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Singapore – Competition Highlights.

14 April, 2014

 

Applied Materials Inc. And Tokyo Electron Ltd Notifies The Competition Commission Of Singapore (“CCS”) On Its Proposed Merger

 
On 20 January 2014, Applied Materials Inc. (“AMI”) and Tokyo Electron Limited (“TEL”) notified their proposed merger to the CCS, i.e. an all-stock transaction to create a new company. AMI is active in the production and supply of equipment, services and software for the manufacture of semiconductor, flat panel display and photovoltaic products whilst TEL, inter alia, supplies a wide range of wafer fabrication equipment used to manufacture semiconductors. The CCS review focuses on the seven (7) markets in which the parties overlap. As of today, the merger it is still under review by the CCS.

 
Singapore Airlines Ltd. And Air New Zealand Ltd Notify CCS On Their Proposed Strategic Alliance

 
On 30 January 2014, the CCS received a notification for decision on the proposed strategic alliance between Singapore Airlines Ltd. (“SIA”) and Air New Zealand Ltd (“ANZ”). The notification was made in relation to Section 34 of the Competition Act which prohibits anticompetitive agreements. The strategic alliance will result in the cooperation of two airlines that are currently competing in the scheduled international air passenger transport services market, including on Singapore origin and destination routes. As such, the agreement is likely to be viewed as anti-competitive unless the CCS accepts the airlines’ arguments that the proposed cooperation will result in a Net Economic Benefit (“NEB”) in Singapore.

 
Scoot Pte Ltd And Tiger Airways Singapore Pte Ltd Notify CCS On Their Proposed Cooperation

 
On 28 January 2014, the CCS received a notification for decision on the proposed cooperation between Scoot Pte Ltd. (“SPL”) and Tiger Airways Singapore Pte Ltd (“TAS”). The notification was made in relation to Section 34 of the Competition Act which prohibits anti-competitive agreements. Under the proposed cooperation, the airlines will cooperate on, inter alia, schedules, prices, sales and marketing and service policies allegedly to improve the overall quality of service offered to passengers on their respective networks, with the exception of routes between Singapore and Australia. The proposed arrangement will result in the cooperation of two airlines that are currently competing in the scheduled international air passenger transport services market, including on Singapore origin and destination routes. As such, the agreement is likely to be viewed as anti-competitive unless the CCS accepts the airlines’ arguments that the proposed cooperation will result in a Net Economic Benefit (“NEB”) in Singapore.

 

Seek Asia Investments Pte Ltd’s Proposed Acquisition Of Jobstreet’s Businesses Is Notified To The CCS

 
On 20 February 2014, the CCS received a notification for decision on the proposed acquisition by Seek Asia Investments Pte Ltd (“SA”) of a number of recruitment business assets of the Jobstreet Business Entities (“JBE”), including JobStreet.com Pte Ltd (“JS”). The notification was made under the CCS’ voluntary merger notification regime. Under this proposed acquisition, SA will acquire sole control over JBE’s recruitment business assets including JS. Both parties currently provide online recruitment advertising services and recruitment solutions in Singapore. Therefore, in making its decision, the CCS will determine whether the proposed merger will result in a substantial lessening of competition in the relevant market(s).

 
CCS Releases Report On Findings From Aviation Market Study

 
On 18 March 2014, the CCS released the conclusions of a market study on the aviation industry which the CCS commissioned in 2012. The market study was conducted with the aim of “[determining] the scale and scope of benefit arising from [airline] joint ventures (“JVs”),” and was based on the Japan Airlines/American Airlines and All Nippon Airways/Continental/United Airlines JVs that the CCS had previously cleared. Results of the market study indicated that the formation of airline JVs resulted in a NEB in Singapore but that “the significant drop in passenger fares found in literature based on USA flight data were not replicated in JVs formed in, or operated in Singapore and the Asia Pacific region.” Given these findings, the CCS concluded that it will rely less on reported benefits of typical airline JVs based solely on western research materials and give less weight to NEB arguments based on fare reductions in making future decisions on airline JVs.

 

Rajah & Tann

 

For further information, please contact:

 

Kala Anandarajah, Partner, Rajah & Tann

kala.anandarajah@rajahtann.com

 

Dominique Lombardi, Partner, Rajah & Tann

dominique.lombardi@rajahtann.com

 
Homegrown Competition & Antitrust Law Firms in Singapore

 
 

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