The Bundeskartellamt has cleared the planned mergers of Deutsche Shell GmbH, Hamburg (Shell) with DEA Mineralöl AG, Hamburg (DEA) and Deutsche BP AG, Hamburg (BP) with Veba Oel AG, Gelsenkirchen (Veba Oel) subject to strict obligations. The President of the Bundeskartellamt, Ulf Böge, stated: “In order for the planned mergers to be cleared, the companies have undertaken to reduce their market shares to a level below the threshold for collective market dominance by selling petrol stations. Besides this limitation of the level of concentration in the petrol station market, further obligations will ensure that particularly the supply of fuel to independent petrol station operators will be guaranteed in the future.”

Shell/DEA and BP/Veba Oel will sell 5.3 per cent and 4 per cent, respectively, of the total sales volume of the domestic petrol stations to third companies. However, this must not result in the creation of dominant positions. With a network comprising around 16,000 petrol stations, the market share reduction will involve the sale of approx. 1500 petrol stations. Possible shut-downs of petrol stations are not considered to represent sales as demanded under the obligations and will thus not be taken into account. In order to give the buyers of the petrol stations the possibility to establish a stable competitive position, Shell/DEA will supply fuel to refinery-independent buyers on favourable terms for up to five years.  The buyers will be able to choose from three pricing schemes. They can buy the fuels as if they were produced and supplied under contract processing conditions, i.e. the petrol station operator will be treated as if he operated the refinery himself. Alternatively, they can buy the fuels on the basis of the average domestic price quotation (OMR region). Another option is to purchase fuels on the basis of the international price quotation (plus transport costs for the supply to Germany).

Additionally, Shell/DEA will supply, over a period of 10 years, 1.3 million cubic meters of fuels per annum from depots along the RMR pipeline in western Germany on the same terms as a pipeline operator.  This will improve the logistic base for the supply of fuel to refinery-independent petrol stations.

BP/Veba Oel have to sell a combined share of 45 per cent of the nominal capital of Bayernoil Raffineriegesellschaft GmbH to a third company that does not itself hold a share in a major refinery with a petrol station network of its own. This deal represents 6.6 per cent of the fuel volume sold by petrol stations. The obligation opens up procurement opportunities for independent petrol station operators that are not affiliated with refineries. These obligations will considerably reduce the high level of concentration of over 60 per cent in this market of the three largest companies, Shell/DEA, BP/Veba Oel and Esso (oligopoly).

With the following obligations the creation or strengthening of dominant positions in the market for jet fuel Jet A1 is not to be expected. The infrastructure bottlenecks at Frankfurt Airport, which accounts for as much as approx. 60 per cent of the total volume of jet fuel sold, will be eased by further obligations. Accordingly, Shell/DEA, which supply jet fuel to Frankfurt Airport via the RMR pipeline, will provide 200,000 cubic metres of Jet A1 a year directly at the airport on favourable terms for 10 years. In this way the fuel purchaser will be placed in the same position as if he also had the economical infrastructure of pipeline supply at his disposal. Moreover, BP/Vebal Oel will provide a further 100,000 tons a year on comparable terms for 3 years.

Additionally, Shell/DEA will withdraw from one of the three fuelling companies at Frankfurt Airport. As a result of the sale of the 45 per cent share in Bayernoil-Raffineriegesellschaft, the buyer will gain around 100,000 tons of Jet A1 a year which he could also make available for supply at Frankfurt.  

Concerning the bitumen market the companies were able to dispel the Bundeskartellamt’s concerns that the mergers would lead to the creation or strengthening of dominant positions.