CELEX: 32021M10450
Language: en
Date: 2021-11-10 00:00:00
Title: Commission Decision of 10/11/2021 declaring a concentration to be compatible with the common market (Case No COMP/M.10450 - CDP / MACQUARIE / OPEN FIBER) according to Council Regulation (EC) No 139/2004 (Only the English text is authentic)

EUROPEAN COMMISSION
                                                               Brussels, 10.11.2021
                                                               C(2021) 8234 final
                                                                                PUBLIC VERSION
                                                                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                                                                information omitted has been replaced by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.
                                                               CDP Equity S.p.A.
                                                               Via Goito, 4
                                                               00185, Rome
                                                               Italy
                                                               Macquarie Infrastructure and Real Assets
                                                               (Europe) Limited
                                                               Ropemaker Place
                                                               28 Ropemaker Street
                                                               EC2Y 9HD, London
                                                               United Kingdom
Subject:             Case M.10450 – CDP/Macquarie/Open Fiber
                     Commission decision pursuant to Article 6(1)(b) of Council Regulation
                     No 139/20041 and Article 57 of the Agreement on the European Economic
                     Area2
Dear Sir or Madam,
(1)        On 4 October 2021, the Commission received notification of a proposed
           concentration pursuant to Article 4 of Council Regulation (EC) No 139/2004, by
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     OJ L 1, 3.1.1994, p. 3 (the “EEA Agreement”).
Commission européenne, DG COMP MERGER REGISTRY, 1049 Bruxelles, BELGIQUE
Europese Commissie, DG COMP MERGER REGISTRY, 1049 Brussel, BELGIË
Tel: +32 229-91111. Fax: +32 229-64301. E-mail: COMP-MERGER-REGISTRY@ec.europa.eu.
 ---pagebreak---          which Macquarie Infrastructure and Real Assets (Europe) Limited (“MIRA”, United
         Kingdom) and CDP Equity S.p.A. (“CDPE”, Italy, together with MIRA the
         “Notifying Parties”) acquire joint control over Open Fiber S.p.A. (“Open Fiber”,
         Italy) within the meaning of Article 3(1)(b) and 3(4) of the Merger Regulation (the
         “Transaction”).3
1.       THE PARTIES
(2)      MIRA is an investment fund that manages infrastructure and other real assets,
         including real estate, energy and agriculture as well as critical infrastructure assets
         such as utilities and telecommunications networks, airports and ports.4 MIRA is
         ultimately controlled by Macquarie Group Limited (“Macquarie”, Australia) a
         multinational independent investment bank.
(3)      CDPE is a long-term investor in companies of significant national Italian interest,
         through direct and indirect shareholdings. CDPE is part of Cassa Depositi e Prestiti
         S.p.A. (“CDP”, Italy), ultimately controlled by the Italian Ministry for Economy and
         Finance.
(4)      Open Fiber is a wholesale-only operator developing, managing and maintaining an
         optical fibre network, predominantly with fibre-to-the-home (“FTTH”) technology,
         across Italy. Open Fiber is currently jointly controlled by CDPE (50% of shares) and
         Enel S.p.A. (“Enel”) (50% of shares).
2.       THE CONCENTRATION
(5)      The Transaction is accomplished in two simultaneous steps. First, pursuant to a share
         purchase agreement signed on 29 July 2021, Fibre Networks Italy S.p.A. (“FNI”), a
         company indirectly controlled by MIRA, will acquire 40% of the share capital and
         voting rights in Open Fiber from Enel (“40% Transaction”).5 Second, pursuant to a
         share purchase agreement signed on 4 August 2021, CDPE will acquire from Enel
         the remaining 10% participation of the share capital and voting rights in Open Fiber
         (“10% Transaction”, together with the 40% Transaction, the “50% Transaction”).
         Following the completion of these steps, Enel will no longer be a shareholder of
         Open Fiber, CDPE will own 60% of the shares in Open Fiber and MIRA will own
         40% of the shares in Open Fiber. Since CDPE is already jointly controlling Open
         Fiber pre-Transaction, the specificity of the merger consists in MIRA replacing Enel
         as a jointly controlling parent (as explained below).
