CELEX: 32014M7387
Language: en
Date: 2014-12-15 00:00:00
Title: Commission Decision of 15/12/2014 declaring a concentration to be compatible with the common market (Case No COMP/M.7387 - BP / STATOIL FUEL AND RETAIL AVIATION) according to Council Regulation (EC) No 139/2004 (Only the English text is authentic)

EN

                                                                                       Case No COMP/M.7387 - BP/ STATOIL FUEL AND RETAIL AVIATION

                                                                                                Only the English text is available and authentic.

                                                                                                                      REGULATION (EC) No 139/2004
                                                                                                                                 MERGER PROCEDURE

                                                                                                     Article 6(1)(b) in conjunction with Art 6(2)
                                                                                                                                 Date: 15/12/2014

                                                                       In electronic form on the EUR-Lex website under document number 32014M7387

|[pic]                             |EUROPEAN COMMISSION                                                                                      |

                                   Brussels, 15.12.2014
                                   C(2014) 9978 final

                                   [pic]

                                   [pic]

|To the notifying party:                                            |                                                                   |
|                                                                   |                                                                   |

Dear Madam(s) and/or Sir(s),

Subject:    Case M.7387 - BP/ Statoil Fuel and Retail Aviation
    Commission decision pursuant to Article 6(1)(b) in conjunction with Article 6(2) of Council Regulation No 139/2004[1]

    1) On 27 October 2014, the Commission received a notification of a proposed concentration pursuant to Article 4 of Council Regulation (EC) No
       139/2004[2] by which BP p.l.c ("BP", UK) acquires within the meaning of Article 3(1)(b) of the Merger Regulation sole control of the whole
       of the undertaking Statoil Fuel & Retail Aviation AS ("SFRA", Norway) by way of purchase of shares. BP is designated  hereinafter  as  the
       "Notifying Party" and both BP and SFRA are designated hereinafter as "the Parties".

       The Parties

    2) BP is active across the value chain of oil and gas from the exploration and production over the  refining  to  the  distribution  of  fuel
       products. BP's activities include the refining of aviation fuel and the into-plane supply of aviation fuel on a global level.

    3) SFRA is active in the into-plane supply of aviation fuel at 80 airports in the EEA with a focus on Scandinavian airports.

       The OperatIon and the Concentration

    4) The transaction consists of SFRA's parent, Alimentation Couche-Tard Inc. ("Alimentation Couche-Tard", Canada), transferring  100%  of  the
       shares in SFRA to BP. The operation therefore constitutes a concentration within the meaning of Article 3(1)(b) of the Merger Regulation.

       EU DIMENSION

    5) The undertakings concerned have a combined aggregate world-wide turnover of more than EUR 5 000 million[3] [BP: EUR 285 471 million; SFRA:
       EUR […]]. Each of them has an EU-wide turnover in excess of EUR 250 million [BP: EUR […]; SFRA: EUR […]] but they do not achieve more than
       two-thirds of their aggregate EU-wide turnover within one and the same Member State.

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

       COMPETITIVE ASSESSMENT

Background

    7) Aviation fuel is a product of the crude oil refining process, with kerosene (the base ingredient of  aviation  fuel)  being  extracted  as
       crude oil is distilled.

    8) Refineries typically produce either gasoline (petrol) or middle distillates, such as diesel and kerosene  for  aviation  fuel.  Whether  a
       refinery chooses to produce diesel or aviation fuel will largely be driven by the demand and value of the  product  in  the  market  at  a
       particular time.

    9) As EU refineries produce insufficient middle distillates to meet EU demand, the demand for aviation fuel in the EU is  met  by  refineries
       within EU Member States and fuel imported from  outside  the  EU.  A  considerable  volume  of  aviation  fuel  is  therefore  transported
       internationally (by ships) to be used at EU airports which lack immediate access to refineries or where the local refineries cannot  match
       the local demand.

   10) Into-plane suppliers typically purchase fuel ex-refinery (or ex-storage tank or ex-ship  at  an  import  terminal)  and  transport  it  by
       pipeline or vessel to an off-airfield storage terminal near the individual airport. From there, the aviation fuel is transported to an on-
       airfield storage site at the airport and distributed via hydrants or fuel trucks (bowsers) into the air planes. At the airports into-plane
       suppliers rely on access to the distribution infrastructure (i.e. on-airfield storage and hydrants), which is controlled by joint-ventures
       in which the into-plane suppliers are shareholders.

   11) The supply chain is illustrated in Graph 1 below

                                                                     Graph 1

[pic]

   12) As an alternative to investment in infrastructure, into-plane suppliers may supply aviation fuel without  investment  in  the  on-airfield
       infrastructure or service companies. One example is the throughputter model, where the supplier has an agreement to  use  the  on-airfield
       storage capacity and into-plane supply services owned and operated by the service company at the relevant  airports.  There  is  also  the
       reseller model, where the reseller only acquires title to the aviation fuel at wingtip once it has passed through  the  infrastructure  at
       the airport, and then, as the fuel is delivered to the aircraft, pursuant to the contract between the reseller and  the  airline,  it  re-
       sells the fuel to the airline.

   13) Purchasers of into-plane services include commercial airlines, the military and owners of smaller aircraft such as private jets  or  light
       aircraft (so-called general aviation). Commercial airlines account for over 95 per cent of  aviation  fuel  demand  in  the  EU.  Airlines
       typically purchase their aviation fuel requirements on an into-plane basis at the airports that they fly to or  from.  Airlines  can  also
       operate on what is known as a self-supply basis, where they purchase the fuel further up the supply chain (e.g. ex-storage at the airport,
       ex-storage tank at an import terminal, ex-ship, or ex-refinery), and then arrange on their own for the fuel  to  be  supplied  into  their
       aircraft, either on a throughput basis or by acquiring an interest in the relevant service companies operating at the airport.

   14) The companies' into-plane supply activities overlap at six airports: Copenhagen, Stockholm, Gothenburg,  Malmö,  Hamburg  and  to  a  more
       limited extent in Amsterdam.

Product Market Definition

   15) BP is active in ex-refinery sales of aviation fuel on a worldwide basis. The Target is not active in this area. Both BP and the Target are
       active in the into-plane supply of aviation fuel at some airports in the EU.

   16) The Commission has in the past considered that aviation fuel constitutes a distinct product market, which is  separate  from  other  motor
       fuels.[4]

   17) The Notifying Party supports the above mentioned product market definition.

   18) The large majority of respondents to the market investigation submitted that aviation fuel constitutes  a  separate  product  market  from
       other motor fuel[5] given logistical, equipment and product differences.[6] The Commission considers, based on the results of  the  market
       investigation, that aviation fuel constitutes a separate product market from other motor fuels.

   19) In addition, from a demand side perspective, it is noted that aviation fuel could  be  further  segmented  into  two  different  types  of
       aviation fuel depending on what it is intended to be used for: (i) jet fuel, which is a kerosene-based fuel used in  turbo-fan,  turbo-jet
       and turbo prop engine aircrafts, typically used by the larger commercial airlines, and (ii)  avgas  which  is  a  gasoline-based  product,
       typically used to supply smaller aircrafts with a piston or reciprocating engine.

   20) The Notifying Party claims that no further segmentation should be made between jet fuel and avgas. The Notifying Party further claims that
       the only airport where the Parties overlap in the sale of avgas is at Malmö airport, since the Parties do not sell avgas  at  any  of  the
       other affected markets. The volumes at Malmö airport are de minimis.

   21) The Commission has previously considered that ex-refinery sales of aviation fuel should not be further segmented into these two  potential
       submarkets.[7] As regards a possible segmentation of aviation fuel between avgas and jet fuel at the airport level, the  Commission  notes
       that there are indications that they are not substitutable from a demand side perspective. In any case, the market definition can be  left
       open in this regard as it does not change the competitive assessment in the present case.

   22) Therefore, taking into account the results of the market investigation and for the purpose of the present case, the  Commission  considers
       that aviation fuel constitutes a separate product market from other motor fuels. As regards the potential  distinction  of  aviation  fuel
       between avgas and jet fuel, the precise market definition can be left open in this  specific  case  as  the  proposed  transaction  raises
       serious doubts as to its compatibility with the internal market regardless of the product market definition[8]. In  Stockholm,  Copenhagen
       and Gothenburg, the Parties only supply jet fuel. In Malmö, where both Parties supply  avgas,  the  Commission  analyses  the  competitive
       situation for jet fuel and avgas separately.

Ex-refinery sales of aviation fuel

   23) According to previous Commission decisions, ex-refinery sales of aviation fuels constitute a distinct product market.[9] Ex-refinery sales
       are sales of large quantities by refineries to wholesalers, resellers or airlines with  access  to  the  required  transport  and  storage
       infrastructure. These sales also include sales to into-plane suppliers.[10]

   24) The Notifying Party agrees that ex-refinery sales of aviation fuels constitute a distinct product market.

   25) The large majority of respondents to the market investigation submitted that, in  line  with  the  Commission's  previous  decisions,  ex-
       refinery sales of aviation fuel consist of sales made in large volumes on a spot basis or term basis by refiners to wholesalers, other oil
       companies, traders, resellers and large industrial customers, including sales to into-plane suppliers.[11]

   26) The majority of respondents to the market investigation also submitted that there is no need to distinguish between  avgas  and  jet  fuel
       within the market for ex-refinery sales.[12] This is in line with previous decision making practice of the Commission.[13]

   27) Taking into account the results of the market investigation and for the purposes of the present case, the Commission  considers  that  ex-
       refinery sales constitute a separate market which includes avgas and jet fuel.

Into-plane supply of aviation fuel

   28) According to previous Commission decisions, into-plane supply (also known as retail supply) consists of the supply  of  aviation  fuel  at
       individual airports under contracts between into-plane suppliers and airlines, with the fuel supplied pursuant to  the  arrangements  with
       servicing companies (of which the company may or may not be a member/owner) that operate the  airport  fuelling  infrastructure  (storage,
       hydrant pipelines) and perform actual into-plane fuelling services with dispenser vehicles or fuelling trucks to the aircraft  for  a  fee
       paid by the airlines.[14]

   29) The Commission has in the past considered that into-plane supply of aviation fuel constitutes a separate product market.[15]

   30) The Notifying Party agrees with this market definition.

   31) The majority of the respondents to the market investigation submitted that, in line  with  previous  Commission's  precedents,  into-plane
       supply of aviation fuel constitutes a separate product market.[16]

   32) Taking into account the results of the market investigation and for the purposes of the present case, the Commission considers that  into-
       plane supply of aviation fuel constitutes a separate product market. As regards the potential distinction of aviation fuel  between  avgas
       and jet fuel, the precise market definition can be left open, as better explained above.

Geographic Market Definition

Ex-refinery sales of aviation fuel

   33) The Commission has in the past considered the geographic scope of the market for ex-refinery sales of aviation fuels to be EU or  Western-
       Europe wide.[17] However, the Commission has also considered a smaller Northern European market consisting of Denmark, Finland, Norway and
       Sweden.[18]

   34) The Notifying Party submits that the market should be at least EU-wide given that: (i) there is significant trade of aviation fuel  across
       the EU and indeed a significant volume of aviation fuel is imported from outside the EU  (approximately  20  per  cent  of  aviation  fuel
       consumed in the EU is imported, mainly from the Middle and Far East); (ii) aviation fuel may be transported with relative ease and at  low
       cost over vast distances by ship; and (iii) 80 per cent of aviation fuel supplied at airports in  Denmark  and  Sweden  is  provided  from
       imported sources.

   35) The Notifying Party further notes that even if a narrower market definition is adopted (e.g. Scandinavian or national markets  where  SFRA
       is active downstream), BP does not own or have an interest in any refineries in Scandinavia and only owns  or  has  an  interest  in  five
       refineries in Germany. All of BP's refineries are inland and none of them supply aviation  fuel  to  Hamburg  airport,  or  export  it  to
       Scandinavia. Similarly, the Notifying Party argues that if a broader market definition was used (e.g. an EU-wide  market  for  ex-refinery
       sales, or wider), BP's ex-refinery sales would remain significantly below the thresholds for a vertically affected market.

   36) The Commission considers that the exact scope of the geographic market can be left open as the transaction does not give rise  to  serious
       doubts with regard to the ex-refinery sales of aviation fuel under any plausible market definition.

Into-plane supply of aviation fuel

   37) The Commission has in the past considered that the geographic scope of into-plane supply of aviation fuel  is  limited  to  each  specific
       airport.[19]

   38) The determining factors in finding individual airports to constitute local markets include the following: (i) airlines tend to select  the
       supplier that submits the best bid, airport by airport, according to the relative  advantages  of  the  suppliers  at  that  location;[20]
       (ii) suppliers tend to require access to into-plane infrastructure and must have access to the distribution  and  fuelling  infrastructure
       specific to each airport in order to supply aviation fuel to airlines;[21] (iii) on the  demand  side,  if  the  price  of  aviation  fuel
       increases to an unsatisfactory level at one airport, an airline is unable to turn to another airport in order to obtain the same fuel at a
       lower price, given the constraints connected with the availability of time slots.[22]

   39) The Notifying Party does not dispute the above mentioned geographic market definition but it claims that whereas  there  may  be  barriers
       that make it difficult for an airline, in the short term, to switch airports in response to  an  increase  in  the  aviation  fuel  price,
       airlines are able to tanker fuel in particular in short-haul flights, allowing airlines to  avoid  or  minimise  the  need  to  refuel  at
       airports with higher fuel prices.[23]

   40) The large majority of the respondents to the market investigation submitted that the supply of into-plane aviation fuel is limited to each
       airport, as prices and other conditions regarding the  contracts  to  supply  into-plane  aviation  fuel  are  negotiated  per  individual
       airports.[24] In addition, respondents to the market investigation from the demand side submitted that they choose their  into-plane  fuel
       supplier by airport, taking into account the best offer per airport.[25]

   41) Taking into account the results of the market investigation and for the purposes of the present case, the Commission  considers  that  the
       geographic scope of the market for into-plane supply of aviation fuel is limited to each specific airport.

       Competitive Assessment

1 Non-Coordinated Horizontal Effects

   42) The Parties' activities overlap horizontally at 6 of the 80 airports  with  regard  to  this  transaction,  namely  (1)  Stockholm-Arlanda
       (Stockholm), (2) Malmö, (3) Gothenburg-Landvetter (Gothenburg), (4) Copenhagen-Kastrup (Copenhagen), (5) Hamburg  and  (6)  Amsterdam.[26]
       The transaction will lead to a reduction in the number of actual suppliers at Stockholm (from 3 to 2), Gothenburg (from  3  to  2),  Malmö
       (from 3 to 2), Copenhagen (from 4 to 3), Hamburg (from 6 to 5) and Amsterdam (from 5 to 4).

1 Stockholm

2 Overview

   43) Stockholm airport (Arlanda) is the largest airport in Sweden and the third  largest  airport  in  Scandinavia.  It  handles  20.7  million
       passengers annually and has an annual volume of demand for aviation fuel of around […] cbm.  The  supply  chain  of  the  into-plane  fuel
       suppliers active in Stockholm is illustrated in the graph below.

                                                         Graph 1 – Supply Chain Stockholm
[pic]

   44) As indicated in the graph above, all aviation fuel supplied at Stockholm airport is currently imported  via  vessel  to  the  off-airfield
       storage facilities at the Gävle harbour. Generally, to maximise efficiencies, a supplier typically brings in a large  vessel  loaded  with
       fuel and this cargo is “broken” between the into-plane suppliers ex-ship. As part of this process, the most efficient model for each into-
       plane supplier is to fill their storage tanks with as large volumes as possible to minimise the number of shipments required.

   45) There are two main off-airfield storage sites operated by Vopak and OKQ8 respectively, which are used  by  into-plane  fuel  suppliers  to
       supply Stockholm Airport. Vopak leases its off-airfield storage site to BP and SAS Oil, while OKQ8 leases its storage site  to  Shell.  In
       addition to these two storage sites and in order to comply with the Swedish Compulsory Storage Obligation (CSO),[27] BP leases  additional
       storage from […]. On the contrary, SFRA does not currently have any rights in relation to off-airfield storage. Instead,  SFRA's  fuel  is
       delivered by […].

   46) The into-plane suppliers then transport the aviation fuel via rail transport to the on-airfield storage site, which  is  operated  by  the
       airport's main into-plane suppliers as a joint-venture ("AFAB"). AFAB is currently co-owned by BP ([…]%), SFRA ([…]%),  Shell  ([…]%)  and
       SAS Oil ([…]%). Post-transaction the joint venture will be equally co-owned by BP ([…]%), Shell  ([…]%)  and  SAS  Oil  ([…]%)  […].  AFAB
       operates both the on-airfield storage and the hydrant system. AFAB also manages the rail transport of fuel from Gävle import  terminal  to
       the airport.

   47) The into-plane suppliers then hand over the actual into-plane supply to an into-plane service provider, which pumps the aviation-fuel from
       the hydrant system via a dispenser vehicle into the aircraft. Currently, there are two such providers active at Stockholm airport. AFCO is
       an into-plane service provider owned by Shell, SAS Oil and SFRA and SFS is an into-plane service provider owned by  BP,  Q8  and  Chevron.
       However, it should be noted that Q8 and Chevron have ceased supplying at the airport in 2012.

   48) On the demand side, it should also be noted that most airlines carry out annual tenders in relation to their jet fuel requirement.

3 Market structure

   49) The Stockholm airport is an affected market. The table below sets out the market structure pre- and post-transaction.

                                      Table 1 – Market shares in Stockholm, by value (excluding self-supply)
|Excluding Self-Supply           |2011                            |2012                        |2013                            |
|BP                              |[20-30]%                        |[30-40]%                    |[40-50]%                        |
|SFRA                            |[30-40]%                        |[30-40]%                    |[30-40]%                        |
|Combined                        |[50-60]%                        |[60-70]%                    |[70-80]%                        |
|Shell                           |[10-20]%                        |[10-20]%                    |[20-30]%                        |
|Q8                              |[0-5]%                          |[0-5]%                      |[0-5]%                          |
|Chevron                         |[20-30]%                        |[10-20]-%                   |[0-5]%                          |
|Total size (M€)                 |[…]                             |[…]                         |[…]                             |

   50) There are currently only three competing suppliers of aviation fuel in Stockholm, i.e. BP, SFRA and Shell (Q8 and Chevron having exited in
       2012). In addition to those, SAS Oil is supplying part of SAS's fuel requirement in Stockholm. However, SAS Oil does not supply any  other
       airlines and does not participate in tenders.

   51) The transaction would further reduce the number of competitors from 3 to 2 and would thus lead to a duopoly.

   52) Moreover, the Parties have high market shares, which they held consistently over the last three years.  Over  the  last  three  years  the
       Parties were the two largest players, while Shell as the remaining competitor held  a  significantly  lower  market  share:  in  2013  the
       Parties’ combined market share by value amounted to [70-80]%, while Shell accounted to only [20-30]%. The Parties' combined  market  share
       is, therefore, well above the 50% threshold which, according to case-law may, in itself, be  evidence  of  the  existence  of  a  dominant
       position.[28]

4 Theory of harm

   53) For the reasons set out below, the Commission considers that, even though fuel supply contracts are  allocated  through  informal  bidding
       processes, the transaction removes an important competitive constraint. Moreover, the Commission considers that customers' buyer power  is
       insufficient to discipline the merged entity and potential competitors face considerable barriers to entry.

The Notifying Party’s Arguments

   54) The Notifying Party submits that the market structure at the Stockholm airport with only two suppliers post-transaction  will  not  impede
       effective competition. Firstly, the Notifying Party argues that effective competition will be ensured even though only two suppliers  will
       remain post-merger, because (1) most airlines carry out annual tenders in relation to their jet fuel requirement, (2) customers can easily
       switch between the two remaining suppliers and (3) there are no capacity constraints  that  would  hinder  either  of  the  remaining  two
       suppliers to expand production. As a result, the Notifying Party submits that market shares "tend to be  relatively  short-lived  and  not
       symptomatic of sustained market power".[29] Secondly,  the  Notifying  Party  submits  that  airlines  are  sophisticated  customers  with
       significant buyer power. Thirdly, the Notifying Party argues that new players can easily enter the market.

   55) In addition, the Notifying Party claims that there is no economic evidence of a relationship between the number of suppliers active at  an
       airport and margins earned at that airport. The Notifying Party therefore argues that  as  long  as  there  remain  at  least  two  strong
       competitors, the loss of a supplier will have no impact on prices. To reach this conclusion, the Notifying Party relies on  two  types  of
       regression analyses, (1) a cross-sectional regression analysis, i.e. comparing margins across airports and assessing whether and  to  what
       extent the number of active suppliers at an airport affects the level of  margins  earned  at  that  airport,  and  (2)  a  fixed  effects
       regression analysis, i.e. comparing margins at different moments within each airport and assessing whether entries and exits of  suppliers
       within an airport affect the level of margins earned. According to the Notifying Party, both sets of  analyses  found  no  evidence  of  a
       relationship between the number of suppliers active at an airport and margins earned at that airport.[30]

Removal of an Important Competitive Constraint

   56) The Commission took into account the Notifying Party's arguments and concedes that most airlines carry out  annual  tenders  and  that  in
       principle there are no significant barriers to switching suppliers once a supply contract comes to an end and a new tender  is  organised.
       However, the Commission considers that these conditions are not sufficient to reach the conclusion  that  effective  competition  will  be
       ensured even though only two suppliers will remain post-merger. In particular, the Commission considers that the presence of Shell as  the
       only remaining competitor at Stockholm airport is not sufficient to ensure effective competition for the reasons set out below.

   57) Firstly, all suppliers do not operate with the same supply chain. As a result suppliers face different cost structures (including marginal
       costs), which affect their ability and incentive to offer a low price and also means that they are unlikely to be able to exert  the  same
       competitive constraint on each other. These differences may be found at any level of the supply chain, i.e. sourcing of fuel, off-airfield
       storage, on-airfield storage and into-plane service. In this respect, the Notifying Party's internal documents indicate […].[31] […]. Post-
       transaction this constraint will disappear and Shell is unlikely to be able to compensate for this loss, given its higher marginal costs.

   58) Secondly, the customers who responded to the Commission's questionnaire confirm that SFRA and BP are close competitors and that  they  are
       exerting an important competitive constraint on each other. In particular, a large majority of customers considers SFRA to be the  closest
       competitor to BP and a majority of them consider BP to be the closest competitor to SFRA.[32] Moreover,  a  large  majority  of  customers
       consider SFRA as the most aggressive competitor in terms of credit terms and also (but to a lesser extent) in  terms  of  prices.[33]  The
       Notifying Party itself submitted a diversion ratio analysis based on the 10 largest lost contracts of BP over the last three  years.  This
       analysis shows that […] of them were won by SFRA, representing [70-80]%  of  BP's  lost  volume.  This  again  illustrates  how  strong  a
       competitive constraint SFRA is. Post-transaction this competitive constraint on BP will disappear.

   59) Thirdly, the market investigation has shown that not all fuel suppliers present in Stockholm participated in all tender procedures.[34] In
       particular, there are tenders in which only BP and SFRA submitted a quote. Post-merger, it is therefore likely that there will be  tenders
       in which the merged entity will not face any competition.

   60) Fourth, some customers at Stockholm airport engage in multi-sourcing. Although the majority of airlines active in Stockholm source from  a
       single supplier, those that multi-source are typically larger customers who account for a significant share of the overall volume supplied
       in Stockholm. In 2013, the Notifying Party identified […] multi-sourcing customers, […], representing [60-70]% of the  overall  demand  in
       Stockholm.[35] Post-merger, if these airlines still want to multi-source (e.g. for reasons of security of supply) between  two  suppliers,
       both suppliers would face no competition on the part of the demand that they are covering. Moreover, to the extent that absent the  merger
       they would have relied on three suppliers (Shell, BP and SFRA) for their supply of fuel,  post-transaction  the  two  remaining  suppliers
       would have to provide a larger proportion of these customers' demand. This would imply a higher exposure  to  the  credit  risk  of  these
       airlines, which, as explained by the Notifying Party, may be contrary to the suppliers' policy. As the willingness to take a higher credit
       risk exposure to this airline may be limited, the two remaining suppliers would likely shorten their credit terms.

   61) Finally, the Commission considers that the econometric analysis submitted by the Notifying Party does not provide convincing evidence that
       no relationship exists between margins and the number of suppliers. The analysis has shortcomings with  regard  to  the  methodology,  the
       data, the interpretation and the robustness of the results which imply that the analysis cannot be considered conclusive.[36]

   62) First, both the number of bidders for a given contract and the profitability of the contract are likely to depend on unobserved supply and
       demand factors. The margin-concentration analysis submitted by the Notifying Party is  therefore  likely  to  suffer  from  a  problem  of
       endogeneity which leads to biased and therefore unreliable results.

   63) Second, the cross-sectional analysis (i.e. comparing margins across airports) does  not  adequately  account  for  unobserved  differences
       between airports, which may affect the margins earned, such as differences in the supply chain of BP and of its  competitors,  differences
       in the level of barriers to entry and differences in the customer mix.

   64) Third, in the fixed effect analysis (i.e. focusing on the effects of entries and exits of firms within an airport),  the  Notifying  Party
       only assumed a linear relationship between the number of suppliers and margins. In other words, this approach assumes that the  effect  on
       the margin of reducing the number of competitors from three to two is identical to the effect of reducing this number from eight to seven,
       etc. The Commission does not consider this assumption to be theoretically sound.

