Mergers: Commission approves acquisition of Telekom Romania by Orange, subject to conditions

(Credit: Unsplash)

This article is brought to you in association with the European Commission.


The European Commission has approved, under the EU Merger Regulation, the proposed acquisition of Telekom Romania Communications (“TKR”) by Orange SA (“Orange”). The approval is conditional on the divestiture of TKR’s 30% minority shareholding in Telekom Romania Mobile Communications (“TRMC”), which is a direct competitor of Orange.

Executive Vice-President Margrethe Vestager, in charge of competition policy, said: “Europeans need access to fast and reliable communication services, with sufficient alternatives on the market. With this decision, and the commitments offered by Orange, the Romanian telecommunications market will continue to offer high quality communication services at competitive prices.”

Orange, through its Romanian subsidiaries, and TKR provide telecommunications services in Romania, both at the retail and the wholesale level. Orange’s main activities are related to mobile telecommunications, while TKR is mainly active in fixed telecommunications and TV. TKR is indirectly controlled by Deutsche Telekom (“DT”) and owns a 30% minority stake in TRMC, one of the four main mobile operators active in Romania.

The Commission’s investigation

Following its investigation the Commission found that the transaction, as initially notified, would have raised serious competition concerns on the market for retail mobile telecommunications services. In particular, Orange would have acquired TKR’s 30% minority shareholding in TRMC, one of its key competitors on this market. This may have reduced Orange’s incentives to compete with TRMC, would have given Orange access to commercially sensitive information about its competitor, and allowed it to block important investments by TRMC or the operator’s acquisition by a strategic buyer.

In addition, the Commission investigated potential competition concerns in other markets, such as the provision of fixed-mobile convergent (“FMC”) services, the retail market for business connectivity services and the wholesale market for the supply and acquisition of TV channels.

In all these markets, the Commission found that the merged entity would continue to face significant competition from other players and customers would have sufficient alternatives. In particular with regard to FMC services, the transaction would bring benefits, allowing the merged entity to offer this type of services more efficiently.

The proposed remedies

In order to address the competition concerns identified by the Commission in relation to Orange’s proposed acquisition of the 30% minority shareholding in TRMC, Orange offered to:

  • secure the divestment of TKR’s 30% minority shareholding in TRMC to Hellenic Telecommunications Organization S.A. (“OTE”), which is the current controlling shareholder of TRMC and a subsidiary of DT;
  • not to implement the transaction before TKR and OTE have reached a binding agreement on the divestment, before the Commission has approved both OTE as a suitable purchaser, and the divestment agreement, and finally before the minority stake has been transferred to OTE.

These structural commitments fully remove the competition concerns identified by the Commission in the market for retail mobile telecommunications services. The Commission has therefore concluded that the proposed transaction, as modified by the commitments, no longer raises competition concerns. The decision is conditional upon full compliance with the commitments.

Companies and products

Orange is a global telecommunications operator, active in Romania through its subsidiaries Orange Romania S.A. and Orange Business Romania S.A. It primarily offers mobile telecommunications services relying on its own mobile network, and to a very limited extent, fixed telephony, fixed internet and TV services relying almost exclusively on third-party infrastructure.

TKR is headquartered in Romania and provides fixed telecommunications services, TV services and multiple-play bundles to residential and non-residential customers, wholesale services to other telecommunications operators, and to a very limited degree, mobile telecommunications services as a Mobile Virtual Network Operator relying on an agreement with TRMC.

Merger control rules and procedures

The transaction was notified to the Commission on 8 June 2021.

The Commission has the duty to assess mergers and acquisitions involving companies with a turnover above certain thresholds (see Article 1 of the Merger Regulation) and to prevent concentrations that would significantly impede effective competition in the EEA or any substantial part of it.

The vast majority of notified mergers do not pose competition problems and are cleared after a routine review. From the moment a transaction is notified, the Commission generally has a total of 25 working days to decide whether to grant approval (Phase I) or to start an in-depth investigation (Phase II). This deadline is extended to 35 working days in cases where remedies are submitted by the parties, such as in this case.

