CELEX: 32014M7375
Language: en
Date: 2014-12-05 00:00:00
Title: Commission Decision of 05/12/2014 declaring a concentration to be compatible with the common market (Case No COMP/M.7375 - UTC / CIAT) according to Council Regulation (EC) No 139/2004 (Only the English text is authentic)

|[pic]                             |EUROPEAN COMMISSION                                                                                      |

Brussels, 5.12.2014
C(2014) 9477 final

|In the published version of this decision, some information |           |Public version                                                 |
|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|omitted has been replaced by ranges of figures or a general |           |                                                               |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.                                                |           |                                                               |
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|                                                            |           |MERGER PROCEDURE                                               |

|                                                                       |To the notifying party                                                 |

Subject:    Case M.7375 - UTC / CIAT
Commission decision pursuant to Article 6(1)(b) of Council Regulation No 139/2004[1]

    1) On 31 October 2014, the European Commission received a notification of a proposed concentration  pursuant  to  Article  4  of  the  Merger
       Regulation, following a referral pursuant to Article 4(5), by which the undertaking United Technologies Corporation ('UTC', United States)
       acquires, within the meaning of Article 3(1)(b) of the Merger Regulation, sole control of the whole of the undertaking  CIAT  (France)  by
       way of purchase of shares. UTC is hereinafter referred to as the 'Notifying Party' while UTC and CIAT are collectively referred to as  the
       'Parties'.

       THE PARTIES

    2) UTC is a US-based multinational corporation that provides high technology products and services for the aerospace and commercial  building
       industries worldwide. Among various other products, UTC  is  active  in  the  production  and  supply  of  heating,  ventilation  and  air
       conditioning systems ('HVAC') through its business unit Carrier.

    3) CIAT is a France-based company that manufactures HVAC systems in the EEA and in China and distributes them in over 100 countries through a
       network of its own sales offices and independent distributors.

       THE OPERATION AND THE CONCENTRATION

    4) On 23 July 2014, UTC and CIAT's shareholders signed a 'Firm and Irrevocable Offer to Acquire CIAT Group' in accordance with the  terms  of
       an agreed share purchase agreement. In accordance with the French labour code, CIAT's  shareholders  are  entitled  to  accept  the  offer
       following consultation with the Works Council of CIAT. The transaction would see UTC acquiring 100% of CIAT's  outstanding  share  capital
       and voting rights of CIAT from its present ultimate shareholders. UTC would thus acquire sole control of CIAT. The  transaction  therefore
       constitutes a concentration within the meaning of Article 3(1)(b) of the Merger Regulation.

       EU DIMENSION

    5) The concentration does not have an EU dimension within the meaning of Article 1  of  the  Merger  Regulation  as  it  does  not  meet  the
       thresholds laid down therein.

    6) On 8 August 2014, however, the Notifying Party informed the Commission by means of a reasoned submission pursuant to Article 4(5)  of  the
       Merger Regulation that the concentration was capable of being reviewed under the national competition laws of at least three Member States
       and requested that it be referred to the Commission.  No  Member  State  competent  to  review  the  proposed  transaction  expressed  its
       disagreement within the period set out in the Merger Regulation.

    7) Therefore, the concentration is deemed to have an EU dimension pursuant to Article 4(5) of the Merger Regulation.

       COMPETITIVE ASSESSMENT

    8) The proposed transaction leads to horizontal overlaps between the Parties as both are active in the manufacture and supply of a  range  of
       air-conditioning (HVAC) systems and related products.

1 Market Definition

1 Relevant Product Markets

    9) HVAC systems are essentially air-conditioning systems that are used to provide conditioned air to a building, e.g. air  whose  temperature
       has been adjusted to achieve the desired temperature inside the building. HVAC systems employ various technologies and  come  in  a  large
       number of sizes and configurations suitable for different building sizes and types.

