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Veolia Faces $10 Million Fine from Competition Council for Breach of Competition Laws
Veolia Environnement, a prominent French utility company renowned for its expertise in water and waste management, is currently grappling with a significant fine of $10 million (100 million dirhams) imposed by the Competition Council. This body, an integral part of the Moroccan Competition Authority, diligently upholds transparency and equity in economic relations by regulating various market sectors.
The Competition Council's action stems from its accusation that Veolia violated competition laws by exerting control over water and electricity services in major urban centers. Initially, in September 2021, the Council had approved the merger between Veolia and Suez, contingent upon the divestment of certain activities and assets, including Lydec, to a consortium of investors comprising Meridiam, Global Infrastructure Partners, Groupe Caisse des Depots et Consignations, and its subsidiary CNP Assurance.
However, in September 2023, the Council rebuked Veolia, asserting that the company had failed to fulfill its commitments, resulting in what they deemed an "unauthorized economic concentration." The Council emphasized that the merger had breached Morocco's competition laws by granting Veolia control over the water and electricity distribution market in several major urban areas, including Casablanca, Rabat, and Tangier, facilitated by the utilities companies Lydec, Redal, and Amendis.
Veolia now faces a one-month deadline to identify a suitable buyer for Lydec, with the possibility of an additional one-month extension. This condition aims to address the concerns raised by the Competition Council.
It is noteworthy that the Veolia-Suez merger is not the sole instance prompting decisive action from the Competition Council. In 2022 alone, the Council issued a remarkable 31 antitrust fines, totaling MAD 72 billion ($7.2 billion). These fines were imposed due to failures to adequately report economic concentration operations, as highlighted in the Council's annual report for 2022.
The Competition Council's persistent efforts to maintain fairness and integrity in economic markets underscore its unwavering commitment to protecting the interests of consumers and fostering healthy competition within Morocco's business landscape.