   65) Fourth, the data set submitted by the Notifying Party contains only few changes in the number  of  suppliers  that  are  relevant  to  the
       proposed transaction.[37]

   66) Fifth, both the cross-sectional and the fixed effect analyses suffer from measurement errors. For instance, the main variable of  interest
       (i.e. the number of suppliers) does not adequately measure the  number  of  suppliers  participating  in  tenders  as  not  all  suppliers
       participate in each tender.

   67) Moreover, it should be mentioned that the Commission replicated the Notifying Party's analysis modifying only  few  parameters  and  found
       preliminary indications of a negative relationship between the margins and the number of firms.[38] The  Commission  therefore  takes  the
       view that the results of the Notifying Party's analysis are not robust.

Insufficient Buyer Power

   68) The Notifying Party argues that airlines exercise significant countervailing buyer power by threatening to (1) leverage their demand,  (2)
       to tanker or (3) to self-supply. However, contrary to the Notifying Party's position, the  Commission  considers  that  customers  do  not
       exercise significant buyer power.

Leveraging Demand across Airports

   69) Contrary to the Notifying Party’s position, the Commission does not consider that airlines exercise significant buyer power by  leveraging
       their demand across airports. Leveraging of demand is a strategy by which airlines, when  they  negotiate  prices  for  the  supply  at  a
       particular airport,  threaten to divert their business at other airports to other into-plane suppliers or even to divert traffic from  the
       particular airport to other airports in order to negotiate lower prices.

   70) The information provided by the Notifying Party itself suggests that mostly larger airlines with a strong  presence  at  several  airports
       could envisage such a strategy.[39] Smaller airlines or airlines with a strong presence at only few airports would find it more  difficult
       to leverage their demand.

   71) In any case, the market investigation has shown that the majority of customers have never  threatened  to  divert  business  to  competing
       suppliers also present at other airports. Similarly, from a competitor perspective, the market investigation  has  shown  that  the  large
       majority of into-plane suppliers have never been threatened with such a strategy.

Tankering

   72) Contrary to the Notifying Party's position, the Commission does not consider that airlines are able to exercise  significant  buyer  power
       through the threat of tankering.

   73) Tankering is a refuelling strategy by which an airline takes on more fuel than needed at lower cost airports to cover the  flight  to  the
       destination airport in order to reduce the amount of fuel they take on at the higher price destination airport.

   74) The Notifying Party submitted anecdotal evidence of tankering.[40] However, the Notifying Party itself concedes that tankering is  only  a
       viable strategy where the price difference exceeds the additional cost of carrying excess fuel (i.e. weight).[41]

   75) The market investigation suggests that tankering is usually not a viable strategy for medium or long-haul flights, since the extra  weight
       of the additional fuel increases the overall fuel consumption of the tankering airplane and the advantage of the price difference is lost.
       For example, one airline noted that the "flight time from […] prevents economic tankering”.

   76) As regards Stockholm, the market investigation has shown that a  majority  of  customers  at  Stockholm  airport  tankers  never  or  only
       occasionally. Moreover, the majority of airlines tanker less than 10% of their fuel requirements. Furthermore, if the  price  differential
       for aviation fuel would increase by 5%-10% compared to  other  airports,  the  majority  of  customers  at  Stockholm  airport  would  not
       significantly increase the volumes which they tanker at other cheaper airports.

   77) From a competitor perspective, the market investigation has shown that the majority of into-plane suppliers stated that airlines had never
       threatened them with such a strategy. Moreover, these into-plane suppliers stated that those airlines, which had threatened  with  such  a
       strategy, had not succeeded in obtaining lower prices.

Self-Supply

   78) Contrary to the Notifying Party's position, the Commission does not consider that airlines are able to exercise  significant  buyer  power
       through the threat of self-supply.

   79) The Notifying Party itself concedes that self-supplying airlines usually have higher costs than traditional into-plane suppliers,  because
       they have higher credit costs since their business model is perceived more risky than that of traditional into-plane suppliers and because
       they usually have lower volumes.[42] Self-supply is therefore typically an option only for large  airlines  with  significant  volumes  of
       demand at the respective airport. These airlines primarily engage in self-supply to use it as a  bargaining  tool  or  to  increase  their
       insight into the supply chain costs. Based on the information provided by  the  Notifying  Party,  only  SAS  self-supplies  at  Stockholm
       airport.

   80) Indeed, the market investigation has shown that only very few large customers self-supply and that the extent of  self-supply  is  usually
       limited to only a portion of the airline's demand. Also, almost no customer has threatened to self-supply in past negotiations.

   81) As regards Stockholm airport, the market investigation has shown that almost all customers either consider it  difficult  to  start  self-
       supply at Stockholm airport or have not even considered the matter. Consequently, almost no customer expressed an interest in starting  to
       self-supply in the next 3 years.

Barriers to Entry

   82) The Notifying Party argues that (1) the Groundhandling  Directive  ensures  non-discriminatory  third  party  access,  (2)  self-supplying
       airlines can start supplying to other airlines, (3) new entrants can enter as shareholders in the existing infrastructure  joint-ventures,
       (4) as throughputters as well (5) as resellers and that (6) airlines can sponsor new entry. However, contrary  to  the  Notifying  Party’s
       position, the Commission considers that new entrants face significant barriers to entry at Stockholm airport.

The Groundhandling Directive

   83) Contrary to the Notifying Party's position, the Commission considers that the Groundhandling Directive does  not  in  itself  ensure  easy
       entry for new players at Stockholm airport. In that regard the Commission notes  that  it  has  conducted  an  impact  assessment  on  the
       Groundhandling Directive.  This  impact  assessment  suggests  that  the  current  legal  framework  for  the  management  of  centralised
       infrastructure such as fuel infrastructure is inappropriate.[43]

Entry of a self-supplier in the non-self-supply business

   84) Contrary to the Notifying Party's position, the Commission considers it unlikely that self-suppliers would start supplying other airlines.
       The Notifying Party itself concedes that self-supplying airlines frequently have higher costs of upstream supply of aviation fuel,  partly
       due to higher credit costs.[44] The Notifying Party rightly concludes that airlines are often able to obtain better terms from traditional
       into-plane suppliers, especially in terms of credit.[45] It follows that self-supplying airlines are unlikely to compete with  traditional
       into-plane suppliers in the supply of other airlines.

   85) The market investigation has shown that SAS as the only self-supplying airline at  Stockholm  airport  has  not  supplied  fuel  to  other
       airlines in the last 5 years.

Entry as shareholders

   86) Contrary to the Notifying Party's position, the Commission considers that it is unlikely that potential competitors, which would enter the
       Stockholm airport by purchasing shares in the on-airfield joint venture (AFAB) and in one of the two into-plane joint ventures  (AFCO  and
       SFS), constitute a significant competitive constraint. The Commission considers that potential entrants  face  significant  barriers  when
       attempting to become a member of the relevant infrastructure joint-ventures.

   87) As regards the on-airfield storage joint venture (AFAB), the Commission notes that the joint-venture agreement allows for the entry of new
       participants. However, the joint-venture agreement foresees that the existing shareholders  have  to  unanimously  approve  the  necessary
       increase in share capital. Also, if an existing shareholder intends to sell shares, the joint-venture  agreement  does  not  allow  a  new
       entrant to purchase those shares, but foresees that the  remaining  shareholders  purchase  the  exiting  shareholders'  shares  in  equal
       portions.

   88) As regards the into-plane joint-ventures, there are two such providers active at Stockholm airport, namely AFCO and SFS.

   89) Regarding AFCO, the Commission notes that the joint-venture agreement allows for the entry of new participants. However, the joint-venture
       agreement foresees that the existing shareholders have to unanimously approve the  necessary  increase  in  share  capital.  Also,  if  an
       existing shareholder intends to sell shares, the joint-venture agreement foresees that  the  remaining  shareholders  have  a  pre-emption
       right.

   90) Regarding SFS, the joint-venture agreement foresees the transfer of shares to  a  new  shareholder,  but  such  a  transfer  requires  the
       unanimous decision of the remaining shareholders.

   91) As regards AFCO, two of its shareholders, Chevron and Q8, maintain  dormant  shareholdings  in  this  into-plane  joint-venture.  However,
       neither of these potential competitors has shareholdings in the on-airfield storage joint-venture (AFAB). Only the third shareholder,  BP,
       also has a share in AFAB and remains the sole active shareholder of AFCO. By contrast, Chevron and Q8 have withdrawn from  the  into-plane
       supply of aviation fuel at this airport. There are no indications that Chevron or Q8 intend to re-enter this market.

   92) The market investigation has shown that almost none of the Parties' competitors or customers expect new entry in the coming next years.

Entry as Throughputters

   93) Contrary to the Notifying Party's position, the Commission considers it unlikely that throughputters constitute a significant  competitive
       constraint at Stockholm airport.

   94) Throughputters purchase the right to use the on-airfield storage and into-plane  supply  infrastructure  from  the  infrastructure  joint-
       ventures as such or from individual shareholders without becoming a shareholder of these companies.  According  to  the  Notifying  Party,
       throughputters profit from the fact that they do not incur large capital costs and the associated risks  and  liabilities.  Instead,  they
       merely pay a fee, which the owners of the infrastructure charge in proportion to their usage of the facilities.

   95) Customers generally do not consider throughputters as a significant competitive constraint at Stockholm airport, which is consistent  with
       the fact that there are currently no throughputters active at this airport.

   96) Moreover, throughputters as potential competitors face significant barriers to entry at Stockholm airport,  because  they  would  need  to
       agree on the terms of access with the on-airfield storage joint-venture (AFAB) and with one of the two into-plane joint-ventures (AFCO  or
       SFS). With the exception of self-supplying shareholders (i.e. SAS) and dormant shareholders (i.e. Chevron), these joint-ventures are owned
       by active competitors of any potential entrant. These companies are unlikely to have an active interest in  the  entry  of  an  additional
       competitor. Yet, as shareholders they have a significant margin of discretion in fixing the price and the terms of  access  for  potential
       throughputters. In that regard, the market investigation has confirmed that no throughputter has entered Stockholm airport over the last 3
       years. The Notifying Party itself concedes that, in the last five years, only […] has requested access to  AFAB  and  SFS,  but  abandoned
       negotiations, when the joint-venture requested an up-front administration fee before starting negotiations.[46]

   97) Furthermore, even if a throughputter were to enter Stockholm airport, the market investigation has shown that many customers would  prefer
       the offer from the traditional supplier and almost no customer would give preference to an offer at equal terms  from  the  throughputter,
       mostly for reasons related to reliability and security of supply.

   98) In any case, the market investigation has shown that almost no customer or competitor expects throughputters to enter Stockholm airport in
       the next 3 years.

Entry as Resellers

   99) Contrary to the Notifying Party's position, the Commission does not consider resellers to constitute a competitive constraint at Stockholm
       airport.

  100) Resellers purchase the fuel from other into-plane suppliers "at wingtip" and then sell it  on  to  the  airline.  Resellers  accept  lower
       margins and offer more generous credit terms than into-plane suppliers. According to the Notifying Party, the presence  of  resellers  has
       increased the competitive pressure on into-plane suppliers.

  101) Indeed, the market investigation has shown that almost no customer considers resellers as an important competitive constraint at Stockholm
       airport. There are currently no resellers active at Stockholm airport.

  102) The information provided by the Notifying Party suggests that resellers mainly sell to customers, which are unattractive  for  traditional
       into-plane suppliers, because they purchase relatively small volumes (e.g. general aviation) or carry a high  credit  risk.[47]  This  was
       confirmed by the market investigation. One customer pointed out that "[r]esellers buy the fuel from the suppliers therefore  are  unlikely
       to be more competitive". Similarly, another customer stated that their  "experience  is  that  reseller  prices  are  always  higher  than
       traditional suppliers given that resellers purchase". Another customer concluded that "[t]heir business structure is not competitive".

Sponsor New Entry

  103) Contrary to the Notifying Party's position, the Commission considers it unlikely that customers will sponsor  new  entry  by  facilitating
       entry of a third party supplier at Stockholm airport.

  104) The information submitted by the Notifying Party itself suggests that that an airline needs to have significant volumes  of  demand  at  a
       particular airport in order to sponsor entry.[48] It is therefore unlikely that airlines with average or smaller volumes would be able  to
       generate sufficient demand to sponsor entry.

  105) Moreover, the information submitted by the Notifying Party further suggests that the airlines would need to enable the entrant's access to
       the infrastructure joint-ventures.[49] This is only possible for airlines which are already part of the supply chain  as  shareholders  of
       the infrastructure joint ventures.

  106) As regards Stockholm airport, only one airline (SAS) is a shareholder in the on-airfield storage joint venture (AFAB) and in an into-plane
       joint venture (SFS). However, both joint-venture agreements would require that the remaining shareholders would approve the new entrant.

  107) The market investigation has shown that almost all customers stated that it would be difficult to sponsor such entry at Stockholm airport.
       Moreover, none of the customers at Stockholm airport has sponsored entry by actively facilitating entry of a third-party in  this  market,
       for example by providing them an incentive, expertise, advice or other assistance of a new into-plane supplier in the last 3 years in this
       airport.

Conclusion on Stockholm

  108) As explained above, the Commission considers that, even though fuel supply contracts are allocated through informal bidding processes, the
       transaction will remove an important competitive constraint and could result in higher prices for the into-plane supply of  aviation  fuel
       in Stockholm. This concern is confirmed by the results of the market investigation: the  large  majority  of  respondents  to  the  market
       investigation consider that the intensity of competition will decrease[50]  and  that  price  level  will  increase  post  transaction  in
       Stockholm.[51]

  109) Moreover, based on the results of the market investigation, the Commission considers  that  customers'  buyer  power  is  insufficient  to
       discipline the merged entity and that potential competitors face considerable barriers to entry.

  110) The Commission therefore concludes that the proposed transaction raises serious doubts as to its compatibility with the internal market on
       the market for into-plane supply of aviation fuel in the Stockholm airport.

5 Malmö

6 Overview

  111) Malmö airport is a small regional airport in Sweden, approximately 30 km from Malmö city centre and 55  km  from  Copenhagen.  It  handles
       approximately 2.1 million passengers annually and has an annual volume of demand of around […] cbm. The supply  chain  of  the  into-plane
       fuel suppliers active in Malmö is illustrated in the graph below:

                                                           Graph 2 – Supply Chain Malmö
[pic]

  112) Currently, BP has no off-airfield storage arrangement fully dedicated to its supply  of  jet  fuel  at  the  Malmö  airport.  Instead,  BP
       transports its fuel requirements for Malmö airport by road from the Copenhagen Prøvestenen import  terminal,  where  it  has  off-airfield
       storage which it uses to supply both Copenhagen and Malmö airports. SFRA does not currently have any rights in  relation  to  off-airfield
       storage either. Instead, SFRA's fuel is delivered by its supplier ([…]) at the point the fuel leaves the off-airfield storage terminal  of
       Statoil Fuel and Retail AS (SFR). By contrast, Shell leases off-airfield storage facilities in Malmö from SFR to stock its jet fuel.

  113) With respect to avgas, SFRA currently purchases avgas from the […]. SFRA does not use any off-airfield storage in relation  to  its  avgas
       supply in Malmö. Instead, SFRA organises the transport of avgas directly from […]. […]. BP currently uses the avgas  off-airfield  storage
       facility owned by Oiltanking at Copenhagen for distribution to its airports in Denmark and Sweden, including Malmö.

  114) There is one service company in operation at the airport which  owns  and  operates  the  necessary  on-airfield  storage  and  into-plane
       infrastructure: Malmö Fuelling Services (MFS). MFS is currently co-owned by BP ([…]%), SFRA ([…]%) and Shell ([…]%). Post-transaction  the
       joint venture will be […] co-owned by BP ([…]%) and Shell ([…]%) as the JV agreement […].

  115) On the demand side, it should also be noted that most airlines carry out annual tenders in relation to their jet fuel  requirement.  Avgas
       customers, i.e. general aviation customers flying small aircrafts not suited for use of A-1 jet fuel, do not carry out annual tenders, but
       instead purchase avgas on a less formal basis with supply cards from the various suppliers which they use on an ad  hoc  basis  to  refuel
       when needed.

7 Market structure

  116) The Malmö airport is an affected market. The tables below set out the market structure pre- and post-transaction.

                  Table 2 – Market shares in the into-plane supply of aviation fuel in Malmö, by value (excluding self-supply)*
|Excluding Self-Supply           |2011                            |2012                        |2013                            |
|BP                              |[30-40]%                        |[30-40]%                    |[20-30]%                        |
|SFRA                            |[40-50]%                        |[40-50]%                    |[30-40]%                        |
|Combined                        |[70-80]%                        |[80-90]%                    |[50-60]%                        |
|Shell                           |[20-30]%                        |[10-20]%                    |[40-50]%                        |
|Total size (M€)                 |[…]                             |[…]                         |[…]                             |

   *There is no self-supply at this market – figures are the same as those including self-supply

                      Table 3 – Market shares in the into-plane supply of avgas in Malmö, by value (excluding self-supply)*
|Excluding Self-Supply           |2011                            |2012                        |2013                            |
|BP                              |[10-20]%                        |[10-20]%                    |[5-10]%                         |
|SFRA                            |[20-30]%                        |[40-50]%                    |[70-80]%                        |
|Combined                        |[40-50]%                        |[50-60]%                    |[80-90]%                        |
|Shell                           |52%                             |[40-50]%                    |[10-20]%                        |
|Total size (€)                  |[…]                             |[…]                         |[…]                             |

   *There is no self-supply at this market – figures are the same as those including self-supply

                     Table 4 – Market shares in the into-plane supply of jet fuel in Malmö, by value (excluding self-supply)*
|Excluding Self-Supply           |2011                            |2012                        |2013                            |
|BP                              |[30-40]%                        |[30-40]%                    |[20-30]%                        |
|SFRA                            |[40-50]%                        |[40-50]%                    |[30-40]%                        |
|Combined                        |[70-80]%                        |[80-90]%%                   |[50-60]%                        |
|Shell                           |[20-30]%                        |[10-20]%                    |[40-50]%                        |
|Total size (M€)                 |[…]                             |[…]                         |[…]                             |

   *There is no self-supply at this market – figures are the same as those including self-supply
    Market shares in the supply of jet fuel are virtually identical to market shares in the supply of aviation fuel  (they  are  identical  when
   rounded to the unit), as avgas sales represents only […]% of the overall aviation fuel sales in value.

  117) Regardless of the product market definition retained, there are currently only three competing suppliers  in  Malmö,  i.e.  BP,  SFRA  and
       Shell. The transaction would further reduce the number of competitors from 3 to 2 and would thus lead to a duopoly. Moreover, the  Parties
       combined market share remains high (i.e. above 50% in the case of aviation fuel and jet fuel and [80-90]% in the case of avgas).

8 Theory of harm

  118) Regardless of whether the Commission considers into-plane supply of avgas and of jet fuel to be one market or two  separate  markets,  for
       the reasons set out below, the Commission concludes that the transaction  removes  an  important  competitive  constraint.  Moreover,  the
       Commission considers that customers' buyer power  is  insufficient  to  discipline  the  merged  entity  and  potential  competitors  face
       considerable barriers to entry.

The Notifying Party’s Arguments

  119) The Notifying Party submits that the market structure at the Malmö airport with only  two  suppliers  of  jet  fuel  and  of  avgas  post-
       transaction will not impede effective competition.

  120) With respect to jet fuel, the Notifying Party argues the following. Firstly, the Notifying Party argues that effective competition will be
       ensured even though only two suppliers will remain post-merger, because (1) most airlines carry out annual tenders in  relation  to  their
       jet fuel requirement, (2) customers can easily switch between the two remaining suppliers and (3) there are no capacity  constraints  that
       would hinder either of the remaining two suppliers to expand production. As a result, the Notifying Party submits that market shares "tend
       to be relatively short-lived and not symptomatic of sustained market power".[52] Secondly, the Notifying Party submits that  airlines  are
       sophisticated customers with significant buyer power. Thirdly, the Notifying Party argues that new players can easily enter the market.

  121) The Notifying Party also explains that BP has recently taken a strategic decision to terminate its  off-airfield  storage  arrangement  in
       Malmö […]. The Notifying Party claims that, ever since BP began transporting jet fuel from Copenhagen, […]. It estimates its  2014  market
       share to be approximately [0-5]%.

  122) Finally, as explained in paragraph (55) above, the Notifying Party claims that there is no economic evidence of a relationship between the
       number of suppliers active at an airport and margins earned at that airport.

  123) With respect to avgas, the bidding markets argument does not apply. Therefore, the Notifying  Party  mainly  puts  forward  countervailing
       arguments. First, the Notifying Party claims that customers could purchase avgas from alternative suppliers at local airports in the area.
       Second, the Notifying party claims that a new entrant could easily start offering avgas at Malmö.

Removal of an Important Competitive Constraint

  124) The Commission took into account the Notifying Party's arguments and concedes that most airlines carry out  annual  tenders  and  that  in
       principle there are no significant barriers to switching suppliers once a supply contract comes to an end and a new tender  is  organised.
       However, the Commission considers that these conditions are not sufficient to reach the conclusion  that  effective  competition  will  be
       ensured even though only two suppliers will remain post-merger. In particular, the Commission considers that the presence of Shell as  the
       only remaining competitor at Malmö airport is not sufficient to ensure effective competition.

  125) In the case of jet fuel, even though fuel supply contracts are allocated through informal bidding processes, the Commission considers that
       the transaction removes an important competitive constraint for the reasons set out below.

  126) Firstly, the customers who responded to the Commission's questionnaire confirmed that SFRA and BP are close competitors and that they  are
       exerting an important competitive constraint on each other. In particular, a large majority of customers considered SFRA to be the closest
       competitor to BP and half of them considered BP to be the closest competitor to  SFRA.[53]  Moreover,  SFRA  is  considered  as  the  most
       aggressive competitor in terms of prices by the majority of customers while  half  of  them  consider  SFRA  to  be  the  most  aggressive
       competitor in credit terms.[54] Post-transaction this competitive constraint on BP will disappear.

  127) Secondly, some customers at Malmö airport engage in multi-sourcing. Although the majority of airlines active in Malmö source from a single
       supplier, those that multi-source are typically larger customers who account for a significant share of the  overall  volume  supplied  in
       Malmö. In 2013, the Notifying Party identified […], representing [50-60]% of the overall demand in Malmö.[55] Post-merger,  if  […]  still
       wants to multi-source (e.g. for reasons of security of supply) between two suppliers, both suppliers would face no competition on the part
       of the demand that they are covering. Moreover, to the extent that in the absence of the transaction, the  multi-sourcing  airlines  would
       have relied on three suppliers (Shell, BP and SFRA) for their supply of fuel, post-transaction the two remaining suppliers would  have  to
       provide a larger proportion of these customers' demand. This would imply a higher exposure to the credit risk of these airlines, which may
       be contrary to the suppliers' policy.[56] As the willingness to take a higher credit risk exposure to this airline may be limited, the two
       remaining suppliers would likely shorten their credit terms.

  128) Thirdly, as regards the Notifying Party's argument that BP has  substantially  reduced  its  market  presence  in  Malmö,  the  Commission
       considers that this does not imply that in the absence of the merger BP would not have offered a competitive constraint  on  SFRA.  First,
       during the last three years until 2013 BP had consistently high market shares between [20-30]% and [30-40]%. In 2014 BP was  also  present
       and the Notifying Party itself concedes that market shares in a given year tend to be relatively short-lived.[57] Second,  BP  is  one  of
       only three competitors at Malmö airport and the Commission has no indications that BP is likely to exit the market. Third, in view of  the
       very recent decision of BP to transport fuel directly from Copenhagen, the Commission cannot exclude that this change in  strategy  by  BP
       may have been triggered by the proposed transaction. And finally, absent the merger, BP could have renegotiated  the  terms  of  the  off-
       airfield storage agreement that it had with Nordic Storage.

  129) Finally, as explained in paragraphs (61) et seq. above, the Commission considers that the econometric analysis submitted by the  Notifying
       Party does not provide convincing evidence that no relationship exists between margins and the number of suppliers.

  130) In the case of avgas, as explained above, customers do not carry out annual tenders. The transaction will  lead  to  a  reduction  in  the
       number of competitors from 3 to 2. BP is one of only three competitors at Malmö airport and the Commission has no indications that  BP  is
       likely to exit. Finally, contrary to the Notifying Party's argument, the Commission considers that customers are  unlikely  to  resort  to
       alternative suppliers located at nearby airports if the merged entity were to increase its prices. The alternative airports  mentioned  by
       the Notifying Party are located at a distance of 50 to 100 km from Malmö. Therefore they do not constitute credible alternatives, even for
       general aviation customers. As a result, the Commission considers that the transaction removes an important competitive constraint for the
       into-plane supply of avgas at Malmö airport.

Insufficient Buyer Power

  131) Contrary to the Notifying Party's position, the Commission considers that airline customers do not exercise  significant  buyer  power  in
       relation to the into-plane supply of jet fuel.

Leveraging Demand across Airports

  132) Contrary to the Notifying Party’s position, the Commission does not consider that airlines exercise significant buyer power by  leveraging
       their demand across airports (see paragraphs (69) to (71) above).

Tankering

  133) Contrary to the Notifying Party's position, the Commission does not consider that airlines are able to exercise  significant  buyer  power
       through the threat of tankering.

  134) Firstly, the Notifying Party itself concedes that tankering is only  a  viable  strategy  where  the  price  difference  must  exceed  the
       additional cost of carrying excess fuel (i.e. weight) (see paragraph (74) above).

  135) Secondly, from a general point of view, the market investigation has shown that neither customers nor competitors consider tankering as  a
       significant competitive constraint (see paragraph (75) above).

