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The National Economic Prosecutor’s Office (FNE) approved in Phase II and with mitigation measures the concentration operation consisting of the international merger of Fiat Chrysler Automobiles NV (Fiat) and Peugeot SA (Peugeot).
During its investigation, the FNE considered that if the merger were perfected in a pure and simple way, as the parties claimed, the entity resulting from the merger would have the incentive and the ability to raise the prices of some of the light vans marketed by Fiat in Chile, both in the retail segment and in the sale of fleets to operating leasing companies.
In response to this risk, Fiat and Peugeot offered some mitigation measures that, after making them known for the analysis of interested third parties, allowed the FNE to conclude that they are effective, suitable and proportional to prevent the operation from substantially reducing the competition in the market, while allowing the effective compliance of mitigation measures to be monitored.
The FNE also estimated that the joint weighting of the remedies would enhance inter-brand and intra-brand competition in customer service variables other than the price and quality of the vehicles and would promote the possible expansion of a competitor close to the parties for Chile , as is Toyota.
Therefore, the mitigation measures consist of the obligation of Fiat and Peugeot to keep the importation and wholesale distribution of the products of the RAM and Citroën brands in the hands of independent third parties for three years; to maintain the wholesale distribution of the Peugeot and Opel brands by the Chilean subsidiary of Peugeot for three years.
Meanwhile, in response to the joint venture that Peugeot and Toyota have for the development, manufacture and supply of some compact light commercial vehicles (such as Peugeot Partner, Citroën Berlingo, Opel Combo and Toyota Proace), Peugeot must offer an annual capacity destined exclusively for Chile of light vans of the Toyota brand in favor of said manufacturer, if requested.
This capacity must be additional to that considered in the remedy offered by Peugeot to the European competition agency within the framework of this same merger. In addition, Peugeot will offer Toyota a discount on the transfer prices of vehicles and parts.
The investigation began on April 15, 2020 and during Phase I the proceedings focused on the competitive analysis in the commercial vehicle segment, taking into account the market shares of both companies.
After verifying that the operation could substantially reduce competition, the FNE extended the investigation to Phase II to analyze in depth the market, the effects of the operation, the entry conditions and the possible counterweights, with special emphasis on the van segment. .
During this stage, additional information was collected through online surveys of van importers, dealers and consumers, among other procedures, which made it possible to identify a high competitive proximity between Fiat and Peugeot in the light van segment, specifically between the Peugeot Partner, Citroën models. Berlingo and Opel Combo by Peugeot, and the RAM V700 City and RAM V1000 light van models by Fiat.
Fiat Chrysler is an Italian-American automotive business group dedicated primarily to the manufacture and marketing of components and vehicles worldwide, under the Abarth, Alfa Romeo, Chrysler, RAM, Dodge, Fiat, Jeep, Lancia and Maserati brands. In Chile, the group markets its products represented by an independent third party.
For its part, Peugeot is a French business group dedicated mainly to the manufacture and marketing of components and vehicles worldwide, under the Peugeot, Opel, Citroën, Vauxhall and DS brands. In relation to the Peugeot and Opel brands, the group participates directly in Chile in the importation, distribution and retail sale of vehicles, parts and spare parts. Regarding the Citroën and DS brands, it markets its products locally, represented by an independent third party.
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