Finnish Competition and Consumer Authority (FCCA) has approved, subject to conditions, the acquisition of Suomen Transval Group Oy by Posti Group Oyj. A condition for the approval of the acquisition was that Posti undertakes to offer internal logistics outsourcing services for one year to 3PL operators who are Posti’s competitors. Posti also commits to protecting confidential data acquired by Transval from its customer relationships by keeping it separate from Posti’s information systems for three years.
Posti Group Oyj is the parent company of the Posti group. Business operations of the group’s subsidiaries include delivery of mail and messages, logistics operations, service and information logistics operations, payment transaction and credit institution operations and real estate business.
Suomen Transval Group Oy is an internal logistics company that implements internal logistics solutions for logistics and industrial sites. Transval’s customer base consists primarily of operators of different sizes in the commercial, industrial and logistics sectors.
The FCCA initiated further proceedings concerning the acquisition on 7 December 2018. The FCCA’s initial assessment was that the acquisition may have adverse effects on competition in the market for outsourced internal logistics services, particularly for 3PL (3rd party logistics) operators who are Posti’s competitors and use internal logistics outsourcing services provided by Transval. 3PL operators include PostNord, DHL, DSV and Schenker, among others. The FCCA’s initial assessment also concluded that the acquisition could have negative impacts on competition in relation to the protection of commercially sensitive information of 3PL operators as operators purchase services offered by Transval after the acquisition.
Commitments ensure the continued functioning of competition
Competition issues arising from a corporate acquisition can often be eliminated by setting conditions for the acquisition. The FCCA has deemed that the commitments that Posti has proposed at an early stage of the assessment process are sufficient to eliminate any competition problems related to the acquisition. For this reason, the FCCA has not carried out a full-scale competition effect assessment on the case. The early commitment solution made it possible to process the case relatively quickly.
With the conditions, Posti agrees that Transval shall offer internal logistics outsourcing services to 3PL operators for one year from the date of the decision by the FCCA. This prevents the group from eliminating 3PL operators from the market of outsourced internal logistics by refusing subcontracting. Being able to reliably purchase subcontracting from the group for one year provides 3PL operators with the opportunity to reorganise the services provided by Transval as the operator’s own production or from another internal logistics provider.
Posti also commits to protecting 3PL operators’ confidential data acquired by Transval, by keeping it separate from Posti’s information systems for the duration of three years from the date of the FCCA’s decision. The commitment makes it possible to keep the purchase of internal logistics from Transval an alternative for 3PL operators even after the acquisition.
The FCCA’s decision includes business secrets of the parties involved. The decision cannot be published until the business secrets have been removed.
Further information: Research Officer Jenna Huttu, tel. +358 29 505 3576, firstname.lastname@example.org
According to the Competition Act, the FCCA must be notified of the transaction if the combined turnover of the parties to the corporate transaction exceeds 350 million euros and the turnover from Finland of at least two of the parties exceeds a combined total of 20 million euros. The FCCA will approve a corporate transaction if it has none of the harmful impacts referred to in the Competition Act. The FCCA will intervene in corporate transactions if its investigations suggest that the acquisition substantially impedes effective competition on Finnish markets or a substantial part of the markets, particularly through the creation or reinforcement of a dominant market position. Where necessary, notifications of acquisitions are considered in two stages. The so-called first stage takes a month at most. If the acquisition is clearly not harmful to competition, or if the harmful effects can be prevented by means proposed by the parties to the acquisition, the acquisition is approved during the first stage. If not, the FCCA decides to conduct a further investigation of the matter, during which the acquisition and its competition effects are investigated in further detail.
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