CELEX: 31996M0782
Language: en
Date: 1996-07-17 00:00:00
Title: Commission Decision of 17/07/1996 declaring a concentration to be compatible with the common market (Case No IV/M.782 - Swissair / Allders International) according to Council Regulation (EEC) No 4064/89 (Only the English text is authentic)

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31996M0782

Commission Decision of 17/07/1996 declaring a concentration to be compatible with the common market (Case No IV/M.782 - Swissair / Allders International) according to Council Regulation (EEC) No 4064/89 (Only the English text is authentic)  

Official Journal C 268 , 14/09/1996 P. 0006

 COMMISSION DECISION of 17/07/1996 declaring a concentration to be  compatible with the common market (Case No IV/M.782 - Swissair / Allders  International) according to Council Regulation (EEC) No 4064/89  (Only the English text is authentic) The paper version of the decision is available through the sales offices  of the Office of Official Publications of the European Communities. PUBLIC VERSION MERGER PROCEDURE ARTICLE 6(1)(b) DECISION To the notifying parties Dear Sirs, Subject :<ind> Case IV/M.782SWISSAIR/ALLDERS INTERNATIONAL <ind> <ind> Notification of 14.06.96 pursuant to Article 4 of Council  Regulation No 4064/89 1.<ind> On 14.06.96 the Commission received a notification of a proposed  concentration by which Swissair Associated Companies Ltd.(SAC) acquires  control of the whole of Allders International by way of purchase of  shares. 2.<ind> After examination of the notification, the Commission has  concluded that the notified operation falls within the scope of  application of Council Regulation No 4064/89 and does not raise serious  doubts as to its compatibility with the common market and with the  functioning of the EEA Agreement. I. <tab> THE PARTIES 3.<ind> SAC is a subsidiary of the Swissair Group,active in hotel and  catering business comprising airline catering, rail catering, hotels,  staff restaurants and duty free and retail trading.  The duty free and  inflight sales of SAC is headed by its subsidiary Nuance International  Holding Ag (Nuance). 4.<ind> Allders International comprises a group of four companies: Allders  International Limited, Allders ByeBye Limited, Allders Group Employment  Services Limited and Okefind Limited (Allders Int.).  The group is active  in the field of international tax and duty free retail  sales.   Prior to  the notified operation it has been wholly owned by the UK company Allders  plc. II. CONCENTRATION 5.<ind> The acquisition consists in the purchase of all the issued share  capital of Allders International and its subsidiaries, by way of private  sale and purchase agreement among Allders plc. and its wholly owned  subsidiary Modegain Limited as vendor, and SAC and its wholly owned  subsidiary Nuance International Holding as purchaser. 6.<ind> The transaction constitutes a concentration within the meaning of  Article 3(1)b of the Merger Regulation since Swissair Group will acquire  sole control of Allders International. III. COMMUNITY DIMENSION 7.<ind> The aggregate worldwide turnover in 1995 of the Swissair Group  (4.309 million ECU) plus half of that of Sabena Group (825 million ECU)  and Allders International (617 million ECU) exceeded 5 billion ECU. In the  same year, the aggregate Communitywide turnover of the Swissair Group  (1.403 million ECU) including half of Sabena Group and of Allders  International (355 million ECU), amounted to more than 250 million ECU.  <ind> Although Allders International achieves more than twothirds of its  Communitywide turnover in the UK, the Swissair Group including Sabena does  not achieve more than twothirds of its Communitywide turnover in one  Memberstate. Therefore, the notified operation has a Community dimension.   IV. THE RELEVANT MARKETS <tab> a)<tab> Relevant Product Market 8.<ind> According to the notifying party the relevant product market is  the market for international travel retail, comprising all retail outlets  used specifically by international travellers at airports, onboard  aircraft and onboard ships. A large segment of the international travel  retail market is made up of traditional tax and duty free sales of  alcohol, tobacco, perfumes and cosmetics, the bulk of the remainder  consists of fashion electronics, photographic equipment and newagency  sales. 9.<ind> The segment of the retail travel market in which the parties to  the concentration are most active is airport sales, in particular  traditional tax and duty free sales. Even on the basis of this narrowest  market definition, the concentration will not lead to the creation or  strengthening of a dominant position. <tab> b)<tab> Relevant Geographic Market 10.<ind> The parties believe that the relevant geographic market should be  defined as the EEA as a whole, although, in their view, the area in which  the condition of competition are homogeneous is wider and covers at least  the whole of western Europe if not the world. 11.<ind> In intraCommunity travel, for a large number of travellers there  are a variety of routes between any two nonadjacent countries. Consumers  can purchase the same kind of products at most travel retail outlets,  regardless of their geographic location. From the supply side, the same  retailers are active in many different regions. 12.<ind> For the purpose of this case, however, the exact definition of  the relevant geographic market can be left open because even on the basis  of the most unfavourable market definition (namely the tax and duty free  segment in the EEA), the concentration will not lead to the creation or  strengthening of a dominant position. V.<ind> ASSESSMENT 13.<ind> Allders International's share of the European tax and duty free  segment is approximately 4.7% for 1994. The Swissair Group only current  activities in the relevant product market in the EEA are through its 49.5%  holding in Sabena SA/NV over which Swissair has joint control with the  Belgian Government. Sabena sells retail travel products on board its  aircraft, from which it derived a turnover of ECU 6.2 million in 1995. The  remainder of the Swissair Group's activities in the relevant product  market are in Switzerland and Australia, from which it derived a turnover  of ECU 204 million in 1995. 14.<ind> The combination of Allders International with  the Swissair Group  (including the Sabena Group) will increase EEA market share of the tax and  duty free segment to 5.8% for 1994. Therefore the concentration will not  lead to any significant increase in market share in the EEA. 15.<ind> The parties are not vertically integrated. Suppliers to the  parties, being the manufacturers of the products sold, are not connected  or associated with the parties.  Further there are no exclusive  distribution contracts at the retail level. VI. CONCLUSION 16.<ind> It follows from the above that the proposed concentrationwould  not create or strengthen a dominant position as a result of which  competition would be significantly impeded in the common market or in a  substantial part of it. VII.<tab> ANCILLARY RESTRAINTS 17.<ind> The agreement between SAC and Allders plc. contains a  noncompetition clause pursuant to which Allders plc. agrees not to have  any interest in any tax free or duty free business in [Deleted business  secret] for a period of two years. Since the operation involves the  transfer of goodwill aquired by Allders International in the course of its  business the noncompetition clause can, in principle, be accepted as  ancillary to the notified operation.  There does not however seem to be  any objective justification. as to [Deleted business secret] of the  clause.  Therefore this decision only covers the clause insofar as it  relates to [Deleted business secret]. For the above reasons, the Commission has decided not to oppose the  notified operation and to declare it compatible with the common market and  with the functioning of the EEA Agreement. This decision is adopted in  application of Article 6(1)(b) of Council Regulation No 4064/89. For the Commission,