European and Swedish Antitrust News (October 5, 2020)

logo: Orifarm A/S

The SCA has approved Orifarm’s acquisition of some assets from Takeda, despite some very high resulting combined market shares in OTC and prescription pharmaceutical products sold in Sweden, as price caps and new entries through imports are assumed to prevent increasing prices. In other news, the Nordic competition authorities have published a joint memorandum on digital platforms, Sweden has asked for a European preliminary ruling on a public procurement case, and the EU Commission has approved the Worldline-Ingencio merger while opening an in-depth investigation of the Danfoss – Eaton Hydraulics merger.

SCA approves Orifarm’s acquisition of Takeda assets. Danish company Orifarm is a major pharmaceutical provider in the Nordic countries, particularly in generic drugs, and is set to purchase a portfolio of assets from Takeda, including 47 OTC and prescription pharmaceutical products sold in Sweden. The Swedish Competition Authority found that the combined entity would have a market share of over 85% in one product market and over 60% in another two markets. However, the SCA concludes that the combined entity would be unable to raise prices on two of those products due to the price cap set by the Dental and Pharmaceutical Benefits Agency, while it’s easy for competitors to enter the third market with imported products. The merger will still need approval in another four countries to go ahead.

Joint Nordic memorandum on digital platforms. The Nordic Competition Authorities have published a joint memo on digital platforms, as a contribution to the EU Commission’s evaluation of future regulatory frameworks for digital platforms. The report highlights that the Nordic countries are small open and digital economies where platforms are of great benefit to consumers, but points out problems with for example exclusivity clauses and bundling as well as potential ‘killer mergers’. The authorities therefore ask for new European level ex-ante tools but stress that there must be clarity about the power to impose remedies.

Sweden asks for preliminary ruling on procurement case. A case in in Sweden concerns four public procurement contracts where The Legal, Financial and Administrative Services Agency in Sweden had contracted a supplier of electronic products that went bankrupt upon which the contracts were sold to another supplier. The Administrative courts of appeal found the transfer to be a breach of contract, but the Supreme Administrative Court has now asked the European Court for a preliminary ruling.

EU Commission opens phase-II-investigation of Danfoss – Eaton Hydraulics. Danish company Danfoss has proposed to acquire the Hydraulics business of Irish company Eaton, both of whom are leading global manufacturers of hydraulic components such as pumps, motors and valves. The Commission sees that the transaction would lead to high combined market shares in supply of Hydraulic steering units, Electrohydraulic steering valves and Orbital motors and the Commission will now carry out an in-depth investigation.

EU Commission approves Worldline-Ingencio merger subject to conditions. Worldline is acquiring Ingenico, both of which are French companies that are global providers of payment services for Point-Of-Sale terminals at merchants. The Commission found that the concentration would raise competition concerns in Belgium, Luxembourg and Austria. During the phase-I-investigation, the parties offered to divest businesses in these countries, whereby the Commission approved the merger following an extended phase-I-investigation subject to those conditions.

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