CELEX: 32013M6996
Language: en
Date: 2013-12-11 00:00:00
Title: Commission Decision of 11/12/2013 declaring a concentration to be compatible with the common market (Case No COMP/M.6996 - SECOP / ACC AUSTRIA) according to Council Regulation (EC) No 139/2004 (Only the English text is authentic)

|[pic]                             |EUROPEAN COMMISSION                                                                                      |

                                        Brussels, 11.12.2013
                                        C(2013) 9329 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|omitted has been replaced by ranges of figures or a general |           |                                                               |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                                               |
|                                                            |           |ARTICLE 6(1)(b) DECISION                                       |

                                        |                                                                           |To the notifying party                                            |

Dear Sir/Madam,

Subject:    Case No COMP/M.6996 - SECOP/ ACC AUSTRIA
         Commission decision pursuant to Article 6(1)(b) of Council Regulation No 139/2004[1]

 1. On 6 November 2013, the European Commission received a notification of a proposed concentration pursuant to Article 4 of Council  Regulation
    (EC) No 139/2004 by which, via its subsidiary Secop Kompressoren GmbH, Secop GmbH ("Secop", Germany) acquires within the meaning of  Article
    3(1)(b) of the Merger Regulation sole control of certain assets of ACC Austria GmbH ("ACC Austria", Austria).[2] Secop and ACC  Austria  are
    hereinafter referred to as "the Parties", while Secop is referred to as the "Notifying Party".

 1. THE PARTIES

 2. Secop designs, develops, manufactures and distributes hermetic reciprocating refrigeration compressors for use in household  appliances,  as
    well as for use in light commercial and mobile applications. Secop's headquarters are located in Germany, and it owns  manufacturing  plants
    in Slovakia, Slovenia and China. Secop is ultimately controlled by Aurelius AG, a private  equity  group  with  investments  varying  across
    industries such as chemicals, business services, consumer goods, food & beverage, telecommunications, media and technology.[3]

 3. ACC Austria is active in the manufacture and  distribution  of  hermetic  reciprocating  refrigeration  compressors  for  use  in  household
    appliances. Its parent company is ACC Compressors S.p.A. ("ACC Compressors", Italy), which is also active in  the  refrigerator  compressors
    sector.[4] However, by effect of the on-going insolvency proceedings in Austria (see paragraph 7 below), ACC Compressors does not manage ACC
    Austria anymore.

 4. On 20 December 2012, insolvency proceedings over the assets of ACC Austria (the "ACC Assets") were initiated by the Austrian Regional  Court
    of Graz (Landesgericht für Zivilrechtsachen Graz – the "insolvency court"). The ACC Assets are all of the assets of  ACC  Austria  that  are
    essential and necessary for the operation of the business activities, including factory and office equipment,  inventory  (stock),  customer
    and supplier data, regulatory authorisations, trademarks, patent rights, licences and other IP rights, and all other tangible and intangible
    assets. Neither ACC Compressors nor its assets and production plants are part of the proposed transaction.

 5. As part of the initiation of the insolvency proceedings, the insolvency court appointed an independent  insolvency  receiver.[5]  Insolvency
    receivers are selected by the insolvency court from a list taking into account their specific business experience. Insolvency receivers must
    be independent from the debtor in question, from any creditors and must also not represent the interests of competitors.

 6. From 20 December 2012 to 7 February 2013, ACC Austria was in proceedings with  self-administration  where  the  insolvency  receiver  has  a
    supervisory role and must give its approval for certain actions such as the sale of the business or the taking  up  of  loans.  During  this
    period, ACC Austria continued to be managed by ACC Compressors.

 7. On 7 February 2013, following an application by  ACC  Austria,  the  insolvency  proceedings  were  changed  to  proceedings  without  self-
    administration: under these proceedings, only the insolvency receiver, and no longer ACC Compressors,  has  the  right  to  manage,  and  to
    dispose of, the ACC assets. All actions taken in this context are subject to the monitoring and control of  the  insolvency  court  and  the
    creditors' committee (in German Gläubigerausschuss). The creditors' committee is an insolvency institution similar to a board of  directors,
    and oversees the activities the insolvency receiver.[6] Since 7 February 2013, ACC Compressors thus no longer manages ACC  Austria  and  its
    assets.[7]

 8. During the proceedings without self-administration, ACC Austria proposed a reorganisation plan that was ultimately refused by the creditors'
    committee on 17 April 2013. As a consequence, on 19 April 2013, the reorganisation plan was withdrawn by ACC Austria, following the explicit
    approval of ACC Compressors.

