The European Commission said Wednesday that it has decided to refer part of the proposed acquisition of steel scrap processor TSR by Cronimet, Remondis and Alfa Acciai to the German competition authority, and has approved the remainder.

The EC said in a statement it has referred certain aspects of the acquisition for examination under German national competition law, as the deal threatens to affect competition significantly in certain scrap markets in Germany. The notified operation does not give rise to any competition concerns in the European Economic Area other than these aspects, and the Commission has therefore approved the rest of the deal under the EU Merger Regulation, it said.

Alfa Acciai produces concrete reinforcement bar and reinforcing steels, Cronimet is a trader of ferrous scrap for use in steel production, while Remondis is active in water and recycling management. TSR trades and processes scrap for the steel industry.

The buyout of TSR threatens to seriously affect competition on the regional markets for the collection of carbon steel scrap in the Ruhr area and for the collection of alloyed steel scrap around Stuttgart where there are considerable overlaps between parties, the EC said. Due to joint ventures with other leading market players, considerable structural links would be created on these markets, according to the EC statement.

The German authorities decided the transaction could affect competition and asked the Commission to refer this part of the decision on the concentration to them. This provision of the regulation allows the Commission to partially refer a case when a concentration threatens to affect significantly competition within a Member State, which presents all the characteristics of a distinct market.