Finland: economist perspective

Economic analysis plays an important role in Finnish merger control. Two merger cases from the past year are of particular interest. First, following an in-depth analysis covering a broad range of healthcare markets, the Finnish Competition and Consumer Authority (FCCA) moved to block the healthcare merger of Mehiläinen/Pihlajalinna. However, the Market Court did not rule on the merits of the case since the acquisition contract expired during the court process. Second, the FCCA found a merger between the cash management and cash network providers Loomis and Automatia to give rise to vertical competition concerns but cleared the merger subject to behavioural and access remedies. More generally, the lawyers interviewed agree that merger investigations remain data-intensive and thorough, with many recent clearances being made subject to remedies. The thorough scrutiny of mergers is likely to continue in the future years. Moreover, the FCCA has proposed changes to the existing merger review revenue thresholds, which would increase the number of transactions for the authority to investigate.

At the beginning of 2021, the FCCA ended a four-year cartel investigation into the property management sector, proposing sanctions of €22 million in total for the parties. While both the FCCA and the lawyers monitor pan-European competition policy developments, for example, regarding digital platforms, no enforcement activity in this area has occurred. The role of private enforcement in the field of competition remains small by international standards.

This article is based on interviews with the FCCA and with prominent competition law practitioners from the law firms Frontia, Castrén & Snellman, Hannes Snellman, Krogerus, Merilampi and Waselius & Wist.

Substantial use of economics in Phase II merger investigations

In 2020, the FCCA reviewed 21 mergers, of which 20 were approved (19 without conditions). This is around half of the annual number of merger investigations in the previous two years.[1] The FCCA moved to block one merger and one merger notification was withdrawn during the Phase II investigation.[2] In the first half of 2021, the FCCA cleared 12 mergers, two of which were subject to conditions.

M&A activity has generally been strong, and many transactions have been pursued after being on hold during the first months of the covid-19 outbreak. However, some lawyers’ clients are increasingly aware of the risk that mergers may not be cleared without conditions and are conscious of the effort that the merger review process entails.

The FCCA proposed to prohibit a merger in the healthcare sector

In September 2020, the FCCA moved to block the merger between Mehiläinen Yhtiöt Oyj and Pihlajalinna Oyj, both active in the private healthcare market.[3] The FCCA argued that the proposed transaction would reduce the number of nationwide healthcare providers from three to two.

Both the FCCA and the parties presented economic evidence concerning multiple segments of the healthcare market. The breadth and depth of economic analysis conducted in the Mehiläinen/Pihlajalinna inquiry were unprecedented in Finland and can be considered substantial, even by international standards. The FCCA’s economic analysis covered a broad range of healthcare markets, from insurance-based markets to occupational health markets, each exhibiting different characteristics that required consideration in the analysis.[4] The FCCA developed economic models to capture the specific features of the Finnish healthcare markets, going beyond the conventional tools used in price-rise analyses that are often applied. For example, the FCCA’s theoretical model for the private patient market enabled an analysis of effects on prices set independently by the doctors, and prices determined by healthcare providers. A distinct model was developed to capture how the firms compete for insurance customers. The wealth of granular data available from the Social Insurance Institution enabled types of analysis not previously seen in Finnish merger cases, for example, econometric ex-post analyses of the effects of previous healthcare mergers.

Some of the FCCA’s market definitions in Mehiläinen/Pihlajalinna were informed by a critical loss analysis (CLA) drawing on survey evidence and testing whether public healthcare services belong to the same relevant market as private providers. More generally, the FCCA notes that it applies CLA to inform relevant market definitions more often than most other European competition authorities.

The Mehiläinen/Pihlajalinna review was prolonged beyond the standard statutory time limits due to data issues that led to a stop-the-clock decision. The acquisition offer was announced in November 2019 and expired in November 2020, after the hearings but before the deadline of the Market Court’s decision. In late December 2020, the Market Court ruled that the acquisition had expired and that it saw no reason to rule on the merits of the case.

