CELEX: 32014M7078
Language: en
Date: 2014-01-29 00:00:00
Title: Commission Decision of 29/01/2014 declaring a concentration to be compatible with the common market (Case No COMP/M.7078 - SANTANDER CONSUMER FINANCE / EL CORTE INGLES / FINANCIERA EL CORTE INGLES) according to Council Regulation (EC) No 139/2004 (Only the English text is authentic)

|[pic]                             |EUROPEAN COMMISSION                                                                                      |

                                        Brussels, 29/01/2014
                                        C(2014) 542 final

                                        [pic]

|To the notifying parties:                                                                                                        |                                                                       |

Dear Sir/Madam,

Subject:    No COMP/M.7078 - SANTANDER CONSUMER FINANCE / EL CORTE INGLES / FINANCIERA EL CORTE INGLES
         Commission decision pursuant to Article 6(1)(b) of Council Regulation No 139/2004[1]

    1) On 13 December 2013, the European Commission received a notification of  a  proposed  concentration  pursuant  to  Article  4  of  Council
       Regulation (EC) No 139/2004[2] by which Santander Customers Finance S.A ("SCF", Spain), ultimately controlled by Banco Santander S.A., and
       El Corte Inglés S.A. ("ECI", Spain), collectively referred to as " the Parties", acquire within the meaning  of  Article  3(1)(b)  of  the
       Merger Regulation, joint control of Financiera El Corte Inglés S.A. ("FECI", Spain)  by  way  of  purchase  of  shares,  hereinafter  "the
       proposed transaction".

       THE PARTIES

    2) SCF is active in the provision of finance services in Spain, Portugal and other countries. It offers  finance  products  to  customers  at
       point of sale (through car dealers or merchant outlets) and directly through its own branches, on the Internet and via telemarketing.  SCF
       belongs to Banco Santander Group which is active in the retail, corporate and investment banking, asset management and  insurance  in  the
       EEA and the Americas.

    3) ECI is the parent company of El Corte Inglés Group, active in the field of retail distribution based on the department  store  model.  ECI
       operates various types of stores: hypermarkets, supermarkets and convenience stores, travel agencies and optical  shops.  It  also  offers
       life insurance policies, services in the telecommunication technology sector and sells goods through teleshopping. ECI is active in  Spain
       and Portugal.

    4) FECI is a credit institution within the meaning of Spanish law and is currently solely controlled by ECI. It provides credit  services  in
       connection with the purchases made in stores of the ECI Group and other stores with which it has bilateral arrangements.  FECI  is  mainly
       active in the market for personal credit to customers for financing the purchase of goods as well as in the  market  for  the  issuing  of
       payment cards, namely, store cards. Other activities carried out by FECI include value added  tax  (VAT)  refund  management  services  to
       customers, factoring services, and, insurance mediation services.

       THE OPERATION

    5) The proposed transaction consists in the acquisition of 51% of the shares and the voting rights on FECI by SCF from ECI, pursuant  to  the
       Share Purchasing Agreement signed on 7 October 2013. On the same day ECI, FECI and SCF have entered in a Shareholders' Agreement  defining
       the new corporate governance structure.

       Joint control

    6) Following the transaction, FECI's board of directors will have seven members appointed by the shareholders meeting,  four  of  them  on  a
       proposal of SCF and three of them on a proposal of ECI. The non-executive Chairman of the board will  be  appointed  by  the  3  directors
       nominated by ECI after consultation with SCF, whereas those directors nominated by SCF will appoint the CEO after consultation with ECI.

    7) Certain "board reserved matters" will require a decision with a favourable vote of five out of  seven  board  directors,  including  among
       others: (i) the approval and amendments of the business plan and the budgets; (ii) the amendments of  the  current  conditions  of  FECI's
       commercial policy; (iii) investments in operating asset or any other asset related to FECI's business in excess of EUR […], provided  that
       they were not envisaged in the business plan or the annual budget; conclusion, amendments or termination of financing  agreements  entered
       into by FECI or its subsidiary for an aggregated amount in excess of EUR […]; (iv) the establishment of strategic agreements or  alliances
       having as their object the development of FECI's business.

