Final Report of the Hearing Officer (Pursuant to Articles 16 and 17 of Decision 2011/695/EU of the President of the European Commission of 13 October 2011 on the function and terms of reference of the hearing officer in certain competition proceedings (OJ L 275, 20.10.2011, p. 29) (the ‘Decision 2011/695/EU’).) (M.9076 – Novelis/Aleris) (Text with EEA relevance) 2021/C 36/07
Date: 2019-09-19
Institutions: Directorate-General for Competition, European Commission
Subjects: aluminium, economic concentration, merger control, semi-manufactured goods, subsidiary, waste recycling








C_2021036EN.01000801.xml










2.2.2021   


EN


Official Journal of the European Union


C 36/8






Final Report of the Hearing Officer (1)

(M.9076 – Novelis/Aleris)
(Text with EEA relevance)
(2021/C 36/07)

Introduction









1.


On 18 February 2019, the Commission received a notification of a proposed concentration pursuant to Article 4 of the Merger Regulation (2) by which Novelis Inc. (‘Novelis’ or the ‘Notifying Party’), a fully owned subsidiary of Hindalco Industries Limited, acquires, within the meaning of Article 3(1)(b) of the Merger Regulation, sole control of the whole of Aleris Corporation (‘Aleris’) by way of purchase of shares (the ‘Proposed Transaction’). For the purpose of this report, Novelis and Aleris are jointly referred to as the ‘Parties’.





Procedure









2.


The Commission's first phase investigation raised serious doubts as to the compatibility of the Proposed Transaction with the internal market and the functioning of the EEA Agreement in relation to the EEA market for aluminium flat rolled products (‘FRP’) for automotive body sheets (‘ABS’), and in relation to the potential markets for aluminium sheet for compound tubes in the EEA and for aluminium anodising quality sheet in the EEA. On 25 March 2019, the Commission adopted a decision to initiate proceedings pursuant to Article 6(1)(c) of the Merger Regulation. The Notifying Party submitted written comments on that decision on 4 April 2019.












3.


On 11 April 2019, following the Notifying Party’s request, the Commission adopted a decision extending the second phase investigation period by twenty working days.












4.


On 13 May 2019, the Commission adopted decisions pursuant to Article 11(3) of the Merger Regulation, one addressed to Novelis and another one addressed to Aleris, following their failure to provide complete information in response to a request for information (‘RFI’) from the Commission. Both decisions compelled their addressees to submit a complete response to the RFIs originally sent by the Commission and had the effect of suspending the time limit referred to in the first subparagraph of Article 10(3) of the Merger Regulation from 7 May 2019 until and including 15 May 2019.












5.


On 1 July 2019, the Commission adopted a Statement of Objections (the ‘SO’). In the SO, the Commission came to the preliminary view that the Proposed Transaction would significantly impede effective competition in relation to the production and supply of Aluminium ABS in the EEA resulting from the creation or strengthening of a dominant position in the relevant market and, in any event, from the elimination of an important competitive constraint. The Commission's preliminary conclusion was that the notified concentration was thus not compatible with the internal market and the functioning of the EEA Agreement. The Notifying Party submitted its comments on the SO on 17 July 2019, within the extended deadline set by the Directorate General for Competition (‘DG Competition’). In its letter accompanying its response to the SO, the Parties requested to be heard orally.












6.


The formal oral hearing was held on 23 July 2019. It was attended by the Parties, their external legal and economic advisers, the two interested third persons (see paragraph 7 below), relevant Commission services and representatives of the competition authorities of four Member States (Belgium, Germany, Spain and the United Kingdom) and a representative of the EFTA Surveillance Authority. There were no procedural complaints raised in relation to the hearing.












7.


Following their request, I admitted two trade unions as interested third persons in the procedure. Both interested third persons were provided with a non-confidential version of the SO and given a time-limit within which to submit their observations. Upon their request, the two trade unions were invited to the oral hearing, during which they each presented their views on the Proposed Transaction.












8.


On 6 August 2019, a Letter of Facts was sent to the Notifying Party. The Notifying Party submitted its comments on the Letter of Facts on 19 August 2019.












9.


The Parties were first granted access to the file on 2 July 2019. They asked further access to certain information to DG Competition, which provided additional non-confidential descriptions and shared some of the requested information after contacting information providers. DG Competition granted subsequent access to the file on 7 August 2019 and 2 September 2019. Moreover, DG Competition organised data rooms providing access to certain documents to the Notifying Party's external advisers only. While they were not authorised to extract information from the data room, the external advisers were allowed to compile confidential data room reports for the Commission file as well as a non-confidential version of such reports for the Notifying Party.





Draft Decision









10.


On 9 August 2019, the Notifying Party submitted a first set of commitments pursuant to Article 8(2) of the Merger Regulation in order to address the competition concerns identified in the SO. A revised version of these commitments was submitted on 13 August 2019. On the basis of the feedback obtained from the market testing of the revised commitments, the Notifying Party submitted a final set of commitments (the ‘Final Commitments’) on 3 September 2019.












11.


In the draft decision, the Commission finds that the Final Commitments are suitable and sufficient to eliminate the significant impediment to effective competition to which the Proposed Transaction would give rise and that these commitments render the Proposed Transaction compatible with the internal market and the functioning of the EEA Agreement.





Conclusion









12.


I have reviewed the draft decision pursuant to Article 16(1) of Decision 2011/695/EU and I conclude that it deals only with objections in respect of which the Parties have been afforded the opportunity of making known their views.












13.


I conclude that the effective exercise of procedural rights has been respected in the present proceedings.





Brussels, 19 September 2019.

Joos STRAGIER




(1)  Pursuant to Articles 16 and 17 of Decision 2011/695/EU of the President of the European Commission of 13 October 2011 on the function and terms of reference of the hearing officer in certain competition proceedings (OJ L 275, 20.10.2011, p. 29) (the ‘Decision 2011/695/EU’).

(2)  Council Regulation (EC) No 139/2004 of 20 January 2004 on the control of concentrations between undertakings (the EC Merger Regulation) (OJ L 24, 29.1.2004, p. 1) (the ‘Merger Regulation’).