Thyssenkrupp disputes EU refusal to merge with Tata Steel

German multinational conglomerate Thyssenkrupp has filed a complaint with the European Union's General Court (EGC) against the European Commission's (EC) decision to block its merger with Indian steel giant Tata Steel.

In a statement released yesterday, Thyssenkrupp noted that the commitments it and Tata Steel presented were sufficient to address competition concerns. The company decided to file a complaint because it regrets the EU decision and considers it too far-reaching and wrong. The Commission has presented a restrictive definition of a market that unjustifiably expands the scope of the existing competition law.

The EC does not sufficiently take into account the structural importance of imports to Europe, said Donatus Kaufmann, executive board member of Thyssenkrupp AG. In addition, he noted that overcapacity and high pressure on imports from Asia create an environment in which the planned joint venture with Tata Steel could not dampen competition.

The merger was initially notified to the EU in September last year. Initial market research raised several preliminary competition concerns. Thereafter, the Commission conducted an in-depth investigation, taking into account the views of customers from various sectors, including the packaging and automotive industries. In addition to the results of the investigation, in June this year the antitrust authority vetoed the deal, saying that a possible merger of the two companies would reduce competition and increase prices for various types of steel.