   10) In previous decisions, the Commission has considered that at least residential and light commercial  systems  of  possibly  up  to  25  kW
       cooling power constitute a market separate from systems of higher cooling power.[2]  In  addition,  in  Daikin/OYL,  the  notifying  party
       suggested a further segmentation into three, instead of two, categories according to the end-use of the system based on its cooling power:
       residential and light commercial (0–25 kW), medium commercial (25–250 kW) and heavy commercial (>250 kW). The question  was  however  left
       open in the decision.[3]

   11) Moreover, the Commission has also examined in the past but ultimately left open a possible further segmentation of the cooling power based
       categories on the basis of the technology or structure of the system (for instance monoblocks / split, portable / non-portable,  ducted  /
       non-ducted).[4] In Daikin/OYL, the Commission suggested that as systems with the highest power ratings could  practically  only  be  built
       with one technology, technology-based segmentation was meaningless for those systems. That  question  was  however  also  ultimately  left
       open.[5]

   12) The Notifying Party in the present case submits that HVAC systems can be divided into three categories according to  the  end-use  of  the
       system based on its cooling power. The categories are: (i) residential and light commercial (0–50 kW), (ii) medium commercial (50–350  kW)
       and (iii) heavy commercial and industrial (>350 kW). The Notifying Party also  further  submits  that  its  market  shares  would  not  be
       materially different even if the power ranges suggested in Daikin/OYL were used instead.[6]

   13) The results of the market investigation suggest that segmentation according to the cooling power of the system  might  be  appropriate.[7]
       However, respondents to the market investigation were divided about the actual power ratings according to  which  the  markets  should  be
       delineated.[8] Nonetheless, as the outcome of the competitive assessment is the same regardless of whether the power ratings suggested  in
       Daikin/OYL or the ones submitted by the Notifying Party in the present case are used, it is not necessary to conclude on that question.

   14) As to segmentation according to the technology employed, the Notifying Party submits that no such segmentation is warranted.  Nonetheless,
       the Notifying Party has provided market data on the potential sub-segment of hydronic HVAC systems within each of the cooling power  based
       categories as CIAT concentrates on this technology and because it would result in affected markets if  considered  separately  from  other
       technologies. In addition, the Notifying Party has provided market data separately for rooftop units and air handling units that would, if
       considered separately from other products, also constitute affected product markets.

   15) Hydronic systems are multi-component systems based on the circulation of water between an  outdoor  chiller  and  the  indoor  units  that
       release the cold to the desired space.[9] This is in comparison to systems based on refrigerant circulating between the outdoor units  and
       indoor units that release the cold generated by the outdoor units (such as variable refrigerant flow systems, also  known  as  VRF).  With
       respect to multi-component systems, CIAT is only active in hydronic systems.

   16) Rooftop units are packaged mono-block HVAC units that are traditionally used in commercial buildings  where  no  room-by-room  temperature
       control is required (e.g. supermarkets). The systems are typically installed on the roof and may usually have cooling power of up  to  200
       kW, and they can thus be considered as part of the potential medium commercial segment.

   17) Air handling units are not an alternative to the systems described above, but rather a complement that can  be  added  particularly  to  a
       medium commercial or heavy commercial and industrial HVAC system. Air handling units typically consist of a fan and air-filtration  system
       and are used to distribute treated (cooled / heated) air inside the building.

   18) In this respect, the market investigation shows that the majority of competitors consider that delineation  according  to  the  technology
       employed may be relevant.[10] More particularly, a  number  of  respondents  indicated  that  substituting  hydronic  systems  with  other
       technologies could be technically or economically difficult in some applications and particularly when it comes  to  large  buildings.[11]
       Moreover, it should be noted that not all suppliers are equally present in all technologies and  that,  in  particular,  CIAT  focuses  on
       hydronic systems. Therefore, it cannot be excluded that hydronic systems may constitute distinct product markets.

   19) In addition, the market investigation also suggests that roof top units and air handling units may constitute  distinct  product  markets.
       For instance, a number of customers considered that roof top units cannot be technically or economically substituted  by  other  technical
       solutions in all applications. A number of competitors, including some of the major competitors such as Daikin, indicated  that  they  are
       not at all maufacturing in rooftop units. As to air handling units, customers indicated that they source  air  handling  units  separately
       from other HVAC products and there are a number of suppliers that concentrate on those products rather than HVAC systems in general.[12]

   20) Based on the results of the market investigation and the information provided by the Notifying Party, the Commission nonetheless considers
       that the exact delineation of the relevant product market can be left open since the notified operation  does  not  raise  serious  doubts
       under any possible approach.

