Against the backdrop of the Treasury Department's approval, the Budget Department announced that the move does not create a fear of harm justifying opposition to the request • "The merger will break the 'equality'"

• Cellcom offices. The Finance Ministry approved the merger with Golan Telecom

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  Avishag Rest Town

The Finance Department's Budget Department announced yesterday to the Ministry of Communications and the Competition Authority that it does not oppose the merger of Cellcom and Golan Telecom, and that it does not expect any harm to the competition.

The Finance Ministry's Opinion on the Cellcom and Golan Merger's Opinion states that, "after analyzing the expected implications of a merger between Cellcom and Golan, we did not find that the merger - including its effects on competition, price level and scope of investment in the market - creates a concern that justifies opposition to the request. Brought before the government officials.

"This is due to the multitude and variety of players in the cellular market, besides the fact that most players compete with each other in other industries where their competitive position is different. Therefore, we do not believe that there is a substantial reason to oppose the merger between Cellcom and Golan."

It also states that "the merger between Golan and Cellcom will break the particular 'equality' that exists between the veteran cellular companies, and for the first time in many years, will create a company with a large market share from its competitors."

However, it should be noted that 35% market share for the merged company compared with 26% and 23% for partner companies and Pelephone is not expected to be a significant competitive advantage, according to the Budget Department.

The Budget Department added: "This market power does not result in an elaborate competition for a player with an equality voucher who aspires to preserve his power. Differences in market share may also prevent the market from becoming uncompetitive. The different size of the players maintains a constant incentive for medium and small companies to grow and bite into the market share of The big player, as a drop in prices is hurting the player. "

It is also noted in the opinion that in a market where several players with different market shares, and especially players with a small market share, the ability to coordinate prices in light of the conflicting interests and differences in the magnitude of the price level changes for each of the players. This is unlike the situation in the pre-reform market, where a number of limited players with equal share each retain their power, and the incentive to break the equilibrium is small.

The Treasury Department's opinion also states that "The volume of business and vehicle transfers is further evidence of the high level of competition in the market. In view of the asymmetry in market share, the significant level of distribution and distribution, we do not believe that a merger between a small player and a large player will cause the competition to stop."