Bundeskartellamt clears cable merger subject to conditions

On 15 December the German FCO, Bundeskartellamt, cleared the
acquisition of Kabel BW, Germany’s third largest cable network
operator, by Liberty Global Inc (LGI) subject to conditions and
obligations (see here for more information).

LGI, owner of Unitymedia (another large cable operator in Germany),
initially notified the merger to the European Commission who
referred the case to the Bundeskartellamt in June 2011.
To achieve clearance for the undertaking the involved parties had to
make commitments regarding existing long-term contracts with
housing associations and encryption of free-TV transmission. These
concessions satisfied the Bundeskartellamt’s concerns about the
consolidated cable markets and about broadcasters’ access to
transmission services post-merger.

The commitments are meant to foster competition with other market
players, such as Kabel Deutschland (still the largest of the German
cable network operators) and other telecommunication providers (e.g.
Deutsche Telekom who re-entered the cable television market in 2011).

DotEcon acted as economic adviser to LGI during its initial merger
notification to the Commission.

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