Thyssenkrupp files complaint against EU over Tata merger

Thyssenkrupp will file a complaint against the European Commission’s decision to prohibit the formation of a European flat steel joint venture with Tata Steel. The complaint will be submitted to the General Court of the European Union (EGC), the group said Thursday.

The Commission had found that a joint venture between thyssenkrupp and Tata Steel would restrict competition in Europe, for certain steels and to such an extent that price increases could be expected. While Tata and thyssenkrupp had offered divestments of activities to alleviate such concerns, the Commission found that the remedies were insufficient.

Thyssenkrupp states that it does not share the argumentation of the Commission regarding the assessment of the product groups of packaging steel and hot-dip galvanized steel for the automotive industry. The Commission has for the first time set out a restrictive market definition that unduly extends the scope of the existing competition law, tk says.

Furthermore, the Commission did not take adequate account of the structural importance of imports into Europe. Nor did it consider buyer-side purchasing power and possible substitutions with alternative packaging materials and alternative galvanizing methods, tk says.

“The consolidation of the European steel industry is still right and necessary, which is also shown by the current critical market situation for steel manufacturers,” says Donatus Kaufmann, member of thyssenkrupp’s executive board. “We regret the European Commission’s decision and regard it as too far-reaching and wrong. That is why we are filing a complaint,” he says.