3   Publication in the Official Journal of the European Union No C 414, 13.10.2021, p. 4.
4   With regard to the telecommunications sector, MIRA controls an infrastructure owner and
    telecommunications operator in Poland.
5   The transactional documents provide for the possibility of FNI to assign its full participation in Open
    Fiber to Fibre Network Holding S.à r.l. (“FNH”), a subsidiary controlled by MIRA. Any such assignment
    would not have any effect on the nature of control being acquired by MIRA in Open Fiber. In this
    decision, MIRA should be read as including FNI or FNH, as the case may be, depending on FNI’s
    decision to assign its participation in Open Fiber to FNH.
                                                            2
 ---pagebreak--- 2.1.     Joint control
(6)      At completion of the 50% Transaction, the Notifying Parties will enter into a
         Shareholders’ Agreement, according to which the board of directors of Open Fiber
         will be composed of 7 directors, 4 appointed by CDPE and 3 by MIRA. 6 The
         resolutions on some strategic matters, such as the approval and amendment of Open
         Fiber’s business plan, the approval of major contracts, acquisitions, transfer of
         shares, mergers and amalgamations and the approval of major disposals, will only be
         adopted with the attendance and favourable vote of at least 6 out of the 7 directors.
         Therefore, both CDPE and MIRA’s approval is necessary for these strategic matters.
         MIRA will be entitled to appoint the Chief Financial Officer of Open Fiber and will
         be involved in the appointment of the Chief Executive Officer (through the
         possibility to veto the first two candidates put forward by CDPE).
(7)      Therefore, Open Fiber will be jointly controlled by CDPE and MIRA.
2.2.     Full functionality
(8)      Open Fiber is currently a full-function joint venture. This will not change as a result
         of the Transaction. Indeed, Open Fiber has sufficient own staff (over [NUMBER OF
         OPEN FIBER’S EMPLOYEES] employees), financial resources and dedicated
         management for its operations and for the management of its portfolio and business
         interests.
(9)      Open Fiber will have a market presence. In this regard, Open Fiber has exclusivity
         agreements in place with [OPEN FIBER’S CUSTOMERS] concerning the
         implementation of a FTTH optical fibre network and the subsequent provision of
         end-to-end connection for the access to such optical fiber network. No transactional
         agreement provides for the possibility of termination of these exclusivity agreements
         and the Notifying Parties further submit there is no intention to do so. 7
(10)     Finally, Open Fiber (i) will not take over any specific function of CDPE or MIRA’s
         business activities; (ii) will not have sale or purchase relations with its parent
         companies; and, (iii) will operate on a lasting basis as Open Fiber has been set up for
         an indefinite duration.8
(11)     Therefore, Open Fiber is a full-function joint venture.
2.3.     Assessment of whether the Transaction and the Single Network Transaction
         should be treated as a single concentration
2.3.1. Introduction
(12)     Through a non-binding letter of intent dated 31 August 2020 (“LOI”), CDP and TIM
         S.p.A. (“TIM”) announced the possible creation of a single fixed network in Italy,
         commonly referred to as “La Rete Unica” (the “Single Network”), whereby CDP
         and TIM would acquire joint control of AccessCo, a newly established joint
6    Each director will have one vote. No board member will have a casting vote.
7    Form CO, paragraph 87.
8    Form CO, paragraph 88.
                                                        3
 ---pagebreak---         venture.9 Pursuant to the LOI, AccessCo would be established by combining the
        primary and secondary access networks of Open Fiber and of FiberCop S.p.A.
        (“FiberCop”), a company established by TIM in partnership with KKR & Co Inc.,
        to which TIM transferred its secondary passive access network. 10 The creation of the
        Single Network will be referred to hereinafter as the Single Network Transaction.
(13)    Under the terms of the LOI, AccessCo would be tasked with developing and
        managing the national single network that would result from the integration of the
        networks of Open Fiber and TIM, with the aim of speeding up digital development
        and the diffusion of high-speed internet in Italy. To date, AccessCo has not been
        established.
(14)    Article 21 of the Shareholders’ Agreement submitted to the Commission at the time
        of notification of the Transaction (“Original SHA”) provides that “[NOTIFYING
        PARTIES’ POST CLOSING POSSIBLE BEHAVIOURS]”. In addition, Article 21
        of the Original SHA further provides that, [NOTIFYING PARTIES’ POST
        CLOSING POSSIBLE BEHAVIOURS].
