04.07.2024 The Competition Council (CC) has decided to allow an aviation fuel trader SIA BALTIC GROUND SERVICES LV to acquire a decisive influence over SIA Gulfstream Oil, which is engaged in the sale and refuelling of aviation fuel at Riga International Airport. In its impact assessment, the CC found that the merger would cause less harm or even benefit the competitive situation compared to the absence of the merger and therefore decided to clear the transaction.
SIA BALTIC GROUND SERVICES LV is engaged in the sale and refuelling of JET A-1 aviation fuel on the territory of Riga International Airport. The related companies of SIA BALTIC GROUND SERVICES LV are engaged in aircraft refuelling services at airports in other countries, cargo logistics services, aircraft repair and maintenance, as well as other activities related to air transport. “The business activities of SIA Gulfstream Oil are related to the sale and refuelling of JET A-1 aviation fuel on the territory of Riga International Airport.
The CC notes that the activities of merging parties overlap in the horizontal market – JET A-1 aviation fuel sales and refuelling in the ‘direct to aircraft’ segment at Riga International Airport.
Having assessed the information provided by the companies and obtained during the CC’s investigation, the CC assessed whether the merger would be likely to lead to significant impediments to effective competition in the affected market, resulting in a price increase and reduction in quality and innovation.
Having carried out economic forecasting, as well as the modelling and assessment of alternative scenarios, the CC concludes that the merger between SIA Gulfstream Oil and SIA BALTIC GROUND SERVICES LV will cause less harm or even benefit the competitive situation compared to the absence of the merger. The CC’s in-depth investigation shows that the merger will not alter the competitive structure in such a way as to create an incentive to initiate or facilitate coordination between SIA Gulfstream Oil and SIA BALTIC GROUND SERVICES LV to the detriment of existing competition in the aviation fuel supply and refuelling market and therefore, the merger may be allowed.
At the same time, while protecting the public interest, the CC will pay attention to the further development of competitive conditions, including ensuring that anticompetitive practices, including hidden coordination, do not develop between JET A-1 aviation fuel supply and refuelling service providers.