EU: FedEx merger under scrutiny

The European Commission has launched an in-depth investigation into the proposed acquisition of TNT Express by FedEx.

The Commission is concerned that in a number of European markets for international express and regular small package deliveries, the merged entity would face insufficient competitive constraints from the only two remaining large integrators – UPS and DHL.

It argues that the other integrators would be the only significant competitive constraint on the merged entity for most international express services, with a destination within or outside the European Economic Area.

As the proposed transaction would reduce the number of ‘integrators’ competing in the EEA from four to three, the competitive constraint on the merged entity would be significantly reduced.

Commissioner Margrethe Vestager, in charge of competition policy, said: “Many businesses, and in particular e-commerce, rely heavily on affordable and reliable small package delivery services, and many consumers depend on these services to ensure rapid and safe delivery of goods they have bought. The Commission must therefore make sure that FedEx’s takeover of TNT would not impede effective competition and would not lead to higher prices for consumers.”

Full content: The Wall Street Journal

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