 2. THE OPERATION

 9. On 20 March 2013, ACC Austria's insolvency receiver initiated a tender procedure for the sale of the ACC assets.[8]

10. On 18 April 2013, four bidders presented individual offers for the ACC assets to the insolvency court and to the  creditors'  committee.  On
    that same date, the creditors' committee made a preliminary decision in favour of Secop, based on the latter’s purchase  price  and  on  its
    experience in the sector. The asset purchase agreement ("APA") was concluded on 24 April 2013 and approved by the insolvency  court  on  the
    same day.

11. Further to the APA, Secop will acquire control over the ACC Assets. Following the closing of the proposed transaction, Secop also intends to
    conclude new employment relationships with the existing personnel of ACC Austria.

12. In light of the above, the proposed transaction constitutes a concentration within the meaning of Article 3(1)(b) of the Merger Regulation.

 3. EU DIMENSION

13. The proposed transaction does not meet the thresholds under Article 1 of the Merger Regulation. On 6 August 2013,  however,  Secop  informed
    the Commission by way of a reasoned submission under Article 4(5) of the Merger Regulation that the  proposed  transaction  was  capable  of
    being reviewed under the national competition laws of at least three Member States (Germany, Poland and Hungary).  As  none  of  the  Member
    States competent to examine the concentration under its national competition law expressed its disagreement with the  request  for  referral
    within the 15 working day period, the proposed concentration is deemed to have an EU dimension.

 4. COMPETITIVE ASSESSMENT

14. The proposed transaction leads to a horizontal overlap between Secop and ACC Austria, as both are active in the manufacture and distribution
    of hermetic reciprocating refrigeration compressors for household appliances.[9]

      1. Market definition

   1. Product market definition

15. Refrigeration compressors are devices used to lower the temperature of an enclosed space by removing heat from that space  and  transferring
    it elsewhere. They use a circulating refrigerant as the medium that absorbs and removes heat from the space to be  cooled  and  subsequently
    rejects that heat outside the enclosed space.

16. Today, nine main technologies are used in the compressor industry, namely stirling, linear, rotary,  semi-hermetic  reciprocating,  hermetic
    scroll, semi-hermetic screw, screw open, centrifugal, and hermetic reciprocating. Only a few of these technologies  are  used  in  household
    appliances: the main technology is hermetic reciprocating although linear, rotary and hermetic scroll are also used to a limited extent.[10]
    In addition, the activities of the Parties overlap only as regards one  of  these  technologies,  hermetic  reciprocating  technology,  i.e.
    compression generated with pistons attached to a rotary shaft.

17. In past cases, the Commission has left open the relevant product market definition for compressors.[11]

18. According to the Notifying Party, compressors used in refrigerators are part of a separate product market from  compressors  used  for  air-
    conditioning because the technologies are not substitutable. Since, however, certain companies are active both in relation to  refrigerators
    and air-conditioning systems, the Notifying Party does not exclude that there may be an overall product market for  compressor  technologies
    including both types.

18. The Notifying Party further argues that the relevant product market is the market for hermetic reciprocating compressors.  According  to  the
    Notifying Party, there is no need to further segment the market. In particular,  the  Notifying  Party  disagrees  with  a  possible  further
    segmentation according to: (i) the end use of the compressors (i.e. household appliances, light commercial, mobile  applications);  (ii)  the
    efficiency category; or (iii) the fixed speed/variable speed technologies used.

19. As mentioned in paragraph 54 below, ACC Compressors has submitted an alternative market definition based on a number of  criteria,  including
    the quality of the compressor. The Commission will address this alternative market definition in paragraph 62 below.

20. A large majority of the customers and of the competitors that replied to  the  market  investigation  indicated  that  compressors  for  air-
    conditioning and for refrigeration purposes are not substitutable as they have different technical characteristics.[12] As regards  different
    compressor technologies, a majority of the customers and approximately half of the competitors that responded  to  the  market  investigation
    indicated that, in their view, the different compressor technologies are not  substitutable.[13]  As  regards  refrigeration  compressors  in
    particular, a majority of the competitors that responded to the market investigation  considered  that  manufacturers  cannot  easily  switch
    production between the different technologies for household refrigerators (such as hermetic reciprocating or linear).[14]

21. Regarding a possible segmentation by end use, from a demand side perspective, a majority of  the  customers  that  responded  to  the  market
    investigation indicated that the same hermetic reciprocating compressor cannot be used in household appliances,  light  commercial  appliance
    and mobile applications mostly because of technical requirements.[15] From the  supply  perspective,  a  majority  of  the  competitors  that
    responded to the market investigation indicated that compressors for different end uses are likely to belong to separate markets because  the
    design and operating conditions of the compressors differ.[16]

