EU expected to review BP-Amoco merger

Competition lawyers said they expected British Petroleum Co Plc's planned merger with Amoco Corp to be reviewed under European Union merger rules but several did not foresee major antitrust problems.
Several Brussels-based experts in EU competition law said they believed the merger was big enough to be examined by the European Commission, the EU's antitrust watchdog.
The companies held plans to join up in the biggest ever industrial merger, creating a colossus with combined revenues of more than $ 107 bn in 1997.
BP Amoco would be the third-largest commercial oil company by sales and would lead the world in commercial reserves of oil and equivalent liquids.
"Given the highly competitive nature of the sector, I wouldn't imagine there would be any problems," a lawyer said, stressing that this view was based on what he had read about the merger in the media.

Under the EU's merger regulation, mergers and acquisitions must be filed for approval with the Commission if the companies have a combined global turnover of at least 5 bn ECU ($ 5.50 bn) and EU turnover of 250 mm ECU ($ 275 mm) each.
The Commission said it had not yet been formally notified of the merger and could not be certain the deal fell under the merger regulation until it received details.
"We have to study the notification. In any case, the merger cannot be effective without the green light of the Commission," Commission spokesman Costas Verros has said.
"Either we find out there are no problems according to the merger regulation or if there are any problems the Commission is going to decide," he said.
When the Commission examines a transaction under the merger regulation, it generally decides after 1 month whether to clear the deal or to open a full, four-month probe into its impact on competition in the European market.
The Commission, which has the power to block or force changes to deals it finds anti-competitive, looks at issues such as whether a merger would create an excessive market share in a specific sector or country.
A competition lawyer said the EU merger regulation would "most likely" apply to the BP Amoco merger given the EU turnover involved. He said the oil sector was already quite concentrated and he would expect the Commission to look closely at the deal.
However, he, like the other lawyers interviewed, said he was not a specialist in the energy field.
Amoco Chairman Larry Fuller said he believed antitrust issues were "relatively minor" and would probably be confined to "certain areas of our marketing operations in the US."
BP's business in Europe is much bigger than Amoco. Amoco has 2 chemical plants in Belgium, a fabrics plant in Germany and operations in the Netherlands, all EU members.
According to BP's yearly report, the company had total sales of $ 34.60 bn in Britain in 1997 and $ 20,46 in the rest of Europe.