Siemens, Alstom in-depth questionnaires focus on market definitions and role of data

5 September 2018 10:29am

25 July 2018. By Natalie McNelis and Matthew Newman.

Siemens’ and Alstom’s proposed railway merger is open for comments, with EU regulators’ second-phase questionnaires in the hands of interested parties, MLex has learned.

Like the European Commission’s initial review, MLex understands that the questionnaires focus on trains and signaling equipment, with the questions for competitors broken down into three sections: distinguishing among the products, defining the geographic scope of the market, and analyzing the value of data.

The commission’s second-phase review didn’t come as a surprise given the complexity of Europe’s rail markets, which are highly regulated at both the EU and national level. Officials will use the additional information gathered from the questionnaires to either overcome their “serious doubts” about the merger or to confirm them.

The first section of the request for information focuses on distinguishing between high-speed trains and other types of trains, with the EU watchdog expressing an interest in the regulatory requirements faced by companies.

The second section focuses on geography. When it comes to China, however, rather than focusing on whether Chinese companies compete in the EU, the questions turn on whether European suppliers are eligible to compete in China, Korea and Japan.

Indeed, in the press release opening the in-depth investigation, the commission said it examined the impact of the transaction both in Europe and on a worldwide basis “excluding China, Japan and Korea, which appear to have barriers preventing imports from foreign suppliers.”

The commission has yet to determine whether the market is global, Europe-wide or broken down along national lines. The parties have argued that the transaction is needed to equip them to compete around the world with China’s state-owned CRRC, the world’s largest train maker.

The third section of the questionnaire asks questions about the value of data. Suppliers get reports from sensors installed in the equipment, and the commission asks about the general availability of this data and the extent to which having such information represents an advantage for the supplier. For instance, it could put the supplier in pole position to provide maintenance services.

Deadlines for answering the questionnaires are this week, but limited extensions are customary.

The case number is M.8677.

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