The EU Commission announced on Tuesday that it has approved the acquisition of Ceconomy AG-the parent company of MediaMarkt and Saturn-by the Chinese JD Group, albeit subject to certain conditions. This approval came under the regulation concerning third-country subsidies.
During the review process, the Commission determined that the Chinese conglomerate receives state subsidies which could potentially distort the EU single market. To address these concerns, the companies agreed to several commitments. These include ensuring that intra-group transactions are conducted under market conditions, and offering warehouse and logistics services, as well as technological services, from JD to other retailers under the same terms applied to Ceconomy.
These obligations are binding for a period of ten years and are intended to completely neutralize any market distortion caused by the subsidies. An independent trustee will be responsible for overseeing the implementation of these agreements.
EU Commission Vice-President Teresa Ribera commented that consumers will benefit from competition both in retail and e-commerce, and that companies will benefit from equal competitive conditions. Ribera noted that the involved companies demonstrated a cooperative attitude, which allowed for commitments to be established. These commitments effectively counteract the identified third-country subsidies and their potential damaging effects on the internal market, among other things, by preventing cross-subsidization of the participating companies’ activities in Europe.