22. Regarding a possible segmentation by efficiency category, a majority of the customers that responded to the  market  investigation  indicated
    that energy efficiency, even if increasingly important, is only one of  several  criteria  they  take  into  account  when  they  purchase  a
    compressor.[17] Certain of the customers that responded to the market investigation also indicated that they procure  a  mix  of  compressors
    with different energy efficiencies.[18] A customer also specified that while the compressor is an important  drive  for  the  overall  energy
    efficiency of the refrigerator, there are other ways to improve such efficiency (e.g. the design of the refrigerator) and that  there  is  no
    distinct market for high-efficiency compressors.[19] Furthermore, some respondents to the market investigation indicated  that  most  of  the
    major compressor manufacturers, including certain Chinese producers, are able to offer high  efficiency  compressors.[20]  In  light  of  the
    above, the Commission considers that there is no basis, in this case, to further  segment  the  market  according  to  the  different  energy
    efficiency levels of compressors.

23. Regarding a possible segmentation between fixed and variable speed compressors, it should be noted that fixed speed compressors are the  most
    common type of compressors and can be produced by every manufacturer.[21] As regards variable speed  compressors,  differing  positions  were
    expressed during the market investigation: while certain manufacturers indicated that they  can  produce  variable  speed  compressors,  some
    customers indicated that they believed there were few producers  doing  so.[22]  Some  manufacturers  also  indicated  that  their  customers
    sometimes require variable speed compressors.[23]

24. In any event, for the purposes of the assessment of the notified transaction, the exact  delineation  of  the  relevant  product  markets  as
    regards end use and technology can be left open since the notified transaction does not raise serious doubts as to its compatibility with the
    internal market under any plausible market definition.

   2. Geographic market definition

25. In past cases, the Commission has left open the relevant geographic market definition for compressors.[24]

26. The Notifying Party claims that the relevant geographic market (regardless of the product market definition) is: (i) world-wide in scope;  or
    (ii) at least EEA-wide in scope and including Belarus, Ukraine, Russia, Serbia, Switzerland and Turkey ("EEA+"); or (iii) at  least  EEA-wide
    in scope. According to the Notifying Party, there are large cross-border trade flows and low transportation costs, both  at  global  and  EEA
    level.

27. The overwhelming majority of respondents to the  market  investigation  indicated  that  they  source  hermetic  reciprocating  refrigeration
    compressors on a worldwide level for production plants located in the EEA.[25] Furthermore, the  respondents  indicated  that  there  are  no
    limitations as such to sourcing compressors from any geographic area, although one respondent mentioned transport costs,  delivery  time  and
    customs as limitations.[26] The majority of respondents also indicated that transport costs normally represent only 0–5% of the  final  price
    of refrigeration compressors.[27]

28. In the light of the above, the Commission considers that the geographic market of the market for hermetic reciprocating compressors (and  its
    possible segments) is at least EEA-wide, although for the purpose of this decision the precise geographic market definition can be left  open
    since the notified transaction does not raise serious doubts as to its compatibility with the internal  market  under  any  plausible  market
    definition.

   2. Competitive assessment

29. The transaction will lead to horizontally  affected  markets  on  a  potential  market  encompassing  all  types  of  hermetic  reciprocating
    refrigeration compressors in the EEA and on a potential narrower market encompassing only hermetic  reciprocating  refrigeration  compressors
    for household appliances in the EEA.[28]

   1. Non-coordinated effects

30. On the EEA market for all types of hermetic reciprocating compressors, the Parties estimate that their combined 2012 market share  was  below
    [30-40]% both in value and in volume ([20-30]% in value and [20-30]% in volume). On this market, according to their  estimates,  the  Parties
    will face strong competition from both Embraco (2012 market share of [20-30]% in value and [20-30]% in volume)  and  Jiaxipera  (2012  market
    share of [10-20]% in value and [10-20]% in volume).

31. During the course of its market investigation, the Commission gathered sales data in  order  to  reconstruct  the  EEA  market  for  hermetic
    reciprocating refrigeration compressors for household appliances. The Commission's calculations are based on  the  replies  of  a  number  of
    manufacturers of compressors active on the merchant market and on the reply of one  manufacturer  with  only  captive  sales.  Since  certain
    manufacturers did not respond to the Commission's request for information, the market value is lower than in reality,  with  the  consequence
    that the market shares provided in the tables below overestimate the position of the various players. Even on that basis, however, the market
    shares of ACC Austria and Secop remain lower than the 2012 market shares estimates provided by Secop in the notification.