  136) Thirdly, the market investigation has confirmed that the majority of customers at Malmö tankers never or only occasionally. Moreover,  the
       majority of airlines tanker less than 10% of their fuel requirements. Furthermore, if the  price  differential  for  aviation  fuel  would
       increase by 5%-10% compared to other airports, the majority would not significantly increase  the  volumes  which  they  tanker  at  other
       cheaper airports.

Self-Supply

  137) Contrary to the Notifying Party's position, the Commission does not consider that airlines are able to exercise  significant  buyer  power
       through the threat of self-supply.

  138) Firstly, the Notifying Party itself concedes that self-supplying airlines usually have higher costs than traditional into-plane suppliers,
       because they have higher credit costs since their business model is perceived more risky than that of traditional into-plane suppliers and
       because they usually have lower volumes (see paragraph (79) above).

  139) Secondly, from a general point of view, the market investigation has shown neither customers nor competitors consider self-supply  or  the
       threat of it as a significant competitive constraint (see paragraph (80) above).

  140) Thirdly, as regards Malmö airport, there is currently no self-supply. Moreover,  the  market  investigation  has  shown  that  almost  all
       customers either consider it difficult to start self-supply at Malmö airport or have not considered the  matter.  No  customer  considered
       that it would be easy to start self-supply at Malmö airport nor expressed an interest in starting to self-supply in the next 3 years.

Barriers to entry

  141) Contrary to the Notifying Party’s position, the Commission considers that new  entrants  face  significant  barriers  to  entry  at  Malmö
       airport. The Commission sets out the main reasons below. These apply to both jet fuel and avgas, unless stated otherwise.

The Groundhandling Directive

  142) Contrary to the Notifying Party's position, the Commission considers that the Groundhandling Directive does  not  in  itself  ensure  easy
       entry for new players at Malmö airport (see paragraph (83) above).

Entry of a self-supplier in the non-self-supply business

  143) Contrary to the Notifying Party's position, the Commission considers it unlikely that self-suppliers would start supplying other airlines.

  144) Firstly, the Notifying Party itself concedes that self-supplying airlines usually have higher costs of upstream supply of  aviation  fuel,
       partly due to higher credit costs (see paragraph (84) above).

  145) Secondly, the market investigation has shown that there is no self-supplying airline at Malmö airport.

Entry as shareholders

  146) Contrary to the Notifying Party's position, the Commission considers that it is unlikely that potential competitors, which would enter the
       Malmö airport by purchasing shares in the only joint-venture operating both the on-airfield  storage  and  the  into-plane  infrastructure
       (MFS), constitute a significant competitive constraint.

  147) The Commission considers that potential entrants face significant barriers when attempting to become a member of this  joint-venture.  The
       Commission notes that the joint-venture agreement allows for the entry of new participants. However, the existing shareholders'  board  of
       directors evaluates whether the applicant meets the qualifying criteria. Besides, if an additional shareholder were to  enter  the  joint-
       venture through an increase in capital, the joint-venture agreement foresees that the existing shareholders have  to  unanimously  approve
       the necessary increase in share capital in a general meeting.  Also,  if  an  existing  shareholder  intends  to  sell  shares  to  a  new
       shareholder, the joint-venture agreement foresees that the exiting shareholder first has to offer his share to the remaining  shareholders
       in equal portions.

  148) The market investigation has shown that almost none of the market players expect new entry in the coming years.

Entry as Throughputters

  149) Contrary to the Notifying Party's position, the Commission considers it unlikely that throughputters constitute a significant  competitive
       constraint at Malmö airport.

  150) No customer considers throughputters as an important competitive constraint at Malmö airport, which is in line with the  fact  that  there
       are currently no throughputters active at Malmö airport.

  151) Secondly, throughputters as potential competitors face significant barriers to entry at Malmö airport, because they would need to agree on
       the terms of access with the joint-venture (MFS). This joint-venture is owned by active competitors of  any  potential  entrant  that  are
       unlikely to have an active interest in the entry of an additional competitor. Yet, as shareholders  they  have  a  significant  margin  of
       discretion in fixing the price and the terms of access for  potential  throughputters.  In  that  regard,  the  market  investigation  has
       confirmed that no throughputter has entered Malmö airport over the last 3 years.

  152) Thirdly, even if a throughputter were to enter Malmö airport, the market investigation has shown that  many  customers  would  prefer  the
       offer from a traditional supplier and almost no customer would give preference to an offer at equal terms from the throughputter.

  153) Lastly, the market investigation has shown that almost no customer or competitor expects throughputters to enter Malmö airport in the next
       3 years.

Entry as Resellers

  154) Contrary to the Notifying Party's position, the Commission does not consider resellers to constitute a  competitive  constraint  at  Malmö
       airport.

  155) The information provided by the Notifying Party suggests that resellers mainly sell to customers, which are unattractive  for  traditional
       into-plane suppliers, because they purchase relatively small volumes (e.g. general aviation)  or  carry  a  high  credit  risk.  This  was
       confirmed by the market investigation (see paragraph (102) above).

  156) The market investigation has shown that almost no customer considers resellers as an important competitive constraint  at  Malmö  airport.
       This is in line with the fact that – based on the results of the market investigation - resellers are not active to any significant extent
       at Malmö airport.

Sponsor New Entry

  157) Contrary to the Notifying Party's position, the Commission considers it unlikely that customers will sponsor  new  entry  by  facilitating
       entry of a third party supplier at Malmö airport.

  158) Firstly, the information submitted by the Notifying Party itself suggests that an airline needs to have significant volumes of demand at a
       particular airport in order to sponsor entry (see paragraph (104) above).

  159) Secondly, the information provided by the Notifying Party itself suggests that only airlines which are already part of the supply chain as
       shareholders of the infrastructure joint ventures would enable the entrant's access to the infrastructure joint  ventures  (see  paragraph
       (105) above). However, there is currently no self-supplying airlines at Malmö airport.

  160) Thirdly, the possibility and timeliness of entry would most likely still depend on the other shareholders willingness to waive any special
       rights and approve the entry of a new competitor.

  161) The market investigation has shown that almost all customers stated that it  would  be  difficult  to  sponsor  entry  at  Malmö  airport.
       Moreover, none of the customers at Malmö airport has sponsored entry by actively facilitating entry of a third-party in this  market,  for
       example by providing them an incentive, expertise, advice or other assistance of a new into-plane supplier in the last  3  years  in  this
       airport.

Entry as an avgas supplier

  162) The Notifying Party claims that a new entrant could easily start offering avgas without needing  to  secure  access  to  the  storage  and
       service JV at Malmö (MFS). According to the Notifying Party, a new entrant could instead install its own small storage tank or operate  on
       a bridger-to-bowser basis.[58] However, either of these two operation models would necessitate having access to a fuel delivery vehicle (a
       bowser vehicle in the case of Malmö) at the airport of Malmö. This constitutes a significant barrier to entry for two reasons. On the  one
       hand, it would be too costly for a new entrant to acquire its own bowser vehicle and hire  the  necessary  personnel,  given  the  limited
       volumes of supply involved. On the other hand, as explained above, the Commission considers it unlikely  that  a  new  entrant  would  get
       access to the relevant infrastructure JV (MFS) either as a throughputter or a shareholder. The Commission therefore considers  that  entry
       as an avgas supplier is not sufficiently likely to discipline the merged entity.

Conclusion on Malmö

  163) As explained above, the Commission considers that, even though fuel supply contracts are allocated through informal bidding processes, the
       transaction will remove an important competitive constraint and could result in higher prices for the into-plane supply of  aviation  fuel
       in Malmö. This concern is confirmed by the results of the market investigation: the large majority of respondents from the demand side  to
       the market investigation consider that the intensity of competition will  decrease[59]  and  that  the  price  level  will  increase  post
       transaction in Malmö.[60]

  164) Moreover, based on the results of the market investigation, the Commission considers  that  customers'  buyer  power  is  insufficient  to
       discipline the merged entity and that potential competitors face considerable barriers to entry.

  165) The Commission therefore concludes that the proposed transaction raises serious doubts as to its compatibility with the internal market on
       the market for into-plane supply of aviation fuel in the Malmö airport. The Commission notes that such concerns cover jet fuel  and  avgas
       supply, regardless of whether avgas and jet fuel constitute different product markets. As explained above, the proposed transaction raises
       serious doubts as to its compatibility with the internal market regardless of the product market definition retained in Malmö.

9 Gothenburg

10 Overview

  166) Gothenburg airport is a regional airport located in the West of Sweden. It handles approximately 5 million passengers annually and has  an
       annual volume of fuel demand of around […] cbm. The supply chain of the into-plane fuel suppliers active in Gothenburg is  illustrated  in
       the graph below:

                                                        Graph 3 – Supply Chain Gothenburg
[pic]

  167) A significant proportion of aviation fuel that is supplied at Gothenburg airport is sourced from the local  ST1  refinery  which  produces
       sufficient aviation fuel to meet approximately two-thirds of demand at Gothenburg. The remaining one third of demand is  met  by  imported
       fuel. SFRA ([…]) and Shell both source the vast majority of their fuel from the ST1 refinery. BP relies solely on  imported  fuel  as  the
       commitments between the ST1 refinery and Statoil and Shell, respectively, utilise all of ST1’s production capacity.

  168) Off-airfield terminal storage facilities near Gothenburg are owned by Vopak and ST1. Shell leases storage capacity  from  ST1.  BP  leases
       storage capacity from Vopak. By contrast, SFRA does not currently have any rights in  relation  to  off-airfield  storage  in  Gothenburg.
       Instead, SFRA's fuel is delivered by its supplier ([…]) at the point the fuel leaves the off-airfield storage terminal of ST1. The fuel is
       transported from the off-airfield storage facilities by road to the on-airfield storage at Gothenburg.

  169) There is one service company in  operation  at  the  airport  which  owns  and  operates  both  the  on-airfield  storage  and  into-plane
       infrastructure: Gothenburg Fuelling Company AB (GFC). There are no hydrant systems at the airport. GFC is currently co-owned by BP ([…]%),
       SFRA ([…]%) and Shell ([…]%). Post-transaction the joint venture will be […] co-owned by BP ([…]%) and Shell ([…]%) as  the  JV  agreement
       […].

  170) On the demand side, it should also be noted that most airlines carry out annual tenders in relation to their jet fuel requirement.

11 Market structure

  171) The Gothenburg airport is an affected market. The table below sets out the market structure pre- and post-transaction.

                                    Table 3 – Market shares in Gothenburg, by value (excluding self-supply)**
|Excluding Self-Supply           |2011                            |2012                        |2013                            |
|BP                              |[40-50]%                        |[30-40]%                    |[20-30]%                        |
|SFRA                            |[30-40]%                        |[20-30]%                    |[20-30]%                        |
|Combined                        |[70-80]%                        |[60-70]%                    |[50-60]%                        |
|Shell                           |[20-30]%                        |[30-40]%                    |[40-50]%                        |
|Total size (M€)                 |[…]                             |[…]                         |[…]                             |

      ** There is no self-supply at this market – figures are the same as those including self-supply

  172) There are currently only three competing suppliers of aviation fuel in Gothenburg, i.e. BP, SFRA and Shell. The transaction would  further
       reduce the number of competitors from 3 to 2 and would thus lead to a duopoly. The Parties combined market share remains high (i.e.  above
       50%), despite the decrease in BP's market share in 2013.

12 Theory of harm

  173) For the reasons set out below, the Commission considers that, even though fuel supply contracts are  allocated  through  informal  bidding
       processes, the transaction removes an important competitive constraint. Moreover, the Commission considers that customers' buyer power  is
       insufficient to discipline the merged entity and potential competitors face considerable barriers to entry.

The Notifying Party’s Arguments

  174) The Notifying Party submits that the market structure at the Gothenburg airport with only two suppliers post-transaction will  not  impede
       effective competition. Firstly, the Notifying Party argues that effective competition will be ensured even though only two suppliers  will
       remain post-merger, because (1) most airlines carry out annual tenders in relation to their fuel requirement,  (2)  customers  can  easily
       switch between the two remaining suppliers and (3) there are no capacity constraints  that  would  hinder  either  of  the  remaining  two
       suppliers to expand production. As a result, the Notifying Party submits that market shares "tend to be  relatively  short-lived  and  not
       symptomatic of sustained market power".[61] Secondly,  the  Notifying  Party  submits  that  airlines  are  sophisticated  customers  with
       significant buyer power. Thirdly, the Notifying Party argues that new players can easily enter the market.

  175) The Notifying Party also explains that BP […]. As a result, BP' market share would have dropped to less than 10% in 2014.

  176) Finally, as explained in paragraph (55) above, the Notifying Party claims that there is no economic evidence of a relationship between the
       number of suppliers active at an airport and margins earned at that airport.

Removal of an Important Competitive Constraint

  177) The Commission took into account the Notifying Party's arguments and concedes that most airlines carry out  annual  tenders  and  that  in
       principle there are no significant barriers to switching suppliers once a supply contract comes to an end and a new tender  is  organised.
       However, the Commission considers that these conditions are not sufficient to reach the conclusion  that  effective  competition  will  be
       ensured even though only two suppliers will remain post-merger. In particular, the Commission considers that the presence of Shell as  the
       only remaining competitor at Gothenburg airport is not sufficient to ensure effective competition for the reasons set out below.

  178) Firstly, the customers who responded to the Commission's questionnaire confirmed that SFRA and BP are close competitors. In particular,  a
       large majority of customers considered SFRA to be the closest competitor to BP.[62] Moreover, a large  majority  of  customers  considered
       SFRA as the most aggressive competitor in terms of credit terms and also (but to a lesser extent) in terms of  prices.[63]  The  Notifying
       Party itself submitted a diversion ratio analysis based on the 10 largest lost contracts of BP over the last three  years.  This  analysis
       shows that […] of them were won by SFRA, representing [30-50]% of BP's lost volume.  This  again  illustrates  how  strong  a  competitive
       constraint SFRA is. Post-transaction this competitive constraint on BP will disappear.

  179) Secondly, Shell's ability and incentive to compete in some tenders is likely limited by barriers to expansion. According to  the  Parties'
       internal documents, both Shell and SFRA would face increased marginal costs if they supply more than a certain volume.[64] This is because
       Shell and SFRA source their fuel requirement in priority from the local ST1 refinery, and this refinery has capacity constraints. Beyond a
       certain volume, Shell (and SFRA) would have to turn to more distant refineries, involving increased product costs. This implies  that  for
       volumes above a certain threshold, Shell will only be able to exert a milder competitive constraint on the merged entity.

  180) Thirdly, the market investigation has shown that not all fuel suppliers present in Gothenburg participated in all  tender  procedures.[65]
       In particular, there are tenders in which only BP and SFRA submitted a quote. Post-merger, it is  therefore  likely  that  there  will  be
       tenders in which the merged entity will not face any competition.

  181) Fourth, some customers at the Gothenburg airport engage in multi-sourcing. Although the majority of airlines active in  Gothenburg  source
       from a single supplier, those that multi-source are typically larger customers who account for a significant share of the  overall  volume
       supplied in Gothenburg. In 2013, the Notifying Party identified […] – representing [40-50]% of the overall demand in Gothenburg.[66] Post-
       merger, if these airlines still want to multi-source (e.g. for reasons of security of supply) between two suppliers, both suppliers  would
       face no competition on the part of the demand that they are covering. Moreover, to the extent that in the absence of the transaction,  the
       multi-sourcing airlines would have relied on three suppliers (Shell, BP and SFRA) for their  supply  of  fuel,  post-transaction  the  two
       remaining suppliers would have to provide a larger proportion of these customers' demand. This would imply a higher exposure to the credit
       risk of these airlines, which may be contrary to the suppliers' policy. As the willingness to take a higher credit risk exposure  to  this
       airline is likely to be limited, the two remaining suppliers will likely shorten their credit terms.

  182) Fifth, as regards the Notifying Party's argument that BP has substantially reduced its  market  presence  in  Gothenburg,  the  Commission
       considers that this does not imply that in the absence of the merger BP would not have offered any competitive constraint on SFRA.  First,
       during the last three years until 2013 BP had consistently high market shares between [20-30]% and [40-50]%. In 2014 BP was  also  present
       and the Notifying Party itself concedes that market shares in a given year tend to be relatively short-lived.[67] Second,  BP  is  one  of
       only three competitors at Gothenburg airport and the Commission has no indications that BP is likely to exit the market. Third, in view of
       the […].

  183) Finally, as explained in paragraphs (61) et seq. above, the Commission considers that the econometric analysis submitted by the  Notifying
       Party does not provide convincing evidence that no relationship exists between margins and the number of suppliers.

Insufficient Buyer Power

  184) Contrary to the Notifying Party's position, the Commission considers that customers do not exercise significant buyer power.

Leveraging Demand across Airports

  185) Contrary to the Notifying Party’s position, the Commission does not consider that airlines exercise significant buyer power by  leveraging
       their demand across airports (see paragraphs (69) to (71) above).

Tankering

  186) Contrary to the Notifying Party's position, the Commission does not consider that airlines are able to exercise  significant  buyer  power
       through the threat of tankering.

  187) Firstly, the Notifying Party itself concedes that tankering is only  a  viable  strategy  where  the  price  difference  must  exceed  the
       additional cost of carrying excess fuel (i.e. weight) (see paragraph (74) above).

  188) Secondly, from a general point of view, the market investigation has shown that neither customers nor competitors consider tankering as  a
       significant competitive constraint (see paragraph (75) above).

  189) Thirdly, the market investigation has confirmed that the majority of customers at Gothenburg tankers never or only occasionally. Moreover,
       the majority of airlines tanker less than 10% of their fuel requirements. Furthermore, if the price differential for aviation  fuel  would
       increase by 5%-10% compared to other airports, the majority would not significantly increase  the  volumes  which  they  tanker  at  other
       cheaper airports.

Self-Supply

  190) Contrary to the Notifying Party's position, the Commission does not consider that airlines are able to exercise  significant  buyer  power
       through the threat of self-supply.

  191) Firstly, the Notifying Party itself concedes that self-supplying airlines usually have higher costs than traditional into-plane suppliers,
       because they have higher credit costs since their business model is perceived more risky than that of traditional into-plane suppliers and
       because they usually have lower volumes (see paragraph (79) above).

  192) Secondly, from a general point of view, the market investigation has shown that neither customers nor competitors consider self-supply  or
       the threat of it as a significant competitive constraint (see paragraph (80) above).

  193) Thirdly, as regards Gothenburg airport, there is currently no self-supply. Moreover, the market investigation has shown  that  almost  all
       customers either consider it difficult to start self-supply at  Gothenburg  airport  or  have  not  considered  the  matter.  No  customer
       considered that it would be easy to start self-supply at Gothenburg airport. Consequently, almost no customer  expressed  an  interest  in
       starting to self-supply in the next 3 years.

Barriers to entry

  194) Contrary to the Notifying Party’s position, the Commission considers that new entrants face significant barriers to  entry  at  Gothenburg
       airport.

The Groundhandling Directive

  195) Contrary to the Notifying Party's position, the Commission considers that the Groundhandling Directive does  not  in  itself  ensure  easy
       entry for new players at Gothenburg airport (see paragraph (83) above).

Entry of a self-supplier in the non-self-supply business

  196) Contrary to the Notifying Party's position, the Commission considers it unlikely that self-suppliers would start supplying other airlines.

  197) Firstly, the Notifying Party itself concedes that self-supplying airlines usually have higher costs of upstream supply of  aviation  fuel,
       partly due to higher credit costs (see paragraph (84) above).

  198) Secondly, the market investigation has shown that there is no self-supplying airline at Gothenburg airport.

Entry as shareholders

  199) Contrary to the Notifying Party's position, the Commission considers that it is unlikely that potential competitors, which would enter the
       Gothenburg airport by purchasing shares in the only joint-venture operating both the on-airfield storage and the into-plane infrastructure
       (GFC), constitute a significant competitive constraint.

  200) The Commission considers that potential entrants face significant barriers when attempting to become a member of this  joint-venture.  The
       Commission notes that the joint-venture agreement allows for the entry of new participants. However, the existing shareholders'  operating
       committee evaluates whether the applicant meets the qualifying criteria. Besides, if an additional shareholder were to  enter  the  joint-
       venture through an increase in capital, the joint-venture agreement foresees that by default all resolutions at shareholder meetings shall
       be passed with the unanimous vote of all the members. Also, if an existing shareholder intends to sell shares to a  new  shareholder,  the
       joint-venture agreement foresees that the exiting shareholder first has to  offer  his  share  to  the  remaining  shareholders  in  equal
       portions.

  201) The market investigation has shown that almost none of the market players expect new entry in the coming next years.

Entry as Throughputters

  202) Contrary to the Notifying Party's position, the Commission considers it unlikely that throughputters constitute a significant  competitive
       constraint at Gothenburg airport.

  203) Firstly, the market investigation has shown that almost none  of  the  customers  consider  throughputters  as  an  important  competitive
       constraint at Gothenburg airport. This is in line with the fact that there are currently no throughputters active at Gothenburg airport.

  204) Secondly, throughputters as potential competitors face significant barriers to entry at Gothenburg airport, because  they  would  need  to
       agree on the terms of access with the joint-venture (GOT). This joint-venture is owned by active competitors of any potential entrant that
       are unlikely to have an active interest in the entry of an additional competitor. Yet, as shareholders they have a significant  margin  of
       discretion in fixing the price and the terms of access for  potential  throughputters.  In  that  regard,  the  market  investigation  has
       confirmed that no throughputter has entered Gothenburg airport over the last 3 years.

  205) Thirdly, even if a throughputter were to enter Gothenburg airport, the market  investigation  has  shown  that  a  significant  number  of
       customers would prefer the offer from a traditional supplier and almost no customer would give preference to an offer at equal terms  from
       the throughputter.

  206) Lastly, the market investigation has shown that almost no customer or competitor expects throughputters to enter Gothenburg airport in the
       next 3 years.

Entry as Resellers

  207) Contrary to the Notifying Party's position, the Commission  does  not  consider  resellers  to  constitute  a  competitive  constraint  at
       Gothenburg airport.

  208) The information provided by the Notifying Party suggests that resellers mainly sell to customers, which are unattractive  for  traditional
       into-plane suppliers, because they purchase relatively small volumes (e.g. general aviation)  or  carry  a  high  credit  risk.  This  was
       confirmed by the market investigation (see paragraph (102) above).

  209) The market investigation has shown that almost no customer considers resellers  as  an  important  competitive  constraint  at  Gothenburg
       airport. This is in line with the fact that – based on the results of  the  market  investigation  -  resellers  are  not  active  to  any
       significant extent at Gothenburg airport.

Sponsor New Entry

  210) Contrary to the Notifying Party's position, the Commission considers it unlikely that customers will sponsor  new  entry  by  facilitating
       entry of a third party supplier at Gothenburg airport.

  211) Firstly, the information submitted by the Notifying Party itself suggests that an airline needs to have significant volumes of demand at a
       particular airport in order to sponsor entry (see paragraph (104) above).

  212) Secondly, the information provided by the Notifying Party itself suggests that only airlines which are already part of the supply chain as
       shareholders of the infrastructure joint ventures would enable the entrant's access to the infrastructure joint  ventures  (see  paragraph
       (105) above). However, there are currently no self-supplying airlines at Gothenburg airport.

  213) Thirdly, the possibility and timeliness of entry would most likely still depend on  the  other  shareholders'  willingness  to  waive  any
       special rights and approve the entry of a new competitor.

  214) The market investigation has shown that almost all customers stated that it would be difficult to sponsor  entry  at  Gothenburg  airport.
       Moreover, none of the customers at Gothenburg airport has sponsored entry by actively facilitating entry of a third-party in this  market,
       for example by providing them an incentive, expertise, advice or other assistance of a new into-plane supplier in the last 3 years in this
       airport.

Conclusion on Gothenburg

  215) As explained above, the Commission considers that, even though fuel supply contracts are allocated through informal bidding processes, the
       transaction will remove an important competitive constraint and could result in higher prices for the into-plane supply of  aviation  fuel
       in Gothenburg. This concern is confirmed by the results of the market investigation: the majority of respondents from the demand  side  to
       the market investigation consider that the intensity of competition will decrease[68] and that price level will increase post  transaction
       in Gothenburg.[69]

  216) Moreover, based on the results of the market investigation, the Commission considers  that  customers'  buyer  power  is  insufficient  to
       discipline the merged entity and potential competitors face considerable barriers to entry.

  217) The Commission therefore concludes that the proposed transaction raises serious doubts as to its compatibility with the internal market on
       the market for into-plane supply of aviation fuel in the Gothenburg airport.

13 Copenhagen

14 Overview

  218) Copenhagen airport is the largest airport in Denmark and Scandinavia. It handles 24.1 million passengers annually and has an annual volume
       of demand for aviation fuel of around […] cbm. The supply chain of the into-plane fuel suppliers active in Copenhagen  is  illustrated  in
       the graph below.

                                                        Graph 4 – Supply Chain Copenhagen
[pic]

  219) The vast majority of the aviation fuel supplied at Copenhagen airport is imported. However, SFRA and  Shell  source  part  of  their  fuel
       requirement respectively from Statoil’s Kalundborg refinery and Shell's refinery in Fredericia. By contrast, BP currently imports  all  of
       its fuel requirements. As regards imports, to maximise efficiencies, a supplier typically brings in a large vessel loaded with fuel – this
       cargo is “broken” between the into-plane suppliers ex-ship. As part of this process, the most efficient model for each into-plane supplier
       is to fill their storage tanks with as large volumes as possible to minimise the number of shipments required.