(15)    Section 6.2 of the 40% Transaction agreement provides for an earn-out payment due
        by MIRA to Enel in the event that the Single Network Transaction materializes,
        regardless of the modality in which it may be achieved (the “Single Network Earn-
        Out”), capped at EUR 400 million.
(16)    In the following sections, the Commission assesses whether the Transaction and the
        Single Network Transaction should be treated as a single concentration or as
        independent transactions.
2.3.2. Legal context
(17)    Recital 20 of the Merger Regulation provides that it is “appropriate to treat as a
        single concentration transactions that are closely connected in that they are linked
        by condition or take the form of a series of transactions in securities taking place
        within a reasonably short period of time”.
(18)    The question of whether legally distinct transactions form a single concentration
        within the meaning of Article 3 of the Merger Regulation has been further clarified
        by the General Court in the Cementbow judgment,11 which underlines that, for that
        purpose, the Commission should consider all the specific circumstances “with a
        concern to ascertain the economic reality underlying the transactions”.12
(19)    In particular, the General Court clarified that, “when faced with a number of legally
        distinct transaction”, the Commission should identify “the economic aim pursued by
        the parties, by examining […] whether the undertakings concerned would have been
        inclined to conclude each transaction taken in isolation or whether, on the contrary,
9   See CDP’s press release of 31 August 2020 at the following link: CDP: via libera alla società della rete
    unica nazionale.
10 The purpose of FiberCop is to rollout and to provide passive access services to the secondary network.
    FiberCop is operational since April 2021.
11 Judgment of 23 February 2006, Cementbouw Handel & Industrie v Commission , T‑282/02,
    EU:T:2006:64.
12 Cementbouw judgment, paragraph 106.
                                                       4
 ---pagebreak---        each transaction constitutes only an element of a more complex operation, without
       which it would not have been concluded by the parties. In other words, in order to
       determine the unitary nature of the transactions in question, it is necessary, in each
       individual case, to ascertain whether those transactions are interdependent, in such
       a way that one transaction would not have been carried out without the other.” 13
(20)   Those criteria have been codified by the Commission in the Consolidated
       Jurisdictional Notice (“CJN”), which notes in particular that the conditionality
       referred to in recital 20 of the Merger Regulation can be de jure or de facto.14 The
       CJN notes that de jure conditionality is achieved when “the agreements themselves
       are linked by mutual conditionality.”15 De facto conditionality “requires an
       economic assessment of whether each of the transactions necessarily depends on the
       conclusion of the others. Further indications of the interdependence of several
       transactions may be the statements of the parties themselves or the simultaneous
       conclusion of the relevant agreements. A conclusion of de facto interconditionality of
       several transactions will be difficult to reach in the absence of their simultaneity.”16
(21)   Finally, paragraph 41 of the CJN states that “several transactions, even if linked by
       condition upon each other, can only be treated as a single concentration, if control
       is acquired ultimately by the same undertaking(s).”
2.3.3. Notifying Parties’ views
(22)   The Notifying Parties submit that the Transaction and the Single Network
       Transaction are not linked by a condition for the following reasons.
(23)   First, the Notifying Parties argue that Article 21 of the Original SHA does not
       constitute an implicit approval of the Single Network Transaction by MIRA. In this
       regard, the Notifying Parties note that any potential transactions related to the Single
       Network Transaction [DETAILS ON MIRA’S RIGHTS SET FORTH IN THE
       ORIGINAL SHA].17 The Notifying Parties note that this is supported by the
       language of Article 21 of the SHA, where it provides that the Notifying Parties
       [NOTIFYING PARTIES’ POST CLOSING POSSIBLE BEHAVIOURS].18 In any
       case, the Notifying Parties clarify that the LOI [LOI DURATION].19
(24)   Second, the Notifying Parties submit that the Single Network Earn-Out payment
       foreseen in the 40% Transaction agreement is customary in transactions of this
       nature and is not able to materially affect any possible future decision of MIRA to
       proceed or not with the Single Network Transaction, [FINANCIAL AGREEMENT
       BETWEEN MIRA AND ENEL]. 20
(25)   Third, the Notifying Parties point out that the transactional documents provide for a