32. Merchant market share estimates for the  Parties  and  their  main  competitors  on  the  narrower  EEA  market  for  hermetic  reciprocating
    refrigeration compressors for household appliances, as calculated by the Commission on the basis of the results of the market  investigation,
    are indicated in the table below:

|EEA market for hermetic reciprocating refrigeration compressors for household appliances, 2012                                      |
|                                                                                                                              |
|Year                       |Parties' combined EEA market share, merchant market      |Parties' combined EEA market share,      |
|                           |                                                         |captive use included                     |
|                           |Value                       |Volume                      |Value               |Volume              |
|2012                       |[20-30]%                    |[20-30]%                    |[10-20]%            |[10-20]%            |
|January-June 2013          |[10-20]%                    |[10-20]%                    |[10-20]%            |[10-20]%            |

      Source: Commission's market reconstruction

33. As indicated in the tables above, post-transaction, a number of suppliers will remain active on the market. These include  Embraco,[29]  that
    will remain the market leader and is described by some customers as a company with a strong capacity to innovate and the  widest  variety  of
    products,[30] and Jiaxipera, a Chinese company with a similar market share to that of Parties. Certain customers and competitors also mention
    Donper, a Chinese company, as an alternative supplier,[31] as well as the recent entry  of  the  Chinese  manufacturer,  Wanbao.[32]  Certain
    competitors and customers stated that the Chinese manufacturers compete quite aggressively in the EEA.[33]

34. The market data collected by the Commission during the market investigation indicates that between 2010 and 2012, the  merchant  market  grew
    by approximately [10-20]% both in value and volume. Over that same period, Secop's and ACC Austria's sales decreased both in value and volume
    whereas Embraco's and Jiaxipera's increased, both in value and volume. In a growing market, the Parties were therefore unable to maintain the
    value and volume of their sales whereas their main competitors grew theirs. The Commission considers that this trend further  emphasises  the
    limited market position of the Parties.

35. The Commission also notes that certain original equipment manufacturers (OEMs) of refrigerators, such as Panasonic, LG and  Samsung,  produce
    their own hermetic refrigeration compressors in-house and have started to be  active  on  the  merchant  market  for  hermetic  reciprocating
    refrigeration compressors.[34] According to the data collected by the Commission during the market investigation, the value  of  the  captive
    market was approximately [40-50]% of the value of the merchant market in 2012.

36. In addition, all customers that responded to the market investigation indicated that  in  addition  to  Embraco  and  Jiaxipera,  there  will
    remain, post-transaction, a sufficient number of alternative suppliers to Secop and ACC Austria for hermetic reciprocating  compressors  such
    as Donper, Wanbao, LG, and Panasonic.[35] A large majority of customers and of competitors also considered that  there  is  sufficient  spare
    production capacity for refrigeration compressors.[36]

37. In addition, the market investigation supported the Notifying Party's position according to which Secop and ACC Austria are not each  other's
    closest competitors on the market for hermetic reciprocating refrigeration compressors for household appliances.[37] A majority of  customers
    consider that Secop’s closest competitors of are Embraco (mostly due to its  technology  and  product  portfolio)  and  Jiaxipera  while  ACC
    Austria’s closest competitors are also Embraco and Jiaxipera.[38] A majority of competitors also did  not  mention  ACC  Austria  as  Secop's
    closest competitor and vice versa.[39]

38. As noted above, the Parties' market shares are lower if captive use by integrated OEMs is taken into account. Some customers  mentioned  that
    certain OEMs, namely Samsung, LG and Panasonic, have started to be active on the merchant market  for  hermetic  reciprocating  refrigeration
    compressors.[40]

39. Moreover, the customers of hermetic  reciprocating  refrigeration  compressor  manufacturers  are  large  multinational  OEMs  such  as  BSH,
    Whirlpool, Liebherr or Electrolux and respondents to the market investigation indicated that these customers have buyer power that they  use,
    during negotiations with compressor manufacturers, to impose higher quality requirements and lower prices.[41]

40. As regards competition on the possible segment for variable speed compressors, some respondents to the market  investigation  indicated  that
    they generally have a higher efficiency and that the segment for this category of products in the EEA is small but growing.[42]  ACC  Austria
    does, however, not sell variable speed compressors and Secop has only recently started supplying them. As a result, the transaction will  not
    lead to any overlap in the variable speed compressors segment and will not eliminate an important innovator on the market.