Both behavioural and structural remedies have been imposed to alleviate post-merger competition concerns

The FCCA cleared a vertical merger between Loomis AB and Automatia Pankkiautomaatit Oy with behavioural and access remedies, which are intended to facilitate competition in cash management services for five years following the transaction.[5] Loomis operates in cash transit and handling services, and Automatia operates a nationwide ATM network in Finland under the Otto brand and provides cash management services to Finnish banks. In the most in-depth economic analysis of a vertical merger conducted in Finland to date, the FCCA investigated the merged entity’s ability and incentive to foreclose the downstream operator Avarn from the market and what the impact of the potential foreclosure would be.[6] In the end, the FCCA accepted the merger with behavioural and access remedies, which stipulate that the merged entity must provide access to its cash infrastructure for cash handling service providers for the next five years. Avarn is guaranteed a continuation of its current purchasing contract for two years and a declining minimum order for three years after that.[7]

In 2021 so far, the FCCA has cleared several mergers subject to conditions.

First, the merger between the alcoholic beverage producers, importers and distributors Altia Oyj and Arcus ASA was cleared subject to remedies, with the requirement that an upfront buyer was identified. Consistent with the approach taken by the Swedish and Norwegian competition authorities, who cleared the transaction with conditions,[8] and drawing predominantly on structural competition analysis, the FCCA conditioned the merger on the divestment of Altia’s Skåne Akvavit brand to alleviate concentration in the relatively small aquavit beverage category in Finland.[9] Arcus had to terminate the distribution agreement for Metsmaasikas wild strawberry liqueur. The acquisition cannot be completed before an agreement has been concluded with a buyer approved by the FCCA. The FCCA confirms that it is likely to require similar upfront buyer provisions in future transactions that are cleared subject to divestiture commitments.

Assemblin AB’s acquisition of Fidelix Holding Oy in the building automation market was cleared subject to divestments in the Uusimaa and Pirkanmaa regions, again with an upfront buyer requirement. Assemblin was required to ensure the continuation of a contract with the building automation system provider DEOS AG to the best of its ability and to transfer its DEOS-related knowledge and key personnel to the buyer.[10]

Remedies were also required in the Valio Oy/Heinon Tukku Oy merger, where the merging parties had overlapping business in public sector food service procurements and the dairy, industrial grocery and frozen food supply markets. Valio was required to protect Heinon Tukku’s confidential information about Valio’s competitors to prevent it from being used by Valio in a manner that could harm competition.[11]

The lawyers have experienced no significant change in the level of scrutiny applied by the FCCA in merger clearance. Many of the lawyers note that recent review processes have been data-intensive and detailed with, at times, short deadlines for data delivery. Some note that companies contemplating mergers should be mindful that the FCCA may require remedies to alleviate competition concerns relating to local, geographic or product markets, regardless of the sizes of those markets. Some lawyers stressed the importance of a careful pre-notification dialogue with the FCCA.

The FCCA notes that firms preparing a merger filing should be cautious not to rely too heavily on market definitions established in previous cases.[12] Moreover, market definition is, first and foremost, a tool to understand the competitive constraints faced by the merged entity.

The FCCA suggests lower revenue thresholds in merger control

In March 2021, the European Commission issued a communication to guide the application of the referral mechanism set out in article 22 of the EU Merger Regulation (EUMR).[13] The communication provides the member states with an opportunity to refer mergers to the Commission if the transaction poses a threat to competition while falling short of the existing revenue (or other) thresholds. The communication allows intervening intervene in so-called ‘killer acquisitions’ (ie, mergers that aim to eliminate an upcoming competitor). Some of the lawyers interviewed told us that this pan-European development has been recognised by companies contemplating mergers and acquisitions in Finland.

In addition to the likely future increase in the number of mergers referred to by the European Commission under article 22 EUMR, the FCCA recently called for a change to the thresholds applied. In June 2021, the FCCA expressed its concern that the current thresholds of €350 million for combined global revenue and €20 million for at least two of the merging parties respectively were too high to bring all potentially problematic transactions under appropriate scrutiny, especially considering the size of the Finnish economy and individual markets therein. Noting that the current thresholds in Finland are considerably higher than in the other Nordic countries, the FCCA observed that this has led to high degrees of concentration in, for example, the Finnish bus transportation and healthcare markets, where the FCCA has been unable to review smaller acquisitions. The FCCA suggests that the thresholds should be adapted to become more similar to those in Sweden and Norway. It suggests that mergers where the merging parties’ combined revenue exceeds €100 million and the turnover of at least two of the merging parties exceeds €20 million should be notified and that the authority should obtain the power to request a notification of mergers where the merging parties’ combined revenues in Finland exceeds €50 million. In its report, the FCCA estimated that these changes would increase the number of merger investigations by one-third and would result in substantial welfare gains.[14] The study was requested by the Ministry of Economic Affairs and Employment of Finland, and the FCCA’s findings will be processed by the Ministry.

