Antitrust Law Daily Wrap Up, ANTITRUST NEWS: European Commission to Allow Time Warner’s Acquisition of Central European Media Enterprises, (Jun 14, 2013)
Organizations Mentioned:Central European Media Enterprises | Time Warner
By Tobias J. Gillett, J.D., LL.M.
The European Commission has approved Time Warner’s proposed acquisition of Central European Media Enterprises (CME), a Bermuda-based company involved in television broadcasting and other media sectors in Eastern and Central Europe, the agency has announced.
CME conducts television broadcasting and other media activities primarily in Bulgaria, the Czech Republic, Croatia, Romania, the Slovak Republic, Slovenia, Hungary, and Moldova. The EC found the transaction would not cause competition concerns in the markets for licensing of audio-visual television content, wholesale supply of television channels, sale of television advertising, licensing and distribution of films for theatrical release, and licensing and distribution of home entertainment content in the relevant countries.
Time Warner’s and CME’s television content licensing activities do not overlap, the Commission found. Since Time Warner and CME usually acquire different kinds of broadcasting rights, the buying power of the merged entity would not be increased with respect to rights holders.
The transaction also would not negatively affect competition in the wholesale supply of television channels, because CME mostly operates generalist free-to-air channels, while Time Warner offers basic pay television or premium movie channels and does not have a strong presence in the countries in which CME operates.
The transaction would not raise competition concerns in the market for the sale of television advertising because it would lead to only a “very limited increment in market share” in that market, and CME and Time Warner were not close competitors.
The merged entity would continue to face strong competition in licensing and distribution for films for theatrical release and the home entertainment sector, and the two companies’ activities in those fields had only “limited (if any) overlap.”
Finally, the transaction would not raise vertical competition concerns in any relevant market, “particularly in light of the fact that the merged entity will not have the necessary degree of market power and/or the economic incentive to shut out suppliers or customers from the markets.”
More information on the case can be found here.
Companies: Central European Media Enterprises; Time Warner
News: Antitrust