41. As regards the possible segment for fixed-speed compressors, in light of the limited  number  of  variable  speed  compressors  sold  on  the
    market, and the even smaller number of such compressors sold by Secop,[43] the combined 2012  market  share  of  the  Parties  on  a  segment
    comprising only fixed speed compressors in the EEA was roughly equivalent to the market share of  the  Parties  on  the  overall  market  for
    hermetic reciprocating compressors for household appliances. The competitive conditions on the fixed-speed compressors segment, in particular
    the existence of a number of alternative suppliers, the pressure from Chinese  manufacturers  and  from  integrated  OEMs,  as  well  as  the
    existence of buyer power, are the same as on the market for hermetic reciprocating refrigeration compressors for household appliances.

42. Finally, while one niche customer expressed certain concerns,[44] a majority of the customers that  responded  to  the  market  investigation
    indicated that the transaction will either not have a negative effect on the market for household compressors,[45] or have a positive  impact
    on innovation and from a logistical point of view.[46] As regards competitors, one respondent  mentioned  the  possibility  that  the  merged
    entity may increase its capacity to reduce its prices.[47] One integrated OEM expressed concerns regarding  access  to  the  merged  entity's
    products. This concern, however, was not substantiated and the respondent subsequently confirmed that sufficient alternative  and  innovative
    suppliers will remain.[48]

43. In light of the above, the Commission concludes that the proposed transaction does not raise serious doubts as to its compatibility with  the
    internal market as a result of non-coordinated effects.

   2. Coordinated effects

44. Despite the existence of past coordination on the market,[49] the Notifying Party claims that the proposed transaction will not lead  to  any
    coordinated effects inter alia because of a lack of transparency on the market, the strong influence of Chinese manufacturers  and  the  fact
    that customers are sophisticated buyers.

45. For the reasons set out below, the Commission considers that the proposed transaction will  not  lead  to  any  coordinated  effects.  First,
    customers have significant buyer power (see paragraph 40 above) and can play different suppliers against each other. As  also  stated  above,
    all customers confirmed that sufficient competitive alternatives will remain.

46. Second, several OEMs with  in-house  production  capacities  exercise  a  competitive  pressure  on  the  hermetic  reciprocating  compressor
    manufacturers (see paragraph 36 above), and there are indications that some of them have started to be active on the  merchant  market.  Such
    entry (and/or its threat) will further deter the established players from possibly coordinating their behaviour.

47. Third, Chinese manufacturers play an increasing role on the hermetic reciprocating compressors market and customers are increasingly  relying
    on them (see paragraphs 34 and 40 above). Indeed, a majority of competitors and approximately half of the customers  that  responded  to  the
    market investigation noted that the price of compressors has been steadily declining over the past five years, one of the main reasons  being
    the competitive pressure exercised by Chinese manufacturers.[50]

48. In light of the above, the Commission concludes that the proposed transaction does not raise serious doubts as to its compatibility with  the
    internal market as a result of coordinated effects.

   3. The claims by ACC Compressors

49. […].

50. […].

51. […].

52. […] ACC Compressors […] argued that […] there has been an early implementation of the transaction.

53. […].

54. […] ACC Compressors argues that there is a separate European market for premium compressors for  household  refrigerators.  Such  a  separate
    market exists due to an array of criteria, including quality and the geographical proximity of the manufacturer with top brand  refrigerators
    that guarantees short delivery time with high flexibility on product mix, superior customer  services  and  joint  research  and  development
    activities with the customers. According to ACC Compressors, only ACC Compressors, ACC Austria, Secop  and  Embraco  are  active  on  such  a
    market. […][51]

55. […].

56. First, the Commission has not found any evidence that the transaction was implemented early. In particular, there is  no  evidence  that  the
    circumstances mentioned in paragraph 35 of the Consolidated Jurisdictional notice are fulfilled.[52] The insolvency  receiver  was  appointed
    before the tender procedure and is required by Austrian law to be independent from both the debtor and competitors. Its actions  are  checked
    and controlled by the insolvency court and the creditors' committee.[53] In addition, in this particular case, the insolvency receiver  bears
    the economic risk of the on-going business of ACC Austria as it concluded an overdraft facility agreement of 7.5 million with a bank.[54]

57. […] ACC Compressors is currently in insolvency proceedings.

58. […] A majority of customers that responded to the market investigation indicated that  enough  alternative  compressors  manufacturers  would
    continue to produce refrigeration compressors post-transaction, […].[55] A majority of customers that responded to the  market  investigation
    also indicated that enough innovation would remain post-transaction […].[56]

59. In its assessment, the Commission also considered the possibility that, […], customers of ACC Compressors would turn to ACC Austria  as  both
    companies produce similar refrigeration compressors, in particular the so-called "KAPPA-line" compressors. However, the sales  data  provided
    by ACC Austria and ACC Compressors suggests that customers are unlikely to adopt such behaviour. Indeed, between 2010 and the first  semester
    of 2013, the sales of ACC Austria and ACC Compressors both simultaneously decreased (there was a particularly strong decrease  in  the  first
    semester of 2013). This indicates […], ACC Compressors customers would likely turn to a manufacturer of refrigeration compressors other  than
    ACC Austria.

