商务部关于松下收购三洋公告英文版

松下收购三洋

MINISTRY OF COMMERCE: PUBLIC ANNOUNCEMENT [2009] NO. 82

CONCERNING ANTI-MONOPOLY REVIEW DECISIONS ON CONDITIONAL APPROVAL OF PANASONIC ACQUISITION OF SANYO

Publication Date: 30 October 2009

Implementation Date: 30 October 2009

Ministry of Commerce of the People's Republic of China ("MOFCOM") received anti-monopoly notification filing for concentration of undertakings ("Concentration") by Panasonic Corporation (hereinafter "Panasonic") and Sanyo Electric Co., Ltd. (hereinafter "Sanyo"). Upon review, MOFCOM decides to conditionally approve the Concentration. Pursuant to Article 30 of Anti-monopoly Law of the People's Republic of China (the "AML"), we hereby make the following public announcement:

I. Acceptance and Review Procedures
On 21 January 2009, MOFCOM received the Concentration notification filing in connection with Panasonic's acquisition of Sanyo. On 30 April, the applicants submitted supplemental materials to MOFCOM. On 4 May, MOFCOM accepted the notification filling, and commenced the Phase I Review. Upon the completion of Phase I Review, MOFCOM decided to commence Phase II Review, with 3 September as the ending date of Phase II Review. On 14 August, MOFCOM informed the applicants of the competition concerns identified during its review, and requested the applicants to propose corresponding remedial measures within the prescribed period. On 26 August, the applicants applied to MOFCOM for further extension of the Phase II Review period, so that they can prepare the specific remedial measures to address the aforesaid competition concerns. Pursuant to Article 26 of AML, MOFCOM decided to extend the Phase II Review period for 60 days, with 3 November 2009 as the ending date of the Extended Review period.

II. Reviewed Aspects
Pursuant to Article 27 of AML, MOFCOM carried out a thorough review of the Concentration from the following perspectives:
(a) the market shares of the participating undertakings on the relevant market and their market power;
(b) the level of concentration on the relevant market;
(c) the impact of the concentration of undertakings on market entry and technology progress;
(d) the impact of the concentration of undertakings on consumers and other relevant undertakings; and
(e) the impact of the concentration of undertakings on the national economic development.

III. Tasks Carried Out During the Review Process
After acceptance of the notification filing, MOFCOM sought comments in writing from relevant government agencies, chambers of commerce and industry associations, verified the authenticity and completeness of the notification filing materials and relevant supplemental materials, and requested the applicants to provide supplemental materials and clarifications in respect of certain specific issues. During the review process, MOFCOM requested the applicants to submit relevant documents and evidences in respect of the parties' overlapping product types, sales data, product differentiation, product pricing methods and strategy, distribution mode, negotiation with downstream customers, capacity variations and vertical relations that possibly exist, etc.. In order to collect the views of relevant parties, MOFCOM also issued questionnaires to 39 competitors and downstream customers in respect of different products, conducted telephone interview with certain enterprises, and conducted field investigation in Shenzhen and other locations. In respect of the issues which will restrict or eliminate competition identified during the review, MOFCOM and the applicants carried out thorough consultations, and reached consensus on remedial measures to eliminate the adverse impact.

IV. Competition Concerns
Upon review, MOFCOM confirms that the Concentration will create restrictive or eliminative competitive effect in the following three product markets:

1. Button-type Rechargeable Lithium Battery
Button-type Rechargeable Lithium Battery is the backup power source used in electrical appliances such as mobile phones and video recorders; and, upon review, constitutes a distinct product market; and the geographic market is defined to be the worldwide market. The Concentration will create restrictive or eliminative competitive effect in such product market, due to the following reasons:
(a) Firstly, Button-type Rechargeable Lithium Battery market is highly concentrated. The applicants are the largest and the second largest manufacturer respectively in such market. After the Concentration, Panasonic will have 61.6% market share, and as a result the downstream customers' right of choice will be highly restricted. Since most of the downstream customers adopt the policy of procuring products from two or more suppliers, the restrictive competitive effect resulting from the Concentration will be more significant.
(b) Secondly, after the Concentration, Panasonic will have the power to raise price unilaterally. On the one hand, due to the very limited number of competitors on the market, after the Concentration, any price increase by Panasonic will hardly face any effective competitive constraint; on the other hand, since Panasonic's price increase may be beneficial to other competitors, other competitors will not have the incentive to effectively compete with Panasonic.
(c) Thirdly, any buyer countervailing power will not be sufficient to eliminate the above restrictive competitive effect. Although a portion of the large downstream customers have the buyer countervailing power to counterbalance the market power of the post-Concentration entity, such buyer countervailing power cannot extend to other medium/small sized customers who do not have comparable bargaining power.