  220) There are three off-airfield storage sites owned respectively by Oiltanking, TOTSA (the trading and shipping arm  of  Total)  and  Samtank
       owns two storage tanks which are currently not used to supply Copenhagen but which are being advertised as  available.  Oiltanking  leases
       storage capacity to BP, SAS Oil and Shell while TOTSA leases storage capacity to Shell and Total. SFRA's fuel is delivered by its supplier
       ([…]) at the point the fuel leaves the off-airfield storage terminal.

  221) Fuel is then transferred from the off-airfield terminal storage facilities via pipeline to the on-airfield  storage  site  at  Copenhagen,
       which is operated by the airport's main into-plane suppliers as a joint-venture ("BKL").[70] BKL is currently co-owned by BP ([…]%),  SFRA
       ([…]%), Shell ([…]%), Total ([…]%), SAS Oil ([…]%) and Q8 ([…]%).[71] Post-transaction the joint venture will be equally  co-owned  by  BP
       ([…]%), Shell ([…]%), Total ([…]%), SAS Oil ([…]%) and Q8 ([…]%) as the JV agreement […]. BKL operates both the  on-airfield  storage  and
       the hydrant system. BKL also owns and operates the pipeline from Copenhagen’s Prøvestenen import terminal to the airport.

  222) The into-plane suppliers then hand over the actual into-plane supply to an into-plane service provider, which pumps the aviation-fuel from
       the hydrant system via a dispenser vehicle into the aircraft. Currently, there are two such providers active at Copenhagen airport. DRS is
       an into-plane service provider co-owned by BP ([…]%), SAS Oil ([…]%) and Q8 ([…]%)[72]; and SST is an into-plane service provider owned by
       Shell ([…]%), SFRA ([…]%) and Total ([…]%).

  223) On the demand side, it should also be noted that most airlines carry out annual tenders in relation to their jet fuel requirement.

15 Market Structure

  224) The Copenhagen airport is an affected market. The table below sets out the market structure pre- and post-transaction.

                                     Table 4 – Market shares in Copenhagen, by value (excluding self-supply)
|Excluding Self-Supply           |2011                            |2012                        |2013                            |
|BP                              |[5-10]%                         |[5-10]%                     |[20-30]%                        |
|SFRA                            |[30-40]%%                       |[30-40]%%                   |[10-20]%                        |
|Combined                        |[40-50]%                        |[30-40]%                    |[30-40]%%                       |
|Shell                           |[30-40]%                        |[40-50]%                    |[40-50]%                        |
|Total                           |[10-20]%                        |[10-20]%                    |[20-30]%                        |
|Q8                              |[0-5]%                          |[0-5]%                      |[0-5]%                          |
|Total size (M€)                 |[…]                             |[…]                         |[…]                             |

  225) There are currently only four competing suppliers of aviation fuel in Copenhagen, i.e. BP, SFRA, Shell and  Total  (Q8  having  exited  in
       2012). In addition to those, SAS Oil is supplying part of SAS's fuel requirement in Copenhagen. However, SAS Oil does not supply any other
       airlines and does not participate in tenders.

  226) The transaction would further reduce the number of competitors from 4 to 3.

  227) Moreover, the Parties have high combined market shares (around [40-50]%), which they held consistently over the last three years.

16 Theory of harm

  228) For the reasons set out below, the Commission considers that, even though fuel supply contracts are  allocated  through  informal  bidding
       processes, the transaction removes an important competitive constraint. Moreover, the Commission considers that customers' buyer power  is
       insufficient to discipline the merged entity and potential competitors face considerable barriers to entry.

The Notifying Party’s Arguments

  229) The Notifying Party submits that the market structure at the Copenhagen airport with only 3 suppliers  post-transaction  will  not  impede
       effective competition. Firstly, the Notifying Party argues that effective competition will be ensured even  though  only  three  suppliers
       will remain post-merger, because (1) most airlines carry out annual tenders in relation to  their  fuel  requirement,  (2)  customers  can
       easily switch between the three remaining suppliers and (3) there are no capacity constraints that would hinder either  of  the  remaining
       three suppliers to expand supply. As a result, the Notifying Party submits that market shares "tend to be relatively short-lived  and  not
       symptomatic of sustained market power".[73] Secondly,  the  Notifying  Party  submits  that  airlines  are  sophisticated  customers  with
       significant buyer power. Thirdly, the Notifying Party argues that new players can easily enter the market.

  230) Finally, as explained in paragraph (55) above, the Notifying Party claims that there is no economic evidence of a relationship between the
       number of suppliers active at an airport and margins earned at that airport.

Removal of an Important Competitive Constraint

  231) The Commission took into account the Notifying Party's arguments and concedes that most airlines carry out  annual  tenders  and  that  in
       principle there are no significant barriers to switching suppliers once a supply contract comes to an end and a new tender  is  organised.
       However, the Commission considers that these conditions are not sufficient to reach the conclusion  that  effective  competition  will  be
       ensured even though only three suppliers will remain post-merger. In particular, the Commission considers that the presence of  Shell  and
       Total as the two only remaining competitors to the merged entity at Copenhagen airport is not sufficient to ensure  effective  competition
       for the reasons set out below.

  232) Firstly, the customers who responded to the Commission's questionnaire confirmed that SFRA and BP are close  competitors.  In  particular,
       almost half of the customers consider SFRA to be the closest competitor to BP.[74] Moreover, a large majority of customers considered SFRA
       as the most aggressive competitor in terms of credit terms.[75] Post-transaction this competitive constraint will disappear.

  233) Secondly, the market investigation indicated that there are likely significant barriers to  expansion  in  relation  to  Copenhagen.  More
       specifically, where a supplier is operating at close to 100% of its  capacity,  any  significant  volume  increase  would  either  require
       additional investment (e.g. long term lease of additional off-airfield capacity) or involve operating at  higher  variable  costs.  It  is
       unclear whether suppliers would be willing to incur additional fixed costs, not knowing exactly how much additional volume of supply  they
       could expect and for how long. Therefore, it is unclear whether such supplier would exert any significant competitive  constraint  on  the
       merged entity in at least part of the tenders.

  234) Thirdly, the Notifying Party's internal documents indicate that Shell is less competitive beyond a certain volume. This is  because  Shell
       relies on two sources of fuel for its supply in Copenhagen airport: a local refinery (Federicia refinery) and imports.  Beyond  a  certain
       volume, Shell has to rely on more expensive imports, as the volume which can be sourced from the local  refinery  is  exhausted.[76]  This
       implies that for tenders beyond this volume threshold, Shell will only be able to exert a milder  competitive  constraint  on  the  merged
       entity.

  235) Fourthly, the merger is likely to trigger a unit cost increase for the two remaining  competitors  (Shell  and  Total).  This  is  because
       currently, Statoil and Air BP are shareholders of the two competing into-plane services companies, respectively SST (Shell/SFRA/Total) and
       DRS (BP/SAS). Post-merger it is likely that the merged entity will want to transfer all of the Statoil customers from  SST  to  the  other
       into-plane company DRS. This would significantly reduce the volume of fuel handled by SST and instead increase the volume of fuel  handled
       by DRS. As a result, SST will likely have over-capacity (i.e. too many trucks and personnel) and will  therefore  experience  higher  unit
       costs. Consequently, Shell and Total are likely to operate at a cost disadvantage compared to BP/SFRA, and the competitive constraint they
       are currently able to exert on the Parties is likely to be reduced as a result of the transaction. The Notifying  Party  itself  voiced  a
       similar concern […].[77]

  236) Fifth, the market investigation has shown that not all fuel suppliers present in Copenhagen participated  in  all  tender  procedures.[78]
       There were even cases where only BP and SFRA submitted a quote. Post-merger, it is therefore likely that there will be  tenders  in  which
       the merged entity will face no competition at all.

  237) Sixth, some customers at the Copenhagen airport engage in multi-sourcing. Although the majority of airlines active  in  Copenhagen  source
       from a single supplier, those that multi-source are typically larger customers who account for a significant share of the  overall  volume
       supplied in Copenhagen. In 2013, the Notifying Party identified […] – representing [20-30]% of the overall demand in Copenhagen.[79] Post-
       merger, if these airlines want to multi-source (e.g. for reasons of security of supply) between three  suppliers,  these  suppliers  would
       face no competition on the part of the demand that they are covering. Moreover, to the extent that in the absence of the transaction,  the
       multi-sourcing airlines would have relied on four suppliers (Total, Shell, BP and SFRA) for their supply  of  fuel,  post-transaction  the
       three remaining suppliers would have to provide a larger proportion of these customers' demand. This would imply a higher exposure to  the
       credit risk of these airlines, which might be contrary to the suppliers' policy. As the willingness to take a higher credit risk  exposure
       to this airline may be limited, the two remaining suppliers will likely shorten their credit terms.

  238) Finally, as explained in paragraphs (61) et seq. above, the Commission considers that the econometric analysis submitted by the  Notifying
       Party does not provide convincing evidence that no relationship exists between margins and the number of suppliers.

Insufficient Buyer Power

  239) Contrary to the Notifying Party's position, the Commission considers that customers do not exercise significant buyer power.

Leveraging Demand across Airports

  240) Contrary to the Notifying Party’s position, the Commission does not consider that airlines exercise significant buyer power by  leveraging
       their demand across airports (see paragraphs (69) to (71) above).

Tankering

  241) Contrary to the Notifying Party's position, the Commission does not consider that airlines are able to exercise  significant  buyer  power
       through the threat of tankering.

  242) Firstly, the Notifying Party itself concedes that tankering is only  a  viable  strategy  where  the  price  difference  must  exceed  the
       additional cost of carrying excess fuel (i.e. weight) (see paragraph (74) above).

  243) Secondly, from a general point of view, the market investigation has shown that neither customers nor competitors consider tankering as  a
       significant competitive constraint (see paragraph (75) above).

  244) Thirdly, the market investigation has confirmed that the majority of customers at Copenhagen tankers never or only occasionally. Moreover,
       the majority tankers less than 10 % of its fuel requirements. Furthermore, if the price differential for aviation fuel were to increase by
       5%-10% compared to other airports, the majority would not significantly increase the volumes which they tanker at other  cheaper  airports
       would purchase more than 10% of their volume at other cheaper airports.

Self-Supply

  245) Contrary to the Notifying Party's position, the Commission does not consider that airlines are able to exercise  significant  buyer  power
       through the threat of self-supply.

  246) Firstly, the Notifying Party itself concedes that self-supplying airlines usually have higher costs than traditional into-plane suppliers,
       because they have higher credit costs since their business model is perceived more risky than that of traditional into-plane suppliers and
       because they usually have lower volumes (see paragraph (79) above).

  247) Secondly, from a general point of view, the market investigation has shown neither customers nor competitors consider self-supply  or  the
       threat of it as a significant competitive constraint (see paragraph (80) above).

  248) Thirdly, as regards Copenhagen airport, the market investigation has shown that almost all customers either consider it difficult to start
       self-supply at Copenhagen airport or have not considered the matter. No customer considered that it would be easy to start self-supply  at
       Copenhagen airport. Consequently, almost no customer expressed an interest in starting to self-supply in the next 3 years.

Barriers to entry

  249) Contrary to the Notifying Party’s position, the Commission considers that new entrants face significant barriers to  entry  at  Copenhagen
       airport.

The Groundhandling Directive

  250) Contrary to the Notifying Party's position, the Commission considers that the Groundhandling Directive does  not  in  itself  ensure  easy
       entry for new players at Copenhagen airport (see paragraph (83) above).

Entry of a self-supplier in the non-self-supply business

  251) Contrary to the Notifying Party's position, the Commission considers it unlikely that self-suppliers would start supplying other airlines.

  252) Firstly, the Notifying Party itself concedes that self-supplying airlines usually have higher costs of upstream supply of  aviation  fuel,
       partly due to higher credit costs (see paragraph (84) above).

  253) The market investigation has shown that SAS, which is the only self-supplying airline at Copenhagen airport,  has  not  supplied  fuel  to
       other airlines in the last 5 years.

Entry as shareholders

  254) Contrary to the Notifying Party's position, the Commission considers that it is unlikely that potential competitors, which would enter the
       Copenhagen airport by purchasing shares in the on-airfield joint venture (BKL) and in one of the two into-plane joint  ventures  (SST  and
       DRS), constitute a significant competitive constraint. The Commission considers that potential entrants  face  significant  barriers  when
       attempting to become a member of the relevant infrastructure joint-ventures.

  255) As regards the on-airfield storage joint venture (BKL), the Commission notes that the joint-venture agreement allows for the entry of  new
       participants. However, the existing shareholders' management committee evaluates whether the  applicant  meets  the  qualifying  criteria.
       Also, if an existing shareholder intends to sell shares to a new shareholder,  the  joint-venture  agreement  foresees  that  the  exiting
       shareholder first has to offer his share to the remaining shareholders in equal portions.

  256) As regards the into-plane joint-ventures, the Commission notes that the joint-venture agreement of SST does provide for the entry of a new
       shareholder. If a shareholder wants to exit the joint-venture, the assets and liabilities of the joint-venture will be divided between the
       remaining shareholders in proportion to their ownership shares. As regard DRS, if an existing shareholder intends to sell shares to a  new
       shareholder, the joint-venture agreement foresees that the exiting shareholder first has to offer his share to the remaining  shareholders
       in equal portions.

  257) The Commission notes that Q8 is a dormant shareholder in BKL and DRS. However, there are no indications that Q8 has any intentions to  re-
       enter this market.

  258) The market investigation has shown that almost none of the Parties' competitors or customer expect new entry in the coming next years.

Entry as Throughputters

  259) Contrary to the Notifying Party's position, the Commission considers it unlikely that throughputters constitute a significant  competitive
       constraint at Copenhagen airport.

  260) Firstly, the market investigation has shown that almost no customer considers throughputters as an  important  competitive  constraint  at
       Copenhagen airport. This is in line with the fact that there are currently no throughputters active at Copenhagen airport.

  261) Secondly, throughputters as potential competitors face significant barriers to entry at Copenhagen airport, because  they  would  need  to
       agree on the terms of access with the on-airfield storage joint-venture (BKL) and with one of the two into-plane  joint-ventures  (SST  or
       DRS). With the exception of self-supplying shareholders (i.e. SAS) and dormant shareholders (i.e. Q8), these joint-ventures are  owned  by
       active competitors of any potential entrant. These companies are unlikely to have an  active  interest  in  the  entry  of  an  additional
       competitor. Yet, as shareholders they have a significant margin of discretion in fixing the price and the terms of  access  for  potential
       throughputters. In that regard, the market investigation has confirmed that no throughputter has entered Copenhagen airport over the  last
       3 years.

  262) Thirdly, even if a throughputter were to enter Copenhagen airport, the market investigation has shown that many customers would prefer the
       offer from a traditional supplier and almost no customer would give preference to an offer at equal terms from the  throughputter,  partly
       because customers consider traditional suppliers as more reliable.

  263) Lastly, the market investigation has shown that almost no customer and almost no competitor expects  throughputters  to  enter  Copenhagen
       airport in the next 3 years.

Entry as Resellers

  264) Contrary to the Notifying Party's position, the Commission  does  not  consider  resellers  to  constitute  a  competitive  constraint  at
       Copenhagen airport.

  265) The information provided by the Notifying Party suggests that resellers mainly sell to customers, which are unattractive  for  traditional
       into-plane suppliers, because they purchase relatively small volumes (e.g. general aviation)  or  carry  a  high  credit  risk.  This  was
       confirmed by the market investigation (see paragraph (102) above).

  266) The market investigation has shown that almost no customer considers resellers  as  an  important  competitive  constraint  at  Copenhagen
       airport. This is in line with the fact that – based on the results of  the  market  investigation  -  resellers  are  not  active  to  any
       significant extent at Copenhagen airport.

Sponsor New Entry

  267) Contrary to the Notifying Party's position, the Commission considers it unlikely that customers will sponsor  new  entry  by  facilitating
       entry of a third party supplier at Copenhagen airport.

  268) Firstly, the information submitted by the Notifying Party itself suggests that an airline needs to have significant volumes of demand at a
       particular airport in order to sponsor entry (see paragraph (104) above).

  269) Secondly, the information provided by the Notifying Party itself suggests that only airlines which are already part of the supply chain as
       shareholders of the infrastructure joint ventures would enable the entrant's access to the infrastructure joint  ventures  (see  para.(see
       para.(see paragraph(see para. (105) above). Moreover, the possibility and timeliness of entry would most likely still depend on the  other
       shareholders willingness to waive any pre-emption rights and to approve the entry of a new competitor. As regards Copenhagen airport, only
       one airline (SAS) is a shareholder in the on-airfield storage joint venture (BKL) and in an into-plane joint venture (DRS). However,  both
       joint-venture agreements would require that none of the remaining shareholders exercises his pre-emption right.

  270) Thirdly, the market investigation has shown that almost all customers stated  that  it  would  be  difficult  to  sponsor  such  entry  at
       Copenhagen airport. Moreover, none of the customers at Copenhagen airport has sponsored entry by actively facilitating entry of  a  third-
       party in this market, for example by providing them an incentive, expertise, advice or other assistance of a new  into-plane  supplier  in
       the last 3 years in this airport.

Conclusion on Copenhagen

  271) As explained above, the Commission considers that, even though fuel supply contracts are allocated through informal bidding processes, the
       transaction will remove an important competitive constraint and could result in higher prices for the into-plane supply of  aviation  fuel
       in Copenhagen. This concern is confirmed by the  results  of  the  market  investigation:  the  majority  of  respondents  to  the  market
       investigation consider that the intensity of competition will decrease[80]  and  that  price  level  will  increase  post  transaction  in
       Copenhagen.[81]

  272) Moreover, based on the results of the market investigation, the Commission considers  that  customers'  buyer  power  is  insufficient  to
       discipline the merged entity and that potential competitors face considerable barriers to entry.

  273) The Commission therefore concludes that the proposed transaction raises serious doubts as to its compatibility with the internal market on
       the market for into-plane supply of aviation fuel in the Copenhagen airport.

17 Hamburg

18 Overview

  274) Hamburg airport is the fifth busiest commercial airport in Germany. It handles 13.5 million passengers annually and has an  annual  volume
       of demand of around […] cbm. The supply chain of the into-plane fuel suppliers active in Hamburg is illustrated in the graph below:

                                                          Graph 5 – Supply Chain Hamburg
[pic]

  275) Virtually all aviation fuel supplied at Hamburg airport is sourced from the Klesch Heide refinery, which is located  only  105  kilometres
       from Hamburg airport. BP’s current agreement with the Heide refinery […].

  276) There is no off-airfield storage used for the supply of aviation fuel in Hamburg. Instead, the fuel is directly transported by  road  from
       the Heide refinery to the on-airfield storage facilities at Hamburg. There  are  two  competing  on-airfield  storage  joint  ventures  in
       Hamburg: TGH which is currently co-owned by BP ([…]%), SFRA ([…]%) and Shell ([…]%); and HTS which is co-owned by BP ([…]%), Shell  ([…]%)
       and Lufthansa ([…]%). Post-transaction TGH will be co-owned by BP ([…]%) and Shell ([…]%).

  277) The into-plane suppliers then hand over the actual into-plane supply to an into-plane service provider, which  carry  fuel  from  the  on-
       airfield storage to the aircraft with bowser vehicles. Currently, there are two such providers active at Hamburg airport. HFS is an  into-
       plane service provider co-owned by BP ([…]%), Shell ([…]%), SFRA ([…]%), and Lufthansa ([…]%). Skytanking is an  independent  provider  of
       into-plane services, offering an alternative into-plane service to HFS.

  278) On the demand side, it should also be noted that most airlines carry out annual tenders in relation to their jet fuel requirement.

19 Market structure

  279) The Hamburg airport is an affected market. The table below sets out the market structure pre- and post-transaction.

                                       Table 5 – Market shares in Hamburg, by value (excluding self-supply)
|Excluding Self-Supply           |2011                            |2012                        |2013                            |
|BP                              |[20-30]%                        |[20-30]%                    |[20-30]%                        |
|SFRA                            |[20-30]%                        |[20-30]%                    |[20-30]%                        |
|Combined                        |[50-60]%                        |[40-50]%                    |[40-50]%                        |
|Shell                           |[40-50]%                        |[50-60]%                    |[40-50]%                        |
|Exxon                           |[0-5]%                          |[0-5]%                      |[0-5]%                          |
|WFS                             |[0-5]%                          |[0-5]%                      |[5-10]%                         |
|Total size (M€)                 |[…]                             |[…]                         |[…]                             |

  280) There are currently six competing suppliers of aviation fuel in Hamburg, i.e. BP, SFRA, Shell, Exxon, WFS and Q8, which entered the market
       very recently. The latter three operate with a throughput model. In addition to these six suppliers, Lufthansa is self-supplying  part  of
       its fuel requirement in Hamburg. However, Lufthansa does not supply any other airlines and does not participate in tenders.

  281) The transaction would reduce the number of competitors from 6 to 5.

20 Competitive assessment

  282) For the reasons set out below, and although the Parties have a combined market share close to [50-60]%, the Commission considers that  the
       transaction does not remove an important competitive constraint in Hamburg. Moreover, the Commission considers that barriers to entry  are
       very limited.

The Transaction Does not Remove an Important Competitive Constraint

  283) The competitive landscape at the Hamburg airport is very different from the one described in the four airports above.

  284) Firstly, the transaction will only reduce the number of suppliers from 6 to 5. In 2013, there were already five independent suppliers (BP,
       SFRA, Shell, Exxon and WFS). In addition to those five suppliers, Q8 entered into a throughput agreement with the on-airfield  storage  JV
       in June 2014 and has an into-plane agreement with an  independent  into-plane  service  company  (Skytanking).  The  market  investigation
       confirmed that Q8 is currently participating in tenders and has already won some.

  285) Secondly, suppliers active in Hamburg all operate with the same supply chain. In particular, all of  them  source  from  local  refineries
       (mainly the Heide refinery) and transport the aviation fuel directly to the on-airfield storage facilities. As a result, it is likely that
       they face very similar cost structures, including marginal costs. […].[82] This implies that all suppliers should be equally able to exert
       a similar competitive constraint on the others.

  286) Thirdly, the Notifying Party's internal documents also suggest […].[83]

  287) Fourth, the results of the market investigation do not indicate that SFRA is a particularly important competitive constraint  for  BP,  or
       vice versa.[84]

  288) As a result of all the above, the Commission considers that the five remaining suppliers  will  ensure  that  effective  competition  will
       remain post-transaction.

Conclusion

  289) The market investigation showed no indications that, the proposed transaction, will remove an  important  competitive  constraint  in  the
       Hamburg airport[85] nor that it will directly lead to higher prices in this airport.[86]

  290) Based on the results of the market investigation above the Commission concludes that the  proposed  transaction  does  not  raise  serious
       doubts as to its compatibility with the internal market on the market for into-plane supply of aviation fuel at the Hamburg airport.

21 Amsterdam

22 Overview

  291) Amsterdam Airport (Schiphol) is the largest airport in the Netherlands and the fourth busiest airport in Europe. It handled  52.6  million
       passengers in 2013 and total aviation fuel demand was around […] cbm in 2013. The supply chain of the into-plane fuel suppliers active  in
       Amsterdam is illustrated in the graph below.

                                                         Graph 5 – Supply Chain Amsterdam
[pic]

  292) As indicated in the figure above, all aviation fuel supplied at Amsterdam airport  is  delivered  by  one  of  the  two  pipeline  systems
       connecting Amsterdam airport: the Central European Pipeline System (CEPS) or the ASP pipeline system. The CEPS pipeline is owned by  NATO.
       It allows BP and other suppliers to pump aviation fuel from anywhere in the CEPS directly to  the  Amsterdam  airport.  The  ASP  pipeline
       system is co-owned by KLM ([…]%), Shell ([…]%), Total ([…]%), SFRA ([…]%) and ASP Beheer ([…]%). SFRA uses the ASP pipeline  system  which
       receives, stores and transports aviation fuel, via the Amsterdam harbour area, into AFS at Amsterdam Airport. ASP has a storage  agreement
       with Oiltanking and AFS is the contracted operator of the ASP pipeline system.

  293) The fuel is then delivered into the on-airfield storage site, which is operated as a joint-venture ("AFS"). AFS is currently  co-owned  by
       BP ([…]%), SFRA ([…]%), KLM ([…]%), Q8 ([…]%), Morgan Stanley ([…]%)[87], Shell ([…]%) and Total  ([…]%).[88]  Post-transaction,  […]%  of
       AFS, as the JV agreement […]. AFS operates both the on-airfield storage and the hydrant system.

  294) The into-plane suppliers then hand over the actual into-plane supply to an into-plane service provider, which pumps the aviation-fuel from
       the hydrant system via a dispenser vehicle into the aircraft. Currently, there are three such providers active at Amsterdam airport:  CRS,
       GTS and KLM. CRS is currently owned by SFRA, Chevron, Esso and Total. It is currently in the process  of  being  sold  to  Skytanking,  an
       independent operator. GTS is owned by BP, Shell and Q8.

23 Market structure

  295) The table below sets out the market shares (by value) of the Parties and  their  competitors  pre-  and  post-transaction,  excluding  the
       volumes of fuel that were self-supplied.