60. The Commission has nonetheless investigated the scenario in which all ACC Compressors' sales would be transferred to  ACC  Austria  based  on
    sales figures pre-dating the drop in ACC Austria's sales in 2013.

61. First, the Commission considers unfounded ACC Compressors' claim that a "premium" market exists, based on  a  number  of  criteria  involving
    product-specific elements, geographical elements and elements that relate to the specific relationships between customers and  manufacturers.
    This is because such criteria do not correspond to the basic principles used by the Commission in its notice on the  definition  of  relevant
    market for the purposes of competition law to define a relevant product market.[57] In addition, not only did no  respondent  to  the  market
    investigation refer to the possible existence of a premium market, but certain customers specifically  mentioned  both  that  no  such  high-
    quality or high-efficiency market exists and that all refrigeration compressor manufacturers, including those located in China, are  able  to
    produce high quality refrigeration compressors.[58]

62. Second, the Commission considers, in light of its market reconstruction, that even if all the sales of ACC Compressors  were  transferred  to
    the merged entity, the latter would become only the number two player on the EEA  market  for  all  hermetic  reciprocating  compressors  for
    household appliances, with 2012 market shares in the range of 30-40% in volume and 20-30% in value. On this market, Embraco would remain  the
    market leader with 2012 shares in the range of 30-40% in volume and 40-50% in value. Jiaxipera  would  also  continue  to  exert  significant
    pressure with 2012 market shares close to the merged entity (in the range of 30-40% in volume and 20-30%  in  value).[59]  In  addition,  the
    competitive pressure from Chinese manufacturers and OEMs with in-house capacity described in paragraphs 34 and 36 above  would  also  remain.
    OEMs would also continue to exercise buyer power.

63. […].

   5. CONCLUSION

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

                                        For the Commission
                                        (signed)
                                        Joaquín ALMUNIA
                                        Vice-President

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

[2]   Publication in the Official Journal of the European Union No C 330, 14.11.2013, p. 11.

[3]   Except for Secop, none of the Aurelius portfolio companies has any overlap or vertical link with ACC Austria.

[4]   Unlike ACC Austria, ACC Compressors has no research and development department and is therefore not active in the  design  and  development
    of compressors.

[5]   See Articles 80, 80 (a) 80 (b) 81, 81(a) of the Austrian Insolvency Law. See reply to the request for information of 6 December 2013.  Kapp
    Rechtanwalts GmbH (now called Kapp & Strimitzer Rechtsanwälte GmbH) represented by Mag. Mario Kapp was appointed as insolvency  receiver  by
    order of the insolvency court on 20 December 2012.

[6]   See letter of the insolvency receiver of 9 December 2013.

[7]   ACC Compressors has also been in economic and financial difficulties. By order of 28 June 2013, the Tribunale  di  Pordenone  declared  the
    status of insolvency for ACC Compressors according to Articles 3 and 8 of the Italian Legislative Decree 270/99 (see letter  of  24  October
    2013). However, ACC Compressors currently still produces and distributes refrigeration compressors.

[8]   The tender procedure was launched in parallel to the reorganisation plan proposal.

[9]   See paragraphs 180 and 224 of the Form CO. ACC Austria is not active in the light commercial compressors and  mobile  application  segments
    and has no plans to enter such segments within the next two years.

[10]  See page 60 of the Form CO and replies to question 4 of the Commission’s  request  for  information  pursuant  to  Article  11  of  Council
    Regulation (EC) No 139/2004 addressed to customers – Compressors - (Q2), dated 8 November 2013.

[11]  See most recently COMP/M.5048 - Ingersoll Rand/Trane, paragraphs 8 and 9.

[12]  See replies to question 7 of the Commission’s request for information pursuant to  Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to customers – Compressors - (Q2), dated 8 November 2013 and to question 8 of the Commission’s request for information pursuant to
    Article 11 of Council Regulation (EC) No 139/2004 addressed to competitors – Compressors – (Q1), dated 8 November 2013.

[13]  See replies to question 8 of the Commission’s request for information pursuant to  Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to customers – Compressors - (Q2), dated 8 November 2013 and to question 9 of the Commission’s request for information pursuant to
    Article 11 of Council Regulation (EC) No 139/2004 addressed to competitors – Compressors – (Q1), dated 8 November 2013.

