Bosnia: Acquisition of Cable Operator Cleared Conditionally

Bosnia and Herzegovina

Bosnia: Acquisition of Cable Operator Cleared Conditionally

In a landmark merger control case, the national competition authority (NCA) of Bosnia and Herzegovina – the Competition Council – has conditionally cleared the acquisition of a local cable operator. This appears to be the first ever conditional clearance in Bosnia.

By way of the conditionally cleared the transaction, a telecom incumbent Mtel a.d. Banja Luka (owned by Telecom Serbia) is to acquire 100% of shares in Elta-Kabel d.o.o. Doboj, a cable operator active in certain parts of Bosnia and Herzegovina. The clearance decision has not been published yet; however, based on what is available, it is possible to get a picture of what the planned transaction is about.

From the NCA’s statement, we can assume that the transaction concerned at least the following relevant product markets: fixed telephony, mobile telephony, internet access, and distribution of radio and TV programs – all at retail level. Further, it appears that the NCA examined all these markets from the perspective of the national territory.

The information which is publicly available does not reveal under which conditions specifically was the transaction cleared. In accordance with the Bosnian Competition Act, if the NCA decides to clear a transaction with strings attached, it shall state in the clearance decision the measures, conditions, and deadlines of the conditional clearance.

The parties notified the transaction to the NCA in early March this year. In July, the NCA dismissed the request of a rival cable operator, Telemach, to be afforded the status of a party to the proceedings in which the NCA was examining the takeover of Elta-Kabel.

What to make of this decision?

The Bosnian NCA has so far been reluctant to clear transactions conditionally and this decision appears to be the first time a conditional merger clearance was issued in Bosnia and Herzegovina.

From a market perspective, this planned takeover appears to be another step in the consolidation of telecom-related markets in Bosnia and Herzegovina. It remains to be seen how the competitors will respond.

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