Bundeskartellamt prohibits participation in Bremerhavener Entsorgungsgesellschaft by Nehlsen/Rethmann/swb

The Bundeskartellamt has prohibited the companies Karl Nehlsen GmbH & Co. KG (Nehlsen), Rethmann Entsorgungswirtschaft GmbH & Co. KG (Rethmann) and swb AG (swb) from acquiring joint control over Bremerhavener Entsorgungsgesellschaft mbH (BEG). The merger would have resulted in dominant positions in the markets for the disposal (in particular incineration) of domestic waste, commercial waste incineration and the collection and transport of domestic waste in the federal Länder of Bremen and Lower Saxony. In addition, the merger would have led to illegal restraints of competition in these markets (Section 1 of the ARC).

The President of the Bundeskartellamt, Ulf Böge, stated: “The joint participation in BEG by Nehlsen, the leading disposal company in the region, and Rethmann, one of the major German disposal companies, would not have been compatible with competition law. The companies concerned were not able to find solutions to the competition and merger control problems raised. Against this background a clearance of the merger subject to conditions or obligations was not possible.”

As a result of their participation in BEG, Nehlsen/Rethmann/swb would have achieved market shares clearly above 50 per cent in the markets for the disposal of domestic waste and commercial waste incineration in the federal Länder of Bremen and Lower Saxony.

The largest competitor, E.ON, does not have a comparable market potential since its business is mainly focused on energy supply. In addition, Rethmann’s participation in the merger would have resulted in the company ceasing to be one of the few potential competitors. Therefore, the creation of dominant positions in these markets was likely.

In the market for the collection and transport of domestic waste, Nehlsen and swb already held market shares of over 50 per cent before the merger due to their interlocks with other disposal companies active in the region. As a result of the merger, the joint market share held by these companies would have increased to over 60 per cent while the closest competitor only achieves a market share of just over 10 per cent. The merger would have further strengthened an already existing joint dominant position in this market.

Böge welcomed the smooth cooperation with the Directorate General Competition in Brussels. Initially, the merger had been notified to the European Commission under the European Merger Regulation. On 30 May 2002 the European Commission referred the case to the Bundeskartellamt upon request as the merger exclusively affected regional markets in Germany and resulted in competition problems there.