MEETING OF THE AUTHORITY, 9 AND 10 MARCH 2005
PRESS RELEASE
PRESS RELEASE
The Competition Authority today held its first meeting chaired by Antonio Catricalà, who officially took office as the new Chairman yesterday.
During the course of the meeting, the Board comprising Carlo Santagata, Nicola Occhiocupo, Giorgio Guazzaloca e Antonio Pilati, welcomed the new Chairman who recalled the contribution made by his predecessor, Giuseppe Tesauro, to spreading the culture of competition, and spoke of the far from easy, but challenging, task of succeeding him.
At the same meeting the Authority approved the Chairman's nominee as his Head of the Chairman’s Office, Luigi Fiorentino, and amended the Bylaws to transform the Chairman's Office into an office working directly with the whole Board, without introducing any changes to the powers and responsibilities of the Authority's institutional offices.
Luigi Fiorentino, 46, has had a long experience as a civil servant, and recently served as Head of the Department of Human and Instrumental Resources at the Prime Minister's Office. He has also held the post of Director of the Central Service for General Affairs and Organisation at the Ministry of the Economy and Finance, where he had previously been the Deputy Chef de Cabinet to Treasury Ministers Ciampi and Amato. He has also served as Provveditore Generale dello Stato (Head of State Assets Management Department) and as a member of numerous management boards. He has also had academic experience, publishing numerous papers and monographs on various administrative law issues, and has conducted research abroad and lectured at several universities. At the present time he lectures under contract at Rome's Tor Vergata University.
With regard to its institutional work in relation to competition, the Authority examined a number of mergers and acquisitions and cases of misleading advertising. It authorised the takeover by Parmalat S.p.A. of Carnini S.p.A.. On 27 January 2005, the Authority had declared that prior notification of the acquisition had not been served, and the operation was investigated to ascertain any possible anti-competitive effects on the fresh milk market, where most of Carnini's turnover is generated.
Even though both companies operate not only in the fresh milk sector but in other commodity areas as well, in view of Carnini's absolutely marginal shares of these other markets, the Authority focused on three types of milk: "standard" and "high-quality" full fat milk, and "skimmed" milk, all belonging to the fresh milk sector. It also carefully examined the market entry of "micro-filtered" long life milk, even though sales of this product are still rather small.
The investigation revealed the effects of the acquisition, particularly at the local level, and especially in the Lombardy region, where any possible impact on existing fresh milk producers appeared to be the greatest.
It showed that there were no risks of creating or strengthening an individual dominant position. For the acquisition of Carnini would give a very small market share to Parmalat in comparison with what Parmalat had originally acquired when the operation was first put into place. Furthermore, looking ahead to possible pricing strategies that the Carnini acquisition would enable Parmalat to implement, the investigation showed that keeping the Carnini brand would have little influence on prices and hence on the well-being of consumers.
As for the risk of coordinated effects, the investigation concluded that the continuing significant difference in market shares between Parmalat and Granarolo, which would not be narrowed even as a result of this acquisition, would appear to rule out the possibility that the two operators might combine their strategies to jointly deploy their market strength.
This consideration was also confirmed by the fact that Granarolo had increased its market share over the past five years, coinciding with the wide-ranging downsizing of the Parmalat group.
In the light of these considerations, the Authority therefore resolved to authorise the acquisition.
At the same meeting, opinions were adopted pursuant to section 22 of the Competition Act at the request of the Ministry of the Economy and Finance regarding the draft invitations to tender for the supply of "light commercial vehicles" for government departments.
Both opinions declared that the invitation to tender and the tendering rules were essentially consistent with the principles laid down by the Authority governing invitations to tender drawn up by Consip.
A third opinion, once again requested by the Ministry of the Economy and Finance, related to a draft invitation to tender to supply the "credit card payment financial service for government departments" together with the tendering rules prepared by Concessionaria Servizi Informatici Pubblici - CONSIP S.p.A.. The Authority also took note of the prior notification, served pursuant to section 8(2) of the Competition Act, of the spin-off of the gas distribution business by the newly incorporated GEAT Distribuzione Gas S.p.A., controlled by the Riccione city council.
Lastly, with reference to the new powers regarding conflict of interest, the Authority declared that the post of Special Government Commissioner was incompatible with that of a serving Prefect.
Rome, 10 March 2005