    8) It follows from the above that the strategic decisions related to FECI's commercial policy are jointly adopted by SFC and ECI.  Therefore,
       FECI will be jointly controlled by the Notifying Parties.

      Full-functionality

    9) The Parties submit that FECI has sufficient resources to operate independently on the market, holds the necessary authorisations and meets
       the capital requirements to exercise the activities of a specialised credit institution in Spain. It also has its own management  as  well
       as 700 employees, including teams dedicated to client management, risk control and promotion. Furthermore, FECI has its own assets and  in
       particular it owns the IT system containing the applications necessary for cards management, operation  and  credit  risk,  administration
       system, comprising a database of transactions and customers, as well as customer management applications; a  risk  management  system,  an
       accounting system, an information system, and lastly a quality assurance system.

   10) Further, FECI has access to its own portfolio of customers and it provides private label card acceptance services  to  merchants  such  as
       Repsol, Burger King, Cinesa or Galeries Lafayette. […].

   11) The vast majority of FECI's revenues stem from transactions with third parties and customers: end customers who  finance  their  purchases
       using the "personal payment formula" or private label card, which represent [50-60]%, and fees paid by other  companies  than  ECI,  which
       represent [10-20]% of the income. FECI is remunerated at arm's length for services provided to ECI.

   12) Lastly FECI has been active on the market for the last 17 years and the parties intend to maintain the joint control at least for a period
       of >8 years. Therefore, FECI will operate on a lasting basis.

   13) It follows from the above that FECI will be a full-function joint venture.  Therefore, the proposed transaction constitutes an acquisition
       of joint control over the whole of an undertaking within the meaning of Article 3(1)(b) of the Merger Regulation.

       EU DIMENSION

   14) The undertakings concerned have a combined aggregate world-wide turnover of more than EUR 5 000 million[3], namely  EUR  96  960  million.
       Each of them has an EU-wide turnover in excess of EUR 250 million (Banco Santander S.A.: EUR […] million, ECI: EUR […] million  and  FECI:
       EUR […] million), but they do not achieve more than two-thirds of their aggregate EU-wide turnover within one and the same Member State.

   15) The notified operation therefore has a EU dimension within the meaning of Article 1(2) of the Merger Regulation.

       MARKET DEFINITION

   16) FECI provides the following credit services exclusively in connection with purchases made in stores of the ECI Group and  in  stores  with
       which it has bilateral agreements: (i) personal loans to customers and, (ii) financing through private label cards. It also  provides  VAT
       refund management services, factoring services and card management  services.  Other  activities  include  the  distribution  of  non-life
       insurance products which are offered together with payment cards. FECI is also active in the field of customer credit and card issuing  in
       Spain and marginally in Portugal.

   17) SCF is active in the provision of card-based customer credit, customer credit granted  via  loans,  customer  credit  activities  for  the
       purchase of motor vehicles, payment card issuing, including private label cards and management services for  card  payment  in  Spain  and
       Portugal.

   18) ECI is a large retail distribution company based on a department store model in Spain and in Portugal.

   19) The proposed transaction gives rise to horizontal overlaps resulting in affected markets only in Spain as regards  (i)  the  provision  of
       consumer credit, in particular, the provision of consumer credit through loans, and (ii) the issuing of payment cards, in particular,  the
       issuing of personal credit/charge cards and the issuing of personal pure store cards.

   20) The proposed transaction also leads to limited horizontal overlaps in Portugal in the market  for  consumer  credit  and  the  issuing  of
       payment cards and their respective segments. Nevertheless it does not result in affected markets even at  the  narrowest  possible  level.
       Thus, these overlaps will not be further examined.

   21) Furthermore, there is a pre-existing vertical link between the activities of ECI and FECI on the markets for retail distribution of  goods
       in Spain and the provision of financing services. However, these vertical links do not result in affected markets either  and,  therefore,
       they will not be further assessed.