       minimum lock-up period of [LOCK-UP PERIOD DURATION]. Although, for
13  Cementbouw judgment, paragraphs 106-107.
14  CJN, paragraph 43.
15  CJN, paragraph 43.
16  CJN, paragraph 43.
17  Form CO, Annex 10, page 7.
18  Form CO, Annex 10, page 3.
19  Form CO, footnote 9. [LOI DURATION].
20  Form CO, Annex 10, page 11.
                                                   5
 ---pagebreak---        completeness, [EXCEPTIONS TO THE LOCK-UP PERIOD], the Notifying Parties
       submit that MIRA will act as a long-term investor in Open Fiber.21
(26)   Fourth, the Notifying Parties submit that the Transaction and the Single Network
       Transaction are not de jure or de facto inter-related within the meaning of the CJN.
       In particular, the Notifying Parties submit that: (i) the Transaction is not conditional
       upon the Single Network Transaction and would take place anyway; (ii) both
       transactions would not occur at the same time; and, (iii) the execution of Single
       Network Transaction is hypothetical, 22 uncertain and subject to further negotiations
       and agreements. 23
2.3.4. Commission’s assessment
(27)   The Commission considers that the Transaction and the Single Network Transaction
       constitute independent transactions.
(28)   First, the Commission notes that the agreements underpinning the Transaction do not
       provide that the Transaction is conditional upon the Single Network Transaction (nor
       vice versa). In addition, the conclusion of the Single Network Transaction is
       uncertain and the respective transaction agreements have not been entered into.
(29)   The Commission notes that Article 21 of the Original SHA [NOTIFYING
       PARTIES’ POST CLOSING POSSIBLE BEHAVIOURS], but does not contain an
       express obligation on the part of MIRA to unconditionally agree to the completion of
       the Single Network Transaction. In this regard, the Commission notes that, under the
       SHA,24 MIRA formally retains the right to [DETAILS ON MIRA’S RIGHTS SET
       FORTH IN THE SHA]. Accordingly, the Commission concludes that the
       agreements do not give rise to any de jure conditionality between the Transaction
       and the Single Network Transaction.
(30)   In any case, on 8 November 2021, the Notifying Parties signed an agreement laying
       down an amended version of the Shareholders’ Agreement (“Amended SHA”). The
       Amended SHA no longer contains the provisions referred to in paragraph (14)
       above, including any references to [NOTIFYNG PARTIES’ POST CLOSING
       POSSIBLE BEHAVIOURS].
(31)   Second, on the assessment of a possible de facto conditionality, the Commission
       notes that the Transaction and the Single Network Transaction will not take place
       simultaneously. Notably, the Single Network Transaction remains hypothetical, as
       confirmed by the Notifying Parties, 25 and its main terms and conditions have not yet
       been agreed upon. Furthermore, the Commission also understands that the terms for
       the Single Network Transaction set out in the LOI [LOI DURATION] and that in
       any case they would have been subject to further negotiations. 26 Therefore, there is
21  Form CO, Annex 10, page 10.
22  Form CO, Annex 10, page 7.
23  Form CO, paragraphs 18 – 19.
24  As also confirmed by the Notifying Parties, [DETAILS ON MIRA’S RIGHTS SET FORTH IN THE
    SHA].
25  Among others, Form CO, Annex 10, page 7: “[The Single Network Transaction] is a separate and
    hypothetical deal…”.
26  Form CO, paragraph 19 and footnote 9.
                                                    6
 ---pagebreak---         currently no agreement or draft agreement which summarises the key terms and
        conditions under which the Single Network Transaction could be achieved. Indeed,
        [DETAILS ON MIRA’S RIGHTS SET FORTH IN THE SHA], as MIRA is
        currently unaware of the main terms at which the Single Network Transaction could
        occur. Furthermore, the Commission notes that the existence of the Single Network
        Earn-Out in itself will not reduce the possible incentive for MIRA [DETAILS ON
        MIRA’S RIGHTS SET FORTH IN THE SHA]. If anything, the Single Network
        Earn-Out may increase such incentive as it would make it more expensive for MIRA
        [STRATEGIC DECISIONS].
