The European Commission has opened an in-depth investigation to assess Vodafone’s proposed acquisition of Liberty Global’s business in the Czech Republic, Germany, Hungary and Romania under EU merger regulations. The commission is concerned the takeover may reduce competition in Germany and the Czech Republic.
Commissioner Margrethe Vestager, in charge of competition policy, said: “It’s important that all EU consumers have access to affordable and good quality telephone and TV services. Our in-depth investigation aims to ensure that Vodafone’s acquisition of Liberty Global’s telecommunications businesses in the Czech Republic, Germany, Hungary and Romania will not lead to higher prices, less choice and reduced innovation in telecoms and TV services for consumers.”
In the Czech Republic, Hungary and Romania, Vodafone is mainly active as a mobile network operator, and Liberty Global as a fixed telecommunications operator.
In Germany, Vodafone and Liberty Global operate non-overlapping coaxial cable networks (for example, networks that cover different areas and regions). Vodafone is also active in areas where Liberty Global offers cable services via wholesale access to Deutsche Telekom’s xDSL network.
The commission’s initial market investigation identified the a number of main concerns. In the Czech Republic it believes that providers of standalone telecommunications services could be shut out of the retail market for mobile telecommunications services, the retail market for internet access services and the retail market for TV services, because of the converged products that the merged entity could offer.
At this stage, the commission has not identified any specific competition concerns relating to the proposed merger for the Hungarian and Romanian markets.
The commission will now carry out an in-depth investigation into the effects of the transaction to determine whether its initial competition concerns are confirmed and has 90 working days, until May 2, 2019, to take a decision.