1 Relevant product market

1 The market for issuing of payment cards

   22) In its previous decisional practice, the Commission has distinguished  three  main  card-related  activities:  the  issuing  of  cards  to
       individuals and companies; card processing; and the “acquiring” of merchants (including hotels, airlines and  other  businesses  accepting
       cards) for card payment acceptance.[4]

   23) Within the activity of issuing payment cards, the Commission has considered that debit cards and credit/charge cards  belong  to  separate
       markets.[5]

   24) Charge cards[6] and credit cards[7] have been considered by the Commission to be part of the same relevant product market as  regards  the
       payment function, since both types of cards offer similar payment services, although the credit function differs between them.[8]

   25) Within the group of credit/charge cards, it is possible to operate a distinction between special purpose cards and  universal  cards.  The
       Commission has previously found that special purpose cards consist of pure store  cards  which  are  accepted  for  payment  only  in  all
       commercial outlets of a given brand or selection of brands and within a limited geographic  scope.  For  the  purposes  of  this  decision
       special purpose or pure store cards will be referred to as pure store cards.

   26) Universal cards include both hybrid store cards[9] as well as cards which do not have any association with particular  store  brands,  and
       are characterised by much wider acceptance for payments at a range of commercial outlets. Universal cards  carry  the  brands  of  payment
       networks.[10]

   27) The Notifying Parties submit that pure store cards  could  be  used  by  the  merchant  for  its  promotional  strategy  and  may  include
       complementary services such as insurance. In practice these cards enable the  merchants  to  encourage  customer  loyalty  and  to  obtain
       information on purchasing patterns and the consumption profile. In the case of FECI, pure purpose cards constitute a  further  element  of
       the merchant's commercial offer. In this regard, the Notifying Parties consider that pure store cards compete with other services  offered
       to customers on the market to which the particular retail store or chain belongs.

   28) The Notifying Parties contest the existence of a market segment consisting in the issuing of pure store cards.  According  to  them,  pure
       store cards are not substitutable products from the demand side. Moreover, they do not compete in the same store, since once the  customer
       has decided to carry out a purchase in a particular shop, pure store cards do not compete with each other. Rather, such cards play a  role
       in the customer's decision as a part of the retailer's commercial offer. Furthermore, from the supply side  (the  moment  merchants  offer
       such cards to customers) pure store cards are not mutually exclusive products, as a customer may hold several of them.

   29) The market investigation has largely confirmed that card issuing constitutes a separate  product  market.  Moreover,  respondents  to  the
       market investigation have pointed out that differences between universal cards and  pure  store  cards  could  support  a  further  market
       segmentation into the issuing of universal cards, and the issuing of pure store cards.[11]

   30) A segmentation into the a market for the issuing of universal cards and the issuing of pure store cards could be justified on  grounds  of
       supply-side considerations, namely, different commercial conditions governing the relations between retailers and card issuers as well  as
       particularities in the infrastructure needed for the issuing of universal or pure store cards. In particular, different fees apply to  the
       use of each type of card. Moreover, universal and pure store cards are subject to different risk scoring, which is usually lower  for  the
       latter type of cards. As regards the technological infrastructure, pure store cards  require  specific  computer  applications  for  their
       customization according to a partner’s preferences.  Universal  cards  must  also  comply  with  brand-specific  regulations  (e.g.  Visa,
       Mastercard or America Express), which renders them more standardised financial products as opposed to  special-purpose  cards,  which  are
       issued in consideration of the brand needs, e.g. the brand's sales strategy.[12]

   31) The results of the market investigation suggest  that,  from  the  supply  side,  universal  cards  and  pure  store  cards  show  limited
       substitutability. From the demand side, the market investigation has confirmed[13] that there is a degree of substitutability between  the
       two types of cards, since both types of cards can be used to pay at the same outlets,  including  those  which  offer  pure  store  cards.
       However, pure store cards often have specific advantages which do not apply to universal  cards,  for  example  in  terms  of  promotional
       programs. In this regard, customers hold an interest to hold a pure store card. A customer who holds a pure store card is therefore likely
       a priori to use it in preference to universal cards at the outlets which the card serves, at least if the  circumstances  which  motivated
       holding it in the first place have not changed.