Penalties proposed on six real estate management firms for price-fixing

While few investigations of cartels and abuse of dominance have reached the Market Court in recent years, the lawyers alluded to ongoing investigations, which are likely to surface in due course. As in many European countries, investigations can take several years. Many rulings are expected to be made on a by object basis and are therefore unlikely to include any substantive economic analysis of the effects of the prohibited conduct.

One example of a horizontal infringement is the alleged price coordination between six real estate management companies and the Finnish Real Estate Management Federation (an industry organisation). In February 2021, after four years of investigation, the FCCA proposed sanctions of €22 million in total. According to the investigation, the parties had discussed the harmonisation of their pricing and price increases in meetings and seminars between 2014 and 2017. The price recommendations were then distributed among participants through the industry organisation.[15]

In March 2021, the Market Court imposed sanctions worth €4 million on Jackon Finland and UK-Muovi for price coordination of EPS-insulation ergo styrofoam products. The parties had coordinated price increases of the most common products between November 2012 and the summer of 2014. The third participant, Styroplast, revealed the infringement to the FCCA in 2015 and was not sanctioned due to its cooperation.[16]

The FCCA confirms that few formal cases regarding abuse of dominant position have been filed in recent years. According to the FCCA, abuse of dominance cases have, in the past, involved substantial economic analysis and may continue to do so in the future depending on the nature of the case. Furthermore, the FCCA notes that economic input is often necessary for preliminary assessments of competition concerns brought to the FCCA’s attention.

Private enforcement activity remains low

In its public communications regarding real estate management infringement, the FCCA alluded to difficulties relating to potential damage claims based on the infringement and recommended that housing associations renegotiate their contracts with real estate managers. Finland has no opt-out class action regime, and the existing methods for combining large numbers of fragmented competition law infringement-related damage claims have proved challenging in practice. Some lawyers note that the claimants’ limited success in damage cases in recent years may discourage companies from pursuing claims. This may be one reason why no substantial competition-related damages claims are currently pending in Finnish courts.

According to some of the lawyers, the situation may evolve as a rebuttable presumption of harm, now implemented in Finnish law, will be applicable in future cases. While some lawyers anticipate an increasing role for litigation funders in civil claims in Finland, no one considers it likely that an effective class action system will be implemented in Finland soon. Some pointed out that in the case of European Commission infringement decisions, for example in the Trucks matter, Finnish claimants have simply joined class actions litigated elsewhere.

Although damage cases are not heard in specialist courts in Finland and the judges do not have economic backgrounds, some of the lawyers perceive the judges in the Helsinki District Court and the Helsinki Court of Appeal to be increasingly prepared to assess economic argumentation in follow-on damage cases.

State aid complaint filed against the Finnish public service broadcaster

In May 2021, the media conglomerate Sanoma Media Finland Oy submitted a state aid complaint to the European Commission concerning the activities of the Finnish Broadcasting Company Yleisradio Oy (Yle) in video-on-demand services and digital learning materials. According to the complaint, the provision of these services by Yle affects Sanoma’s ability to generate revenue from its commercial services.[17] In June 2021, the Ministry of Transport and Communications replied to the Commission that the above-mentioned services fall within Yle’s public service mandate and do not distort competition.[18]

The covid-19 state aid scheme will soon come to an end. Some lawyers believe that the definition of state aid is, in practice, broadening to encompass tax policy. The use of economics and financial economic analysis varies across state aid matters.

Pharmacy sector under scrutiny

The FCCA also used economic tools in its recent market studies. For example, in late 2020, the FCCA’s Impact Assessment unit published a report about the Finnish pharmacy market.

