EU – Baltic States, Financial Services, Insurance, Latvia, Legislation, Mergers and take-overs

The Competition Council decided to authorize the deal as market analysis did not indicate that the takeover might have any adverse effects on competition in the non-life insurance market.

According to the takeover report, VIG is buying a 90% stake in BTA Baltic Insurance Company, while a 10% stake will remain with the Latvian insurer's current owner BTA Insurance Company SE.

The Competition Council indicates in its ruling that the takeover deal affects three non-life insurance markets in Latvia – the motor third party liability (MTPL) insurance market, guarantee insurance market, as well as the travel insurance market.

Upon assessing the deal's impact on competition, the watchdog came to the conclusion that the affected markets are characterized by types of short-term insurance and stiff competition and that the takeover will not restrict clients' choice of services providers. The Competition Council also does not expected the deal to create any significant obstacles that might prevent new players from entering the market or the existing ones from expanding their operations.

Although VIG will expand its market share as a result of the acquisition, it will not lead to a dominant position in the market.

According to VIG's report, the takeover deal is intended to develop and strengthen the insurance company's long-term position in the Baltics and to expand the range of its insurance services.

Vienna Insurance Group is one of the largest insurance groups in Central and Eastern Europe. Vienna Insurance Group already has a branch of Compensa Life Vienna Insurance Group SE (life insurance) and a branch of Compensa TU S.A. Vienna Insurance Group (non-life insurance) operating in the Latvian market.

BTA Baltic Insurance Company (BTA Baltic) is a subsidiary of BTA Insurance Company SE (BTA) that started operations in the Baltic states on July 1, 2015, following the successful completion of the reorganization process by separating business activities in the Baltic states and the rest of Europe. BTA Baltic has received a license for all types of insurance services, which allows the company to offer customers all kinds of insurance services in the Baltic countries – Latvia, Lithuania and Estonia.