2 Relevant Geographic Markets

   21) In Carrier/Toshiba, the Commission had suggested that the market for residential and light commercial systems was at least  EEA-wide.  The
       exact market definition was, however, left open.[13] However, in  later  decisions  the  Commission  found  indications  pointing  towards
       narrower, possibly even national markets for HVAC systems. The market definition has nonetheless been ultimately left open.[14]

   22) The Notifying Party submits that the relevant geographic markets for HVAC systems are EEA-wide in scope. In support of its submission, the
       Notifying Party refers to, for instance, high levels of cross-border trade, centralised production within the EEA, low transport costs and
       standardisation of the products so that the same products can typically be sold throughout the EEA. The Notifying Party also submits  that
       conditions of competition are not materially different in different regions of Europe.  Nonetheless,  the  Notifying  Party  has  provided
       market data separately for the EEA level, regional level and national level.

   23) Concerning rooftop units, the Notifying Party submits that their geographic markets are similar to HVAC systems in general. The  Notifying
       Party does nonetheless acknowledge that the demand for rooftop units varies between  different  countries  and  they  are  generally  more
       demanded in certain countries such as Spain. CIAT also achieves […]% of its rooftop unit sales  in  Spain  where  its  related  production
       facility is located.

   24) As to air handling units, the Notifying Party notes that they are generally bulky and lower-value products the transporting of  which  can
       be proportionally more costly than other HVAC products. The Notifying Party therefore suggests that the markets could be regional or  even
       national in scope.

   25) The results of the market investigation were inconclusive as to the geographic markets for HVAC systems.  On  the  one  hand,  the  market
       investigation indicates that the markets could be  wider  than  national.  For  instance,  suppliers  have  generally  concentrated  their
       production at a limited number of locations from where they ship supplies to numerous countries.[15] Some customers responding  were  also
       already sourcing from countries other than their own and the majority, but not all, also indicated they could either start  sourcing  from
       abroad or sponsor an entry to their own country if faced with a permanent price increase of 5–10%.[16]

   26) Nonetheless, some indicators also point towards possible national markets. In particular, many customers prefer their suppliers to have  a
       national presence. This applies particularly with respect to the heavy commercial and industrial systems that are  tailored  according  to
       customer needs and require on-site service unlike for instance residential and light commercial systems.[17] The market investigation also
       gave indications that French customers in particular have a tendency to buy French.[18] Moreover, the  Parties'  market  footprint  varies
       significantly between different EEA countries and, in particular, CIAT's sales  are  concentrated  into  and  close  to  France  and  CIAT
       generally only achieves notable market shares in France, the Netherlands and Luxembourg. An exception to this is rooftop units  that  CIAT
       mainly sells in Spain where its related production facility is located. The national Spanish market is also the only potential market  for
       rooftop units that would constitute an affected market as a result of the proposed transaction.

   27) Based on the results of the market investigation and the information provided by the Notifying Party, the Commission nonetheless considers
       that the precise definition of the relevant geographical market can be left open, as the notified operation does not raise serious  doubts
       under any possible approach.

2 Competitive assessment

   28) For the purpose of assessing the present operation, and in line with the precedent paragraphs on market definition,  the  Commission  will
       assess the effects on competition in the potential cooling power based segments.  In  addition,  those  potential  technology  based  sub-
       segments that would give rise to affected markets will also be assessed.

1 HVAC systems

   29) In the light of the results of the market investigation and the information provided by the Notifying Party, the Commission considers that
       the proposed transaction does not result in any affected markets at the EEA-level  with  respect  to  air  conditioning  systems  when  no
       distinction is made according to the technology employed.[19] However, at the national level a number of markets are affected,  mainly  in
       the potential medium commercial and heavy commercial and industrial segments even if no distinction is made according to  technology.  The
       Parties' market shares in the affected potential national markets are given in the table below.

