COMPETITION COUNCIL: MERGER BETWEEN CLASSIFIED ADS WEBSITES RESTRICTED COMPETITION

On 6 May 2016, the Competition Council (hereinafter – KT) prohibited a merger whereby in 2014 AS Eesti Meedia acquired 100 per cent of AllePAL OÜ shares. KT found that the merger restricted competition in the Lithuanian markets of classified ads for real estate and vehicles.

UAB Plius and UAB Vertikali medija, which are related to AS Eesti Meedia, and UAB Diginet LT, which is related to AllePAL OÜ, are the biggest managers of classified ads websites for real estate and vehicles in Lithuania. Having suspected that the merger might have created or strengthened a dominant position or restricted competition in the relevant markets, KT obliged the merging parties to submit a merger notification. Having examined the notification, KT found that the merger implemented in 2014 eliminated competition among classified ads websites and increased prices of classified ads for real estate and vehicles.

Our aim is to make markets as competitive as possible for the benefit of consumers. We prohibited the merger because it limited the possibilities of other economic entities willing to enter the market and increased the prices of classified ads. 

Šarūnas Keserauskas, Chairman of the Competition Council

In addition, KT examined the application of AS Eesti Meedia whereby the company asked to terminate the merger examination procedure since on April 26 the company transferred the shares of UAB Vertikali medija to third parties. However, since the companies informed KT about these changes only six days prior to the end of the merger examination, KT was not able to gather necessary data to assess whether the transfer of shares eliminated competition concerns identified by KT. As a result, KT did not satisfy the application.

During the last five years, KT cleared 158 mergers, 3 of which were subject to remedies, and prohibited one merger. In five cases, merging parties withdrew their merger notifications after receiving KT conclusions which stated that the intended mergers would restrict competition.