Table 6 – Market shares in Amsterdam, by value (excluding self-supply)
|Excluding Self-Supply           |2011                            |2012                        |2013                            |
|BP                              |[20-30]%                        |[20-30]%                    |[10-20]%                        |
|SFRA                            |[10-20]%                        |[5-10]%                     |[0-5]%                          |
|Combined                        |[30-30]%                        |[30-40]%                    |[10-20]%                        |
|Q8                              |[20-30]%                        |[20-30]%                    |[30-40]%                        |
|Shell                           |[10-20]%                        |[30-40]%                    |[20-30]%                        |
|Total                           |[10-20]%                        |[10-20]%                    |[10-20]%                        |
|Exxon                           |[5-10]%                         |[0-5]%                      |[0-5]%                          |
|Chevron                         |[5-10]%                         |[0-5]%                      |[0-5]%                          |
|Total size (M€)                 |[…]                             |[…]                         |[…]                             |

  296) There are currently five competing suppliers of aviation fuel in Amsterdam, i.e. BP, SFRA, Shell, Q8 and Total. In addition to these  five
       suppliers, KLM is self-supplying its entire fuel requirement in Amsterdam. However, KLM does not supply any other airlines  and  does  not
       participate in tenders.

24 Competitive assessment

  297) Amsterdam is not an affected market as the Parties had a combined market share of  [10-20]%  in  2013  (excluding  self-supply).  For  the
       reasons set out below, the Commission considers that the transaction does not raise serious doubts in Amsterdam.

  298) First, post-transaction, the merged entity will still face strong competition from three  independent  competitors,  i.e.  Shell,  Q8  and
       Total.

  299) Secondly, as appears from the market investigation, the majority of customers do not consider SFRA to be the closest competitor to  BP  or
       vice versa.[89]

  300) Thirdly, a large majority of the fuel supplied in Amsterdam will be unaffected by the transaction, as KLM's self-supply accounts  for  75-
       80% of overall fuel demand at the airport.

  301) Fourth, Skytanking is in the process of acquiring the  business  of  one  of  the  three  into-plane  service  companies  (CRS)  from  its
       shareholders (SFRA, Chevron, Esso and Total).[90] The presence of this independent into-plane service company will facilitate entry of new
       into-plane fuel suppliers.

  302) Finally, Morgan Stanley became a shareholder in the storage JV (AFS) in 2012.

Overall assessment

  303) Based on the above and the results of the market investigation above the Commission concludes that the proposed transaction does not raise
       serious doubts as to its compatibility with the internal market on the market for into-plane supply of  aviation  fuel  in  the  Amsterdam
       airport.

2 Coordinated Horizontal Effects

  304) According to established case law[91] and the Commission guidelines on the assessment  of  horizontal  mergers,[92]  in  order  to  assess
       coordinated effects it must be established that a proposed merger will make coordination more likely, more effective or more  sustainable.
       The analysis needs to focus in particular on: (i) the ability to reach terms of coordination; (ii)  the  ability  to  monitor  deviations;
       (iii) the existence of a credible deterrent mechanism if deviation is detected; and (iv) the reactions  of  outsiders  such  as  potential
       competitors and customers.

  305) The reduction in the number of suppliers from 3 to 2 in Stockholm, Gothenburg and Malmö, from 4 to 3 in Copenhagen may, in  itself,  be  a
       factor that facilitates coordination and increase the likelihood of coordination.[93]  Therefore,  the  Commission  has  investigated  the
       possibility that the proposed merger, besides raising serious doubts on the non-coordinated effects described above, may also  lead  to  a
       weakening of competitive pressure as a result of coordinated effects.

The views of the Notifying Party

  306) The Notifying Party submits that the transaction will not lead to coordinated effects for several reasons.

  307) Firstly, it is difficult for into-plane suppliers to reach terms of coordination because their  economic  situation  is  asymmetric  (e.g.
       different market shares, degree of vertical integration, supply chain costs, etc.) and  customer  portfolios  change  from  year  to  year
       depending on the results of the tenders.

  308) Secondly, it is difficult for into-plane suppliers to monitor deviations from the coordination because of the lack of transparency due  to
       the high number of airlines active in these markets and changing conditions of cost and demand such as the size of the tenders.

  309) Thirdly, coordination is not sustainable because there is no credible deterrent mechanism since the affected markets are  bidding  markets
       where airlines as large and sophisticated buyers place infrequent and large volume orders.

  310) Finally, the Notifying Party submits that reactions from outsiders might easily destabilise the  coordination  because  new  entrants  can
       easily enter the affected markets and customers may successfully tempt one of the coordinating  firms  to  deviate  in  order  to  gain  a
       substantial market share.[94]

The Commission's assessment

  311) Although the market for into-plane supply of aviation fuel is characterised by regular tenders, the market investigation revealed a number
       of factors which are conducive to co-ordinated behaviour. The results of the market investigation indicated, contrary to the view  of  the
       Notifying Party, that the market is rather transparent. Competitors submitted  that  they  receive  sometimes  information  regarding  the
       identity of the other participants to the tenders especially during negotiations.[95] Some  customers  acknowledged  that  they  sometimes
       disclose the identity of the other participants to the tenders. [96] The majority of competitors have also sometimes information regarding
       the features of other competing bids and winning bids such as  price,  credit  terms,  quantities  and  duration[97]  and  some  customers
       submitted that they share such information with their suppliers.[98] In any case, customers submitted  that  sometimes  they  provide  the
       number of quotes received and market players are aware of the other suppliers in the market.[99] In addition, the majority of  competitors
       have sometimes information regarding the identity of the winner of the tender.[100]

  312) In addition, contrary to the Notifying Party's arguments, the market investigation also  showed  that  entry  barriers  are  high,  namely
       because joint venture agreements at the affected airports make it difficult for new entrants to become shareholders or thoughputters,  and
       resellers are not considered by airlines to be credible alternatives.

  313) It can, however, be left open, whether the transaction also raises serious doubts with regard to co-ordinated effects on the  markets  for
       into-plane supply of aviation fuel at the airports of Stockholm, Malmö, Gothenburg and Copenhagen in view of the commitments submitted  by
       the Notifying Party.

3 Vertical Effects

  314) The proposed transaction gives rise to vertically affected markets involving (i) BP's ex-refinery supply of aviation fuel at EU-level  and
       (ii) SFRA's into-plane supply activities at each of the airports where it has a market share above 30%, namely  Stockholm  ([30-40]%)  and
       Malmö ([30-40]%) as well as the "solus" airports, where it is the only supplier.

Input Foreclosure

  315) According to the Notifying Party however, BP does not have an ability to foreclose supply of aviation fuel  for  the  vertically  affected
       airports as its market share in the EU-wide market for the ex-refinery supply of  aviation  fuel  amounted  to  only  [5-10]  %  in  2013.
       Moreover, BP does not have any refineries in Scandinavia and its German refineries do not supply fuel to the Hamburg airport. Furthermore,
       there are numerous other competitors with substantial market shares such as Total ([10-20]%), Exxon ([5-10]%), Shell  ([5-10]%)  that  can
       supply aviation fuel to the affected airports in the EEA.

  316) Taking into account BP's limited market share in the upstream market for ex-refinery supply of aviation fuel as well as the  existence  of
       other competitors upstream, the Commission considers that the concentration is unlikely to lead to input foreclosure with  regard  to  the
       vertically affected markets of ex-refinery supply of aviation fuel and into-plane fuel supply.

Customer Foreclosure

  317) The Commission considers that the merged entity will not have the ability to foreclose its  competitors'  access  to  customers.  This  is
       because BP's upstream competitors supply aviation fuel to customers active in a range of airports in the EU. They  would  therefore  still
       have access to many customers even in the hypothetical situation in which the merged entity stopped sourcing its aviation fuel requirement
       from other suppliers than BP. With regard to the airports where the merged entity will be the only into-plane supplier  of  aviation  fuel
       ("solus" airports), the Notifying Party submits that the "solus" airports supplied by any of the Parties in 2013 only  accounted  for  […]
       cbm (BP: […] cbm; SFRA: […] cbm) equalling [0-5]% of the amount of aviation fuel produced in the EU in 2013 including imports.

  318) Taking into account that BP's competitors can supply customers at an EEA level to other airports as well as the fact that "solus" airports
       account for less than [0-5]% of the amount of aviation fuel produced in the EU in 2013, the merged entity is unlikely to have  an  ability
       to engage in customer foreclosure.

Conclusion on vertical effects

  319) The Commission considers that the concentration does not raise  serious  doubts  with  regard  to  the  vertical  relations  between  BP's
       activities in the ex-refinery sales of aviation fuel and the new entity's activities in the into-plane supply of aviation fuel.

4 General conclusion on the competitive assessment

  320) The Commission considers that the transaction raises serious doubts as to its compatibility with the internal market with  regard  to  the
       markets for into-plane supply of aviation fuel at the airports in Stockholm, Malmö, Gothenburg and Copenhagen at least as a result of non-
       coordinated effects.

       PROPOSED REMEDIES

  321) In order to render the concentration compatible with the internal market, the Notifying Party has modified the notified  concentration  by
       entering into the following commitments (the "Commitments"),[101] which are annexed to this decision and form an integral part thereof.

  322) Pursuant to the Commitments, BP commits to divest its into-plane  supply  of  aviation  fuel  business  in  the  following  airports:  (i)
       Copenhagen Kastrup airport (Copenhagen), (ii) Stockholm Arlanda airport (Stockholm), (iii) Gothenburg Landvetter airport (Gothenburg)  and
       (iv) Malmö airport (Malmö) (collectively the "Relevant Airports") to an independent and unconnected party.

  323) The Divestment Business includes all the elements of the current SFRA business at the Relevant Airports. These include the following:

    i) SFRA's shareholdings in all the relevant infrastructure joint venture service companies (the "Relevant Infrastructure JVs") providing  jet
       fuel storage, transportation, and into-plane refuelling services on behalf of the into-plane suppliers at the Relevant  Airports.  BP  has
       procured signed waivers from all other shareholders in the Relevant Infrastructure JVs that they will  not  exercise  any  pre-emption  or
       other rights which might prevent an onward sale by BP of the SFRA shareholdings in the Relevant Infrastructure JVs to a Purchaser.

   ii) The relevant authorisations required for the Purchaser to operate at the Relevant Airports, to  the  extent  they  are  capable  of  being
       assigned.

  iii) All current customer contracts under which SFRA supplies jet fuel to airline customers at the Relevant Airports.

   iv) The transfer of all relevant historical data from SFRA’s systems which is available to BP relating to SFRA’s customers, credit  and  other
       records.

    v) The transfer of SFRA key personnel, composed of four full-time employees: (1) one Sales and Marketing Manager who will  also  act  as  the
       Hold Separate Manager; (2) one Sales Assistant; (3) one JV Liaison and Stock Control; and (4) one Invoicing Assistant.

   vi) A commitment to provide pre-airfield supply and delivery of jet fuel to the Purchaser at the Relevant Airports on  back-to-back  terms  to
       those available to SFRA under the […] Supply Agreements. The […] Supply Agreements are effective for  a  period  of  12  months  from  the
       completion of the Concentration. BP will extend the period of supply available to the Purchaser,  on  terms  which  replicate  as  far  as
       possible the terms of the […] Supply Agreements, to a date 12 months from Closing (the “Extended Supply  Arrangements”).  Pricing  of  the
       supply from BP to the Purchaser for such period shall not exceed the costs incurred by BP in relation to purchase, storage and delivery of
       the product and any related compulsory storage services provided thereunder.

  vii) A commitment to provide, in relation to avgas supply in Malmö, pre-airfield supply and delivery of avgas  for  an  interim  period  of  12
       months from Closing. The avgas will be delivered, and legal title transferred, at the point the  avgas  enters  the  relevant  on-airfield
       storage at Malmö airport. Pricing of the supply from BP to the Purchaser for such period shall not exceed the  costs  incurred  by  BP  in
       relation to purchase, storage and delivery of the product.

  324) The Divestment Business must be sold to a Purchaser approved by the Commission and having the financial resources,  proven  expertise  and
       incentive to maintain and develop it as a viable and active competitive force. The Purchaser must be active either in relation to the into-
       place supply of aviation fuel or in related markets (that is, neighbouring markets or vertically related markets).

  325) In addition the undertakings concerned have entered into related  commitments,  inter  alia  regarding  the  separation  of  the  divested
       businesses from their retained businesses,  the  preservation  of  the  viability,  marketability  and  competitiveness  of  the  divested
       businesses, including the appointment of a monitoring trustee and, if necessary, a divestiture trustee.

       ASSESSMENT OF THE PROPOSED REMEDIES

1 Framework for the Commission's Assessment of the Commitments

  326) Where a notified concentration raises serious doubts as to its compatibility with the internal market, the Parties may modify the notified
       concentration so as to remove the grounds for the serious doubts identified by the Commission with a view to having it declared compatible
       with the internal market pursuant to Article 6(1)(b) in conjunction with Article 6(2) of the Merger Regulation.

  327) As set out in the Commission Notice on Remedies,[102] commitments have to eliminate the Commission's serious doubts entirely, they have to
       be comprehensive and effective from all points of view and they must be capable of being implemented effectively within a short period  of
       time, as the conditions of competition on the market will not be maintained until the commitments have been fulfilled.[103]

  328) In assessing whether or not commitments will restore effective competition, the Commission  considers  their  type,  scale  and  scope  by
       reference to the structure and the particular characteristics of the market in which the Commission has identified serious  doubts  as  to
       the compatibility of the notified concentration with the internal market.[104]

  329) Divestiture commitments are the best way to eliminate serious doubts resulting from horizontal overlaps of the  Parties'  activities.[105]
       The divested activities must consist of a viable business that, if operated by a suitable Purchaser,  can  compete  effectively  with  the
       merged entity on a lasting basis and that is divested as a going concern.[106]

  330) The business to be divested must include all the assets which contribute to its current operation or which are  necessary  to  ensure  its
       viability and competitiveness and all personnel which are currently employed or which are necessary to ensure the business' viability  and
       competitiveness. Personnel and assets which are currently shared between the business to be divested and other businesses of the  Parties,
       but which contribute to the operation of the business or which are necessary to ensure its viability and  competitiveness,  must  also  be
       included. Otherwise, the viability and competitiveness of the business to be divested would be endangered. Therefore, the business  to  be
       divested must contain the personnel providing essential functions for the business, at least in a sufficient proportion to  meet  the  on-
       going needs of the business to be divested.[107]

  331) Furthermore, the intended effect of the divestiture will only be achieved if and once the business is transferred to a suitable  Purchaser
       with proven relevant expertise and ability to maintain and develop the business  to  be  divested  as  a  viable  and  active  competitive
       undertaking.

2 The Commission's market test and assessment of the Commitments

The results of the market test

  332) The Commission launched a market test of the Commitments on 25 November 2014. Overall, the market test was positive as to  the  scope  and
       general suitability of the Commitments to remedy the serious  doubts  identified  by  the  Commission  as  to  the  compatibility  of  the
       transaction with the internal market. However, the market test identified specific elements of  the  Commitments  that  were  subsequently
       improved by the final version of the Commitments submitted on 5 December 2014. These elements include the fact  that  financial  investors
       would not be suitable Purchasers and the fact that Gothenburg and Malmö might not be interesting on a stand-alone basis.

  333) The respondents to the market test both from the supply and demand side generally considered that the  Divestment  Business  includes  all
       necessary assets and would be able to compete effectively with the merged entity and that the scale and scope of the  divestment  business
       is sufficient to ensure immediate viability and competitiveness at all Relevant Airports.[108]

  334) The majority of respondents to the market test from the supply side have however considered that financial investors would not be suitable
       Purchasers.[109]

  335) The Notifying Party agreed to address the issues expressed during the market test and on 5 December 2014 submitted  a  revised  and  final
       version of the Commitments addressing the issues in the following way:

      (i) BP included as part of the commitment that the Purchaser of the Divestment Business has to be active either in relation  to  the  into-
       plane supply of aviation fuel or in related markets (inside or outside the EEA).

      (ii) The Divestment Business will be sold to one single Purchaser. However, the Commission may approve the sale of the Divestment  Business
       in two separate parts to two different Purchasers, so as to ensure that Gothenburg and Malmö are  sold  together  with  Copenhagen  and/or
       Stockholm.

Suitability of the Commitments to remove the serious doubts

  336) As explained above, the Commitments consist in the divestiture of the entire SFRA business  that  the  Notifying  Party  is  acquiring  in
       relation to each of the Relevant Airports. This constitutes a structural measure which will not necessitate medium or long-term monitoring
       measures. The Commission considers that the proposed divestment will eliminate the Parties' overlap in relation to the  into-plane  supply
       of aviation fuel at each of the Relevant Airports. Moreover, the Commitments can be implemented effectively within a short  time  and  are
       sufficiently workable and lasting.

  337) The proposed divestment will eliminate the Parties' overlap in the into-plane jet fuel supply in  Copenhagen,  Stockholm,  Gothenburg  and
       Malmö and in avgas supply in Malmö. This allows the entry of  an  additional  competitor  with  proven  track  record,  and  is  therefore
       considered suitable to remove any serious doubts as to the compatibility of the concentration with the internal market.

  338) As confirmed by the market test and as explained in further details below, the Divestment Business includes all  necessary  components  to
       enable a suitable Purchaser to operate on a lasting basis and to compete promptly with the existing suppliers.

  339) Therefore, the Commission considers that the sale of the Divestment Business to an independent and suitable Purchaser will  eliminate  the
       serious doubts identified by the Commission on the market for into-plane supply of aviation fuel at each of the Relevant Airports.

      (i) Viability of the Divestment Business

  340) The Divestment Business includes all necessary components to enable a suitable Purchaser to operate on a  lasting  basis  and  to  compete
       promptly with the existing suppliers at each of the Relevant Airports.

  341) First, for each of the Relevant Airports, the Divestment Business includes the entire SFRA shareholdings in  the  Relevant  Infrastructure
       JVs which will grant the Purchaser the same rights that SFRA currently enjoys to use the infrastructure services at the Relevant  Airports
       to supply aviation fuel to its customers.

  342) The majority of respondents to the market test confirmed that the acquisition of shares in the on-airfield storage and into-plane services
       JVs are sufficient to ensure the  viability  and  competitiveness  of  the  divestment  business  on  a  lasting  basis  at  all  Relevant
       Airports.[110]

  343) The Commission also notes that there will be no limitation on the volume of fuel that the Purchaser will be able to put through any of the
       Relevant Infrastructure JVs to supply its customers at any of the Relevant  Airports.  All  on-airfield  infrastructure  required  by  the
       Divestment Business to provide into-plane fuel supply (e.g. storage, pipelines, hydrant system, vehicles and staff) are  provided  by  the
       Relevant Infrastructure JVs at the Relevant Airports. This means the Purchaser will not require any separate assets or personnel at any of
       the Relevant Airports. While the remaining shareholders in the Relevant Infrastructure JVs have certain pre-emption rights in relation  to
       the transfer of shares or change of control, the Notifying Party provided the Commission with signed waivers from the  other  shareholders
       in the Relevant Infrastructure JVs that they would not exercise such rights.

  344) Second, the Commission notes that the Divestment Business includes pre-airfield supply and delivery  of  aviation  fuel  at  each  of  the
       Relevant Airports for a transitional period of 12 months.[111] The Commission notes that respondents to the  market  investigation  stated
       that it is important to ensure access to off-airfield storage as well as to fuel supplies for such a transitional  period.[112]  Based  on
       the results of the market test, the Commission considers that the 12 months arrangement will ensure  that  any  Purchaser  has  access  to
       competitive fuel supply for a 12 months transition period while it establishes its own pre-airfield aviation fuel supply and  off-airfield
       storage arrangements for the Relevant Airports.

  345) This supply arrangement will also cover the compulsory storage obligation (CSO)[113] of the Purchaser for a period of 12 months. Regarding
       the potential impact of the CSO obligation on the viability of the divested business, the respondents to the market test did not raise any
       significant concerns.[114]

  346) In addition, the majority of respondents from the supply and demand side  consider  that  other  terms  and  conditions  included  in  the
       divestment business (such as operational flexibility) would allow the Purchaser to develop into a viable and effective competitor  at  all
       Relevant Airports.[115] Therefore, the Commission considers that the terms of these supply arrangements will be  sufficiently  competitive
       to allow a Purchaser to exert strong competitive pressure on the remaining suppliers.

  347) Third, for each of the Relevant Airports, the Divestment Business includes all SFRA customer contracts for the supply  of  aviation  fuel.
       The market test confirmed that SFRA customers will continue to purchase from the divested business[116] and  further  that  such  transfer
       ensures the immediate viability of the divested business.[117] Therefore, the Commission considers  that  these  transfers  will  allow  a
       Purchaser to quickly establish links with customers and have an immediate customer base pending future airline tenders.

  348) Fourth, in order to operate at the Relevant Airports, the Purchaser will need to obtain the necessary  authorisations  from  the  relevant
       airport authorities, as confirmed by the respondents to the market test.[118] The respondents to the market test also consider  that  such
       qualification would take between some weeks and 6 months.[119] In this  respect,  the  Notifying  Party  commits  to  notify  the  airport
       authority of the transfer of the Divestment Business and to use all best endeavours to (i) procure the consent of  the  airport  authority
       for the assignment of the Concession Agreement to the Purchaser; or (ii) to assist the Purchaser to enter a Concession Agreement with  the
       airport authority. The Commission considers that this commitment is sufficient to ensure viability regarding the necessary  authorisations
       from the relevant airport authorities.

  349) Fifth, the Divestment Business includes all personnel which are necessary to  ensure  the  business'  viability  and  competitiveness.  As
       explained above, the Relevant Infrastructure JVs have all the personnel required  to  provide  into-plane  fuel  supply  at  the  Relevant
       Airports. As such, the Purchaser will not require any additional personnel for operational aspects of on-airfield storage  and  refuelling
       services at any of the Relevant Airports. The Divestment Business will include four full-time employees: (i) a sales and marketing manager
       who will also act as the Hold Separate Manager; (ii) one sales assistant; (iii) one JV liaison and stock controller; and (iv) one  finance
       controller. Based on the results of the market test,[120] the Commission considers that the above mentioned personnel  are  sufficient  to
       ensure the viability and competitiveness of the Divestment Business.

  350) Finally, the Divestment Business includes pre-airfield supply and delivery of avgas for an interim period of 12 months in Malmö. The avgas
       will be delivered, and legal title transferred, at the point  the  avgas  enters  the  relevant  on-airfield  storage  at  Malmö  airport.
       Therefore, the Divestment Business includes the transfer of SFRA's rights in avgas supply and ensures  the  Purchaser's  access  to  avgas
       supply in Malmö. The Commission considers that this commitment is sufficient to ensure the viability and competitiveness of the Divestment
       Business.

      (ii) The Commitments can be implemented effectively within a short space of time and are sufficiently workable and lasting

  351) The Commission considers that the proposed Commitments are capable of being implemented effectively within a short space  of  time.  While
       some of the Relevant Infrastructure JV shareholder or partnership agreements may contain notice  periods  and  pre-emption  or  change  of
       control provisions, the Notifying Party provided the  Commission  with  signed  waivers  from  the  other  shareholders  in  the  Relevant
       Infrastructure JVs that they will not exercise their rights and release SFRA from its obligations under the  relevant  provisions  of  the
       agreements. Moreover, the Commission considers that the elements of the commercial aviation airline contracts and the necessary  personnel
       can be carved out appropriately to form the Divestment Business without causing any delay to the sale process, or competitiveness  of  the
       Divestment Business.

Purchaser criteria and potential buyers

  352) The market test revealed that the Divestment Business is perceived as an attractive offer for a Purchaser.[121]

  353) Regarding the necessary characteristics of a suitable Purchaser, the market test respondents listed, amongst others, access to fuel supply
       and to the infrastructure joint ventures, suitable governance to ensure technical standards are met and necessary  financial  capabilities
       for adequate insurance.[122] In addition, many of the respondents to the market test from the supply side do not consider  that  financial
       investors to be suitable Purchasers.[123] The majority of respondents to the market test have however considered that it is sufficient for
       a Purchaser to have activities in the into-plane supply of aviation fuel outside the EEA.[124]

  354) The market test both from the supply and demand side also showed that while Copenhagen and Stockholm are large enough to be interesting on
       a stand-alone basis, Gothenburg and Malmö may not be interesting to purchase  on  a  stand-alone  basis.[125]  Therefore,  the  Commission
       considers that, for viability reasons, it may be necessary that the Divestment Business is sold to a single Purchaser. The Commission  may
       however approve the sale of the Divestment Business in two separate parts to two different Purchasers. However, taking  into  account  the
       market test results that stated that Gothenburg and Malmö might not be interesting on a stand-alone basis, and in  order  to  ensure  that
       Gothenburg and Malmö can be viably sold the sale of the Divestment Business in two separate parts to two Purchasers will only be  approved
       by the Commission as long as: (i) Gothenburg and Malmö are sold together with Copenhagen and/or Stockholm and (ii) it can be  demonstrated
       that this does not affect the viability and competitiveness of the Divestment Business after the sale,  taking  account  of  the  proposed
       Purchaser(s).

  355) Finally, the market test revealed five interested buyers, the majority of which are already active in the market for into-plane supply  of
       aviation fuel inside or outside the EEA.[126]

3 Conclusion on the Commitments

  356) On the basis of the above, the Commission concludes that the Commitments are suitable and sufficient to remedy the serious  doubts  raised
       by the transaction in the markets for into-plane supply of aviation fuel  in  the  following  airports:  (i)  Copenhagen  Kastrup  airport
       (Copenhagen), (ii) Stockholm Arlanda airport (Stockholm), (iii) Gothenburg Landvetter airport (Gothenburg) and (iv) Malmö airport (Malmö).
       The Commitments remove the entire increment that would have been added by the transaction in the above-mentioned airports.  Moreover,  the
       Commitments are comprehensive and effective from all points of view, and are capable of  being  implemented  effectively  within  a  short
       period of time.

       Conditions and Obligations

  357) Pursuant to the first sentence of the second subparagraph of Article 6(2) of the Merger Regulation,  the  Commission  may  attach  to  its
       decision conditions and obligations intended to ensure that the undertakings concerned comply with the commitments they have entered  into
       vis-à-vis the Commission with a view to rendering the concentration compatible with the internal market.

