Altice received a 125 million euros’ fine from Brussels for purchasing PT before getting the approval

The European Commission will impose a 125 million euros’ fine to Altice for purchasing PT Portugal before receiving the all-clear from Brussels. PT Portugal was purchased in 2015, in a business assessed in 5.7 billion euros. The operation was not right away approved by the European Commission, which, in May of 2017, started investigating Altice. The company has stated it will appeal the decision.

“Companies that act prematurely and move forward with mergers before a notification or approval compromise the effective functioning of the European Union’s merger control system”, stated Margrethe Vestager, the European Commissioner for Competition. “This is the system that protects European consumers from mergers that could result in price increases or that could limit supply”, she stated.

"Companies that act prematurely and move forward with mergers before a notification or approval compromise the effective functioning of the European Union’s merger control system.”

The European Commission decided, therefore, to fine Altice in 125 million euros, which, Vestager states, “reflects the severity of the violation and intends to discourage other companies from breaking EU rulings concerning merger control”.

Altice stated it will appeal the decision. “Altice fully disagrees with the Commission’s decision“, the company stated in a press release published on their website, adding they will request the EU General Court for “the decision as a whole to be annulled or, at the very least, that the sanction are significantly reduced”. The same press release also highlights: “This decision would have serious consequences for European companies; it also sets a precedent, which will have an impact on all future M&A transactions in Europe and consequently on the EU economy”.

"Altice fully disagrees with the Commission’s decision (…) This decision would have serious consequences for European companies; it also sets a precedent, which will have an impact on all future M&A transactions in Europe and consequently on the EU economy.”

According to the Commission, Altice made relevant decisions about the activity of PT Portugal even before the authorities approved the purchase operation, namely concerning marketing, having obtained confidential commercial information. Authorities mention: “Certain dispositions of the acquisition agreement meant Altice got the legal right to enforce a decisive influence on PT Portugal, namely by giving Altice voting rights on regular activities from PT Portugal”.

In addition, “in certain cases, Altice did in fact enforce a decisive influence on some of PT Portugal activities, namely by instructing PT Portugal about a marketing campaign aiming to get and receive detailed confidential commercial information about PT Portugal, not included in any confidentiality agreement”.