(32)    The Commission therefore concludes that there is no evidence to support that the
        Transaction and the Single Network Transaction could be de facto conditional upon
        each other.
(33)    Finally, and in any event, the Commission notes that, on the basis of the [LOI
        DURATION] LOI, the Single Network Transaction would lead to joint control over
        AccessCo by CDPE and TIM. However, as is evident from paragraph 41 of the CJN,
        two transactions can only be treated as a single concentration if the ultimate
        undertakings acquiring control in the two cases are the same. Accordingly, since
        there is no evidence suggesting that, should the Single Network Transaction ever
        occur, the target would be controlled by CDPE and MIRA, the Transaction and the
        Single Network Transaction cannot in any event be considered to constitute a single
        concentration.
2.3.5. Conclusion
(34)    In light of the assessment above, the Commission considers that the Transaction and
        the Single Network Transaction constitute independent transactions.
(35)    Therefore, the Commission concludes that it only has jurisdiction to review the
        Transaction as notified by the Notifying Parties under the Merger Regulation.
(36)    At the same time, the Commission notes that, should the Single Network Transaction
        materialise, in whichever form, it may be reviewed by the relevant competition
        authority under the applicable competition law framework.
3.      UNION DIMENSION
(37)    The undertakings concerned have a combined aggregate world-wide turnover of
        more than EUR 5 000 million27 (Macquarie: EUR [FINANCIAL INFORMATION]
        million; CDP: EUR [FINANCIAL INFORMATION] million; Open Fiber: EUR
        [FINANCIAL INFORMATION] million). Each of them has a Union-wide turnover
        in excess of EUR 250 million (Macquarie: EUR [FINANCIAL INFORMATION]
        million; CDP: EUR [FINANCIAL INFORMATION] million; Open Fiber: EUR
        [FINANCIAL INFORMATION] million) but they do not achieve more than two-
        thirds of their aggregate Union-wide turnover within one and the same Member
        State. The notified operation therefore has a Union dimension.
27  Turnover calculated in accordance with Article 5 of the Merger Regulation .
                                                          7
 ---pagebreak--- 4.       COMPETITIVE ASSESSMENT
(38)     The specific change brought by the Transaction in Open Fiber consists in the
         replacement of Enel by MIRA as a jointly controlling parent and in the increase of
         CDPE’s stake from 50% to 60%, even though CDPE already jointly controlled Open
         Fiber prior to the Transaction.
(39)     Open Fiber is active in the market for the wholesale supply of fixed internet access
         services in Italy28 and in the market for the wholesale supply of fixed backhaul
         services in Italy.29
(40)     None of MIRA’s (or Macquarie’s) portfolio companies is active in market for the
         wholesale supply of fixed internet access services in Italy or in the market for the
         wholesale supply of fixed backhaul services in Italy, or in a product market which is
         upstream or downstream from those markets.
(41)     Beyond the activities of Open Fiber, CDPE and CDP are not active in the market for
         the wholesale supply of fixed internet access services in Italy or in the market for the
         wholesale supply of fixed backhaul services in Italy, or in a product market which is
         upstream or downstream from those markets. CDP only has a non-controlling
         minority shareholding in TIM (since 2018). Through FiberCop, TIM is Open Fiber’s
         main competitor on the market for the wholesale supply of fixed internet access
         services in Italy and on the market for the wholesale supply of fixed backhaul
         services in Italy. Moreover, since 31 March 2021, the chairman of the board of
         directors of CDP and CDPE (“CDP’s Chairman”) also sits on TIM’s board of
         directors (“TIM’s Board”) as a non-independent director (“CDP’s Entry in TIM’s
         Board”).
4.1.     Feedback from market participants and the AGCM
(42)     The Commission has reached out to a number of market participants to seek their
         views on the Transaction. The Commission has also received a submission from the
         Italian Competition Authority (“AGCM”).
(43)     Some market participants as well as the AGCM expressed a concern that the
         Transaction would facilitate coordination between Open Fiber and TIM by
         weakening the competitive constraints between Open Fiber and TIM in the markets
         for the wholesale supply of fixed internet access services and the supply of fixed
         backhaul services in Italy. Such concern is based on the following arguments.