  358) The achievement of the measure that gives rise to the structural change of the market is a condition, whereas the implementing steps which
       are necessary to achieve this result are generally obligations on the Parties. Where  a  condition  is  not  fulfilled,  the  Commission's
       decision declaring the concentration compatible with the internal market and the EEA Agreement no longer stands.  Where  the  undertakings
       concerned commit a breach of an obligation, the Commission may revoke the clearance decision in accordance with Article 6(3) of the Merger
       Regulation. The undertakings concerned may also be subject to fines and periodic penalty payments under Articles 14(2) and  15(1)  of  the
       Merger Regulation.

  359) In accordance with the basic distinction between conditions and obligations, the decision in this case is conditional on  full  compliance
       with the requirements set out in Section B of the final Commitments, which constitute conditions. The remaining requirements  set  out  in
       the other Sections of the said Commitments are considered to constitute obligations.

  360) The full text of the final Commitments is annexed to this Decision as Annex I and forms an integral part thereof.

       CONCLUSION

  361) For the above reasons, the Commission has decided not to oppose the notified operation as modified by the commitments and  to  declare  it
       compatible with the internal market and with the functioning of the EEA Agreement, subject to  full  compliance  with  the  conditions  in
       Section B of the commitments annexed to the present decision and with the  obligations  contained  in  the  other  sections  of  the  said
       commitments. This decision is adopted in application of Article 6(1)(b) in conjunction with Article 6(2) of the Merger Regulation.

                                   For the Commission
                                  (Signed)

                                   Margrethe VESTAGER
                                   Member of the Commission

                                                 Annex 1 - COMMITMENTS TO THE EUROPEAN COMMISSION

                                                 Case M.7387 – BP/STATOIL FUEL & RETAIL AVIATION

                                                      COMMITMENTS TO THE EUROPEAN COMMISSION

Pursuant to Article 6(2) of Council Regulation (EC) No 139/2004 (the “Merger Regulation”), BP plc (the “Notifying Party” or “BP”)  hereby  enters
into the following Commitments (the “Commitments”) vis-à-vis the European Commission (the “Commission”) with a view to rendering the  acquisition
by BP of the entire shareholding of Statoil Fuel & Retail Aviation AS (“SFRA”) (the “Concentration”) compatible with the internal market and  the
functioning of the EEA Agreement.

This text shall be interpreted in light of the Commission’s decision pursuant to  Article  6(1)(b)  of  the  Merger  Regulation  to  declare  the
Concentration compatible with the internal market and the functioning of the  EEA  Agreement  (the  “Decision”),  in  the  general  framework  of
European Union law, in particular in light of the Merger Regulation, and by reference to the  Commission  Notice  on  remedies  acceptable  under
Council Regulation (EC) No 139/2004 and under Commission Regulation (EC) No 802/2004 (the “Remedies Notice”).

Section A. Definitions

 1. For the purpose of the Commitments, the following terms shall have the following meaning:

   Affiliated Undertakings: undertakings controlled by the Notifying Party and/or by the ultimate parents of the Notifying  Party,  whereby  the
   notion of control shall be interpreted pursuant to Article  3  of  the  Merger  Regulation  and  in  light  of  the  Commission  Consolidated
   Jurisdictional Notice under Council Regulation (EC) No 139/2004 on the control of  concentrations  between  undertakings  (the  "Consolidated
   Jurisdictional Notice").

   Assets: the assets that contribute to the current operation or are necessary to ensure the viability and competitiveness  of  the  Divestment
   Business as indicated in Section B, paragraph 6 (a), (b), (c) and (d), and described more in detail in the Schedule.

   BP: BP plc, incorporated under the laws of England and Wales with its registered office at 1 St James’ Square, London SW1Y 4PD and registered
   with the Company Register under number 102498.

   Closing: the transfer of the legal title to the Divestment Business to the Purchaser.

   Closing Period: the period of 3 months from the approval of the Purchaser and the terms of sale by the Commission.

   Confidential Information: any business secrets, know-how, commercial information, or any other information of a proprietary  nature  that  is
   not in the public domain.

   Conflict of Interest: any conflict of interest that impairs the Trustee's objectivity and independence in discharging its  duties  under  the
   Commitments.

   Divestment Business: the business as defined in Section B and in the Schedule which the Notifying Party commits to divest.

   Divestiture Trustee: one or more natural or legal person(s), who is approved by the Commission and appointed by the Notifying Party  and  who
   has received from the Notifying Party the exclusive Trustee Mandate to sell the Divestment Business to a Purchaser at no minimum price.

   Effective Date: the date of adoption of the Decision.

   First Divestiture Period: the period of […] from the Effective Date.

   Hold Separate Manager: the person that the Notifying Party procures that the Seller shall appoint for the Divestment Business to  manage  the
   day-to-day business under the supervision of the Monitoring Trustee.

   Key Personnel: means the current SFRA employees described further in the Schedule who will be included in the Divestment Business.

   Monitoring Trustee: one or more natural or legal person(s), who is/are approved by the Commission and appointed by the Notifying  Party,  and
   who has/have the duty to monitor BP’s compliance with the conditions and obligations attached to the Decision.

   Parties: the Notifying Party and SFRA.

   Personnel: means the Key Personnel – there are no further Personnel included in the Divestment Business.

   Purchaser: the entity approved by the Commission as acquirer of the Divestment Business in accordance with the criteria set out in Section D.

   Purchaser Criteria: the criteria laid down in paragraph 17 of these Commitments that the Purchaser must fulfil in order to be approved by the
   Commission.

   Relevant Airports: means collectively (i) Copenhagen Kastrup airport (“Copenhagen”), (ii)  Stockholm  Arlanda  airport  (“Stockholm”),  (iii)
   Gothenburg Landvetter airport (“Gothenburg”) and (iv) Malmö airport (“Malmö”).

   Relevant Infrastructure JVs: means collectively (i) Bændstoflageret Københavns Lufthavn I/S (“BKL”); (ii)  Shell-Statoil-Total  I/S  (“SST”);
   (iii) A Flygbränslehantering AB (“AFAB”); (iv) Stockholm Fuelling Services AB (“SFS”); (v) Gothenburg Fuelling Company AB (“GFC”);  and  (vi)
   Malmö Fuelling Services (“MFS”).

   Schedule: the schedule to these Commitments describing more in detail the Divestment Business.

   […]:  means […].

   Seller:  means Statoil Fuel & Retail AS, a subsidiary of Alimentation Couche-Tard Inc, the legal entity which is selling SFRA to BP.

   […] Supply Agreements:  means the Petroleum Products Sale and Purchase agreements for jet fuel between (i) SFRA and […]  and  (ii)  SFRA  and
   […]entered into on […], and that come into force […].  A summary of the key terms of the […] Supply Agreements is provided in the Schedule.

   Trustee(s): the Monitoring Trustee and/or the Divestiture Trustee as the case may be.

   Trustee Divestiture Period: the period of […] from the end of the First Divestiture Period.

Section B. The commitment to divest and the Divestment Business

 Commitment to divest

 2. In order to maintain effective competition, BP commits to divest, or procure the divestiture of the Divestment Business by  the  end  of  the
    Trustee Divestiture Period as a going concern to a Purchaser and on terms of sale approved by the Commission in accordance with the procedure
    described in paragraph 18 of these Commitments.  To carry out the divestiture, BP commits to find a Purchaser  and  to  enter  into  a  final
    binding sale and purchase agreement for the sale of the Divestment Business within the First Divestiture Period.

 3. If BP has not entered into such an agreement at the end of the First Divestiture Period, BP shall grant the Divestiture Trustee an  exclusive
    mandate to sell the Divestment Business in accordance with the procedure described in paragraph 30 in the Trustee Divestiture Period.

 4. BP shall be deemed to have complied with this commitment if:

     a) by the end of the Trustee Divestiture Period, BP or the Divestiture Trustee has entered into a final binding sale and purchase agreement,
        and the Commission approves the proposed purchaser and the terms of sale as being consistent with the Commitments in accordance with  the
        procedure described in paragraph 18; and

     b) the Closing of the sale of the Divestment Business to the Purchaser takes place within the Closing Period.

 5. In order to maintain the structural effect of the Commitments, the Notifying Party shall, for  a  period  of  10  years  after  Closing,  not
    acquire, whether directly or indirectly, the possibility of exercising influence (as defined in paragraph 43 of the Remedies Notice, footnote
    3) over the whole or part of the Divestment Business, unless, following the submission of a reasoned request from the Notifying Party showing
    good cause and accompanied by a report from the Monitoring Trustee (as provided in paragraph 44 of these Commitments), the  Commission  finds
    that the structure of the market has changed to such an extent that the absence of influence  over  the  Divestment  Business  is  no  longer
    necessary to render the proposed concentration compatible with the internal market.

 Structure and definition of the Divestment Business

 6. The Divestment Business includes all the elements of the current SFRA business at the  Relevant  Airports.   Together,  these  will  allow  a
    Purchaser to replicate the competitive offering of SFRA at each Relevant  Airport.   The  present  legal  and  functional  structure  of  the
    Divestment Business as operated to date is described in the Schedule.  The Divestment Business, described in more  detail  in  the  Schedule,
    includes in particular:

    a) all SFRA’s shareholdings in the Relevant Infrastructure JVs at the Relevant Airports providing either  storage,  transport  and/or  into-
       plane re-fuelling services;

    b) all rights and obligations under the commercial aviation airline customer contracts pursuant to which  SFRA  supplies  jet  fuel  at  the
       Relevant Airports, which BP will use its best endeavours to ensure are transferred to a Purchaser;

    c) all agreements containing relevant authorisations required for the Purchaser to operate at the Relevant Airports, to the extent they  are
       capable of being assigned;

    d) all customer, credit and other records of the Divestment Business; and

    e) the Personnel described in the Schedule, subject to employee consent and relevant employment  laws,  that  are  reasonably  necessary  to
       ensure the viability and competitiveness of the Divestment Business.

 7. In addition, the Divestment Business includes: (i) pre-airfield supply and delivery of jet fuel to  the  Relevant  Airports  on  back-to-back
    terms to those under the […] Supply Agreements.  The […]  Supply  Agreements  are  effective  for  12  months  from  the  completion  of  the
    Concentration, and the main terms are described further in Part II of the Schedule.  BP will extend the period of  supply  available  to  the
    Purchaser, on terms which replicate as far as possible the terms of the […] Supply  Agreements,  to  a  date  12  months  from  Closing  (the
    “Extended Supply Arrangements”).  Pricing of the supply from BP to the Purchaser for such period shall not exceed the costs incurred by BP in
    relation to purchase, storage, and delivery of the product and any related compulsory storage services provided thereunder.   These  Extended
    Supply Arrangements give additional time for a Purchaser to enter its own pre-airfield supply  arrangements;  and  (ii)  12  months  of  pre-
    airfield supply and delivery of avgas to Malmö for such volumes as requested by the Purchaser, with delivery  at  the  point  that  the  fuel
    enters the on-airfield storage at Malmö.  Pricing of the supply from BP to the Purchaser for such period should not exceed the costs incurred
    by BP in relation to purchase, storage and delivery of the products.  Strict firewall procedures will be adopted so as  to  ensure  that  any
    competitively sensitive information related to, or arising from such supply arrangements (for example, product roadmaps) will not  be  shared
    with, or passed on to, anyone outside the identified individuals at BP involved in managing the supply and delivery of jet fuel for  each  of
    the Relevant Airports to the Purchaser under the […] Supply Agreements or the Extended Supply Arrangements, and the supply  and  delivery  of
    avgas for Malmö.

 Section C.  Related commitments

 Preservation of viability, marketability and competitiveness

 8. From the Effective Date until Closing,  the  Notifying  Party  shall  preserve  or  procure  the  preservation  of  the  economic  viability,
    marketability and competitiveness of the Divestment Business, in accordance with good  business  practice,  and  shall  minimise  as  far  as
    possible any risk of loss of competitive potential of the Divestment Business. In particular BP undertakes:

    a) not to carry out any action that might have a significant adverse impact on the value, management or competitiveness  of  the  Divestment
       Business or that might alter the nature and scope of activity, or the industrial or commercial strategy or the investment policy  of  the
       Divestment Business;

    b) to make available, or to procure to make available, sufficient resources for the development of the Divestment Business, on the basis and
       continuation of the existing business plans;

    c) to take all reasonable steps, or procure that all reasonable steps are being taken, including appropriate  incentive  schemes  (based  on
       industry practice), to encourage all Key Personnel to remain with the Divestment Business, and not to solicit or move  any  Personnel  to
       BP’s remaining business. Where, nevertheless, individual members of the Key Personnel exceptionally leave  the  Divestment  Business,  BP
       shall provide a reasoned proposal to replace the person or persons concerned to the Commission and the Monitoring  Trustee.  BP  must  be
       able to demonstrate to the Commission that the replacement is well suited to carry  out  the  functions  exercised  by  those  individual
       members of the Key Personnel.  The replacement shall take place under the supervision of the Monitoring Trustee, who shall report to  the
       Commission.

Hold-separate obligations of the Notifying Party

 9. The Notifying Party commits, from the Effective Date until Closing, to keep  the  Divestment  Business  separate  from  the  business  it  is
    retaining and to ensure that unless explicitly permitted under these Commitments or required by applicable laws: (i)  management and staff of
    the business retained by BP have no involvement in the Divestment Business; (ii) the Key Personnel and Personnel of the  Divestment  Business
    have no involvement in any business retained by BP and do not report to any individual outside the Divestment Business, subject  to  liaising
    with a ring-fenced BP employee, in order for BP to ensure that the operations of the Divestment Business until Closing allow BP to  meet  its
    obligation under the Commitments as well as relevant laws, regulations and BP plc group policies.

10. Until Closing, BP shall assist the Monitoring Trustee in ensuring that the Divestment Business is managed as a distinct and  saleable  entity
    separate from the business which BP is retaining.  Immediately after the adoption of the Decision, BP shall procure  that  the  Seller  shall
    appoint a Hold Separate Manager.

11. The Hold Separate Manager, who shall be part of the Key Personnel, shall manage  the  Divestment  Business  independently  and  in  the  best
    interest of the business with a view to ensuring its continued economic viability, marketability and  competitiveness  and  its  independence
    from the business retained by BP.  The Hold Separate Manager shall closely cooperate with and  report  to  the  Monitoring  Trustee  and,  if
    applicable, the Divestiture Trustee.  Any replacement of the Hold Separate Manager shall be subject to the procedure laid down  in  paragraph
    8(c) of these Commitments. The Commission may, after having heard BP, require BP to replace the Hold Separate Manager.

 Ring-fencing

12. BP shall implement or procure to implement, all necessary measures to ensure  that  it  does  not,  after  the  Effective  Date,  obtain  any
    Confidential Information relating to the Divestment Business and that any such Confidential Information obtained by BP before  the  Effective
    Date will be eliminated and not be used by BP.  In particular, the participation of  the  Divestment  Business  in  any  central  information
    technology network shall be severed to the extent possible, without compromising the viability of the Divestment Business.  BP may obtain  or
    keep information relating to the Divestment Business which is reasonably necessary for the divestiture of  the  Divestment  Business  or  the
    disclosure of which to BP is required by law.

Non-solicitation clause

13. BP undertakes, subject to customary limitations, not to solicit, and to  procure  that  Affiliated  Undertakings  do  not  solicit,  the  Key
    Personnel transferred with the Divestment Business for a period of 24 months after Closing.

Due diligence

14. In order to enable potential purchasers to carry out a reasonable due diligence of the Divestment Business, BP shall,  subject  to  customary
    confidentiality assurances and dependent on the stage of the divestiture process:

    a) provide to potential purchasers sufficient information as regards the Divestment Business;

    b) provide to potential purchasers sufficient information relating to the Personnel and allow them reasonable access to the Personnel.

Reporting

15. BP shall submit written reports in English on potential purchasers of the Divestment Business and developments in the negotiations with  such
    potential purchasers to the Commission and the Monitoring Trustee no later than 10 days after the end of every month following the  Effective
    Date (or otherwise at the Commission’s request).  BP shall submit a list of all potential purchasers having expressed interest  in  acquiring
    the Divestment Business to the Commission at each and every stage of the divestiture process, as well as a copy of all  the  offers  made  by
    potential purchasers within five days of their receipt.

16. BP shall inform the Commission and the Monitoring Trustee on the preparation of the data room documentation and the due  diligence  procedure
    and shall submit a copy of any information memorandum to the Commission and the Monitoring Trustee  before  sending  the  memorandum  out  to
    potential purchasers.

 Section D. The Purchaser

17. In order to be approved by the Commission, the Purchaser must fulfil the following criteria:

    a) The Purchaser shall be independent of and unconnected to the Notifying Party and its Affiliated Undertakings (this being assessed  having
       regard to the situation following the divestiture).

    b) The Purchaser shall have the financial resources, proven expertise and incentive to maintain and develop the  Divestment  Business  as  a
       viable and active competitive force in competition with the Notifying Party and other competitors;

    c) The acquisition of the Divestment Business by the Purchaser must neither be likely to create, in light of the  information  available  to
       the Commission, prima facie competition concerns nor give rise to a risk that the implementation of the Commitments will be delayed.   In
       particular, the Purchaser must reasonably be expected to obtain all necessary approvals from the relevant regulatory authorities for  the
       acquisition of the Divestment Business; and

    d) The Purchaser shall be active either in relation to the into-plane supply of aviation fuel or in related markets in the EEA or elsewhere.

18. The final binding sale and purchase agreement (as well as ancillary agreements) relating to the divestment of the Divestment  Business  shall
    be conditional on the Commission’s approval.  When BP has reached an agreement with a purchaser, it  shall  submit  a  fully  documented  and
    reasoned proposal, including a copy of the final agreement(s), within one week to the Commission and the Monitoring Trustee. BP must be  able
    to demonstrate to the Commission that the purchaser fulfils the Purchaser Criteria and that the Divestment Business is being sold in a manner
    consistent with the Commission's Decision and the Commitments.    For the approval, the Commission shall verify that  the  purchaser  fulfils
    the Purchaser Criteria and that the Divestment Business is being sold in a manner consistent with the Commitments including  their  objective
    to bring about a lasting structural change in the market. The Commission may approve the sale of the Divestment Business without one or  more
    Assets or parts of the Personnel, or by substituting one or more Assets or parts of the Personnel  with  one  or  more  different  assets  or
    different personnel, or in two separate parts to two different purchasers, if this does not affect the viability and competitiveness  of  the
    Divestment Business after the sale, taking account of the proposed purchaser(s).

Section E. Trustee

 I.   Appointment procedure

19. BP shall appoint a Monitoring Trustee to carry out the functions specified in these Commitments for  a  Monitoring  Trustee.   The  Notifying
    Party commits not to close the Concentration before the appointment of a Monitoring Trustee.

20. If BP has not entered into a binding sale and purchase agreement regarding the Divestment Business one month before  the  end  of  the  First
    Divestiture Period or if the Commission has rejected a purchaser proposed by BP at that time or thereafter, BP shall  appoint  a  Divestiture
    Trustee.  The appointment of the Divestiture Trustee shall take effect upon the commencement of the Trustee Divestiture Period.

21. The Trustee shall:

    a) at the time of appointment, be independent of the Notifying Party and its Affiliated Undertakings;

    b) possess the necessary qualifications to carry out its mandate, for example have sufficient relevant experience as an investment  bank  or
       consultant or auditor; and

    c) neither have nor become exposed to a Conflict of Interest.

22. The Trustee shall be remunerated by the Notifying Party in a way that does not  impede  the  independent  and  effective  fulfilment  of  its
    mandate. In particular, where the remuneration package of a Divestiture Trustee includes a success premium linked to the final sale value  of
    the Divestment Business, such success premium may only be earned if the divestiture takes place within the Trustee Divestiture Period.

   Proposal by BP

23. No later than two weeks after the Effective Date, BP shall submit the name or names of one or more natural or legal persons whom BP  proposes
    to appoint as the Monitoring Trustee to the Commission for approval.  No later than one month before the end of the First Divestiture  Period
    or on request by the Commission, BP shall submit a list of one or more persons whom BP proposes to appoint  as  Divestiture  Trustee  to  the
    Commission for approval. The proposal shall contain sufficient information for the Commission to verify that the person or  persons  proposed
    as Trustee fulfils the requirements set out in paragraph 21 and shall include:

    a) the full terms of the proposed mandate, which shall include all provisions necessary to enable the Trustee to  fulfil  its  duties  under
       these Commitments;

    b) the outline of a work plan which describes how the Trustee intends to carry out its assigned tasks;

    c) an indication whether the proposed Trustee is to act as both Monitoring Trustee and Divestiture Trustee or whether different trustees are
       proposed for the two functions.

  Approval or rejection by the Commission

24. The Commission shall have the discretion to approve or reject the proposed Trustee(s) and to approve the  proposed  mandate  subject  to  any
    modifications it deems necessary for the Trustee to fulfil its obligations.  If only one name is approved, BP shall appoint or  cause  to  be
    appointed the person or persons concerned as Trustee, in accordance with the mandate approved by the Commission. If more  than  one  name  is
    approved, BP shall be free to choose the Trustee to be appointed from among the names approved.  The Trustee shall be  appointed  within  one
    week of the Commission’s approval, in accordance with the mandate approved by the Commission.

   New proposal by BP

25. If all the proposed Trustees are rejected, BP shall submit the names of at least two more natural or legal persons within one week  of  being
    informed of the rejection, in accordance with paragraphs 19 and 24 of these Commitments.

   Trustee nominated by the Commission

26. If all further proposed Trustees are rejected by the Commission, the Commission shall nominate a Trustee, whom BP shall appoint, or cause  to
    be appointed, in accordance with a trustee mandate approved by the Commission.

 II.  Functions of the Trustee

27. The Trustee shall assume its specified duties and obligations in order to ensure compliance with the Commitments.   The  Commission  may,  on
    its own initiative or at the request of the Trustee or BP, give any orders or instructions to the Trustee in order to ensure compliance  with
    the conditions and obligations attached to the Decision.

  Duties and obligations of the Monitoring Trustee

28. The Monitoring Trustee shall:

    a) propose in its first report to the Commission a detailed work plan describing how it intends to monitor compliance with  the  obligations
       and conditions attached to the Decision;

    b) oversee, in close co-operation with the Hold Separate Manager, the on-going management of the Divestment Business with a view to ensuring
       its continued economic viability, marketability and competitiveness and monitor compliance by BP  with  the  conditions  and  obligations
       attached to the Decision. To that end the Monitoring Trustee shall:

        i) monitor the preservation of the economic viability, marketability and competitiveness of the Divestment  Business,  and  the  keeping
           separate of the Divestment Business from the business retained by BP, in accordance with paragraphs 8 and 9 of these Commitments;

       ii) supervise the management of the Divestment Business as a distinct and saleable entity, in  accordance  with  paragraph  10  of  these
           Commitments;

      iii)  with respect to Confidential Information:

            - determine all necessary measures to ensure that BP does not after the Effective Date obtain any Confidential Information  relating
              to the Divestment Business,

            - in particular strive for the severing of the Divestment Business’ participation in a central information technology network to the
              extent possible, without compromising the viability of the Divestment Business,

            - make sure that any Confidential Information relating to the Divestment Business obtained  by  BP  before  the  Effective  Date  is
              eliminated and will not be used by BP; and

            - decide whether such information may be disclosed to or kept by BP as the disclosure is reasonably necessary to allow BP  to  carry
              out the divestiture or as the disclosure is required by law;

       iv) monitor the splitting of assets and the allocation of Personnel between the Divestment Business and BP or Affiliated Undertakings;

    c) propose to BP such measures as the Monitoring Trustee considers necessary to ensure BP’s compliance with the conditions  and  obligations
       attached to the Decision, in particular the maintenance  of  the  full  economic  viability,  marketability  or  competitiveness  of  the
       Divestment Business, the holding separate of the Divestment Business and the non-disclosure of competitively sensitive information;

    d) review and assess potential purchasers as well as the progress of the divestiture process and verify that, dependent on the stage of  the
       divestiture process:

              i) potential purchasers receive sufficient and correct information relating  to  the  Divestment  Business  and  the  Personnel  in
                 particular by reviewing, if available, the data room documentation, the information memorandum and the  due  diligence  process,
                 and

             ii) potential purchasers are granted reasonable access to the Personnel;

    e) act as a contact point for any requests by third parties, in particular potential purchasers, in relation to the Commitments;

    f)    provide to the Commission, sending BP a non-confidential copy at the same time, a written report within 15 days after the end of every
       month that shall cover the operation and management of the Divestment Business as well as the splitting of assets and the  allocation  of
       Personnel so that the Commission can assess whether the business is held in a manner consistent with the Commitments and the progress  of
       the divestiture process as well as potential purchasers;

    g) promptly report in writing to the Commission, sending BP a non-confidential copy at the same time, if it concludes on reasonable  grounds
       that BP is failing to comply with these Commitments;

    h) within one week after receipt of the documented proposal referred to in paragraph 18 of these  Commitments,  submit  to  the  Commission,
       sending BP a non-confidential copy at the same time, a reasoned opinion as to the suitability and independence of the proposed  purchaser
       and the viability of the Divestment Business after the Sale and as to whether the Divestment Business is sold in a manner consistent with
       the conditions and obligations attached to the Decision, in particular, if relevant, whether the Sale of the Divestment Business  without
       one or more Assets or not all of the Personnel affects the viability of the Divestment Business after the sale,  taking  account  of  the
       proposed purchaser;

    i)    assume the other functions assigned to the Monitoring Trustee under the conditions and obligations attached to the Decision.