Table 1 – Affected HVAC systems markets by cooling power[20], all technologies, 2013

|                        |Residential and Light Commercial (0–50kW)|Medium Commercial (50–350kW)                |Heavy Commercial and Industrial (>350kW)   |
|Country             |CIAT                                        |UTC                                        |Combined                                   |

 Country |CIAT |UTC |Combined |CIAT |UTC |Combined |CIAT |UTC |Combined | |Baltic countries | | | |[5–10]% |[10–20]% |[20–30]% | | | | |Belgium |
| | |[5–10]% |[10–20]% |[20–30]% |[5–10]% |[20–30]% |[20–30]% | |Croatia | | | |[10–20]% |[10–20]%  |[20–30]%  |[10–20]%  |[10–20]%  |[20–30]%  |
 |Czech Republic |[0–5]% |[20–30]% |[20–30]% | | | | | | | |Finland | | | |[0–5]% |[20–30]% |[20–30]% |[0–5]% |[20–30]% |[20–30]% | |France | | |
  |[20–30]% |[20–30]% |[50–60]% |[10–20]% |[20–30]% |[40–50]% | |Germany | | | |[0–5]% |[10–20]% |[20–30]% |[0–5]% |[10–20]% |[20–30]% | |Greece
     |[0–5]% |[30–40]% |[40–50]% |[0–5]% |[20–30]% |[20–30]% |[0–5]% |[30–40]% |[30–40]% | |Luxembourg |[10–20]% |[0–5]% |[20–30]% |[40–50]%
   |[10–20]% |[60–70]% |[30–40]% |[20–30]% |[50–60]% | |Malta | | | |[0–5]% |[50–60]% |[50–60]% | | | | |Netherlands | | | |[10–20]% |[40–50]%
  |[50–60]% |[5–10]% |[50–60]% |[50–60]% | |Norway | | | |[10–20]% |[20–30]% |[30–40]% |[10–20]% |[10–20]% |[20–30]% | |Portugal | | | |[5–10]%
     |[10–20]% |[20–30]% |[10–20]% |[10–20]% |[20–30]% | |Slovakia | | | |[5–10]% |[20–30]% |[20–30]% | | | | |Spain | | | |[5–10]% |[20-30]%
|[30–40]% |[0–5]% |[20–30]% |[20–30]% | |Sweden | | | | | | |[0–5]% |[30–40]% |[30–40]% | |Source: The Notifying Party

   30) The combined market shares generally remain modest and the market share increments are limited even if hydronic systems are considered  as
       separate markets. However, the Parties' combined market shares are high with respect to hydronic  medium  commercial  systems  in  France,
       Luxembourg, Malta and the Netherlands as well with respect to heavy commercial and industrial  systems  in  France,  the  Netherlands  and
       Luxembourg. With the exception of Malta, the market share increment in each case is also not negligible.

   31) However, for the following reasons the Commission considers that the proposed transaction does not give rise to competition concerns  with
       respect to HVAC systems even with respect to those countries and regardless of whether  hydronic  systems  are  considered  to  constitute
       distinct markets or not.

   32) First, the Commission notes that, in light of their replies during the market  investigation,  market  participants  did  not  in  general
       consider the Parties to be each other's closest competitors. For instance in France and the Netherlands, many customers considered  Daikin
       or Trane as being closer competitors to the Parties than the Parties are to each other. Other close competitors mentioned included York in
       France and the Netherlands and GEA in the Netherlands.[30] Trane and Daikin were also referred to as being strong particularly in hydronic
       systems in France and, in addition, Climaveneta was mentioned as having noticeable capabilities in the field.[31]

   33) Second, even if the markets were considered as national, the market investigation shows that it is apparent that a significant  number  of
       customers would be willing to either source from abroad or even sponsor entry to their own countries.[32] The Commission also notes  that,
       in light of the replies during the market investigation, competitors generally confirm that they  have  adequate  production  capacity  to
       increase their supplies should customers turn to them if the merged entity attempted to increase prices after the  transaction,  and  that
       customers will continue to have alternative sources of supply.[33] It is thus likely that at least some level  of  competitive  constraint
       results from a risk of a potential entry or increased market presence of alternative suppliers.

