Bundeskartellamt clears acquisition of RBH by Railion

The Bundeskartellamt has cleared the acquisition of RAG Bahn und Hafen GmbH, Gladbeck ("RBH") of RAG AG ("RAG") by Railion Deutschland AG ("Railion"), which belongs to the Deutsche Bahn AG group.

According to the President of the Bundeskartellamt, Dr. Ulf Böge, the merger could be cleared without obligations because it does not lead to the creation or strengthening of a dominant position. The fact that in the course of the proceedings the companies concerned sold 200 goods wagons for transporting coal to a commercial hirer has allayed reservations previously expressed by the Bundeskartellamt. RBH also terminated rental contracts for approx. 1,100 goods wagons to the end of the agreed contract period.

The Bundeskartellamt based its assessment on the national market for the transport of bulk dry goods which can be transported in large quantities and on a regular basis. Only transport effected by rail and, to some extent, barge, can be categorized as belonging to this market. According to the extensive investigations conducted by the Bundeskartellamt truck transport cannot be assigned to this market because due to operational cost disadvantages large volumes cannot be transported at comparable costs by truck. This does not rule out the fact that bulk dry goods are also transported by truck in individual cases; however, this is normally as pre- or post-carriage by road to and from railway terminals and barge ports. Here truck transport does not enter into competition with rail and barge as a carrier but serves as a complementary form of transportation if the other means of transport cannot be used for the entire transport route.

Irrespective of whether domestic German transport or cross-border transport is concerned, as far as the transport services are effected within Germany, the Bundeskartellamt’s investigations concluded that Railion has well over a third of the share of the market.

However, the merger does not lead to a strengthening of an alleged dominant position. Firstly, RBH undertakes few transport services for third companies on the assumed market. Secondly, Railion already carried out transport services in cooperation with RBH before the merger. Railion provides the structure for these transports and is to take over the company transport of the RAG group. However, the sale of the 200 wagons and the termination of the rental contracts for the approx. 1,100 goods wagons has brought about structural improvements on the market concerned which at least outweigh any deterioration.
The President of the Bundeskartellamt, Dr Böge, stated: “With the sale of the coal wagons and the termination of existing rental contracts an adequate quantity of competitive wagons will come onto the market in the short term which will allow competitors to offer coal transports themselves and establish themselves as competitors to Railion. Against this background the merger project was cleared.”