2. Civilian-use Nickel Hydrogen Battery
Civilian-use Nickel Hydrogen Battery mainly serves as the main power source for the electrical appliances such as electrical tools; and constitutes a distinct product market; and the geographic market is defined to be the worldwide market. The Concentration will create restrictive or eliminative competitive effect in such product market, due to the following reasons:
(a) Firstly, Civilian-use Nickel Hydrogen Battery's market is fairly highly concentrated, and has limited number of competitors. After the Concentration, Panasonic will have 46.3% market share, which is much higher than any other competitor. The Concentration may afford Panasonic the power to raise price unilaterally.
(b) Secondly, the brand designation practice may impede market competition. During the investigation, MOFCOM found out that the transaction counterparties of some downstream customers of Civilian-use Nickel Hydrogen Battery require such customers to use battery products of Panasonic or Sanyo brand. Such brand designation practice has restrained market competition, and has foreclosing effects on battery products of other brands, and the Concentration will further enhance such restrictive competitive effect.
(c) Thirdly, Nickel Hydrogen Battery market development has slowed down and therefore it is fairly difficult to attract sufficient market entrance so as to offset the above restrictive and eliminative competitive effect.

3. Automotive Nickel Hydrogen Battery
Automotive Nickel Hydrogen Battery is the battery used to power Hybrid Electric Vehicle or Pure Electric Vehicle. The Concentration will create restrictive or eliminative competitive effect in such product market, due to the following reasons:
This product market is highly concentrated, with Panasonic EV Energy Co., Ltd. ("PEVE") established jointly by Panasonic and Toyota possessing 77% market share, having overwhelmingly dominant position. In addition, the remaining competitors on the market only include Panasonic and Sanyo Therefore the Concentration will lead to further reduction of the number of competitors on the market, and Panasonic may very likely use its influence of PEVE to further weaken the competition on the market.

V. Consultations Regarding Imposition of Restrictive Conditions
In order to address the aforesaid competition concerns, pursuant to Article 29 of AML, on 20 August, 26 August, 10 September, 24 September, and 20 October 2009, MOFCOM and the applicants held a number of consultation sessions on the proposed remedial measures. On 22 October 2009, the applicants submitted their final remedial measures proposal. Upon assessment, MOFCOM confirmed that such remedial measures are sufficient to eliminate the adverse impact of the Concentration on the relevant markets in China.

VI. Review Decisions
Since the Concentration of Panasonic and Sanyo will have eliminative or restrictive competitive effect on the relevant product markets such as Button-type Rechargeable Lithium Battery, Civilian-use Nickel Hydrogen Battery and Automotive Nickel Hydrogen Battery, etc., in order to mitigate the Concentration's adverse effect on market competition, MOFCOM decided to approve the Concentration with restrictive conditions imposed, requiring Panasonic and Sanyo to implement the following remedial measures:

1. In respect of Button-type Rechargeable Lithium Battery
(a) Fully divesting the existing Button-type Rechargeable Lithium Battery business from Sanyo, i.e. Button-type Rechargeable Lithium Battery business of Sanyo in the Tottori-ken factory at Iwami-cho, Tottori-ken, Japan shall be transferred to an independent third party (the "Purchaser"). The selection of the Purchaser shall be conducted in accordance with the principles of being conducive to the development of the divested business and being conducive to market competition, and shall be subject to the approval of MOFCOM. Sanyo shall, based on the Purchaser's needs, transfer the relevant assets required for operation of Button-type Rechargeable Lithium Battery business, including manufacturing equipments, sales and R&D departments and customer resources. Concurrently, Sanyo shall license the Purchaser to use proprietary intellectual property rights owned by it related to manufacture of the Button-type Rechargeable Lithium Battery.
(b) Panasonic and Sanyo shall complete the above remedial measures within 6 months of the date of consummation of the Concentration. If such measures fail to be completed within 6 months, an extension of 6 months may be granted subject to MOFCOM's prior approval. If parties to the Concentration still fail to complete the aforesaid remedial measures within such extended period, MOFCOM will have the right to appoint an independent trustee to divest the aforesaid business to an independent third party.
(c) During the period from the date of consummation of the Concentration to the completion date of the aforesaid remedial measures, the relevant business entities of Panasonic and Sanyo shall operate independently, and shall not disclose relevant price, customer information and other competitive information to each other, except for the disclosure of information for fulfillment of any statutory obligation.

