Full-function Joint Venture between Bianchi and Sons Limited, Merill Invest Limited and Ziti Technologies Limited

On the 7 September 2021, a notification of a proposed joint venture between Bianchi and Sons Limited, Merill Invest Limited and Ziti Technologies Limited, was deemed complete by the Office for Competition (hereinafter referred to as “the Office”).

Bianchi and Sons Limited and Merill Invest Limited are shareholders into the already incorporated company Gozo Fast Ferry Limited, which manages and operates passenger fast ferry services between Valletta, Malta and Mġarr, Gozo. Ziti Technologies Limited (hereinafter referred to as ‘Ziti’) is a holding company that operates in the technology sector, and forms part of the same international group of companies that Malta Public Transport Services (Operations) Limited forms part of.

On 21 October 2021, the Office decided to initiate proceedings for an in-depth investigation (known as Phase II investigation) in accordance with regulation 6(1)(iii) of the Control of Concentrations Regulations (hereinafter referred to as “the Regulations”). In its preliminary investigation, the Office concluded that the proposed joint venture could prima facie limit competition in the market for passenger fast ferry services between Valletta, Malta and Mġarr, Gozo. The Office expressed concerns that the proposed joint venture could lead to adverse non-horizontal competition effects arising through input foreclosure; harming competition and consumer welfare in the process.

The objective of the Phase II investigation was thus for the Office to undertake a more in-depth quantitative and qualitative assessment on the effects of the proposed joint venture on competition and to assess whether the proposed joint venture may result into a substantial lessening of competition within any market or markets in Malta.

Following detailed consideration and analysis, the Office declared the concentration lawful in terms of Regulation 6(1)(ii) of the Control of Concentrations Regulations, subject to the Commitments submitted by the Notifying Parties pursuant to Regulation 6(2) and the proviso to Regulation 9(2) of the Regulations. As a result of the approval, Ziti will become an additional shareholder in the company Gozo Fast Ferry Limited.

The Commitments

In order to address the Office's concerns, the Notifying Parties submitted a set of Commitments, consisting mainly in:

• Ziti ensuring that Malta Public Transport (Operations) Limited will treat all present and future Valletta-Mġarr fast ferry operators on equal, fair, reasonable and non-discriminatory (hereinafter referred to as “FRAND”) terms, in relation to the scheduling and operation of scheduled bus services to and from the Valletta/Mġarr fast ferry terminals;
• Ziti ensuring that Tallinja Technology Limited provides commercial access to the tallinja card (being both personalised and non-personalised) and the related ticketing technology on FRAND terms and in particular on no less favourable terms than the ones granted to Gozo Fast Ferry Limited in all respects through standard terms of service and prices, which shall be available on demand to all fast ferry operators that currently operate, or those that may wish to enter, the Valletta-Mġarr fast ferry market in line with Port Notice 02/2021 and subject to the signing of the necessary Non-Disclosure Agreements;

The Commitments are to remain into effect for a minimum duration of six years, potentially renewable at the discretion of the Office

Following a reviewing period, the Office concluded that these Commitments remedy the competition concerns raised. The decision to approve the proposed joint venture is conditional upon full compliance with the Commitments.

The full text of the final non-confidential version of the decision will be made public after it is cleared of any confidential information and business secrets it may contain.