EN This text is made available for information purposes only. A summary of this decision is published in all Community languages in the Official Journal of the European Union. Case No COMP/M.5830 – Olympic/ Aegean Airlines Only the English text is authentic. REGULATION (EC) No 139/2004 MERGER PROCEDURE Article 8 (3) Date: 26/01/2011 Brussels, 26.1.2011 C (2011)316 final PUBLIC VERSION COMMISSION DECISION of 26/01/2011 declaring a concentration to be incompatible with the internal market and the EEA Agreement (Case No COMP/M.5830 - Olympic/ Aegean Airlines) (Only the English text is authentic) Commission Decision of 26/01/2011 declaring a concentration to be incompatible with the internal market and the EEA Agreement (Case No COMP/M.5830 - Olympic/ Aegean Airlines) (Only the English text is authentic) (Text with EEA relevance) THE EUROPEAN COMMISSION, Having regard to the Treaty on the Functioning of the European Union, Having regard to the Agreement on the European Economic Area, and in particular Article 57 thereof, Having regard to Council Regulation (EC) No 139/2004 of 20 January 2004 on the control of concentrations between undertakings ("the EC Merger Regulation")1, and in particular Article 8(3) thereof, Having regard to the Commission's Decision of 30 July 2010 to initiate proceedings in this case, Having given the undertakings concerned the opportunity to make known their views on the objections raised by the Commission, Having regard to the opinion of the Advisory Committee on Concentrations2, Having regard to the final report of the Hearing Officer in this case 3, WHEREAS: 1 OJ L 24, 29.1.2004, p. 1. 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 OJ C ...,...20. , p.... 3 OJ C ...,...200. , p.... I. INTRODUCTION AND PROCEDURE (1) On 24 June 2010, the Commission received a notification of a proposed concentration pursuant to Article 4 of Council Regulation (EC) No 139/2004 ("the Merger Regulation") by which the Vassilakis Group of companies, Greece ("Vassilakis"), Marfin Investment Group, Greece ("Marfin") and the Laskaridis Group of companies, Greece ("Laskaridis") (collectively "the Parties") acquire joint control by way of purchase of shares over a newly merged company ("the merged entity") including the businesses of the following previously independent Greek companies: a) Aegean Airlines S.A. ("Aegean")4; and b) Olympic Air S.A. ("Olympic Air")5, Olympic Handling S.A. ("Olympic Handling") and Olympic Engineering S.A ("Olympic Engineering") (collectively, "Olympic"). (2) After examination of the notified transaction described in recital (1) ("the transaction"), the Commission concluded that the notified operation fell within the scope of the Merger Regulation and raised serious doubts as to its compatibility with the internal market and the EEA Agreement. The Commission therefore initiated proceedings in accordance with Article 6(1)(c) of the Merger Regulation on 30 July 2010 ("the decision opening proceedings"). (3) The Parties submitted their written comments on the decision opening proceedings on 10 August 20106. (4) Following a request by the Parties, a non-confidential version of certain key submissions of third parties collected during the first phase investigation was provided to the Parties on 17 August 2010. (5) On 1 September 2010, pursuant to Article 11(3) of the Merger Regulation, the Commission addressed a decision to Marfin and a decision to Olympic Air, requiring those undertakings to provide email correspondence of selected individuals over a certain time period. The requested information was needed to assess the relevant context of the transaction and in particular Olympic Air's financial situation. Further to that request, the proceedings were suspended from 2 September 2010 until 28 September 20107. 4 IATA airline designator of Aegean is "A3". 5 IATA airline designator of Olympic Air is "OA". 6 Reply of the Parties to the decision opening proceedings of 30 July 2010. 7 Under Article 9 of Commission Regulation No (EC) 802/2004 of 7 April 2004 implementing Council Regulation (EC) No 139/2004 on the control of concentrations between undertakings (OJ L 133, 30.4.2004, p. 1), the time limits referred to in Article 10(3) of the Merger Regulation are suspended for the period between the end of the time limit fixed in the first request for information and the receipt of complete and correct information required by a decision adopted pursuant to Article 11(3) of the Merger Regulation. 