The FCCA found that that competition in the pharmacy market is not functioning well enough due to deficiencies in the regulatory system. These deficiencies manifest as high prices for the public healthcare system and patients, and high returns for pharmacists. The FCCA’s list of reform suggestions includes: (i) decreasing the regulated margin for pharmaceuticals, (ii) an extension of the pharmacy tax, (iii) lowering entry barriers (iv), ending the regulation of the number of pharmacies in local markets, (v) allowing fully digital pharmacies, (vi) enabling price competition for drugs, and (vii) liberalising non-prescription drugs.[19] The government’s proposals for changes to the legislation in June 2021 were in line with some of the FCCA’s proposals, including lowering barriers to entry and expansion and enabling price competition in the non-prescription drugs segment.[20]

Competition implications of pricing algorithms and big data are monitored, without any concrete cases so far

Several lawyers remark that Finnish enterprises, including outside the tech sector, are increasingly interested in understanding the competition implications of big data and digital platforms. Some find their clients to be interested in understanding the compliance requirements relating to digital platforms, data and pricing algorithms, although Finland has seen no concrete cases yet.

In early 2021, the FCCA published a report regarding the competitive effects of the increasing prevalence of pricing algorithms.[21] The report explained how algorithms may facilitate collusion and stresses the responsibility of firms using such algorithms to ensure compliance with competition law. The FCCA contributed to a report by the Nordic competition authorities on the competition issues surrounding data and digital platforms.[22]


Copenhagen Economics has acted as an economic advisor to a party in three of the cases mentioned in this article, namely the Mehiläinen/Pihlajalinna merger for Mehiläinen and two other matters. Copenhagen Economics involvement is to become public in due course.

[1] According to the FCCA’s listing of merger decisions, in 2019 the FCCA accepted 30 mergers unconditionally, accepted four conditionally and proposed to prohibit one. In 2018 the FCCA accepted 37 mergers unconditionally and three conditionally. The FCCA does not have the power to prohibit mergers in Finland, but it can propose prohibition to the Market Court.

[2] The notification of Hankkija’s acquisition of SSO’s agricultural trade was withdrawn due to competition concerns in Phase II and the deal was renegotiated such that the merger notification thresholds were not met.

[3] The FCCA’s press release from 29 September 2020:

[4] The public proposal for the Market Court for Mehiläinen/Pihlajalinna merger, 29 September 2020:, and the economic annex for the Mehiläinen/Pihlajalinna merger, 29 September 2020:

[5] The FCCA’s press release from 14 October 2020:

[6] The FCCA’s decision on Loomis/Automatia, 14 October 2020 (Dnro KKV/383/14.00.10/2020), public version online:

[7] The FCCA’s press release from 14 October 2020:

[8] The FCCA’s press release from 19 April 2021:

[9] The FCCA’s decision on the Altia/Arcus merger, 19 April 2021 (Dnro KKV/1328/14.00.10/2020), public version online:

[10] The FCCA’s press release from 30 July 2021:

[11] The FCCA’s press release from 1 July 2021:

[12] See, for example, the recent clearance decision of Valio/Heinon Tukku: KKV/528/14.00.10/2021, paragraphs 43–47.

[13] Communication from the Commission of 26 March 2021, Commission Guidance on the application of the referral mechanism set out in Article 22 of the Merger Regulation to certain categories of cases:

[14] The FCCA’s press release from 11 June 2021: Buri R, Heinonen M, Parhiala T, Pietola M, Syrjälä S (2021), Selvitys yrityskauppavalvonnan ilmoitusvelvollisuuden muutostarpeista, Kilpailu- ja kuluttajaviraston selvityksiä 7/2021.

[15] The FCCA’s press release on the real estate management cartel, 10 February 2021:

[16] The FCCA’s press release from 3 March 2021:

[17] Sanoma’s complaint form for the European Commission regarding Yle:

[18] The Ministry of Transport and Communications’ reply to the European Commission’s request for information of state aid to public service broadcaster YLE for VOD and online learning services:

[19] The FCCA’s assessment regarding the pharmacy market 5/2020:

[20] The government’s proposal for a new drug law (HE 107/2021):

[21] The FCCA’s assessment regarding algorithms 1/2021:

[22] Digital platforms and the potential changes to competition law at the European level, September 2020:

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