29. If the Monitoring and Divestiture Trustee are not the same legal or natural persons, the  Monitoring  Trustee  and  the  Divestiture  Trustee
    shall cooperate closely with each other during and for the purpose of  the  preparation  of  the  Trustee  Divestiture  Period  in  order  to
    facilitate each other's tasks.

   Duties and obligations of the Divestiture Trustee

30. Within the Trustee Divestiture Period, the Divestiture Trustee shall sell at no  minimum  price  the  Divestment  Business  to  a  Purchaser,
    provided that the Commission has approved both the Purchaser and the final binding sale and purchase agreement (and ancillary agreements)  as
    in line with the Commission’s Decision and the Commitments in accordance with paragraphs 17 and 18 of  these  Commitments.   The  Divestiture
    Trustee shall include in the sale and purchase agreement (as well as in any ancillary agreements) such terms and conditions as  it  considers
    appropriate for an expedient sale in the Trustee Divestiture Period. In particular, the Divestiture Trustee  may  include  in  the  sale  and
    purchase agreement such customary representations and warranties and  indemnities  as  are  reasonably  required  to  effect  the  sale.  The
    Divestiture Trustee shall protect the legitimate financial interests of BP, subject to the  Notifying  Party’s  unconditional  obligation  to
    divest at no minimum price in the Trustee Divestiture Period.

31. In the Trustee Divestiture Period (or otherwise at the Commission’s request), the Divestiture Trustee shall provide  the  Commission  with  a
    comprehensive monthly report written in English on the progress of the divestiture process. Such reports shall be submitted  within  15  days
    after the end of every month with a simultaneous copy to the Monitoring Trustee and a non-confidential copy to the Notifying Party.

  III.      Duties and obligations of the Notifying Party

32. BP shall provide and shall cause its advisors to provide the Trustee with all such co-operation, assistance and information  as  the  Trustee
    may reasonably require to perform its tasks.  The Trustee shall have full and complete access to any of  BP’s  or  the  Divestment  Business’
    books, records, documents, management or other personnel, facilities, sites and technical information necessary  for  fulfilling  its  duties
    under the Commitments and BP and the Divestment Business shall provide the Trustee upon request with copies of  any  document.   BP  and  the
    Divestment Business shall make available to the Trustee one or more offices on their premises and shall be available for meetings in order to
    provide the Trustee with all information necessary for the performance of its tasks.

33. BP shall provide the Monitoring Trustee with all managerial and administrative support that it  may  reasonably  request  on  behalf  of  the
    management of the Divestment Business. This shall include all administrative support functions relating to the Divestment Business which  are
    currently carried out at headquarters level.  BP shall provide and shall cause its advisors to provide the Monitoring  Trustee,  on  request,
    with the information submitted to potential purchasers, in particular give the Monitoring Trustee access to the data room  documentation  and
    all other information granted to potential purchasers in the due diligence procedure. BP shall inform  the  Monitoring  Trustee  on  possible
    purchasers, submit lists of potential purchasers at each stage of the selection process, including the offers made by potential purchasers at
    those stages, and keep the Monitoring Trustee informed of all developments in the divestiture process.

34. BP shall grant or procure Affiliated Undertakings to grant comprehensive powers of attorney, duly executed, to  the  Divestiture  Trustee  to
    effect the sale (including ancillary agreements), the Closing and all actions  and  declarations  which  the  Divestiture  Trustee  considers
    necessary or appropriate to achieve the sale and the Closing, including the appointment of advisors to assist with  the  sale  process.  Upon
    request of the Divestiture Trustee, BP shall cause the documents required for effecting the sale and the Closing to be duly executed.

35. BP shall indemnify the Trustee and its employees and agents (each an “Indemnified Party”) and hold each Indemnified Party  harmless  against,
    and hereby agrees that an Indemnified Party shall have no liability to BP for,  any  liabilities  arising  out  of  the  performance  of  the
    Trustee’s duties under the Commitments, except to the extent that such liabilities  result  from  the  wilful  default,  recklessness,  gross
    negligence or bad faith of the Trustee, its employees, agents or advisors.

36. At the expense of BP, the Trustee may appoint advisors (in particular for corporate finance or legal advice), subject to BP’s approval  (this
    approval not to be unreasonably withheld or delayed) if the Trustee considers the appointment of such advisors necessary or  appropriate  for
    the performance of its duties and obligations under the Mandate, provided that any fees and  other  expenses  incurred  by  the  Trustee  are
    reasonable.  Should BP refuse to approve the advisors proposed by the Trustee the Commission may approve the  appointment  of  such  advisors
    instead, after having heard BP. Only the Trustee shall be entitled to issue instructions to the advisors.  Paragraph 35 of these  Commitments
    shall apply mutatis mutandis. In the Trustee Divestiture Period,  the  Divestiture  Trustee  may  use  advisors  who  served  BP  during  the
    Divestiture Period if the Divestiture Trustee considers this in the best interest of an expedient sale.

37. BP agrees that the Commission may share Confidential Information proprietary to BP with the Trustee. The  Trustee  shall  not  disclose  such
    information and the principles contained in Article 17 (1) and (2) of the Merger Regulation apply mutatis mutandis.

38. The Notifying Party agrees that the contact details of the Monitoring Trustee are published on the website of the  Commission's  Directorate-
    General for Competition and they shall inform interested third parties, in particular any potential purchasers, of the identity and the tasks
    of the Monitoring Trustee.

39. For a period of 10 years from the Effective Date the Commission may request all information from the Parties that is reasonably necessary  to
    monitor the effective implementation of these Commitments.

 IV.  Replacement, discharge and reappointment of the Trustee

40. If the Trustee ceases to perform its functions under the Commitments or for any other good cause, including the exposure of the Trustee to  a
    Conflict of Interest:

    a) the Commission may, after hearing the Trustee and BP, require BP to replace the Trustee; or

    b) BP may, with the prior approval of the Commission, replace the Trustee.

41. If the Trustee is removed according to paragraph 40 of these Commitments, the Trustee may be required to continue in  its  function  until  a
    new Trustee is in place to whom the Trustee has effected a full hand over of all relevant information. The new Trustee shall be appointed  in
    accordance with the procedure referred to in paragraphs 19 to 26 of these Commitments.

42. Unless removed according to paragraph 40 of these Commitments, the Trustee shall cease to act  as  Trustee  only  after  the  Commission  has
    discharged it from its duties after all the Commitments with which the Trustee  has  been  entrusted  have  been  implemented.  However,  the
    Commission may at any time require the reappointment of the Monitoring Trustee if it subsequently appears that the  relevant  remedies  might
    not have been fully and properly implemented.

 Section F. The review clause

43. The Commission may extend the time periods foreseen in the Commitments in response to a request from BP or, in appropriate cases, on its  own
    initiative.  Where BP requests an extension of a time period, it shall submit a reasoned request to the Commission no later  than  one  month
    before the expiry of that period, showing good cause.  This request shall be accompanied by a report from the Monitoring Trustee, who  shall,
    at the same time send a non-confidential copy of the report to the Notifying Party. Only in exceptional circumstances shall BP be entitled to
    request an extension within the last month of any period.

44. The Commission may further, in response to a reasoned request from the Notifying Party showing good cause waive,  modify  or  substitute,  in
    exceptional circumstances, one or more of the undertakings in these Commitments. This request shall be  accompanied  by  a  report  from  the
    Monitoring Trustee, who shall, at the same time send a non-confidential copy of the report to the Notifying Party. The request shall not have
    the effect of suspending the application of the undertaking and, in particular, of suspending the expiry of any  time  period  in  which  the
    undertaking has to be complied with.

Section G. Entry into force

45. The Commitments shall take effect upon the date of adoption of the Decision.

      [Signed]
     ……………………………………
     duly authorised for and on behalf of BP plc
                                                                     SCHEDULE

PART I – DESCRIPTION OF THE DIVESTMENT BUSINESS

1. The Divestment Business as operated to date has the following legal and functional structure:

The Divestment Business as operated to date has not consisted of any separate legal entities, but rather the activities of the SFRA legal  entity
in relation to into-plane supply of jet fuel at the Relevant Airports as well as  the  supply  of  avgas  at  Malmö.   As  described  above,  the
principal elements comprising the Divestment Business and which to date have allowed SFRA to operate and compete at the Relevant Airports are  as
follows:

    • SFRA shareholdings in the Relevant Infrastructure JVs that operate at the Relevant Airports providing storage, transportation, and/or into-
      plane refuelling services.  These shareholdings provide SFRA with the right for its fuel to pass through the on-airfield infrastructure for
      supply to its customers at the Relevant Airports;
    • rights and obligations under commercial aviation airline customer contracts under which SFRA supplies fuel to airline customers at airports
      including, but not limited to the Relevant Airports;
    • concession and other related agreements entered into with  relevant  airport  authorities  and  permits  issued  by  relevant  governmental
      organisations or airport authorities which entitle SFRA to operate at the Relevant Airports;
    • the personnel required to market and sell fuel to commercial aviation airline customers at the Relevant Airports, as well as being involved
      with scheduling and liaising with the Relevant Infrastructure JVs (although such personnel have  not  been  dedicated  exclusively  to  the
      Relevant Airports); and
    • pre-airfield supply and delivery of jet fuel for each of the Relevant Airports delivered at the point  the  fuel  leaves  the  off-airfield
      storage terminal (i.e. into-rail, into-pipe or into-truck) pursuant to an agreement with […]; and
    • pre-airfield supply and delivery of avgas for Malmö.

The Divestment Business offered under these Commitments comprises all the elements above in so far as they relate to the  Relevant  Airports,  or
equivalent elements as BP is able to provide post-completion of its acquisition of SFRA, as discussed further below.

2. In accordance with paragraph 6 of these Commitments, the Divestment Business includes, but is not limited to:

(a) the following main tangible assets:

The main tangible assets included in the Divestment Business are the SFRA shareholdings in the Relevant Infrastructure JVs operating at  each  of
the Relevant Airports which provide jet fuel storage, transportation, and/or into-plane refuelling services.  These joint ventures  are  co-owned
by into-plane fuel suppliers at the Relevant Airports.  The Divestment Business will include all SFRA shareholdings  (or  equivalent  numbers  of
shares) in the Relevant Infrastructure JVs listed below which operate at the Relevant Airports.  These shareholdings will provide  the  Purchaser
with access to, and the rights and obligations in, the Relevant Infrastructure JVs equivalent to those currently enjoyed by SFRA.

Specifically, the Divestment Business includes the following:

Copenhagen:
        i) the transfer of SFRA’s entire ([…]%) JV share in BKL (which  relates  to  the  joint  storage  and  hydrant  airport  facilities  and
           equipment);
       ii) the transfer of SFRA’s entire ([…]%) JV share in SST (which relates to the joint into-plane services);

Stockholm:
        i) the transfer of SFRA’s entire ([…]%) JV share in AFAB (which relates  to  the  joint  storage  and  hydrant  airport  facilities  and
           equipments);
       ii) the transfer of SFRA’s entire ([…]%) JV share in SFS (which relates to the joint into-plane services);

Gothenburg:
        i) the transfer of SFRA’s entire ([…]%) JV share in GFC (which relates to both the joint storage facilities  and  into-plane  services);
           and

Malmö:
        i) the transfer of SFRA’s entire ([…]%) JV share in MFS (which relates to both the joint storage facilities and into-plane services).

On-Airfield Fuel Stocks:

At Closing, a certain volume of fuel stocks may be located in the on-airfield storage facilities at each of the Relevant Airports to  fulfil  the
upcoming obligations of the Divestment Business to its airline customers (“On-Airfield Fuel Stocks”).  BP will  offer  to  sell  the  On-Airfield
Fuel Stocks to the Purchaser with the Divestment Business on market terms to be calculated at Closing.

(b) the following main intangible assets:

The Divestment Business includes no brand names, intellectual property rights or other intangible assets.

(c) the following main licences, permits and authorisations:

The Divestment Business includes:

         i)      in respect of each of the Relevant Airports: a Concession Agreement  with  the  relevant  airport  authority  or  authorisation
            allowing SFRA to operate at the Relevant Airports.  BP commits to notify the airport authority of the  transfer  of  the  Divestment
            Business to a Purchaser and to use its best endeavours to (i) procure the consent of the airport authority for the assignment of any
            Concession Agreement to a Purchaser; or (ii) assist a Purchaser in entering a new Concession  Agreements  or  seeking  authorisation
            from the airport authorities;

             ii)   in addition, in respect of Stockholm:
              A. An AFAB User Agreement.  The User Agreement is a standard term contract between the AFAB and each shareholder  or  user  of  the
                 joint venture.  Therefore, a Purchaser will be entitled to such an agreement – either by way of transfer of  the  existing  SFRA
                 User Agreement or a new agreement between a Purchaser and AFAB on equivalent terms.

              B. An AFAB Operating Agreement between AFAB, the airport authority and the shareholders in  AFAB.   BP  commits  to  use  its  best
                 endeavours to procure the consent of the airport authority for the transfer of the rights and obligations  under  the  Operating
                 Agreement to a Purchaser, which will not be unreasonably withheld, and to obtain the signatures of the other shareholder to  the
                 amendment.

 Finally, a Purchaser will require customer bonded warehouse licences (or permits) for the airport storage from local tax authorities in  Denmark
 and Sweden, which will permit a Purchaser to hold fuel stock without incurring VAT and duties as well as for storage and transport security.   A
 Purchaser will need to make such applications in its own right in relation to these permits as these must be linked to the relevant legal entity
 and cannot be transferred.  However, this is a relatively straightforward process.

 To the best of BP’s knowledge, a Purchaser would not need any further material licences or authorisations to operate at the Relevant Airports.

(d) the following main contracts, agreements, leases, commitments and understandings:

The Divestment Business includes all rights and obligations in so far as they relate to  the  Relevant  Airports  under  the  current  commercial
aviation airline contracts pursuant to which SFRA supplies jet fuel, which BP will use its  best  endeavours  to  ensure  are  transferred  to  a
Purchaser.  The relevant commercial aviation airline contracts in this respect are set out in Annex 1 to this Schedule.  The Divestment  Business
will also include all pre-payments made prior to Closing under the relevant commercial aviation airline contracts  in  relation  to  fuel  to  be
delivered to the Relevant Airports after Closing, but will exclude all receivables owing which relate to deliveries made prior to Closing to  the
Relevant Airports under the relevant commercial aviation airline contracts.

(e) the following customer, credit and other records:

The Divestment Business will include provision to the Purchaser of all relevant historical data from SFRA’s systems  which  is  available  to  BP
relating to SFRA’s customers, credit and other records.

(f) the following Personnel:

SFRA does not have any personnel dedicated exclusively to its operations at the Relevant Airports, and no personnel  physically  located  at  any
Relevant Airport.  The overall headcount of SFRA is […], covering the […] airports being acquired by BP, but there are only […].   The  […]  SFRA
personnel are […].  At the Relevant Airports, all relevant personnel involved in  operational  aspects  of  on-airfield  storage  and  into-plane
supply of aviation fuel at the Relevant Airports are employed by the Relevant Infrastructure JVs.  There is therefore no need for  the  Purchaser
to have any personnel located at the Relevant Airports, and a very small  number  of  personnel  supporting  the  commercial  operations  at  the
Relevant Airports.  Indeed, to the extent a Purchaser already has its own internal sales and marketing and back office  personnel,  it  may  well
not need further personnel to support the Divestment Business.

In this context, the Divestment Business will include the transfer of a limited number  of  SFRA  personnel  (the  Key  Personnel,  as  described
further below) required to ensure the viability and competitiveness of the Divestment Business at the  Relevant  Airports,  subject  to  employee
consent and legal compliance with local employment laws.  There are no  Personnel  included  in  the  Divestment  Business  other  than  the  Key
Personnel.

(g)  the following Key Personnel:

The Divestment Business will include four Key Personnel: (i) a Sales and Marketing Manager who will also act as the Hold Separate  Manager;  (ii)
a JV Liaison and Stock Controller; (iii) a Sales Assistant; and (iv) an Invoicing Assistant:

        i) […] has been identified as the Sales and Marketing Manager and Hold Separate Manager  for  the  Divestment  Business.   As  described
           above, the Sales and Marketing Manager will have overall responsibility for managing the Divestment Business, with  particular  focus
           on sales and marketing.[127]

       ii) […] has been identified as the JV Liaison and Stock Controller. […];

      iii) […] has been identified as the Sales Assistant. […]; and

       iv) […] has been identified as the Invoicing Assistant. […].

The transfer of the Key Personnel into the Divestment Business and the subsequent transfer of the Key Personnel to the Purchaser at the point  of
divestment of the Divestment Business is subject to relevant employee consent and legal compliance with local labour laws.

The Hold Separate Manager will liaise with a ring-fenced BP employee, who will be unconnected with the Air BP Regional Performance  Unit  (NCEPU)
in Scandinavia, in order for BP to ensure that the operations of the Divestment Business until Closing allow BP to meet its obligation under  the
Commitments as well as relevant laws, regulations and BP plc group policies.

(h) the arrangements for supply

There is no barrier to a Purchaser independently purchasing either jet fuel or avgas pre-airfield and transporting it to  the  Relevant  Airports
further to its own arrangements with relevant third parties.  Nonetheless, the Divestment Business includes pre-airfield supply of  jet  fuel  to
each of the Relevant Airports and avgas to Malmö for a period of 12 months from Closing to allow the  Purchaser  time  to  make  its  own  direct
arrangements.  This is described further below.

Pre-airfield supply of jet fuel
To provide interim supply to the Purchaser following Closing, the Divestment Business will include pre-airfield supply and delivery of  jet  fuel
for the Relevant Airports on back-to-back terms to those available to SFRA under the […] Supply Agreements.[128]  The […] Supply  Agreements  are
effective for a period of 12 months from the completion of the Concentration, the main terms are described further in Part II of  this  Schedule.
 BP will extend the period of supply available to the Purchaser, on terms which replicate as  far  as  possible  the  terms  of  the  […]  Supply
Agreements, to a date 12 months from Closing (the “Extended Supply Arrangements”).  Pricing of the supply from  BP  to  the  Purchaser  for  such
period shall not exceed the costs incurred by BP in relation to purchase, storage and delivery of the product and any related compulsory  storage
services provided thereunder.

In relation to the Relevant Airports, the […] Supply Agreements provide that jet fuel will be delivered, and legal title transferred, at a  point
after the fuel exits the relevant off-airfield storage terminal.  BP will maintain this position in transferring SFRA’s  rights  and  obligations
under the […] Supply Agreements and the Extended Supply Arrangements, such that the Purchaser will take delivery  and  legal  title  at  a  point
after the fuel exits off-airfield storage linked to each Relevant Airport.[129]

The […] Supply Agreements contain provisions under which SFRA is  able  to  meet  its  Compulsory  Storage  Obligations  (“CSO”)  under  relevant
legislation through […].  These rights and obligations will be transferred to the Purchaser on back-to-back terms for the  duration  of  the  […]
Supply Agreements and equivalent rights and obligations offered under the Extended Supply  Arrangements,  allowing  the  Purchaser  to  meet  the
existing CSO obligations relating to the Divestment Business in respect of the volumes sold at the Relevant Airports.

Pre-airfield supply of avgas for Malmö

In relation to Malmö, the Divestment Business will include pre-airfield supply and delivery  of  avgas  for  such  volume  as  requested  by  the
Purchaser for an interim period of 12 months from Closing.  The avgas will be delivered, and legal title transferred,  at  the  point  the  avgas
enters the relevant on-airfield storage at Malmö airport.  Pricing of the supply from BP to the Purchaser for such period shall  not  exceed  the
costs incurred by BP in relation to purchase, storage and delivery of the product.  There are no CSO requirements in relation to avgas.

3   The Divestment Business shall not include:

     i) the sale of BP’s joint venture shares in any of the infrastructure joint ventures at Copenhagen, Stockholm, Gothenburg and Malmö –  i.e.
        BP’s […]% share in BKL; BP’s […]% share in DRS; BP’s […]% share in AFAB; BP’s […]% share in AFCO; and BP’s […]% shares in GFC and MFS;

    ii) BP’s existing customer contracts at each of Copenhagen, Stockholm, Gothenburg and Malmö;

   iii) SFRA’s customer contracts other than the current commercial aviation airline contracts pursuant to which SFRA supplies jet fuel  to  the
        Relevant Airports as detailed in Annex 1;

    iv) either of the Parties’ existing operations in the supply of jet fuel and avgas that are not connected to the Relevant Airports;

     v) any obligation on BP to provide pre-airfield fuel supply to the Purchaser under the […] Supply Agreements, or under the Extended  Supply
        Arrangements, on terms which are preferential to the terms available to SFRA under the […] Supply Agreements;

    vi) any obligation on BP to sell On-Airfield Fuel Stocks to the Purchaser on Closing at a price below market rates at that date;

   vii) any receivables (i.e. monies owed) by SFRA customers relating to fuel provided under the customer contracts prior to Closing;

  viii) any obligation on BP to provide the Purchaser with access to BP’s off-airfield fuel storage capacity;

    ix) either of the Parties’ existing activities in the supply of fuel (other than jet  fuel),  including  the  supply  of  aviation  gasoline
        (avgas);

     x) the transfer of any of BP personnel, or of any SFRA’s personnel apart from those reasonably required to support the Divestment  Business
        and described under Personnel and Key Personnel above;

    xi) any office locations, office infrastructure or IT systems currently owned or used by SFRA.  The Purchaser will be entitled  to  use  the
        centralised IT system in so far as it is necessary to ensure the viability of the Divestment Business for a transitional period[130]  on
        a back-to-back terms to the Transitional Services Agreement entered into between BP and the Seller; and

   xii) the transfer of customer bonded warehouse licences (or permits) for the airport storage from local tax authorities in Denmark and Sweden
        permitting a Purchaser to hold fuel stock without incurring VAT and duties as well as for storage and transport security.   A  Purchaser
        will need to make such applications in its own right in relation to these permits.

4.    Assets or personnel not covered by paragraph 2

If there is any asset or personnel which is not be covered by paragraph 2 of this Schedule but which is both used (exclusively  or  not)  in  the
Divestment Business and necessary for the continued viability and competitiveness of the Divestment Business, that asset or  adequate  substitute
will be offered to potential purchasers.

PART II

Summary of key terms of […] Supply Agreements

There are two […] Supply Agreements entered into between […] and SFRA: one covers locations in Sweden and the other covers locations  in  Denmark
(in both cases including but not limited to the Relevant Airports  as  appropriate).   The  terms  and  conditions  of  the  two  agreements  are
materially the same and are summarised below.

The […] Supply Agreements have a term of 12 months from the date of completion of the Concentration.

The total quantity of fuel to be delivered for each Relevant Airport is set out in Appendix 1 of each of  the  […]  Supply  Agreements  ([…]  for
Copenhagen, […] for Stockholm, […] for Gothenburg and […] for Malmö).  The price per metric ton of the product delivered at each location is  set
out in Appendix 2 of each Agreement.

The Agreements include an operational flexibility of […] in relation to the total annual volume.  If SFRA wishes to acquire more than the  agreed
volume, this will be subject to […]’s agreement, which shall not be unreasonably withheld.  SFRA shall no later than  on  the  last  working  day
prior to the start of the applicable pricing period nominate a monthly lifting and pricing quantity of jet fuel.  On day 20 of  the  month  prior
to the month of delivery (“month M-1”), SFRA will have an option to update the quantity with pricing balance of the month of Delivery.

SFRA shall nominate a monthly plan for delivery per location, no later than day 15 of the month M-1, as well as a  tentative  delivery  plan  for
the two months thereafter.

The title to the fuel transfers from […] to SFRA at the point when the  fuel  exits  the  off-airfield  storage  terminal  –  i.e.  into-pipe  at
Prøvestenen import terminal for supply to Copenhagen, into-rail trucks at Gävle import terminal for supply to Stockholm, and  into-truck  at  the
import terminals at Gothenburg and Malmö for supply to those airports.[131]

The […] Supply Agreements provide that […] shall, upon SFRA’s request, hold a given quantity of jet fuel for an agreed period of time  at  agreed
locations for the purposes of fulfilling SFRA’s CSO requirements.  The […] Supply Agreements include a price for the CSO tickets in Q1  2014  and
state that the price will be revised on a quarterly basis.

                                                                     ANNEX 1

                            SFRA 2014 / 2015 contracts for the into-plane supply of jet fuel at the Relevant Airports

                                                                       […]

                                                        Annex 2 to the Commission Decision

                                               The Notifying Party's margin-concentration analysis

 (1)  The Notifying Party submitted an econometric analysis to show that the margin earned at an airport does not depend on the number  of  firms
     present. They claim that the relevant markets can be characterised as bidding markets with homogeneous products, as well as low barriers to
     switching and expansion – implying that two competitors are sufficient to achieve a competitive outcome. Therefore,  excluding  monopolies,
     any other change in the number of firms – as a result of past entries or exits – should not
     affect prices.
     [132] They conclude that since the merger will not result in there being fewer than two competitors at any airport, it will have  no  price
     increasing effect.

 (2)  Two separate data sets were used for the analysis: one from BP and the other from SFRA. BP's data covers 47 airports between  January  2010
     and June 2014. It contains monthly observations, for each airport, of the average margin that BP made and  the  number  of  firms  that  BP
     estimates were competing in tenders.[133] SFRA's data is similar but smaller: it covers 18 airports from 2011  to  2013.  Observations  are
     quarterly,
     because the monthly margin may be mismeasured as a result of cost allocation practices. The Parties use regression  analysis  –  separately
     for each data set – to test the significance of the effect that the number of firms has on the firm's margin.