[14]  See replies to question 12 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to competitors – Compressors – (Q1), dated 8 November 2013.

[15]  See replies to question 9 of the Commission’s request for information pursuant to  Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to customers – Compressors - (Q2), dated 8 November 2013.

[16]  See replies to question 11 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to competitors – Compressors – (Q1), dated 8 November 2013.

[17]  See replies to questions 10.1 and 10.3 of the Commission’s request for information pursuant to Article 11 of  Council  Regulation  (EC)  No
    139/2004 addressed to customers – Compressors – (Q2), dated 8 November 2013. For example, customers also take into account the  price  of  a
    compressor, its dimensions, its power range and the noise it generates. See also agreed minutes of  a  conference  call  with  customers,  9
    December 2013.

[18]  See replies to question 10.1 of the Commission’s request for information pursuant to Article 11 of  Council  Regulation  (EC)  No  139/2004
    addressed to customers – Compressors – (Q2), dated 8 November 2013.

[19]  See agreed minutes of a conference call with a customer, 9 December 2013.

[20]  See the agreed minutes of conference calls with customers, 21 November 2013 and 9 December 2013.

[21]  See for instance agreed minutes of a conference call with a customer, 17 October 2013, describing fixed speed compressors as a commodity.

[22]  See replies to question 5 of the Commission’s request for information pursuant to  Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to competitors – Compressors – (Q1), dated 8 November 2013. See also, for example,  reply  to  question  29  of  the  Commission’s
    request for information pursuant to Article 11 of Council Regulation (EC) No 139/2004 addressed to customers – Compressors – (Q2),  dated  8
    November 2013.

[23]  See replies to question 15 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to competitors – Compressors – (Q1), dated 8 November 2013.

[24]  See most recently for example COMP/M.5048 - Ingersoll Rand/Trane, paragraph 10.

[25]  See replies to question 14 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to customers – Compressors - (Q2), dated 8 November 2013.

[26]  See replies to question 16 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to customers – Compressors - (Q2), dated 8 November 2013.

[27]  See replies to question 14.2 of the Commission’s request for information pursuant to Article 11 of  Council  Regulation  (EC)  No  139/2004
    addressed to customers – Compressors - (Q2), dated 8 November 2013.

[28]  According to the Parties' estimates, on a potential market  encompassing  all  compressors  for  refrigeration  and  air-conditioning,  the
    Parties' combined 2012 market share was [10-20]% in volume in the EEA (2012 market shares in value do not lead to an affected market). Since
    the proposed transaction does not raise serious doubts as to its compatibility with the internal market under  narrower  market  definitions
    (namely the EEA-wide markets for all types of hermetic reciprocating refrigeration compressors and for hermetic reciprocating  refrigeration
    compressors for household appliances), this affected market will not be discussed further in the decision.

[29]  Embraco, part of the Whirlpool group, sells hermetic refrigeration compressors  to  a  number  of  Whirlpool's  competitors.  In  addition,
    Whirlpool sources hermetic refrigeration compressors from other companies […] (see agreed minutes of 21 October 2013).

[30]  See agreed minutes of conference calls with customers, 17 October 2013, and 21 November 2013.

[31]  See replies to question 28 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to competitors – Compressors - (Q1), dated 8 November 2013 and replies to question 18 of the Commission’s request for  information
    pursuant to Article 11 of Council Regulation (EC) No 139/2004 addressed to customers – Compressors – (Q2), dated 8 November 2013.

[32]  See replies to question 26 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to customers – Compressors – (Q2), dated 8 November 2013 and replies to question 28 of the Commission’s  request  for  information
    pursuant to Article 11 of Council Regulation (EC) No 139/2004 addressed to competitors – Compressors - (Q1),

[33]  See replies to question 28 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to competitors – Compressors - (Q1) and agreed minutes of a conference call with a customer, 9 December 2013.

[34]  See agreed minutes of conference calls with customers, 17 October 2013, 18 October 2013, 21 October and 21 November. See  also  replies  to
    question 18.1 of the Commission’s request for information pursuant to Article 11  of  Council  Regulation  (EC)  No  139/2004  addressed  to
    customers – Compressors – (Q2), dated 8 November 2013.

[35]  See replies to question 18 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to customers – Compressors - (Q2), dated 8 November 2013.

[36]  See replies to question 27 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to customers – Compressors - (Q2), dated 8 November 2013 and replies to question 26 of the Commission’s  request  for  information
    pursuant to Article 11 of Council Regulation (EC) No 139/2004 addressed to competitors – Compressors - (Q1), dated 8 November 2013.

