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Brussels has today rejected the proposed railway merger between the French company Alstom and the German company Siemens.
The decision was criticized by the French government as well as by both companies.
The European Commission said in a statement that the merger would have "undermined competition in the markets for railway signaling systems and very high speed trains".
He added that the two companies had not "proposed sufficient solutions to address these concerns".
Margrethe Vestager, EU Commissioner for Competition, said the merger "would have resulted in higher prices, fewer choices and more innovation".
What was the purpose of the merger?
The proposed merger was announced for the first time in September 2017 and was supported by both France and Germany to form a European champion able to compete globally, especially against CRRC (China Railway Rolling Stock Corporation) and Bombardier, a Canadian company.
The Chinese company was born in 2014 following the merger of two public entities with the ambition to become global. In its 2018 annual report, it stated that its products had now "served in 104 countries".
He entered the EU in 2016 after signing an agreement with the Czech railway operator for the supply of three multiple electric units for an amount of 20 million euros. Since then, he has been competing for public contracts throughout the block.
The merger would have led Alstom and Siemens to achieve an annual turnover of 15 billion euros.
Who was against the market?
The proposed agreement has been criticized by several national competition agencies, including those of Germany, Britain, Spain, Belgium and the Netherlands.
The Australian Competition and Consumer Commission had also lodged a formal complaint about the merger with the European Commission, fearing that a reduction in competition would lead to higher prices for heavy rail signaling projects. in the country.
Who was for the deal?
In a statement, Alstom said that it "regrets" the decision today and described it as "a clear setback for European industry".
"Alstom and Siemens are convinced that the operation would have created substantial value for the global mobility sector, the European rail industry, customers, travelers and commuters, without harming European competition", add the text.
In a separate statement, Siemens said the decision "proves that Europe urgently needs structural reform to shape its industrial future in a globally connected world."
"Protecting the interests of customers at the local level should not mean that Europe can not be on a par with major countries like China, the United States and others," he continued.
French Prime Minister Edouard Philippe told MPs that the decision to block the merger was "false" and "based on inaccurate badumptions".
"We need to rebuild the competition law as it is implemented in the EU," said Philippe, adding that the Brussels decision reflected "extravagant and outdated legal concepts".
In an interview with France 2, the French Minister of the Economy, Bruno Le Maire, described this decision as "economic mistake" and "bad luck". "political mistake" Wednesday morning.
He added that this decision "would serve China's economic and industrial interests" and that it "will prevent Alstom and Siemens from having the same weight as its Chinese competitors".
Its competitor, Bombardier, welcomed the decision of the European Commission, saying the merger "would have seriously compromised the health and competitiveness of the entire European rail market".
The unions, who feared that the merger will remove jobs, were also among the opponents of the Siemens-Alstom railway contract.
Later on Wednesday, The Mayor told reporters that the French government would "consider options for the consolidation of Alstom".
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