4 (6) On 20 October 2010, a Statement of Objections was sent to the Parties, pursuant to Article 18 of the Merger Regulation. The Parties submitted their reply to the Statement of Objections on 5 November 2010. A Hearing took place at the Parties' request on 11 November 2010. On 18 November 2010 the Commission sent the Parties a Supplementary Statement of Objections, to which the Parties replied to on 23 November 2010. On 6 December 2010, the Commission sent the Parties a Letter of Facts. In order to allow the Parties to assess the content of the Letter of Facts the Commission granted access to a data room to the Parties' mandated external expert on 10 December 2010. The Parties replied to the Letter of Facts on 13 December 2010. The Advisory Committee was convened on 13 January 2011. (7) In order to address competition concerns identified in the Statement of Objections, the Parties submitted commitments on 12 November 2010 pursuant to Article 8(2) of the Merger Regulation. On 18 November 2010, the Parties submitted a revised version of these commitments. Following submission of this revised version, the Commission launched a market test to gather the views of relevant market participants on the effectivness of the proposed commitments. On 29 November 2010, the Parties submitted a new version of the commitments which was subsequently modified on 6 December 2010. On the same day, the Commission launched a market test of these modified commitments. II. THE PARTIES (8) Vassilakis is a privately owned Greek group of companies with investments in aviation (Aegean), ground handling (Goldair Handling), car rental and leasing as well as car import and distribution. (9) Marfin is an investment group with investments in aviation (Olympic Air), ground handling (Olympic Handling), maintenance, repair and overhaul services (Olympic Engineering), in-flight catering (Olympic Catering), shipping (including Attica Group's Superfast Ferries and Blue Star Ferries which are active on several routes between the Greek mainland and islands in the Aegean sea as well as other car- passenger transport and freight services active in the Adriatic Sea), healthcare, IT and telecoms, tourism and leisure, and the food and beverages sectors. (10) Laskaridis is a privately owned group of companies with investments in aviation (Aegean), shipping and shipyards, ground handling, tourism and real estate. (11) Aegean is a listed independent8 Greek airline providing scheduled and charter air passenger transport as well as air cargo transport. Since 1999, Aegean has been offering scheduled flights on Greek domestic routes and international short-haul routes. It operates a base at AIA and currently serves more than 45 short-haul destinations 8 Aegean's largest shareholders are Vassilakis (36.3%), Laskaridis (19%), Piraeus Bank (4.7%), […]* (6.4%), […]* (6%), […]* (4.7%) with remaining shares in free float (16.9%) on the Athens Stock Exchange. According to the parties, no entity currently exercises control over Aegean after the termination of a Shareholders' Agreement between Vassilakis and Laskaridis following Aegean's listing in 2007. […]*. * Parts of this text have been edited to ensure that confidential information is not disclosed; those parts are enclosed in square brackets and marked with an asterisk. 5 (including some public service obligation routes). Aegean joined the Star Alliance9 on 30 June 2010. (12) Olympic is solely controlled by Marfin and consists of three entities: i. Olympic Air is active in air transport of passengers and cargo. It started its operations on 1 October 2009 following the privatisation of former Olympic Airlines ("Old Olympic")10 during which Marfin acquired the brand, slots and licenses of liquidated Olympic Airlines11. Olympic Air operates a base at AIA and serves around 40 short-haul destinations (including some public service obligation routes). It does not belong to any airline alliance; ii. Olympic Handling offers a full range of ground handling services at 39 Greek airports, serving both Olympic Air and third party airlines; iii. Olympic Engineering is currently in start-up mode and will provide maintenance, repair and overhaul services ranging from the handling of general events for a single aircraft to full support packages for commercial airplanes. III. THE TRANSACTION AND THE CONCENTRATION (13) According to a Share Purchase Agreement ("SPA") signed between the Parties on 22 February 2010, the transaction is to be achieved in three steps: a) […]*; b) […]*; 9 The Star Alliance is one of the three major airline alliances counting among its members airlines like Lufthansa, Air Canada, United Airlines, US Airways, etc. The alliance members have various degrees of bilateral or multilateral cooperation in place among themselves, ranging from code-share agreements to integrated joint