NMa: Clears KPN/ Enertel acquisition

The Netherlands Competition Authority (NMa) has approved of the acquisition of Enertel N.V. (Enertel) by Koninklijke KPN N.V. (KPN). The competition enforcer concludes after investigation that the concentration will not result in the emergence or strengthening of a dominant position in the telecommunications sector, restricting competition in (part of) the Dutch market.

KPN and Enertel are active in the telecommunications sector. KPN provides private and business consumers with products and services in the field of voice telephony (fixed and mobile), internet and digital television. Enertel offers telecommunications services such as voice telephony, data services and internet services. It is especially active in the wholesale market. Enertel's Wireless Local Loop-licence, allowing for the provision of mobile (data) services, is not part of the transaction.

The wholesale markets for dial-up internet access and telephone traffic involving 0800/090x services, constitute the most important markets in which the joint market share will increase as a result of the acquisition. In the potential market for 'hotspots' (wireless internet access in specific locations such as hotels and airports), the market share of KPN will also increase.

In the market for dial-up internet access (via ISDN or analogue telephone connections), KPN's position is nevertheless strengthened, though a dominant position will not occur, states the NMa. The use of dial-up internet connections, for instance, is subject to decrease, as consumers increasingly switch to broadband internet connections (ADSL, cable). Also, the NMa investigation points out that a sufficient number of parties remain which may offer this service to internet service providers (ISP's).

The NMa investigation further shows that in the market for telephone traffic involving 0800/090x services too, a sufficient number of competitors remain active. In addition to this, it is relatively easy for parties which already dispose of an infrastructure, to enter this market. With regard to the provision of 'hotspots', the NMa did not identify problems either. After the acquisition, KPN will encounter sufficient competition, exerted by other (potential) providers and resulting from alternative options for wireless internet access available to end users.

During its investigation the NMa consulted OPTA. In its point of view, OPTA endorses the NMa's conclusions.

In case of mergers and acquisitions exceeding specified turnover thresholds, the NMa assesses the possible emergence or strengthening of a dominant position. Such a dominant position may have an adverse effect on the price, quality and diversity of supplies. If this be the case, the NMa may impose conditions on the merger or prohibit the merger.