[37]  See replies to question 19 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to customers – Compressors - (Q2), dated 8 November 2013.

[38]  See replies to question 19 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to customers – Compressors - (Q2), dated 8 November 2013.

[39]  See replies to question 21 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to competitors – Compressors - (Q1), dated 8 November 2013.

[40]  See agreed minutes of conference calls with customers, 17 October 2013, 18 October 2013, and 21 November.  See  also  replies  to  question
    18.1 of the Commission’s request for information pursuant to Article 11 of Council Regulation (EC) No  139/2004  addressed  to  customers  –
    Compressors – (Q2), dated 8 November 2013.

[41]  See replies to question 28 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to customers – Compressors - (Q2), dated 8 November 2013. This capacity to impose lower prices is also mentioned by a majority  of
    competitors (see replies to question 30 of the Commission’s request for information pursuant to Article 11 of  Council  Regulation  (EC)  No
    139/2004 addressed to competitors – Compressors - (Q1), dated 8 November 2013).

[42]  See replies to question 13 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to customers – Compressors - (Q2), dated 8 November 2013, replies to question  5  of  the  Commission’s  request  for  information
    pursuant to Article 11 of Council Regulation (EC) No 139/2004 addressed to competitors – Compressors - (Q1), dated 8 November 2013) and  the
    agreed minutes of a conference call with a customer, 17 October 2013.

[43]  Secop estimates its 2012 market share for variable speed compressors did not exceed 10% in the EEA.

[44]  It should be noted that this customer subsequently explained that it is capable of sourcing from different  suppliers  and  that  there  is
    price pressure from the Chinese manufacturers. See agreed minutes, 15 November 2013.

[45]  See replies to question 33 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to customers – Compressors - (Q2), dated 8 November 2013.

[46]  See replies to questions 33 and 34 of the Commission’s request for information pursuant  to  Article  11  of  Council  Regulation  (EC)  No
    139/2004 addressed to customers – Compressors - (Q2), dated 8 November 2013. See agreed minutes of a pre-notification call with a  customer,
    17 October 2013.

[47]  See replies to questions 35 of the Commission’s request for information pursuant to Article 11  of  Council  Regulation  (EC)  No  139/2004
    addressed to competitors – Compressors - (Q1), dated 8 November 2013.

[48]  See replies to questions 38 of the Commission’s request for information pursuant to Article 11  of  Council  Regulation  (EC)  No  139/2004
    addressed to competitors – Compressors - (Q1), dated 8 November 2013 and agreed minutes of a conference call with a competitor, 27 November.

[49]  On 7 December 2011, the Commission adopted a decision in which it established that for some or all of the period  between  April  2004  and
    October 2007, a number of undertakings (including the Parties)  infringed  Article  101  TFEU  and  Article  53  of  the  EEA  Agreement  by
    participating in anti-competitive practices with a view to restricting price competition within the EEA in the  market  for  small  hermetic
    reciprocating compressors (maximum 1,5 horsepower). See Case COMP/39600 – Refrigeration compressors.

[50]  See replies to question 31 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to competitors – Compressors - (Q1), dated 8 November 2013 and replies to question 29 of the Commission’s request for  information
    pursuant to Article 11 of Council Regulation (EC) No 139/2004 addressed to customers – Compressors - (Q2), dated 8 November 2013.

[51]  […]

[52]  Commission's Consolidated Jurisdictional Notice (OJ 16.4.2008 C 95/1). See reply to the request for information dated 25 November 2013.

[53]  See replies to the request for information dated 25 November 2013 and 6 December 2013.

[54]  See reply to the request for information dated 25 November 2013.

[55]  See replies to question 20 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to customers – Compressors - (Q2), dated 8 November 2013. See also  replies  to  question  22  of  the  Commission’s  request  for
    information pursuant to Article 11 of Council Regulation (EC) No 139/2004 addressed to competitors – Compressors - (Q1),  dated  8  November
    2013.

[56]  See replies to question 20 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation  (EC)  No  139/2004
    addressed to customers – Compressors – (Q2), dated 8 November 2013.

[57]  OJ 912.1997, C 372/3.

[58]  See replies to question 10.2 of the Commission’s request for information pursuant to Article 11 of  Council  Regulation  (EC)  No  139/2004
    addressed to customers – Compressors – (Q2), dated 8 November 2013. See also agreed minutes of conference calls with customers, 21  November
    2013, and 9 December 2013. See also agreed minutes of a conference call with a competitor, 27 November  2013  that  indicated  that  Chinese
    manufacturers produce compressors of a quality equal to European manufacturers.

[59]  Figures based on the Commission's market reconstruction for 2012, see table above.