Possible restraint of competition removed in copper production

The Bundeskartellamt has concluded an administrative proceeding against the companies Aurubis AG (Aurubis), Wieland Werke AG (Wieland) and Schwermetall Halbzeugwerk GmbH & Co. KG (Schwermetall). Aurubis and Wieland have adjusted the way they had been working together in their joint venture Schwermetall.

Aurubis’s and Wieland’s activities include the production of copper products (semi-finished products), and they compete on the market for flat rolled products. The two companies are also equal partners in their joint venture Schwermetall, which produces pre-rolled strip, a key input for the production of flat rolled products.

In its proceeding the Bundeskartellamt examined provisions in Aurubis’s and Wieland’s partnership agreement which state that the prior consent of Schwermetall’s advisory board, consisting of the two partners, is required before any changes can be made to Schwermetall’s product mix or customer portfolio and before any new alloys can be produced and supplied by Schwermetall.

Andreas Mundt, President of the Bundeskartellamt: “The Bundeskartellamt’s preliminary findings have shown that these provisions made it possible for each of the two partners to prevent their joint venture Schwermetall from producing pre-rolled strip made of certain alloys for the respective other partner. This could have impeded competition between the two companies.”

Moreover, the provisions requiring prior consent, which were jointly agreed by both partners, could have made it possible for the partners to prevent Schwermetall from producing and supplying pre-rolled strip made of certain alloys to third parties competing with the two partners or to end existing business relationships for the production and supply of pre-rolled strip between third parties and Schwermetall to the detriment of the third parties.

The two partners have now voluntarily removed these provisions from their agreement and made a commitment not to influence in any way Schwermetall’s production and supply of pre-rolled strip to the respective other partner or third parties. In addition, the partners ensure that Schwermetall can fulfil its commitment to conduct its business independently and profitably to the extent that it has the necessary technological expertise. This ensures that Schwermetall is free to decide in future what pre-rolled strip made of which alloys it delivers to which customers.

The Bundeskartellamt’s decision issued today has declared these commitments binding under Section 32b GWB and terminated the proceeding.

Aurubis, formerly Norddeutsche Affinerie AG, is a copper producer and copper recycler based in Hamburg. Aurubis produces copper cathodes from copper concentrates, copper scrap and recycling materials and, within the group, processes them into wire rod, specialty wire, continuous cast shapes, rolled products, rods and profiles.

Wieland, the parent company of the Wieland Group based in Ulm, is a producer of semi-finished products made of copper and copper alloys. It focuses in particular on extruded products, engineered products, thermal solutions and rolled products. Buyers of its rolled products made of copper and copper alloys include customers from the electronics and automotive industries.

Schwermetall is a company jointly controlled by Aurubis and Wieland which is based in Stolberg and operates a cast house and a rolling mill. Pre-rolled copper strip produced by Schwermetall using hot and cold rolling is used as an input for the production of rolled products made of copper. It is processed, in downstream steps, by the partners and third-party companies into thinner rolled products such as roof plates, copper strips for boilers and heat exchangers, cables and connectors, stamped strip, brass and copper strip for industrial applications, copper strip for plating and copper foil.

The Bundeskartellamt’s decision is available below (in German only).