The European Commission has opened an in-depth investigation to assess the proposed acquisition of Bonnier Broadcasting by Telia Company under the EU Merger Regulation.
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The Commission is concerned that the merged entity may shut out competitors from the audio-visual sector in Finland and Sweden.
As a retail TV distributor, Telia Company licenses TV channels (including ancillary rights) from TV broadcasters, such as Bonnier Broadcasting, to include them in its retail audio-visual offering.
The proposed acquisition of Bonnier Broadcasting by Telia Company would create a vertically integrated player in the audio-visual industry in Denmark, Finland, Norway, and Sweden.
In Sweden and Finland, Bonnier Broadcasting is the owner of TV channels that are very important for TV distributors to have in the packages they offer consumers, namely its free-to-air and basic pay TV channels and premium pay TV sports channels.
The Commission's initial market investigation identified the following main concerns:
Telia Company's competitors in TV distribution in Finland and Sweden could be shut out from accessing Bonnier Broadcasting's specific TV channels that are important for consumers.
This could concern any distribution platform of TV channels, namely by satellite, terrestrial networks or over the Internet.
This could result in weakening the constraint currently exercised by competitors on Telia Company and could lead to higher prices of audio-visual services or less choice for consumers in Finland and Sweden.
The merged entity could deny access to TV advertising space on its free-to-air and basic pay TV channels to Telia Company's competitors in the markets for retail mobile telecommunication, fixed internet and TV services.
The merged entity could deny access to its streaming application to customers using competing mobile and fixed internet providers.
At this stage, the Commission is in particular concerned that, following the transaction, consumers in Finland and Sweden would face reduced choice and higher prices for retail TV distribution.
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. ■