FCCA approves acquisition of Hafslund by Fortum

The Finnish Competition and Consumer Authority (FCCA) approved on 8 June 2017 the acquisition of energy companies Hafslund Marked AS, Hafslund Varme AS and Klemetsrudanlegget AS by Fortum Corporation. The Finnish Competition and Consumer Authority has concluded that the acquisition will not significantly impede, as referred to in the Competition Act, effective competition in the Finnish market, because the growth in the parties’ share in the electricity market under review will be limited, and there are many other energy companies operating in the sector.

Fortum Corporation is an energy company that operates in the Nordic and Baltic countries and in Russia and Poland. Its core business consists of the production and sale of electricity and heat, including other energy-related services.

Hafslund Marked and Hafslund Varme are energy companies owned by the city of Oslo.  Hafslund Marked operates in Finland in the electricity retail market through its subsidiary Kotimaan Energia Oy, and also in Sweden, Norway and Spain. Hafslund Varme produces and distributes district heating in Oslo and neighbouring areas.

Klemetsrudanlegget AS is an energy company owned by the city of Oslo, producing district heating into Oslo’s district heating network, and small amounts of electricity in its waste-to-energy plant.

The FCCA’s decision includes business secrets of the parties involved. The decision cannot be published until the business secrets have been removed, i.e. in around two weeks’ time.

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 of at least two of the parties resulting from Finland exceeds 20 million euros for both. FCCA approves a corporate transaction if it has no harmful impacts referred to in the Competition Act. FCCA will intervene in corporate transactions if its investigations suggest that the acquisition may significantly impede effective competition on Finnish markets or a substantial part of the markets, particularly through the creation or reinforcement of a dominant market position.