(44)     First, market participants and the AGCM consider that the Transaction will increase
         CDP’s “strategic and operational control over Open Fiber” by virtue of the increase
         from 50% to 60% of CDP’s stake in Open Fiber.
28   Commission decisions of 6 March 2020 in Case M.9674 – Vodafone Italia/TIM/Inwit JV, paragraphs 123-
     133; Commission decision of 20 September 2013 in Case M.6996 – Vodafone/Kabel Deutschland,
     paragraphs 157-164; Commission decision of 29 June 2009 in Case M.5532 – Carphone
     Warehouse/Tiscali UK, paragraphs 28-34 and 48-53.
29 Commission decisions of 6 March 2020 in Case M.9674 – Vodafone Italia/TIM/Inwit JV, paragraphs 115-
     122; Commission decision of 1 September 2016 in Case M.7758 – Hutchinson 3G Italy/Wind/JV, recitals
     206-211.
                                                       8
 ---pagebreak--- (45)     Second, the AGCM considers that Article 21 of the Original SHA limits MIRA’s
         ability to oppose the Single Network Transaction, whatever its form, and would
         determine an increased convergence between Open Fiber and TIM. Market
         participants also stressed that the provision at hand further undermines MIRA’s
         ability to effectively replace Enel’s driving force in Open Fiber.
(46)     Third, market participants and the AGCM stress that CDP’s Entry in TIM’s Board –
         an event which occurred after the announcement of the Transaction – consolidates
         CDP’s commitment and involvement in TIM. 30 Market participants and the AGCM
         also pointed to CDP’s pre-existing shareholding in TIM.
(47)     In light of this market feedback, the Commission will assess whether the Transaction
         (on its own, without considering possible independent developments unrelated to it,
         such as those that might occur in connection with the Single Network Transaction) is
         likely to increase the likelihood of coordination between Open Fiber and TIM as
         compared to the situation pre-Transaction.
4.2.     Assessment of the feedback from market participants and the AGCM
4.2.1. Legal framework
(48)     Under the Merger Regulation, the Commission assesses whether a concentration
         would significantly impede effective competition in the internal market or in a
         substantial part of it. A merger in a concentrated market may significantly impede
         effective competition due to horizontal coordinated effects where, through the
         creation or the strengthening of a collective dominant position, it increases the
         likelihood that firms are able to coordinate their behaviour and raise prices, even
         without entering into an agreement or resorting to a concerted practice within the
         meaning of Article 101 TFEU. A merger may also make pre-existing coordination
         easier or more stable, either by making the coordination more robust or by
         permitting firms to coordinate on even higher prices. 31
(49)     To assess whether a merger gives rise to horizontal coordinated effects, the
         Commission should examine whether, as a consequence of the merger, first, it would
         be possible to reach terms of coordination and, second, such coordination would be
         sustainable.32
(50)     In examining the possibility and sustainability of coordination, the Commission
         should specifically consider the changes that the Transaction brings about.33 The
         reduction in the number of firms in a market may in itself be a factor that facilitates
         coordination.
30   The Transaction was announced on 17 December 2020, see Enel’s communication at the following link:
     https://www.enel.com/media/explore/search-press-releases/press/2020/12/enel-board-of-directors-
     resolves-to-sell-40---50-of-open-fiber-to-macquarie .
31 Guidelines on the assessment of horizontal mergers under the Council Regulation on the control of
     concentrations between undertakings (" Horizontal Merger Guidelines "), OJ C 31, 05.02.2004,
     paragraph 39.