More information will be available on the Commission’s competition website, in the Commission’s public case register under the case number M.10153.

the sting Milestones

Featured Stings

Can we feed everyone without unleashing disaster? Read on

These campaigners want to give a quarter of the UK back to nature

How to build a more resilient and inclusive global system

Stopping antimicrobial resistance would cost just USD 2 per person a year

Australia urged to evacuate offshore detainees amid widespread, acute mental distress

Any doubt?

From funders to partners: elevating community expertise to help communities thrive

German opposition win in Lower Saxony felt all over Europe

London is becoming the world’s first National Park City

Yemen consultations have started, insists top UN negotiator

Commission approves emergency measures to protect eastern Baltic cod

How data can help mining companies tackle their trust deficit

From drought to floods in Somalia; displacement and hunger worsen, says UN

From raised fists at the 1968 Olympics to taking the knee: A history of racial justice protests in sport

Will the European Court of Justice change data privacy laws to tackle terrorism?

This is how travel hotspots are fighting back against overtourism

Do all you can to resolve climate change ‘sticking points’ UN chief urges South-East Asian leaders, in Bali

Four lessons from Africa on building effective business ecosystems

Australian homes are turning to solar power in record numbers

European research priorities for 2021-2027 agreed with member states

Meeting the basic needs of our healthcare workers

Mental health: a medical school’s demand

Embracing the diversity in a multicultural city of Romania

The EU Commission lets money market funds continue the unholy game of banks

How the power of sport can bring us together and drive social justice

EU Blue Card: Commission welcomes political agreement on new rules for highly skilled migrant workers

Why building consumer trust is the key to unlocking AI’s true potential

Ukraine’s new political order not accepted in Crimea

Protecting European consumers: toys and cars on top of the list of dangerous products

This is how New York plans to end its car culture

Progress against torture in Afghan detention centres, but Government needs to do more, says UN report

European Citizens’ Initiative: Commission registers ‘Mandatory food labelling Non-Vegetarian / Vegetarian / Vegan’ initiative’

Is South Korea set to lose from its FTA with the EU?

Anti-vaccers: does the empty can rattle the most?

The role of public affairs in student NGOs

Future Forces Forum: Prague will be hosting the most important project in the field of Defence and Security

Latin America’s cities are ready to take off. But their infrastructure is failing them

Political power of women suffering ‘serious regression’, General Assembly President warns

7 top things to know about coronavirus today

How global trade can save lives and livelihoods – and help protect the planet

EU job-search aid worth €9.9 million for 1,858 former Air France workers

European Semester 2018 Spring Package: Commission issues recommendations for Member States to achieve sustainable, inclusive and long-term growth

COVID-19: Save European culture and values, MEPs tell Commission

Children suffering ‘atrocities’ as number of countries in conflict hits new peak: UNICEF

We need to rethink ESG to ensure access to water and sanitation for all

International Court of Justice orders Pakistan to review death penalty for Indian accused of spying

Rise in violent conflict shows prevention ‘more necessary than ever’: UN chief

Top UN political official updates Security Council on Iran nuclear deal

It’s not summer holidays what lead to the bad August of the German economy

How can the world end viral hepatitis by 2030? 5 experts explain

How to talk about climate change: 5 tips from the front lines

Failure to open accession talks with Albania and North Macedonia is a mistake

Myanmar doing too little to ensure displaced Rohingya return: UN refugee agency chief

Further reforms in Sweden can drive growth, competitiveness and social cohesion

EU-UK relations: solutions found to help implementation of the Protocol on Ireland and Northern Ireland

Statistics show the ugly face of youth training schemes

Croatian Presidency outlines priorities to EP committees

Media and entertainment in flux: it’s time for the close-up

5 droughts that changed human history

Are the G20 leaders ready to curb corporate tax-avoidance?

European Youth, quo vadis?

China is the first non-EU country to invest in Europe’s €315 billion Plan

EU institutions agree on priorities for coming years: A common agenda for our recovery and renewed vitality

Coronavirus Global Response: EIB and Commission pledge additional €4.9 billion

More Stings?

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s