FIGURES CONCERNING THE FORECLOSURE EFFECT 1 1.1

THE RETAIL MARKET IN NORWAY Groceries

The grocery market in Norway is dominated by four big players: NorgesGruppen, ICA, Coop and Reitangruppen. From at least 2001 until at least 2003, these retailers represented more than 99% of the Norwegian grocery store sales. 1 Table 1:

Number of groceries in Norway

Name NorgesGruppen☼

ICA Norge (formerly Hakon Gruppen) ∞

2001 Meny, Ultra, EuroSpar, Centra Spar, Nærmat, Joker Kiwi Others Total NorgesGruppen Rimi (Stormarked)

ICA Supermarked ICA SparMat Maxi

1

139

2002 141

2003 134

973

1062

714

920

275 466

296 414

303 719

340 476

1 853

1 913

1 870

2004 134

1870

587

587

587

587

13 179 9

13 178 10

13 179 13

13 179 13

AC Nielsen, Dagligvarefasiten 2001, 2002 and 2003.

COOP Norge AS*

Reitangruppen@

Other associates

312

291

236

240

Total ICA

1 100

1 079

1 028

1 032

Coop Mega, Coop Obs!, Coop Prix, Coop marked, Coop annen dagligvare Rema 1000

978

980

932

910

340

359

379

375

Lidl (Champion)  Others ° TOTAL

10 42 4 313

47 4 378

35 4 244

35 4 232

Source:

☼ ∞ * @ °

1.2

NorgesGruppen’s letters dated 22 March 2003 and 21 December 2004, Annual Reports from NorgesGruppen. ICA’s letter dated 12 March 2004, Annual Reports from ICA and calculations made on the basis of Dagligvarekartet 2004/2005 Annual Reports from Coop and calculations made on the basis of Dagligvarefasiten for 2003. Reitangruppen’s letter dated 10 January 2005 and calculations made on the basis of Dagligvarefasiten for 2003 and 2003/2004 Calculations made on the basis of Dagligvarefasiten for 2001, 2002, and 2003/2004. In the absence of any figures available for 2004, the figure for 2003 has been used in 2004.

Kiosks

NorgesGruppen, with the chain, Mix, is the largest player on the kiosk market with a total number of 896 stores in 2004. The second largest player is Reitangruppen with its two chains, Narvesen and 7-Eleven, with a total number of 534 stores in 2004. Table 2:

2

Number of kiosks in Norway 2

Since market development is towards more “big kiosks” with a broader selection of grocery products, it is difficult to have a clear division between the kiosk and the grocery market. For instance, the chain Butikkringen appears as a grocery in NorgesGruppen’s annual reports, but is calculated as a kiosk in

2001 Name Mix Butikkene AS (NorgesGruppen) ☼ Narvesen (Reitangruppen)@ Gyda Butikkene BA© 7 Eleven (Reitangruppen)

2002

2003

2004

1020

920

950

424

421

437

203

203

300

896 (400 independe nt 456 [estimate] 250

63

71

75

78

21 493

20 493

20 493

2224

2128

2275

15 493 13 2201 NP 3293 3

@

COOP* Others◊ Deli De Luca⌂ Total Source: ☼

@ * © ⌂

◊

NorgesGruppen’s letters dated 22 March 2003 and 21 December, Annual Report from NorgesGruppen 2003. Reitangruppen’s letter dated 10 January 2005. Coop’s letter dated 30 March 2004. ”Hvem er hvem i nordisk dagligvarehandel” (Dagligvarehandelen) and Official statistics from Norway Webpage of Deli de Luca Servicehandelsrapporten 2003. Only figures for 2003 were available. The same figures have been used for the entire period. 4

Servicehandelsrapporten 2002, AC Nielsen. Butikkringen has been calculated as a grocery store in this Statement of Objections. It, however, remains possible that some kiosks have been counted twice, i.e. calculated both as kiosks and as groceries. According to information obtained from AC Nielsen in an e-mail dated 21 February 2005, the total number of kiosks in Norway, based on Servicehandelsrapporten for 2002 and 2003 would be slightly higher: 2 355 in 2002 and 2 339 in 2003. One possible explanation for these higher figures is that some outlets counted as kiosk by Servicehandelsrapporten have been counted as groceries by the Authority. The Authority’s calculations of the number of kiosks and groceries should therefore reflect a high estimate. 3 The number of kiosks according to Norway Post is significantly higher. It is noted however that Norway Post seems to take into consideration under kiosks both videoshops (e.g. showtime) and a number of Coop shops. 4 It is noted that an e-mail from Servicehandelsrapporten indicates a total number of kiosks in Norway in 2002 and 2003 to be respectively, 2 355 and 2 339. This slightly higher figures can be explained by the fact that Servicehandelsrapporten has accounted the chain Butikkringen as a kiosks whereas the Authority has, accounted this chain as a grocery [check]. Another difference is that Servicehandelsrapporten considers that there is a higher number of Mix kiosks than the information obtained by the Authority from NorgesGruppen.

