New Zealand Law Society - Telco giants appeal decision to knock back merger

Telco giants appeal decision to knock back merger

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Sky Network Television Ltd and Vodafone are filing appeals in the High Court against the Commerce Commission's decision not to clear the two companies' proposed merger of their New Zealand operating businesses.

In a statement, Sky and Vodafone say they are filing appeals within the statutory time period for an appeal in order to preserve their rights while they wait for the release of the Commerce Commission's reasons for its decision and have the opportunity to assess these. The Commission's reasons are expected to be released in the coming weeks.

In February, the Commission turned down the merger bid, saying its assessment focused on the impact of the proposed merger on competition in both the broadband and mobile telecommunications markets. It said that to grant clearance, the Commission would need to be satisfied that the proposed merger would not be likely to substantially lessen competition in any market in New Zealand.

Chair Mark Berry said the Commission outlined its concerns with the proposed merger in a Letter of Unresolved Issues in October 2016 and subsequent submissions had not resolved these concerns. As a result, the Commission had not been able to exclude the real chance that the merger would substantially lessen competition.

“The proposed merger would have created a strong vertically integrated pay-TV and full service telecommunications provider in New Zealand owning all premium sports content,” said Dr Berry.