   32) The Commission has also distinguished between corporate cards (issued to employees for professional use), and personal  cards  (issued  to
       private individuals for personal use)[14]. FECI does not provide corporate cards.

   33) However, the precise product market definition can be left open, since the proposed transaction will not  give  raise  to  serious  doubts
       regarding its compatibility with the internal market under any of the possible market definitions.

2 The market for customer credit

   34) The Commission has in previous decisions held that banking services can be divided into three  main  segments,  (i)  retail  banking  (ii)
       corporate banking and (iii) financial market services.[15]

   35) Retail banking generally comprises all banking services to private individuals and very small enterprises, which  consist  inter  alia  of
       deposits and account services (current accounts, saving accounts etc.), lending (personal loans, consumer  credit,  overdraft  facilities,
       mortgages etc.), payment services and investment products such as (mutual) funds and other forms of asset management. The  Commission  has
       considered some of these as separate markets in a number of decisions, although it has ultimately left open the exact market definition.

   36) In Spain, customer credit is generally offered by banks having their own distribution network and by specialised credit institutions.

   37) In previous decisions, the Commission has considered that the provision of card-based consumer credit and customer  finance  loans,  which
       include loans sold directly via banks (personal credit), and finance at the point of sale (classical credit) belong  to  separate  product
       markets.[16]

   38) Loans are usually contracted in relation to specific purchases and are usually of an amount higher than that of individual purchases  made
       using credit/charge cards. The repayments associated with such loans are regular and occur over a period which is agreed in advance (i.e.,
       in instalments). The interest rates for these loans are generally lower than those applicable to card-based credit.

   39) Loans can be contracted directly with the bank or credit institution (at their offices or by means of distance selling). Nevertheless,  it
       is also quite common that contracts are entered into at the point of sale, for example, in respect of the purchase of motor vehicles.

   40) In the case of loans afforded directly at the point of sale, it may be the case that the retailer assumes part or even  all  interests  as
       promotional expenses. Consumer finance is thus an additional cost for the commercial chain, and not a source of income, as the purpose  is
       to attract customers and encourage purchases.

   41) Card-based finance is more flexible because the credit is automatically available for each transaction (provided that  the  consumer  does
       not exceed the maximum credit limit agreed in advance and that there are no incidences during the payment process) and it does not require
       successive authorisations by the bank. This credit thus serves a distinct purpose in enabling customers to  borrow  in  order  to  finance
       short-term gaps in cash flow, regardless of the purchasing need or opportunity. Nonetheless, the interest rate of  card-based  finance  is
       usually higher.

   42) The Parties consider that from a demand side prospective there is an undeniable competitive pressure between  card-based  customer  credit
       and customer credit granted via loan, given that customers can use any of these possibilities to finance the purchase of goods.

   43) The market investigation has confirmed that card based customers credit should be viewed as a separate and distinct market  from  personal
       loans.[17]. A number of differences contribute to this assessment. Different risk policies apply to both card-based credit and to customer
       loans. The technologic infrastructure used for payment cards and customer loans is different. Both card-based credit  and  consumer  loans
       have a different commercial policy, implying different commissions and interest rates due to the fact that consumer loans  are  considered
       to cover higher amounts for a specific purchase, whereas card-based credit is used to finance a variety of purchases of lower value.[18]

   44) On the basis of the results of the market investigation, it could be considered that card  based  credit  and  customer  loans  belong  to
       separate product markets. However the exact product market definition can be left open since the proposed transaction will not give  raise
       to serious doubts regarding its compatibility with the internal market under any plausible market definition.

