RARIK, Orkubú Vestfjarða and Landsvirkjun established the company Orkusalan ehf. to handle the production and sale of electricity. The Competition Authority took up the matter for investigation after a merger notification was received by the agency. The Competition Authority considered that the merger would create competitive problems, as Landsvirkjun would be in a dominant position in the market for production/wholesale electricity and the market for retail electricity to large consumers, but this would significantly strengthen the position of Orkusalan. Given Orkusalan's large market share, Landsvirkjun's membership of Orkusalan was considered to create a dominant position for the newly established company in the market for the retail sale of electricity to general consumers. Following this preliminary conclusion by the Competition Authority, the merging parties proposed that Landsvirkjun withdraw from the company. The Competition Authority approved the merger on the condition that Landsvirkjun sold its shareholding in Orkusalan.
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