The Latvian Competition Authority (KP) has officially approved the merger between ERGO International AG and ADB Gjensidige, allowing ERGO to gain sole decisive influence over Gjensidige. The KP determined that the merger would not result in significant harm to competition, leading to its approval.

ERGO, a company registered in Germany, offers a wide range of non-life, life, and health insurance products either directly or through controlled subsidiaries. In Latvia, ERGO operates through its Estonian subsidiary, ERGO Insurance SE, providing various non-life insurance services, including medical expense insurance and vehicle insurance (KASKO and OCTA). Additionally, ERGO Life Insurance SE, registered in Lithuania, primarily offers health insurance and various life insurance products.

Gjensidige, registered in Lithuania, provides a broad spectrum of non-life insurance products across the Baltic states, including property insurance, travel insurance, and vehicle insurance (OCTA and KASKO).

The activities of the merging parties overlap in the non-life and health insurance markets, including smaller segments like railway, cargo, and marine insurance, where the principle of freedom of services applies and market entry barriers are low. The KP conducted a thorough market analysis in sectors where the combined market share of the merging entities approached or exceeded 25%, assessing the substitutability of market players and the closeness of competition.

In the health insurance market, the KP evaluated the potential for mutual coordination among market participants and analyzed public procurement processes. After reviewing the information provided by the companies and the data available to the KP, it concluded that the merger would not create or strengthen a dominant position in any of the markets in Latvia where the merging parties operate, nor would it have a significant negative impact on competition, thus allowing the merger.

To prevent significant reductions in competition resulting from mergers, transactions that meet the criteria set by competition law require approval from the Competition Authority. This ensures state control over market concentration to prevent structural changes that could limit consumer choices or lead to non-competitive pricing for goods and services. More information on merger control in Latvia is available on the Competition Authority's website under the 'Merger of Market Participants' section.