   45) In the past, the Commission has also considered without taking a definitive position on the matter,  whether  card-based  consumer  credit
       should be further segmented into credit offered on universal cards and credit offered on  private  label  store  cards.[19]  However,  the
       proposed transaction will not give raise to serious doubts regarding its compatibility with the internal market under any plausible market
       definition and, therefore, the exact product market definition can also be left open.

   46) Furthermore, in previous decisions, the Commission has considered the possibility of segmenting the consumer credit market  into  consumer
       credit activities for the purchase of motor vehicles and consumer credit for the purchase of other  consumer  goods[20].  In  the  present
       case, SCF is active in the consumer credit segment for the purchase of motor vehicles, whereas FECI is not. However  the  precise  product
       market definition can be left open since the proposed transaction will not give raise to serious doubts regarding its  compatibility  with
       the internal market irrespective of the market definition chosen.

2 Relevant geographic market

   47) In its previous decisional practice, the Commission has consistently considered that, with regard to retail banking services, the relevant
       geographic market is national in scope due to the different competitive conditions within individual Member States and the importance of a
       network of branches[21]. This approach may also be followed in the present case.

   48) The market investigation confirmed that the competition between suppliers which offer financing through loans or  at  the  point  of  sale
       takes place mostly at national level.[22] Consumer credit market in Spain is a mature market and is dominated by Spanish players who  have
       a local presence.[23] In addition, companies located outside of Spain are generally unable to  exercise  competitive  pressure,  since  in
       order to compete efficiently, they need local presence.

   49) As regards payment cards, the Commission indicated that the market for such market is national in scope even though it admitted that there
       may be scope for the widening of the market in the future[24].

   50) A majority of respondents to the market investigation largely confirmed that the competition between  issuers  of  special  purpose  cards
       takes places at national level, and that companies located outside of Spain do not  exercise  significant  competitive  pressure  in  this
       market.[25] Issuers located outside Spain issue mainly universal and prepaid cards for the Spanish  market.  This  is  due  to  the  lower
       technical complexity of these cards and to the difficulty in controlling the card acquisition at the point of sale.[26]

   51) Based on the above, it could be considered that both markets for payment card issuing and  card-based  consumer  credit  are  national  in
       scope. However the exact product market definition can be left open since the proposed transaction will not give raise to  serious  doubts
       regarding its compatibility with the EU internal market under any market definition.

       Competitive assessment

1 Card issuing

   52) The Notifying Parties’ activities in the market segment for credit/charge card issuing (including universal, hybrid and pure store  cards)
       in Spain sheds a combined share of [10-20]% in terms of value (turnover), with an increment of [5-10]% attributable to FECI, and  [20-30]%
       in terms of volume (number of cards) with an increment of [5-10]% attributable to the Santander Group. The merged entity  will  also  face
       competitive pressure from BBVA ([10-20]% by value; [10-20]% volume) and from CaixaBank ([10-20]% value; [5-10]% volume) as  well  as  from
       several other smaller marker players.

   53) A potential market segment for issuing of pure store cards in Spain would yield high combined market shares by the Notifying Parties. Such
       market share would be [60-70]% with an increment of [0-5]% due to SCF in outstanding debt value, [70-80]% with an increment of [0-5]%  due
       to SCF in turnover value and [50-60]% with an increment of [0-5]% attributable to SCF in number of cards. Indeed, SCF's presence  in  this
       market segment would be very limited. In addition, SCF issues hybrid store cards (co-branded cards) for several merchants  in  Spain,  but
       neither ECI nor FECI are active in this field. In light of this data, the proposed transaction will not have any substantial effect on the
       current market structure of such potential market segment. The resulting entity would also compete with BBVA (market share  of  [10-20]%),
       which offers special purpose/pure store cards to several large retail stores such as Zara (Inditex), Mango, Consum, or with Accordfin ([5-
       10]%), which also offers pure store cards to large retail chains, e.g. to Alcampo, Decathlon or Leroy Merlin.

