Bundeskartellamt prohibits Gruner + Jahr purchase of licence for "National Geographic"

The Bundeskartellamt in Bonn has prohibited Gruner + Jahr AG & Co. KG, Hamburg, the purchase of the licence for publishing the German edition of "National Geographic". The concentration was already realised in 1999.

Though Gruner + Jahr notified the Bundeskartellamt in 1998 of the establishment of the equal joint venture G+J/RBA & Co. KG with the Spanish enterprise RBA Publicaciones Internacionales, S.A., Barcelona, it failed to indicate the intended purchase of the licence for publishing the German edition of National Geographic. The Bundeskartellamt only gained knowledge of the licence purchase in the summer of 2003 when Gruner + Jahr enquired about the possibility of assuming sole control over the joint venture. In early 2004 the authority initiated ex officio proceedings on the licence purchase of 1999.

Although the German edition of National Geographic was not published before the licence purchase in 1999 the purchase nevertheless constitutes a concentration. The decisive factor here is that the brand name "National Geographic" of the US-edition already had a market presence in Germany on which Gruner + Jahr could build when publishing the first German edition.

Since Gruner + Jahr also publishes the journals "GEO" and "P.M." it had a dominant position on the German reader market for popular science journals even before the concentration with a market share of more than 60 per cent which was no longer subject to competition control. With the German edition of “National Geographic” the market share of Gruner + Jahr rose to approximately 75 per cent.

The President of the Bundeskartellamt, Dr Böge, stated: "Given the high market share, the significant increase in market share, the strong lead over other competitors, the high barriers to market entry and the integration of Gruner + Jahr in the financially strong and well-established Bertelsmann media group, the concentration has strengthened the dominant position of Gruner + Jahr and therefore had to be prohibited."

In a further decision the Bundeskartellamt also prohibited the intended purchase by Gruner + Jahr of all shares and therefore the sole control over the equal joint venture which was notified in April 2004.

The proposed concentration would lead to a further worsening of the competitive situation on the reader market for popular science journals in Germany, because it would secure and increase the dominant position of Gruner + Jahr.

The companies can file an appeal against both decisions at the Düsseldorf Higher Regional Court.