32 Horizontal Merger Guidelines, paragraph 42.
33 Horizontal Merger Guidelines, paragraph 42.
                                                           9
 ---pagebreak--- 4.2.2. The Commission’s assessment
(51)     As described above in paragraph (38), the Transaction under review mainly consists
         in the replacement of Enel by MIRA as a jointly controlling shareholder in Open
         Fiber alongside CDP. The Commission will assess the main arguments submitted by
         market participants and the AGCM (as set out in section 4.1 above) in support of
         their view that the Transaction would increase the likelihood of coordination
         between Open Fiber and TIM compared to the situation pre-Transaction. The
         Commission concludes that the Transaction is unlikely to give rise to coordinated
         effects on the market for the wholesale supply of fixed internet access services in
         Italy and in the market for the wholesale supply of fixed backhaul services in Italy. 34
4.2.2.1. The 10% increase of CDPE’s shareholding in Open Fiber
(52)     In relation to CDPE’s increased shareholding in Open Fiber as a result of the
         Transaction, the Commission notes that prior to the Transaction, CDPE already
         jointly controlled Open Fiber.35 As explained in section 2.1 and paragraph (38)
         above, the Transaction does not affect the nature of the control exercised by CDPE
         over Open Fiber within the meaning of the CJN. Therefore, as the Transaction does
         not bring about a change in the quality of CDPE’s control over Open Fiber, it will
         not increase the ability of CDP to determine the strategic competitive behaviour of
         Open Fiber.
(53)     At the same time, as explained in section 2.1 above, MIRA will obtain a veto right
         over all strategic matters relating to Open Fiber’s business. Notably, Article 21 of
         the Amended SHA confirms that such strategic matters include decisions on
         [DETAILS ON MIRA’S VETO RIGHTS SET FORTH IN THE SHA].
(54)     Therefore, any hypothetical coordination of Open Fiber and TIM’s behaviour in the
         roll-out of Open Fiber and FiberCop’s networks respectively would require both
         CDPE and MIRA’s approval. However, MIRA is unlikely to have the incentive to
         approve such coordination. Indeed, any revenues foregone by Open Fiber to the
         benefit of TIM would only profit CDP since MIRA does not have a participation in
         TIM or FiberCop. Rather, MIRA is more likely to have an incentive to ensure that
         Open Fiber will maximise its profits.
(55)     Moreover, already pre-Transaction CDP had a significant (50%) participation in
         Open Fiber (granting it joint control over that company) and a minority participation
         in TIM. Even assuming that such a pre-existing situation might have given CDP an
         incentive to favour a possible coordination between Open Fiber and TIM, the
         observations received by the Commission did not provide any element suggesting
         that CDP’s increased participation in Open Fiber as a result of the Transaction would
         appreciably increase such an alleged pre-merger incentive. If anything, CDP’s
         increased participation in Open Fiber would appear to make any possible
         coordinated outcome favouring TIM more than Open Fiber slightly less attractive for
         CDP.
34   For the sake of clarity, antitrust rules, in particular Article 101 TFEU, will continue to apply to possible
    anticompetitive effects not stemming directly from the Transaction.
35 Commission decision of 15 December 2016 in Case M.8234 – Enel/CDP Equity/Cassa Depositi e
    Prestity/Enel Open Fiber/Metroweb Italia, paragraph 13.
                                                             10
 ---pagebreak--- (56)    In light of the above, the Commission considers that CDPE’s increased shareholding
        in Open Fiber will not affect CDP’s ability and incentive to coordinate Open Fiber
        and FiberCop. The Commission further considers that MIRA will maintain an
        incentive to ensure that Open Fiber will maximise its profits. Therefore, the
        Commission concludes that the 10% increase in CDP’s shareholding in Open Fiber
        is unlikely to increase the likelihood of coordination on the market for the wholesale
        supply of fixed internet access services in Italy and on the market for the wholesale
        supply of fixed backhaul services in Italy.
4.2.2.2. MIRA’s obligation [NOTIFYING PARTIES’ POST CLOSING POSSIBLE
          BEHAVIOURS] under Article 21 of the Original SHA
(57)    On the relevance of Article 21 of the Original SHA, the Commission notes, as
        explained in paragraph (30), that the Amended SHA no longer contains the
        provisions referred to in paragraph (14) above, including any references to
        [NOTIFYING PARTIES’ POST CLOSING POSSIBLE BEHAVIOURS]. Article 21
        of the Amended SHA now contains a wider commitment by both Notifying Parties
        to develop Open Fiber’s network, [DETAILS ON THE PROVISIONS OF THE
        AMENDED SHA]. Therefore, the grounds on the basis of which the AGCM
        submitted its concern on this point are no longer existing.