2. In respect of Civilian-use Nickel Hydrogen Battery
Divesting Civilian-use Nickel Hydrogen Battery business from either Sanyo or Panasonic, and the specific business to be divested can be decided by the parties, provide that MOFCOM's approval shall be obtained before the specific divesture plan is determined.
(a) Sanyo shall transfer its Civilian-use Nickel Hydrogen Battery business in the Takasaki factory at Takasaki City, Gunma-ken, Japan to an independent third party (the "Purchaser"); Sanyo shall supply the Sub- C•D battery manufactured in its plant located in Suzhou, Jiangsu Province, China to the Purchaser through OEM arrangement. Sanyo shall, based on the needs of such Purchaser, transfer the relevant assets required for conduct of Civilian-use Nickel Hydrogen Battery business including manufacturing equipments, sales and R&D departments and customer resources, and license the Purchaser to use its self-owned special intellectual property rights in respect of production of Civilian-use Nickel Hydrogen Battery. Alternatively, Panasonic may transfer its Civilian-use Nickel Hydrogen Battery business in its factory at Wuxi, Jiangsu Province, China to an independent third party. Panasonic shall, based on the needs of such Purchaser, transfer the relevant assets required for operation of Civilian-use Nickel Hydrogen Battery business including manufacturing equipments, sales and R&D departments and customer resources, and license the Purchaser to use proprietary intellectual property rights owned by it related to manufacture of Civilian-use Nickel Hydrogen Battery.
The selection of the Purchaser shall be conducted in accordance with the principles of being conducive to the development of the divested business and being conducive to market competition, and shall be subject to the approval of MOFCOM.
(b) The parties to the Concentration shall complete the above remedial measure within 6 months of the date of consummation of the Concentration. If such measures fail to be completed within 6 months, an extension of 6 months may be granted subject to MOFCOM's prior approval. If parties to the Concentration still fail to complete the aforesaid remedial measures within such extended period, MOFCOM will have the right to appoint an independent trustee to divest the aforesaid business to an independent third party.
(c) During the period from the date of consummation of the Concentration to the completion date of the aforesaid remedial measures, the relevant business entities of Panasonic and Sanyo shall operate independently, and shall not disclose relevant price, customer information and other competitive information to each other, except for the disclosure of information for fulfillment of any statutory obligation.

3. In respect of Automotive Nickel Hydrogen Battery
(a) In respect of Panasonic's divestiture of its Automotive Nickel Hydrogen Battery business
(i) Firstly, Panasonic shall transfer its HEV-use Nickel Hydrogen Battery business in its Shonan factory in Chigasaki-shi, Kanagawa-ken, Japan to an independent third party (the "Purchaser"). The selection of the Purchaser shall be conducted in accordance with the principles of being conducive to the development of the divested business and being conducive to market competition, and shall be subject to the approval of MOFCOM. Panasonic shall, based on the needs of such Purchaser, transfer the relevant assets required for operation of Automotive Nickel Hydrogen Battery business including manufacturing equipments, sales and R&D departments and customer resources, and license the Purchaser to use proprietary intellectual property rights owned by it related to manufacture of HEV-use Nickel Hydrogen Battery.
(ii) Secondly, the parties to the Concentration shall complete the above remedial measures effect within 6 months of the date of consummation of the Concentration. If such measures fail to be completed within 6 months, an extension of 6 months may be granted subject to MOFCOM's prior approval. If parties to the Concentration still fail to complete the aforesaid remedial measures within such extended period, MOFCOM will have the right to appoint an independent trustee to divest the aforesaid business to an independent third party.
(iii) Thirdly, during the period from the date of consummation of the Concentration to the completion date of the aforesaid remedial measures, the relevant business entities of Panasonic and Sanyo shall operate independently, and shall not disclose relevant price, customer information and other competitive information to each other, except for the disclosure of information for fulfillment of any statutory obligation.
(b) In respect of PEVE Company
(i) Firstly, Panasonic's equity ratio in PEVE shall be reduced to 19.5% from current 40%;
(ii) Secondly, Panasonic shall waive its voting rights in PEVE's shareholders' assembly;
(iii) Thirdly, Panasonic shall waive its right to appoint directors to the board of PEVE;
(iv) Fourthly, Panasonic shall waive its veto rights in respect of Automotive Nickel Hydrogen Battery business in the Joint Venture Contract between Panasonic and Toyota(PEVE's parent company).
(v) Fifthly, PEVE shall change its name such that the new name will not include the word of "Panasonic".
The aforesaid measures shall be completed within 6 months after the date of consummation of this Concentration, and content of the aforesaid remedial measures shall remain unchanged for a period of 3 years. MOFCOM's consent is required before cessation of the above remedial measures.

These decisions shall take effect on the date of their publication.

Ministry of Commerce of the People's Public of China

30 October 2009

Note: The translation shall be an unofficial one, which is prepared by Zhong Lun Law Firm's antitrust and competition team, for reference purpose only and should not be construed as legal advice. All rights reserved.