   54) The market investigation has emphasised that FECI would have strengths in the market for issuing of payment cards, in  particular  in  the
       hypothetical market segment of pure store cards. These strengths imply access to the largest customer base[27] in this market  segment,  a
       strong presence at the point of sale thanks to its mother company ECI's department stores and very good historical knowledge  of  customer
       behaviour, combined with significant experience in the operation of pure store cards as the main issuer of pure store cards in the Spanish
       market. Also, the high sales volume of ECI could facilitate the financing of customer  purchases,  for  example,  though  the  three-month
       interest free financing formula offered by FECI to its customers.[28] However, the majority of the respondents of the market investigation
       also pointed out that there are no specific barriers to entry and expansion in this market segment, except for  the  need  for  commercial
       agreements with retailers with a large customer base wishing to offer pure store cards to their customers, and the fact that card  issuers
       must comply with regulatory requirements, such as the need to become a financial entity under Spanish law and  be  granted  a  license  to
       issue payment cards.[29] Finally, despite the fact that three respondents raised concerns with regard to the development of the  Notifying
       Parties’ market share mid-term, the vast majority of the respondents believe that the transaction  would  not  have  negative  effects  on
       pricing in the market for the issuing of pure store cards, since enough competitors would  continue  to  exist  post-transaction  on  this
       potential market segment and FECI accounts for the large majority of the combined share  percentage  with  the  entry  of  SCF  not  being
       significant enough to affect prices.[30]

   55) As regards the market for credit/charge card issuing, in view of the moderate combined shares of the Notifying Parties and  the  existence
       of several strong players remaining post-transaction,  the  proposed  transaction  will  not  give  rise  to  serious  doubts  as  to  its
       compatibility with the EU internal market.

   56) As regards a potential market segment for the issuing of pure store cards, considering the very limited increment of the Notifying Parties
       post-transaction which would not bring about any substantial change in the market structure and in light of  the  results  of  the  market
       investigation, it could also be concluded that the proposed transaction will not give rise to serious doubts as to its compatibility  with
       the EU internal market.

2 Consumer credit

   57) After completion of the proposed transaction, SCF's and FECI's combined market share in the overall  market  segment  for  consumer  loans
       would amount to [10-20]% (with an increment of [0-5]% attributable to FECI) in terms of credit portfolio.  FECI  would  continue  to  face
       competition from CaixaBank ([10-20]%) BBVA ([5-10]%), Banco Sabadell ([5-10]%) and several other market players which have  market  shares
       higher than FECI. In addition, SCF's market share has been decreasing in the last three years. If the market  definition  excluded  credit
       for the purchase of motor vehicles, the combined market share would amount to [10-20]%. The competition would present a similar  landscape
       in this second scenario, with Banco Sabadell ([10-20]%), CaixaBank ([5-10]%), Novagalicia Banco ([5-10]%) and five  other  market  players
       having shares higher than the increment.

   58) With regard to the specific segment for card based customer credit in Spain, the Notifying Parties' combined share would be below 15% ([10-
       20]%, with an increment of [0-5]% attributable to FECI). Therefore, the proposed transaction does not give rise to an affected market.  In
       addition, there are other competitors with similar or higher market shares, namely CaixaBank ([10-20]%)  and  BBVA  ([10-20]%),  and  five
       other financial institutions with shares higher than the increment.

   59) The market investigation has revealed that SCF and FECI are close competitors. However, they are not necessarily the  closest  competitors
       to each other.[31] Some credit institutions other than FECI are perceived to be closer competitors to  SCF,  as  FECI  currently  provides
       financing for ECI’s retail store customers only.[32]

   60) Almost all respondents to the market investigation have confirmed a high degree of market specialisation in the domain of consumer  credit
       by SCF and FECI, with particular strength in the financing of purchases at the point of sale.[33]  The  large  retail  business  from  ECI
       serving as a basis of customer acquisition to FECI is the main characteristic of the  latter’s  specialisation  in  this  market.[34]  The
       market investigation indicated that access to retail distribution is a key element in order to be competitive in the market  for  consumer
       credit through cards as well as at the point of sale.[35] However, this is not perceived to be an insurmountable barrier by respondents to
       the market investigation.[36]

