a trustee to oversee the implementation of such commitments and
the establishment of a fast-track arbitration procedure in order to provide for a dispute resolution
mechanism and to render the commitments enforceable by the market participants themselves. In past
cases, the Commission has often required both the appointment of a trustee and an arbitration
clause (1). In those circumstances, the trustee will oversee the implementation of the commitments,
but will also be able to assist in arbitral proceedings to the effect that they may be finalised in a short
period of time.

(1) Such an approach of combined monitoring by arbitration and a monitoring trustee was, e.g. used in Case COMP/M.2803
— Telia/Sonera of 10 July 2002; Case COMP/M.3083 — GE/Instrumentarium of 2 September 2003; and Case
COMP/M.3225 — Alcan/Pechiney II of 29 September 2003.