For the first time in Norway, a decision to block a merger has been taken to court. The court overturned the decision.
In 2019, Schibsted acquired the majority of Nettbil – a web-based auction service used by individuals to sell used cars to dealerships. At the time, Nettbil was start-up with a low market share, while Schibsted controlled Finn.no, a platform for classified ads with a strong position within sales of used cars.
Despite Nettbil’s low turnover, the Norwegian Competition Authority (NCA) concluded that the acquisition would significantly impede effective competition and blocked the acquisition – with reference to the parties being competitors in a concentrated market where Finn.no already was the leading player. Schibsted appealed the decision to the Norwegian Appeals Competition Tribunal – which upheld the decision to block the transaction.
Schibsted appealed further to Gulating Court of Appeal, which has now overturned the decision. Thus, Schibsted is allowed to acquire Nettbil, unless the state appeals to the Supreme Court of Norway and it decides to block the acquisition.
Oslo Economics provided competition analyses to Schibsted
Oslo Economics provided competition analysis to Schibsted’s legal advisor, Wiersholm, in the processes towards the Norwegian Competition Authority and Norwegian Competition Appeals Tribunal. We are not surprised by the decision.
Based on basic methods of economic analysis we assessed that the parties are not close competitors, and that Finn.no and Nettbil are not even in the same relevant market. Finn.no is a player in the market for classified ads, whereas Nettbil is an innovative dealership – buying and reselling used cars.
Consequences for the merger control in Norway
The court’s judgement came just one week after the Appeals Tribunal decided to allow a bank merger first blocked by the NCA. Within a week, two higher instances have assessed that the NCA, in two different cases, have not demonstrated significant impediment of effective competition – which is necessary to intervene to a merger.
It is still too early to conclude how the decisions will affect the merger control in Norway, but the NCA can be expected to read the two decisions very carefully.