Final Report in the Case COMP/M.5141 — KLM/Martinair
Date: 2009-03-04
Institutions: European Commission
Subjects: air transport, economic concentration, merger control, report, transport company

4.3.2009

EN

Official Journal of the European Union

C 51/3

Final Report (1) in the Case COMP/M.5141 — KLM/Martinair

(2009/C 51/03)

On 17 July 2008, the Commission received a notification of a proposed concentration pursuant to Article 4
of Council Regulation (EC) No 139/2004 (‘EC Merger Regulation’) by which KLM Royal Dutch Airlines N.V.,
ultimately controlled by Air France-KLM Holding S.A. acquires, within the meaning of Article 3(1)(b) of the
EC Merger Regulation, control of the whole of Martinair Holland N.V. by way of purchase of shares.

Based on the results of the first phase market investigation, the Commission concluded that the proposed
transaction raised serious doubts as to its compatibility with the common market due to competition
concerns identified with respect to air passenger transport on certain routes. The notifying party submitted
subsequently a commitment proposal. It consisted in benchmarking the post-merger price evolution of
economy class fares on the routes where competition concerns had been identified vis-à-vis the price evolu-
tion of economy class fares on a basket of comparable routes. However, the market test of the commitments
revealed doubts as to the workability and effectiveness of the price control mechanism and showed that the
commitment was too complex to implement and monitor. The proposed commitment therefore proved to
be not sufficiently clear-cut to eliminate the serious doubts identified by the Commission in the course of its
first phase investigation.

Accordingly, on 8 September 2008, the Commission concluded that the transaction raised serious doubts as
to its compatibility with the common market and with the functioning of the EEA Agreement and decided
to initiate proceedings under Article 6(1)(c) of the EC Merger Regulation.

The notifying party submitted comments on the Article 6(1)(c) decision and orally requested access to the
key documents in the file, in accordance with the Best Practices rules for merger cases. The case team replied
on the same day that no substantiated submissions within the meaning of paragraph 45 of the Best Practices
rules had been made and that, therefore, no key documents existed to which access could be granted. The
notifying party did not further pursue this issue.

Following an in-depth market investigation, the Commission concluded that the proposed concentration
would not significantly impede effective competition in the common market or in a substantial part of it
and that it should therefore be declared compatible with the common market pursuant to Article 8(1) of the
EC Merger Regulation and with the EEA Agreement pursuant to Article 57 thereof. Accordingly, no state-
ment of objections was sent to the notifying party.

No queries or submissions have been made to me by the parties or any third party. The case does not call
for any particular comments as regards the right to be heard.

Brussels, 12 December 2008.

Michael ALBERS

(1) Pursuant to Articles 15 and 16 of Commission Decision 2001/462/EC, ECSC of 23 May 2001 on the terms of reference of

Hearing Officers in certain competition proceedings (OJ L 162, 19.6.2001, p. 21).