   34) With specific regard to Luxembourg, where the Parties would reach their highest combined market shares in hydronic systems, the Commission
       notes that Luxembourg is a small market where single deals may significantly affect market shares. This is confirmed by variations in  the
       Parties' combined market shares during 2011–2013, a period in which, for example, the Parties' combined market  share  in  hydronic  heavy
       commercial and industrial systems varied between [30–40]% and [50–60]%. In view of the above, the Commission considers that in the present
       case, market shares are not necessarily reliable indicators  of  actual  market  power  in  the  assessed  market.  Moreover,  the  market
       investigation has shown that that Luxembourg is not necessarily  a  separate  geographic  market  as  customers  may  easily  source  from
       neighbouring countries as well. Further, a specific sales and service network for Luxembourg does not seem to be a  necessary  requirement
       for entry on the market for alternative producers active in neighbouring countries.[34] This is confirmed by the fact that,  for  instance
       the Notifying Party serves Luxembourg from Belgium.

   35) Third, even if hydronic air conditioning  systems  were  considered  to  be  separate  markets,  many  customers  replied  in  the  market
       investigation that they could consider switching from  hydronic  systems  to  alternative  technologies,  such  as  refrigerant-based  air
       conditioning systems, if the former's prices rose significantly. In  light  of  the  replies  during  the  market  investigation  and  the
       information provided by the Notifying Party, this applies to all of the potential cooling power based sub-segments even if substitution in
       the heavy commercial and industrial systems could be more challenging.[35]  Therefore, the Commission considers that it is likely that  at
       least some level of competitive constraint results from the risk of a potential switch to alternative technologies.

   36) Fourth, the Commission notes that most of the Parties' customers, including those located in France, the Netherlands and Luxembourg,  were
       not concerned by the proposed transaction. While a limited number of customers expressed some concerns  related  to  the  merged  entity's
       market power particularly in France and with respect to hydronic systems,[36] customers nonetheless referred  to  functioning  competition
       and confirmed that an adequate number of alternative suppliers would remain on the  markets  post-transaction,  including  in  France.[37]
       Customers also mentioned the possibility of redirecting some of their purchases away from the merged entity and sponsoring  the  entry  of
       new competitors if needed.[38] In addition, while a number of competitors raised concerns and considered  that  the  proposed  transaction
       could give rise to competition effects due to, for instance a more complete product  portfolio,[39]  customers  did  not  generally  raise
       similar concerns and also mentioned that other suppliers such as Trane have a similarly large product portfolio.[40]

2 Rooftop units

   37) With respect to rooftop units, only the potential national market of Spain would be affected by the proposed transaction with the  Parties
       reaching a combined market share of [40–50]% (UTC [0–5]%; CIAT [40–50]%) according to the Notifying Party's  estimates.  However,  as  the
       market share increment is [0–5 percentage points], the proposed transaction is unlikely to result in a significant change  in  the  market
       structure. In addition, the merged entity will continue to face competition from alternative suppliers  such  as  Lennox  and  Hitecsa[41]
       Moreover, no concerns with respect to rooftop units in Spain were expressed during the market investigation.

3 Air handling units

   38) With respect to air handling units, only the potential national market of France would be affected by the proposed  transaction  with  the
       Parties reaching a combined market share of [30–40]% (UTC [0–5]%; CIAT [20–30]%) according to the Notifying Party's estimates. However, as
       the market share increment remains modest at [0–5] percentage points, the proposed transaction is unlikely  to  result  in  a  significant
       change in the market structure. In addition, the merged entity will continue to face competition from alternative suppliers  such  as  GEA
       ([10–20]%) and Wesper/Hitecsa ([10–20]%). Numerous customers also referred to Daikin and Wolf as being closer competitors to  the  Parties
       than the Parties to each other. In addition, customers also mentioned  Climaveneta  and  Systemair  as  having  notable  capabilities.[42]
       Moreover, a clear majority of market participants did not express any substantiated concerns related to air handling units with  only  one
       competitor being clearly concerned about the merged entity's market shares and its effects on smaller competitors.[43]

4 Conclusion on competitive assessment

   39) Therefore, based on the results of the market investigation and the information provided by the Notifying Party, the Commission  considers
       that the proposed transaction does not give rise to serious doubts as to its  compatibility  with  the  internal  market  even  under  the
       narrowest feasible product and geographic market definitions.