   61) The market investigation confirmed that the transaction would not to lead  to  negative  impact  on  price  in  the  market  for  consumer
       credit.[37]

   62) Considering the moderate combined shares presented by the Notifying Parties and the existence of significant  competitive  pressure  post-
       transaction, and in light of the results of the market investigation, the proposed transaction will not give rise to serious doubts as  to
       its compatibility with the EU internal market regarding the market for consumers credit in Spain and its segments.

       CONCLUSION

   63) For the above reasons, the European Commission has decided not to oppose the notified operation and to  declare  it  compatible  with  the
       internal market and with the EEA Agreement. This decision is adopted in application of Article 6(1)(b) of the Merger Regulation.

                                        For the Commission

                                        (Signed)
                                        Joaquín ALMUNIA
                                        Vice-President

-----------------------
[1]   OJ L 24, 29.1.2004, p. 1 ('the Merger Regulation'). With effect from 1 December 2009, the Treaty on the Functioning of the  European  Union
      ('TFEU') has introduced certain changes, such as the replacement of 'Community' by 'Union' and 'common market' by  'internal  market'.  The
      terminology of the TFEU will be used throughout this decision.

[2]   Publication in the Official Journal of the European Union No C 373,20.12.2013, p. 31.

[3]   Turnover calculated in accordance with Article 5(1) of the Merger Regulation and the  Commission  Consolidated  Jurisdictional  Notice  (OJ
      C95, 16.04.2008, p1).

[4]   Case COMP/M.5241 - American Express/Fortis/Alpha Card, para, COMP/M.5384 – BNP Paribas / Fortis, para. 14, Case  No  COMP/M.6164  -Barclays
      Bank/ Egg credit card assets, para. 9.

[5]   Case COMP/M.5384 BNP Paribas / Fortis, paras 14-16, Case No COMP/M.6164 - Barclays bank / Egg credit card assets, para 10.

[6]   Charge cards, also known as "deferred debit cards", are required to be settled on a net basis in full at the statement due date and do  not
      offer credit.  Statements are issued periodically, typically on a monthly basis.  Case COMP/M.5384 BNP Paribas  /  Fortis,  Decision  of  3
      December 2008, paragraph 19.

[7]   Credit cards in the strict sense, also referred to as "revolving credit cards", require the customer only  to  settle  a  fraction  of  the
      outstanding balance figuring on periodic statements of account.  The remaining part of the outstanding balance may be carried over  to  the
      next statement period, in which case interest charges become due. The customer disposes of a credit facility up to a  pre-arranged  ceiling
      which is replenished as repayments are made on the outstanding amount.  Case COMP/M.5384 BNP Paribas / Fortis, Decision of 3 December 2008,
      paragraph 19.

[8]   Case COMP/M.5384 BNP Paribas / Fortis, Decision of 3 December 2008, paragraph 35; Case No  COMP/M.6164  -Barclays  Bank/  Egg  credit  card
      assets, para. 10.

[9]   Hybrid store cards offer particular conditions or services when used in  the  sponsoring  store  or  collection  of  stores,  and  carry  a
      proprietary logo, but can still be used in other establishments, whether nationally or internationally, for  which  purpose  they  are  co-
      branded with national or international payment scheme logos (see Case COMP/M.5384 BNP Paribas / Fortis, para 19).

[10]  Case COMP/M.5384 BNP Paribas / Fortis, para 22.

[11]  Non- confidential version of the replies to question 18 of the Questionnaire Q1 to Competitors.

[12]  Non- confidential version of the replies of UNOE BANK SA, Banco Popular Español S.A., Grupo Caixa,to question 19 of  the  Questionnaire  Q1
      to Competitors.

[13]  See also Case COMP/M.5384 BNP Paribas / Fortis, para. 28.