4.2.2.3. CDP’s presence in TIM
(58)    Regarding CDP’s presence in TIM, the Commission notes that CDP’s current
        minority shareholding in TIM dates back to 2018 and as such pre-dates the
        Transaction. CDP’s Chairman was appointed as director in TIM on 31 March 2021,
        whereas the Transaction was notified to the Commission later, on 4 October 2021.
        Thus, the Commission notes that CDP’s Entry in TIM’s Board also pre-dates the
        notification of the Transaction. As such, it cannot be considered that the appointment
        of CDP’s Chairman in TIM’s board stems from the Transaction itself.
(59)    Moreover, as regards CDP’s Entry in TIM’s Board, the Notifying Parties submitted
        the following information to the Commission. TIM’s Board is composed of 15
        directors. Only one member of TIM’s Board is a representative of CDP. In this
        regard, the Notifying Parties explain that CDP’s Chairman does not have any
        executive role in TIM,36 and that CDP is not part of any shareholders agreement with
        other TIM shareholders.37 In addition, CDP holds a purely minority stake in TIM,
        which does not confer on CDP any specific governance rights. As a result, both
        before and after the Transaction, CDP will not be able to exercise any decisive form
        of influence over TIM’s Board.
(60)    The Notifying Parties point to a number of legal, regulatory and contractual
        safeguards already in place pre-Transaction, aimed at preventing any exchange of
        sensitive information or coordination between CDP and TIM through the common
        board member.38
36  Notifying Parties response to RFI 3 of 26 October 2021, page 2.
37  Notifying Parties response to RFI 3 of 26 October 2021, pages 1 – 2.
38 Notifying Parties response to RFI 3 of 20 October 2021, pages 2 – 6. For instance, from a legal and
    regulatory perspective, the Notifying Parties refer to (i) Article 2391(5) of the It alian Civil Code, which
    provides that each member of the board shall be responsible for any damage suffered by the company as a
                                                         11
 ---pagebreak--- (61)     In addition, the Notifying Parties submit that CDP’s shareholding in TIM has a
         lesser value than the one in Open Fiber. On the basis of TIM’s stock price at the date
         of notification, CDP’s interest in TIM can be valued at approximately EUR 513
         million.39 In comparison, CDP’s shareholding in Open Fiber will be worth EUR
         [OPEN FIBER’S SHARE VALUE] after the Transaction.40 Therefore, CDP submits
         that it would have the economic incentive to grow Open Fiber’s business to
         maximize the returns of its significant investment in Open Fiber.
(62)     The Commission considers that the Transaction does not increase the risks of
         coordination by virtue of CDP’s position in TIM because CDP’s shareholding in
         TIM and CDP’s Entry in TIM’s Board pre-date the Transaction. As such, possible
         anticompetitive effects stemming from CDP’s position in TIM do not arise as a
         result of the Transaction.
4.2.3. Conclusion
(63)     For the reasons set out above, the Commission concludes that the Transaction as
         such would not increase the risk of coordination of conduct between Open Fiber and
         TIM on the markets for the wholesale supply of fixed internet access services in Italy
         and for the wholesale supply of fixed backhaul services in Italy. Therefore, the
         Commission considers that the Transaction does not give rise to serious doubts as to
         its compatibility with the internal market.
5.       CONCLUSION
(64)     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 and Article 57 of the EEA Agreement.
                                                                 For the Commission
                                                                 (Signed)
                                                                 Margrethe VESTAGER
                                                                 Executive Vice-President
    result of the use of the information received by virtue of its role; and, (ii) Regulation (EU) No 596/2014 of
    the European Parliament and of the Council of 16 April 2014 on market abuse and the respective
    implementing procedures adopted by TIM, which provide that the confidentiality of information acquired
    as a result of being a member on TIM’s board shall be ensured. From a contra ctual perspective, the
    Notifying Parties refer to (i) CDP’s antitrust compliance policy which prevents the exchange of sensitive
    information with competitors; and, (ii) Regulation of CDP’s board of directors which provides for an
    obligation on the members of the board of directors to keep confidential all the information received by
    virtue of their role.
39 Notifying Parties’ response to RFI 4, question 1(a).
40 Notifying Parties’ response to RFI 4, question 1(b).
                                                          12