       CONCLUSION

   40) For the above reasons, the European Commission has decided not to oppose the notified operation and to  declare  it  compatible  with  the
       internal market and with the EEA Agreement. This decision is adopted in application of Article 6(1)  (b)  of  the  Merger  Regulation  and
       Article 57 of the EEA Agreement.

For the Commission

(signed)
Margrethe VESTAGER
Member of the Commission

-----------------------
[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]   M.1433 – Carrier/Toshiba, paragraphs 14–6 and 20; M.4271 – Daikin/OYL, paragraphs 7–13; and M.5421 – Panasonic/Sanyo, paragraphs 158–160.

[3]   M.4271 – Daikin/OYL, paragraphs 7 and 11–3.

[4]   M.1433 – Carrier/Toshiba, paragraphs 17–20; M.4271 – Daikin/OYL, paragraphs 10–3; and M.5421 – Panasonic Sanyo, paragraphs 159–160.

[5]   M.4271 – Daikin/OYL, paragraphs 12–3, including footnote 18.

[6]   The sub-division in power ranges suggested by the Notifying Party in the present case is in line with the ranges used for  data  collection
and market shares estimate by Eurovent Market Intelligence, the market research and  analysis  branch  of  the  Eurovent  trade  association  and
certification body.

[7]   Replies to the Questionnaires for Customers Q1a–Q1c, question 5; replies to the Questionnaire for Competitors Q2, question 5.

[8]   Replies to the Questionnaires for Customers Q1a–Q1c, question 6; replies to the Questionnaire for Competitors Q2, question 6.

[9]   It is also possible to have a system where the water may also be heated.

[10]  Replies to the Questionnaires for Customers Q1a–Q1c, question 7; replies to the Questionnaire for Competitors Q2, question 8.

[11]  Replies to Questionnaires for Customers Q1a–Q1b, question 8; replies to the Questionnaire for Competitors, question 9.

[12]  Replies to the Questionnaire for Customers Q1a, questions 14–5 and 17–8; replies to the Questionnaire for Customers  Q1b,  questions  14–5;
replies to the Questionnaire for Competitors, questions 10 and 16–7.

[13]  M.1433 – Carrier/Toshiba, paragraph 22.

[14]  M.4271 – Daikin/OYL, paragraph 17; and M.5421 – Panasonic / Sanyo, paragraph 162.

[15]  Replies to the Questionnaire for Competitors Q2, questions 18–9.

[16]  Replies to the Questionnaire for Customers Q1a, questions 22–3; replies to the Questionnaire for Customers Q1b,  questions  19–20;  replies
to the Questionnaire for Customers, question 11.

[17]  Replies to the Questionnaire for Customers Q1a, questions 19–21; replies to the  Questionnaire  for  Customers  Q1b,  questions  16–8;  and
replies to the Questionnaire for Customers Q1c, questions 8–10.

[18]  See, for instance confirmed minutes of a call with a competitor, 20.11.2014.

[19]  The Parties achieved the following market shares in the EEA in 2013: Residential and light commercial systems [5–10]%  (UTC  [5–10]%;  CIAT
[0–5]%), medium commercial systems [10–20]% (UTC [10–20]%; CIAT [0–5]%) and heavy commercial and industrial systems [10–20]% (UTC [10–20]%;  CIAT
[0–5]%).

[20]  Some of the potential national markets would constitute affected markets even if no delineation according to the cooling  power  was  made.
However, the market shares are lower than those for the affected power rating based categories.

[21]  The Notifying Party has not been able to provide separate market share  figures  for  the  Baltic  countries  and  Finland.  See  Form  CO,
paragraph 7.4, footnote 64.

[22]  The Notifying Party has not been able to provide separate figures for the Scandinavian countries. See Form CO, paragraph 7.4, footnote 64.

[23]  Replies to the Questionnaire for Customers Q1a, questions 22–3; replies to the Questionnaire for Customers Q1b,  questions  19–20;  replies
to the Questionnaire for Customers Q1c, question 11.

[24]  Replies to the Questionnaire for Competitors, question 34 and 38.