 (3)  The Parties submitted two  types  of regression  analysis:  cross-sectional  and  fixed effects. The cross-sectional analysis assumes  that
     the variables included in the regression adequately explain the differences (or heterogeneity)  between  airports,  so  that  a  comparison
     between the number of firms and the margin can be made between different airports. The fixed effects analysis assumes there are  unobserved
     differences between airports (variables not included in the regression) and controls for them by including dummy variables (i.e:  constants
     that only change between airports but not over time). However, in so doing this model restricts the analysis to the effects  of  entry  and
     exit of firms within an airport.

 (4)  Both sets of analysis found no evidence of a relationship. The Parties checked the robustness of their results with a number of alterations
     – using dummy variables for the number of firms in the case of the cross-sectional analysis (as opposed to assuming a  linear  relationship
     between the number of firms and margins), using the moving average of the  number  of  firms  and  using  the  absolute,  rather  than  the
     percentage, margin. The Parties take the view that their results are robust to these sensitivities.

     Commission Assessment

 (5)  The Commission considers that the above described analysis is not sufficient evidence that the merger will not harm competition. There  are
     a number of shortcomings with the methodology, the data, the interpretation and the robustness of the results which imply that the analysis
     cannot be considered conclusive.[134]

 (6)  To begin with, the result of this study, which does not find a significant relationship between the number of firms and  the  margin,  does
     not necessarily lead to the conclusion that such a relationship does not exist. This is due to a number  of  shortcomings  in  the  general
     methodology of the submission that the Commission has identified. In general, price- and margin-concentration  studies  suffer  from  well-
     known endogeneity problems: both the number of bidders for a given contract and the profitability of the contract can depend on  unobserved
     supply and demand factors. Endogeneity will cause the results of the regression to be biased and,  therefore,  unreliable.  The  Commission
     also takes the view that it is generally difficult to predict the effect of a future merger by examining the effect of a  small  number  of
     past entries and exits of different firms, on different markets and in different time periods.

 (7)  The cross-sectional analysis does not account for unobserved differences  between  airports  that  may  affect  the  margin.  For  example,
     differences in the supply chain of BP and of its competitors, in the level of barriers to entry  and  in  the  customer  mix[135]  may  all
     explain why margins differ across airports. To account for these unobserved factors that  vary  across  airports,  the  parties  include  a
     measure of the level of demand at each airport. According to the Parties, the level of demand  is  correlated  with  the  margin.  This  is
     because (1) the margin measure used is calculated as revenues minus cost of goods sold, i.e. pre-airfield and  on-airfield  variable  costs
     are not subtracted; and (2) these pre-airfield and on-airfield variable costs are typically lower at larger airports (with  higher  demand)
     because these are generally supplied by pipeline and use on airfield hydrants, rather than transporting the fuel to the airport by road and
     using bowser vehicles to transport the fuel from the on-airfield storage to the aircraft. However,  by  itself  this  additional   variable
     does  not  account  for  all  unobserved
     heterogeneity. Moreover, the demand variable introduced by the parties is highly correlated with the number of firms,  as  larger  airports
     tend to have more firms. This will  cause  the  results  of  the  regression  analysis  to  be   less   precise,   meaning   a  significant
     effect is less likely to be found.[136] Furthermore, it makes it unclear what conclusion to draw from the value of the coefficient  on  the
     number-of-firm variables. Since airports with higher levels of demand are likely to have more firms – so  more  competition  –  the  demand
     variable, when included in the regression, may pick up some of the effect that competition has on the margin.  This  would  mean  that  the
     coefficients on the number-of-firms variables are biased and might under-estimate the effect of competition on the margin.  The  Commission
     found that a number of specifications indicate a negative relationship between the number of firms and the margin, once the demand variable
     is removed from the regression.[137]
 (8)  The fixed effects analysis may in principle provide a solution to the problem of unobserved heterogeneity between airports, as it relies on
     changes in the number of firms at airports over time.[138]  However, in their fixed effects analysis, the Parties only estimated  a  linear
     relationship between the number of firms and margins. This means that the effect on the margin of reducing the number of  competitors  from
     three to two
     was assumed to be identical to the effect of reducing this number from eight to seven. The Commission does not consider this approach to be
     theoretically sound. The Commission also demonstrated empirically that this is an incorrect assumption, as it found the  coefficients  that
     measure the effect on the margin of a third entrant to be different from the effect of  a  fourth  entrant  or  a  fifth  in  a  number  of
     specifications. Moreover,  the  data  set  submitted  by the  Notifying  Party does  not  contain  many changes that are  relevant  to  the
     proposed transaction.[139] The Commission takes the view that strong conclusions on the effect of a reduction in the number of  competitors
     from three to two and from four to three cannot be drawn from so few observations.

 (9)  Secondly, the Commission considers that possible measurement errors in the data may have further decreased the precision of the  estimates.
     The first measurement problem is related to the main variable of interest, i.e. the number of suppliers.  This  variable  is  supposed   to
     measure  the  number  of  suppliers  that  are  participating  in  tenders. However, the results of the market test have shown that not all
     suppliers present at an airport participate in all tenders. At an equal "number of suppliers", this variable is therefore likely to measure
     very different competitive forces both from one airport to another and over time. The second measurement problem concerns the timing of the
     effect of changes in the market structure. Contracts are typically, but not always, for a year. The price  is  set  when  the  contract  is
     tendered, which is therefore the point at which the number of firms has an impact on the market. The measure of  the  margin  used  by  the
     Parties is the average margin across the airport – an average consisting, in all likelihood mostly, of contracts set in previous months. If
     a firm stops participating in tenders, the potential impact on the overall airport margin will be mitigated, as it is  spread  over  future
     months. An attempt to adjust the measurement of the number  of  firms   by   the   Parties   to   account   for   this   was   not   deemed
     satisfactory  by  the Commission, because it forced the relationship between the number of firms and the margin to be linear.[140]

 (10) Finally, with regards to robustness, the Commission actually found preliminary indications of a negative relationship between  the  margins
     and the number of firms under various specifications. For instance, an increase in the number of  firms  had  a  negative  and  significant
     effect on the margin in the fixed effects regressions, when using dummy variables  for  the  number  of  firms  –  instead  of  the  linear
     specification proposed by the Parties – and the customer mix variable proposed by the Parties.

 (11) Given the shortcomings listed above, the Commission does not consider  that  the  econometric  analysis  submitted  by  the  Parties  is  a
     convincing indication that no relationship exists between margins and the number of firms. The  insignificant  relationship  found  by  the
     Parties in the case of the cross-sectional analysis is likely to be the consequence  of  unobserved  heterogeneity  of  supply  and  demand
     conditions across airports and measurement errors in the data. In the case of the fixed effects analysis, the insignificant relationship is
     likely to be caused by measurement errors in the data and the fact that the Parties assumed a linear relationship  between  the  number  of
     firms and the margin. The Commission therefore takes the view that this econometric analysis does not provide convincing evidence that  the
     concentration does not have a negative effect on competition.

-----------------------
[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 24, 29.1.2004, p. 1 (the "Merger Regulation").

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

[4]   COMP/M.5880 – Shell / Topaz / JV; COMP/M.5422 – Statoihydro / ST1 / ST1 Avifuels; COMP/M.5005 Galp Energia / Exxonmobil Iberia.

[5]   Questionnaire Q1, Questionnaire to Competitors, question 6. Questionnaire Q2, Questionnaire to Customers, question 8.

[6]   Questionnaire Q1, Questionnaire to Competitors, question 6.

[7]   Case No. COMP/M.5880 – Shell / Topaz / JV, 4 November 2010, paragraphs 15 and 16.

[8]   For the purposes of the present decision, references to aviation fuel include jet fuel and avgas.

[9]   COMP/M.5005 Galp Energia / Exxonmobil Iberia; COMP/M.3110 – OMV / BP; COMP/M.1628 Totalfina / Elf.

[10]  Case No. COMP/M.5422 – Statoilhydro / ST1 / ST1 Avifuels, 22 December 2008.

[11]  Questionnaire Q1, Questionnaire to Competitors, questions 9 and 10. Questionnaire Q2, Questionnaire to Customers, questions 11 and 12.

[12]  Questionnaire Q1, Questionnaire to Competitors, question 8. Questionnaire Q2, Questionnaire to Customers, question 10.

[13]  Case No. COMP/M.5880 – Shell / Topaz / JV, 4 November 2010, paragraphs 15 and 16.

[14]  Case No. COMP/M.3110 – OMV/BP (“Southern German Package”), 11 June 2003, paragraph 18.

[15]  Case No. COMP/M.IV/M.1383 – Exxon / Mobil, 29 September 1999, paragraph 808; Case No.  COMP/M.1628  –TotalFina  /  Elf,  9  February  2000,
  paragraph 224.

[16]  Questionnaire Q1, Questionnaire to Competitors, question 7. Questionnaire Q2, Questionnaire to Customers, question 9.

[17]  Case IV/M.727 – BP/Mobil, 7 August 1996, paragraph 34; Case No. COMP/M.5880 – Shell / Topaz / JV, 4 November 2010, paragraph 19.

[18]  Case No. COMP/M.3291 – Preem / Skandinaviska Raffinaderi, 1 December 2003, paragraph 17.

[19]  Case No. COMP/M.5880 – Shell / Topaz / JV, 4 November 2010, paragraph 22; Case No. COMP/M.5422 - Statoilhydro /  ST1  /  ST1  Avifuels,  22
  December 2008, paragraph 15; Case No. COMP/M.5005 – GALP Energia/ExxonMobil Iberia, 31 October 2008, paragraph 39; Case No. COMP/M.3110 –  OMV
  / BP (“Southern German Package”), 11 June 2003, paragraph 27; Case No. COMP/M.1628 – TotalFina / Elf, 9 February 2000, paragraph 228.

[20]  Case No. COMP/M.1628 – TotalFina / Elf, 9 February 2000, paragraph 225.

[21]  Case IV/M.727 – BP / Mobil, 7 August 1996, paragraphs 29 to 31.

[22]  Case No. COMP/M.1628 – TotalFina / Elf, 9 February 2000, paragraph 228.

[23]  Tankering refers to a strategy whereby an airline changes the quantity of fuel uplifted at particular  airports  within  their  network  in
  order to minimise fuel costs.

[24]  Questionnaire Q1, Questionnaire to Competitors, question 11. Questionnaire Q2, Questionnaire to Customers, question 13.

[25]  Questionnaire Q2, Questionnaire to Customers, question 31.

[26]  The Parties also co-own the infrastructure joint-venture at the airports Brussels, Edinburgh and Glasgow. As SFRA is not  active  at  these
  airports (i.e. a "dormant shareholder"), the Parties' activities do not overlap. No concerns were raised during the market investigation.

[27]  The Swedish Energy Agency determines each year and for each supplier the stocks of fuel that  they  have  to  hold  in  case  of  emergency
  situations.

[28]  Case T-221/95 Endemol v Commission, ECLI:EU:T:1999:85, paragraph 134; Case T-102/96 Gencor v Commission, ECLI:EU:T:1999:65, paragraph  205;
  see also Horizontal Merger Guidelines, paragraph 17.

[29]  Form CO, paragraph 337.

[30]  The econometric analysis submitted by the Notifying Party is explained in more details in Annex 2.

[31]  Annex 8(p) and 8(r) to the Form CO.

[32]  Questionnaire Q2, Questionnaire to Customers, questions 25-26.

[33]  Questionnaire Q2, Questionnaire to Customers, questions 23-24.

[34]  Questionnaire Q2, Questionnaire to Customers, question 35.

[35]  Form CO, Table 9.

[36]  See Annex 2 for more details.

[37]  There is one 3 to 2 change and 4 to 3 changes in the number of traditional suppliers.

[38]  For instance, the Commission found that an increase in the number of firms had a negative and significant  effect  on  the  margin  in  the
  fixed effects regressions, when using the customer mix variable proposed by the Parties but dummy variables for the number of firms –  instead
  of the linear specification proposed by the Parties.

[39]  Form CO, paragraph 266(a).

[40]  "An economic analysis of the BP/Tessem aviation fuel supply transaction (22/10/2014)".

[41]  Form CO, paragraph 266(b).

[42]  Form CO, paragraph 266(c).

[43]  Commission Staff Working Paper – Impact Assessment accompanying the document Proposal for a Regulation of the European  Parliament  and  of
  the Council on groundhandling services at Union airports and repealing Council Directive 96/67/EC  (SEC(2011)  1439  final,  dated  1.12.2011,
  paragraph 30.

[44]  Form CO, paragraph 266(c).

[45]  Form CO, paragraph 266(c).

[46]  Form CO, paragraph 497.

[47]  Form CO, paragraph 221.

[48]  Form CO, paragraph 266(d).

[49]  Form CO; paragraph 266(d).

[50]  Questionnaire Q1, Questionnaire to Competitors, question 83.2; Questionnaire Q2, Questionnaire to Customers, question 69.2.

[51]  Questionnaire Q1, Questionnaire to Competitors, question 85.2. Questionnaire Q2, Questionnaire to Customers, question 71.2.

[52]  Form CO, paragraph 378.

[53]  Questionnaire Q2, Questionnaire to Customers, questions 25-26.

[54]  Questionnaire Q2, Questionnaire to Customers, questions 23-24.

[55]  Form CO, Table 9.

[56]  See for instance Form CO, paragraph 329(c).

[57]  Form CO, paragraph 378.

[58]  A bridger is a standard fuel tanker which can be driven by road to the airport in question. The bridger can then be connected with the
  bowser in order to fill the bowser with avgas. The bowser vehicles can then be used for refuelling aircraft.

[59]  Questionnaire Q2, Questionnaire to Customers, question 69.4.

[60]  Questionnaire Q2, Questionnaire to Customers, question 71.4.

[61]  Form CO, paragraph 358.

[62]  Questionnaire Q2, Questionnaire to Customers, question 25.

[63]  Questionnaire Q2, Questionnaire to Customers, questions 23-24.

[64]  Annex 8(p) and 8(s) to the Form CO.

[65]  Questionnaire Q2, Questionnaire to Customers, question 35.

[66]  Form CO, Table 9.

[67]  Form CO, paragraph 378.

[68]  Questionnaire Q2, Questionnaire to Customers, question 69.3.

[69]  Questionnaire Q2, Questionnaire to Customers, question 71.3.

[70]  A proportion of the fuel that BP stores at the off-airfield terminal storage facilities is not used to supply  Copenhagen  but  instead  is
  transported to other Danish airports and Malmö.

[71]  Q8 ceased offering into-plane supply at Copenhagen in June 2012 but retains a shareholding in BKL;  Q8  is  in  negotiations  to  sell  its
  interest in BKL to the remaining shareholders.

[72]  Q8 is in negotiations to sell its shares in DRS.

[73] Form CO, paragraph 313.

[74] Questionnaire Q2, Questionnaire to Customers, question 24.

[75] Questionnaire Q2, Questionnaire to Customers, questions 23 and 25.

[76] Annex 8(p) and 8(q) to the Form CO.

[77] Form CO, paragraph 337.

[78] Questionnaire Q2, Questionnaire to Customers, question 35.

[79] Form CO, Table 9.

[80]  Questionnaire Q1, Questionnaire to Competitors, question 83.1. Questionnaire Q2, Questionnaire to Customers, question 69.1.

[81]  Questionnaire Q1, Questionnaire to Competitors, question 85.1. Questionnaire Q2, Questionnaire to Customers, question 71.1.

[82]  Annex 8(p) and 8(t) to the Form CO.

[83]  Annex 8(p) and 8(t) to the Form CO.

[84]  Questionnaire Q2, Questionnaire to Customers, questions 23 to 26.

[85]  Questionnaire Q1, Questionnaire to Competitors, question 83.5. Questionnaire Q2, Questionnaire to Customers, question 69.5.

[86]  Questionnaire Q1, Questionnaire to Competitors, question 85.5. Questionnaire Q2, Questionnaire to Customers, question 71.5.

[87]  Morgan Stanley has recently bought shares in AFS to become a supplier in Amsterdam.

[88]  […].

[89]  Questionnaire Q2, Questionnaire to Customers, questions 25-26.

[90]  http://www.mbholding.com/marquard_bahls/en/presse/pressemitteilungen/Skytanking/2013_03-25.php

[91]  Cases T-342/99, Airtours v Commission; T-464/04, Impala v Commission.

[92]  Guidelines on the assessment of horizontal mergers under the Council Regulation on the control of concentrations between  undertakings,  OJ
  C 31 of 5 February 2004, p. 5, paragraphs 39–57.

[93]  The situation is different in Hamburg and Amsterdam where respectively 6 and 5 competitors are active.

[94]        COMP/M.5005 Galp Energia / Exxonmobil Iberia.

[95]  Questionnaire Q1, Questionnaire to Competitors, question 21.1.

[96]  Questionnaire Q2, Questionnaire to Customers, question 28.1.

[97]  Questionnaire Q1, Questionnaire to Competitors, questions 21.3 and 21.4

[98]  Questionnaire Q2, Questionnaire to Customers, question 28.3.

[99]  Questionnaire Q2, Questionnaire to Customers, question 28.1.

[100]       Questionnaire Q1, Questionnaire to Competitors, question 21.2. Questionnaire Q2, Questionnaire to Customers, question 28.2.

[101]       The Notifying Party submitted a first set of commitments on 19 November 2014. In the light of the results of  the  market  test,  the
    Notifying Party implemented specific improvements in the second and final version of the proposed commitments,  which  was  submitted  on  5
    December 2014.

[102] Commission Notice on remedies acceptable under Council Regulation (EC) No  139/2004  and  under  Commission  Regulation  (EC)  No  802/2004
  (2008/C 267/01), (the "Commission Notice on Remedies").

[103] Commission Notice on Remedies, paragraph 9.

[104] Commission Notice on Remedies, paragraph 12.

[105] Commission Notice on Remedies, paragraph 17.

[106] Commission Notice on Remedies, paragraph 23.

[107] Commission Notice on Remedies, paragraphs 25 and 26.

[108] Questionnaire Q3, Questionnaire to Competitors, questions 2.1, 2.2, 2.3, 2.4, 3, 4, 5, 6. Questionnaire  Q4,  Questionnaire  to  Customers,
  questions 2.1., 2.2., 2.3., 2.4, 3, 4, 5,6.

[109] Questionnaire Q3, Questionnaire to Competitors, question 26.1.

[110]       Questionnaire Q3, Questionnaire to Competitors, questions  8.1,  8.2.,  8.3,  8.4.  Questionnaire  Q4,  Questionnaire  to  Customers,
questions 8.1, 8.2., 8.3, 8.4.

[111]       In the case of Malmö, the Commitment covers both jet fuel and Avgas.

[112]       Questionnaire Q3, Questionnaire to Competitors, questions 3, 4, 5, 6. Questionnaire Q4, Questionnaire to Customers, questions  3,  4,
5, 6.

[113]       The CSO determines each year and for each supplier the stocks of fuel that they have to hold in case of emergency situations.

[114]       Questionnaire Q3, Questionnaire to Competitors, question 14.

[115]       Questionnaire Q3, Questionnaire to Competitors, questions 13.1, 13.2, 13.3,  13.4.  Questionnaire  Q4,  Questionnaire  to  Customers,
questions 13.1, 13.2, 13.3, 13.4.

[116]       Questionnaire Q3, Questionnaire to Competitors, question 16. Questionnaire Q4, Questionnaire to Customers, question 16.

[117]       Questionnaire Q3, Questionnaire to Competitors, question 17.

[118]       Questionnaire Q3, Questionnaire to Competitors, questions 7.1, 7.2, 7.3, 7.4.

[119]       Questionnaire Q3, Questionnaire to Competitors, questions 7.1.2, 7.2.2, 7.3.2, 7.4.2.

[120]       Questionnaire Q3, Questionnaire to Competitors,  questions  9.1,  9.2,  9.3,  9.4.  Questionnaire  Q4,  Questionnaire  to  Customers,
questions 9.1, 9.2, 9.3, 9.4.

[121]       Questionnaire Q3, Questionnaire to Competitors, question 19. Questionnaire Q3, Questionnaire to Competitors, question 20.

[122]       Questionnaire Q3, Questionnaire to Competitors, question 21.

[123]       Questionnaire Q3, Questionnaire to Competitors, question 26.1.

[124]       Questionnaire Q3, Questionnaire to Competitors, question 23.

[125]       Questionnaire Q3, Questionnaire to Competitors, question 19.

[126]       Questionnaire Q3, Questionnaire to Competitors, question 25.

[127]       Further information in relation to […] is included on page 72 of  the  SFRA  Confidential  Information  Memorandum  provided  to  the
    Commission as Annex 9(f) to the Form CO.
[128]       BP will retain the right to select the pricing periods under the […] Supply Agreements which apply to supply to all airports  covered
    under these Agreements (i.e. not only the Relevant Airports).  In addition the Purchaser  will  be  required  to  nominate  the  volumes  it
    requires in sufficiently good time to allow BP to meet its obligations to […] in this respect under the terms of these Agreements.
[129]       The precise delivery point varies by location.  At Copenhagen this will be into-pipe at the point the  fuel  exits  the  off-airfield
    storage; at Stockholm this will be into-rail at the point the fuel exits the off-airfield storage; and in Malmö and Gothenburg this will  be
    delivery at the point the fuel enters the on-airfield storage facility at each airport.
[130]       Under the TSA, BP receives the benefit of certain centralised services from the Seller including IT,  accounting,  HR  administration
and payroll and financial services and is entitled to use such services after the completion of the  Concentration,  although  with  an  explicit
expectation that the transition will be completed within six months.  The Divestment Business will  include  transfer  to  a  Purchaser  of  BP’s
rights and obligations under the TSA on back-to-back terms for 12 months from Closing, with the Purchaser  to  meet  any  costs  associated  with
provision of transitional services as required.  Given it is BP’s intention to require no longer  than  six  months  for  its  transition  to  be
complete, a window of 12 months to a Purchaser to transition services in respect of only the Relevant Airports is more than sufficient.

[131]       The […] Supply Agreements describe delivery as being on an FCA basis. This means that the risk and title to the fuel passes from  […]
to the Purchaser, at the agreed point of loading either (i) as the fuel passes the inlet manifold of the buyer’s road  tanker  (or  railcar);  or
(ii) when loading by gravity, as the fuel passes the outlet of the terminal’s loading hose.

[132]       An economic analysis of the BP/Tessem aviation fuel supply transaction (02/09/2014)", Section 4 and Appendices D and E; "An  economic
   analysis of the BP/Tessem aviation fuel supply transaction (22/10/2014)", Section 4 and Appendices D, E and F; Memorandum "M.7387 – BP/SFRA –
   CRA's response to the Commission's concerns with BP/SFRA econometric evidence (10/11/2014)".

[133]       The following control variables are also included: the level of demand at the airport, a fuel price index (Platts), the riskiness  of
   customers, the average amount of fuel sold per plane and a dummy variable indicating an increase in costs –  as  a  result  of  a  regulation
   change – for Swedish airports from April 2013 onwards.

[134]       Since SFRA's data is significantly more limited than BP's data, the Commission has  focused  its  assessment  on  the  analysis  that
   relies on BP's data.

[135]       This level of data does not allow for proper control for the customer mix, whi@Cz¦©ªñ<    >    ?     @     V    W      l     ~      €
   ?  ˜    ™     ÷ä×ÐÂ·¦·•·‰xq^UJU?8?

   hˆ7ùhÔ`¢jhˆ7ùhÔ`¢U[pic]hˆ7ùhÔ`¢CJaJhˆ7ùhÔ`¢aJ$jhˆ7ùhÔ`¢U[pic]aJmHnHu[pic]

   hˆ7ùh¢  › jhˆ7ùh7eUU[pic]mHnHu[pic]hˆ7ùh÷T:mHnHu[pic] hˆ7ùh÷T:5?6?CJ$\?]?aJ$ jhˆ7ùh÷T:U[pic]mHnHu[pic]hˆ7ùh÷T:CJ$aJ$hˆ7ùh÷T:5?CJ$\?aJ$

   hˆ7ùh÷T:hch is likely to be a significant determinant of the observed average margin at each airport and at each point in time. The  customer
   size variable proposed by the Parties only partially accounts for variations in customer mix, because it does not account for  variations  in
   credit-worthiness, contract length and bargaining power, inter alia.

[136]       The correlation between the airport size  and  the  number  of  firms  is  0.835  when  the  measure  includes  self-  suppliers  and
   throughputters, and 0.750 when only traditional suppliers are included .  The  high  correlation  between  a  regression's  right  hand  side
   variables is known as multicollinearity.

[137]       There is a negative and statistically significant effect of four and five-or-more firms on the margin, when compared  to  two  firms,
   under most specifications suggested by the parties for the cross-sectional analysis, once demand is removed from the regression.

[138]       For  example,  see:  Ryanair/Aer  Lingus  I,  General  Court  judgement  of  Ryanair  v  Commission, and Ryanair/Aer Lingus III.
[139]       There is one three-to-two change and four four-to-three changes in the number of traditional suppliers.

[140]       The proposed correction was to take the twelve month moving average of the number of firms and use that instead of the raw number  in
   the regression. If a firm left the market, for example, the moving average spreads this change over twelve months. The result is intended  to
   correlate more closely with the change in the average margin caused by such an exit. Unfortunately, dummy variables cannot be used with  this
   measure. This is because the dummy variable technique estimates the effect of the number of firms on the margin separately for each  possible
   value. This is not feasible when using the moving average, as the number of possible values becomes very large (the  moving  average  is  not
   restricted to being an integer). Therefore, the linear specification must be used, which is unlikely to be sufficiently realistic.

-----------------------
 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