[14]  Case COMP M. 5384 - BNP Paribas / Fortis (paras. 38 and 39); Case COMP/M.6164 -BARCLAYS BANK/ EGG CREDIT CARD ASSETS, para. 10.

[15]  See among others: COMP/M.5960 - Credit Agricole / Casa di Risparmio della Spezia / Agences Intesa Sanpaolo; COMP/M.5948 -  Banco  Santander
      / Rainbow; COMP/M.5811 - Erste Bank / ASK; COMP/M.5726 - Deutsche Bank / Sal. Oppenheim; 8 September 2009  on  case  COMP/M.5605  -  Credit
      Mutuel / Monabanq; COMP/M.5432 - Credit Mutuel / Cofidis; COMP/M. 5363 - Santander / Bradford & Bingley Assets.

[16]  COMP/M.5241 - American Express/Fortis/Alpha Card, para, COMP/M.5384 – BNP Paribas / Fortis, para. 14, Case No COMP/M.6164  -BARCLAYS  BANK/
      EGG CREDIT CARD ASSETS.

[17]  Reply to question 5 of the Questionnaire Q1 to Competitors. See also COMP/M.5384 – BNP Paribas / Fortis, para. 43.

[18]  Non- confidential version of the replies of Banco Popular Español, S.A, ING, Bankia, Cortefiel S.A. to question 6 of the  Questionnaire  Q1
      to Competitors.

[19]  COMP/M.5384 – BNP Paribas / Fortis, para. 56.

[20]  COMP M.1370 - PEUGEOT / CREDIPAR and M.3067 - Intesa/Capitalia/IMI Investimento/Unicredito/FIDIS Retail

[21]  COMP/M.4844, Fortis/ABN AMRO Assets; COMP/M.2578, Banco Santander Central Hispano/AKB; COMP/M.5384 – BNP Paribas / Fortis, para. 72

[22]  Replies to question 8 of the Questionnaire Q1 to Competitors.

[23]  Replies to question 9 of the Questionnaire Q1 to Competitors. Non-confidential reply of Banco Popular Español, S.A. to question  9  of  the
      Questionnaire Q1 to Competitors.

[24]  COMP/M.3740, Barclays Bank/Föreningssparbanken/JV and COMP/M.2567 Nordbanken/Postgirot

[25]  Replies to questions 21 and 22 of the Questionnaire Q1 to Competitors.

[26]  Non-confidential version of the reply of Unoe Bank S.A to question 22(1) of the Questionnaire Q1 to Competitors.

[27]  Access to such a large customer base resulting from the combination of SCF’s  and  FECI’s  customer  portfolios  is,  however,  not  merger
      specific, since it could be achieved by means of commercial agreements between market players.

[28]  Replies to questions 25 and 25.1 of the Questionnaire Q1 to Competitors.

[29]  Replies to question 28 and 28.1 of the Questionnaire Q1 to Competitors.

[30]  Replies to question 29 of the Questionnaire Q1 to Competitors

[31]  Non-confidential version of the reply of UNOE BANK SA to question 10 of the Questionnaire Q1 to Competitors.

[32]  Non-confidential version of the reply to question UNOE BANK SA of the Questionnaire Q 1- Competitors

[33]  Replies to question 13 of Questionnaire Q1 to Competitors.

[34]  Replies to question 14 of Questionnaire Q1 to Competitors.

[35]  Replies to questions 14 and 15 of the Questionnaire Q1 to Competitors.

[36]  Replies to question 16 of the Questionnaire Q1 to Competitors.

[37]  Replies to question 17 of the Questionnaire Q1 to Competitors.

-----------------------
 In the published version of this decision, some information has been omitted pursuant to Article 17(2) of Council Regulation (EC)  No  139/2004
 concerning non-disclosure of business secrets and other confidential information.  The  omissions  are  shown  thus  […].  Where  possible  the
 information omitted has been replaced by ranges of figures or a general description.

                                                                  PUBLIC VERSION

                                                                 MERGER PROCEDURE