[25]  Replies to the Questionnaire for Customers Q1a, questions 33–4; replies to  the  Questionnaire  for  Customers  Q1b,  questions  30–1;  and
replies to the Questionnaire for Customers Q1c, questions 13–4. See  also, for instance confirmed minutes  of  a  call  with  a  French  customer
30.10.2014 and confirmed minutes of a call with a Dutch customer 30.10.2014.

[26]  Replies to the Questionnaire for Customers Q1a, questions 23 and 34; replies to the  Questionnaire  to  Customers  Q1b,  question  20;  and
replies to Questionnaire for Customers Q1c, questions 11 and 31.

[27]  CIAT only sells some limited refrigerant based products  that  generally  are  not  multi–component  systems.  See  the  Notifying  Party's
submission of 1 December 2014.

[28]  In hydronic residential and light commercial systems, the Parties combined market share remained at [5–10]% (UTC [0–5]%;  CIAT  [0–5]%)  in
the EEA in 2013.

[29]  Some of the potential national markets would constitute affected markets even if no delineation according to the cooling  power  was  made.
However, the market shares are lower than those for the affected power rating based categories.

[30]  Replies to the Questionnaire for Customers Q1a, questions 28–9; and replies to the Questionnaire for Customers Q1b, questions 25–6.

[31]  See for example replies to the Questionnaire for Customers Q1a, question 30.

[32]  Replies to the Questionnaire for Customers Q1a, questions 22–3; replies to the Questionnaire for Customers Q1b,  questions  19–20;  replies
to the Questionnaire for Customers Q1c, question 11.

[33]  Replies to the Questionnaire for Competitors, question 34 and 38.

[34]  Replies to the Questionnaire for Customers Q1c, question 11.

[35]  Replies to the Questionnaires for Customers Q1a–Q1b, question 10. Moreover,  it  was  mentioned  that  alternative  solutions  to  hydronic
systems always exists even if switching could be challenging in some applications. See, for instance confirmed minutes of a  call  with  a  Dutch
customer 30.10.2014. One of the main competitors for hydronic systems is variable refrigerant flow ('VRF') systems in which CIAT  is  not  active
at all. The proposed transaction does not, therefore, result in affected markets  with  respect  to  this  potential  segment  at  all.  See  the
Notifying Party's submission of 1 December 2014.

[36]  See, for instance confirmed minutes of a call with a French customer 24.10.2014. See also replies to the Questionnaire for  Customers  Q1a,
questions 33–4; Questionnaire for Customers Q1b, questions 30–1; and replies to the Questionnaire for customers Q1c, questions 13–4.

[37]  Replies to the Questionnaire for Customers Q1a, questions 33–4; replies to  the  Questionnaire  for  Customers  Q1b,  questions  30–1;  and
replies to the Questionnaire for Customers Q1c, questions 13–4. See  also, for instance confirmed minutes  of  a  call  with  a  French  customer
30.10.2014 and confirmed minutes of a call with a Dutch customer 30.10.2014.

[38]  Replies to the Questionnaire for Customers Q1a, questions 23 and 34; replies to the  Questionnaire  to  Customers  Q1b,  question  20;  and
replies to Questionnaire for Customers Q1c, questions 11 and 31.

[39]  Replies to the Questionnaire to Competitors, questions 39–40.

[40]  See replies to the Questionnaire for Customers Q1a, question 30. It should further be noted that UTC is also active in a  number  of  other
technical building solutions, such as lifts and fire control systems. […]. Moreover, only a very limited  number  of  customers  reported  having
purchased other technical building solutions together with air conditioning systems (regardless of  supplier)  or  having  been  offered  such  a
package by any supplier during 2011–2014. See replies to the Questionnaire to Customers Q1a, questions 24–5, and replies to the Questionnaire  to
Customers Q1b, questions 21–2. It should further be noted that, as UTC submits, the acquisition of CIAT would only result in a limited  extension
to UTC's present product portfolio and therefore its ability to engage into bundling would not significantly increase.

[41]  Replies to Questionnaire to Customers Q1a, question 30. Lennox was also mentioned by customers as  being  particularly  strong  in  rooftop
units.

[42]  Replies to Questionnaire to Customers Q1a, questions 28–30.

[43]  Replies to the Questionnaire to Competitors, question 41.