Press Release
C. 01-13 th
El Salvador, February 4 , 2013
CS receives request from ANEP to investigate ALBA The Competition Superintendence (CS) received today a request from the National Association of the Private Enterprise (in Spanish, Asociación Nacional de la Empresa Privada or its acronym “ANEP”), to investigate ex-officio the entity ALBA PETRÓLEOS EL SALVADOR, alleging infringement of the Salvadoran Competition Law (CL) for not having previously filed before the CS a merger or acquisition authorization request. “As with all the actions carried out by the CS, the request filed by the ANEP will transparently and independently analyzed”, said Francisco Diaz Rodriguez, Competition Superintendent.
The ANEP requested the CS to investigate ex.-officio if “ALBA PETRÓLEOS has asked the competition authority for its prior authorization for mergers and/or acquisitions where said entity has participated and that exceed the thresholds pursuant to Article 33 of the CL”. According to Article 33 of the CL: “Mergers or acquisitions whose combined total assets exceed fifty thousand minimum urban annual wages in the industrial sector or whose total income exceeds sixty thousand minimum urban annual wages in the industrial sector shall request the Superintendence their prior authorization.
The Competition Superintendent, Francisco Diaz Rodriguez, clarified the writ received Is not a complaint for the alleged commitment of anticompetitive practices, but a request to gather information and investigate the activities of Alba Petroleos Group related to mergers and/or acquisitions not notified to the CS. In this case, the CS will carry on an investigation pursuant to ANEP´s request based on Article 61 b) of the CL Regulations, in order to determined if the obligation to file a prior merger/acquisition authorization request has been complied with or not. Furthermore, the Superintendent added: “As with other requests previously filed, the CS will analyze it in order to determine if the request has solid proof and if such is the case, then we shall proceed in accordance to the Law”. “This will be a good opportunity for the Salvadoran population to see how large the national market is, to get acquainted with mergers and acquisitions, of the importance of their ex ante analysis in order to prevent any harm to competition and to prove the limitations of the CL”, asserted. En case the CS demonstrates that Alba Petroleos has executed a merger or an acquisition without requesting prior authorization to said authority, this entity would be fined pursuant to Article 38 paragraph 4, in accordance to a previous due process.
About mergers and acquisitions Since 2006, the CS has analyzed mergers and acquisitions which have taken place in various sectors such as: telephony, banking, insurance, petroleum, amongst others. The CS is legally empowered to authorize, condition (impose remedies), or deny a merger or an acquisition before such operation is executed by the economic agents. This is an EX ANTE analysis carried out in order to prevent future limitations to competition. A merger or an acquisition may create an environment that facilitates the commission of anticompetitive practices or the creation of a dominant economic agent in the market that might abuse of said dominance, jeopardizing consumers. In the analysis carried out by the CS, elements such as concentration levels, existing rivalry in the markets, and gains in economic efficiency that result in benefits to the consumer are considered.