1.3

Petrol stations

The four major motor fuel suppliers on the retail market in Norway are Shell, Esso, Statoil and Hydro Texaco. Table 3:

Number of petrol stations in Norway

Operator Shell Statoil Esso Hydro Texaco Rema Conoco Jet Total

2001 Manned 554 395 358 342 1 649

Unmanned 60 4 59 35 34 192

2002 Manned 546 390 351 336 1 623

Unmanned 60 29 62 35 35 281

2003 Manned 525 440 337 305 1 607

Unmanned 60 46 102 36 244

2004 Manned 503 395 329 300 1 527

Unmanned 54 60 104 322

Letter from Shell dated 2 april 2004 (from 2001 to 2003 the number of 60 unmanned petrol stations is based on the figure from 2004; Letter from Statoil 17 June 2005; Letter from Esso dated 9 June 2005 Check whether exist unmanned petrol stations in Esso; Letter from Hydro Texaco from 1 June 2005; information from Norwegian Petroleum Industry Association (Norsk Petroleumsinstitutt)

1.4

Other retailers

Table 4: Overview of other outlets Norway Posts sees as suitable to be used for B-to-C parcel services Type of outlets Name of leading chains Number of outlets Sport dealers Intersport, Gresvig, G-sport 874

Pharmacies

Bookshops

Electro Outlets

Hotel Chains

Hardware stores Builder merchants

Shopping centers Public service offices Total

1.4.1

Apotek 1, vitus, NorgesApoteket, Ditt Apotek, Alliance, Pluss Nordli, Samskipandene ved Universiteter/Høyskoler, Tanum, Binders, Ark, Andvord, NotaBene, Libris Expert ASA, Elkjøp, paceworld, Lefdal, Coop, Hi Fi Klubben First, Best Western, Choice (clarion Comfort Quality), Rainbow, Norlandia, Radisson SAS, Rica, Nordic, Scandic, Norske Vandrerhjem Jernia, Clas Ohlson Bygger’n, Byggkjøp, byggmakker, Farveglede, Neumann, Flisekompaniet

397

751

1046

1997

570 524

190 62 6 411

Total number of groceries, kiosks and petrol stations

Total number of groceries, kiosks and petrol stations in Norway5 2001 2002 2003 2004 4 313 4 378 4 244 Groceries Table 5:

Kiosks Petrol stations (manned) Total

4232

NP 3293 2 224 1 649

NP 3 293 2 128 1623

NP 32932 275 1607

3293 2 201 1527

NP 9 255 8 186

9 294 8 129

9 144 8 126

9 052 7 960

Source: Tables 14, 15 and 16 above.

Table 19: total number of groceries, kiosks and petrol stations within a chain in Norway 2001 2002 2003 2004 4 271 4 331 4 209 4 197 Groceries Kiosks Petrol stations Total

5

1 731 1 782 7 784

1 635 1 661 7 627

1 782 1 604 7 595

1 708 1 604 7 509

According to Dagligvarekartet 2002/2003, 2003/2004 and 2004/2005 the total number of groceries, kiosks and petrol stations was respectively 9.500, 9.200 and 9.100. [this has to be clarified]

2

NUMBER OF PIS

Table 6:

Number of post offices and PIS (including Contract Post offices and Branch Post Offices) 2001-2004

2001 2002 2003 2004 (December)

PIS 897 (incl. 378 BPO) 1146 1175 1201

Post offices 431 304 303 303

total 1328 1450 1478 1504

Source: 1997-2001: “Rapport over utviklingen i servicenivå for Postens leveringsdyktige tjenester for 2001”, Letter of 27 June 2002 from the Norwegian Post and Telecommunications Authority to the Ministry of Transport and Communication. 2002-2003: Annual Report Norway Post 2002 and Annual Report Norway Post 2003. 2004: “Postavisen nr 22”, 17 December 2004. Norway Post letter of 18 March 2005

Table 20: Number of PIS established in the retail groups 2001-2004 2001 2002 2003 2004 NorgesGruppen 361 (84 BPO 603 629 +277) Shell 22(1+ 35 37 BPO+21) COOP 165 200 220 (95BPO+70) ICA 75(16BPO59) 183 185 Other 6 73 77 Total PIS 1094 1148 BPO 378 52 27 Total PIS+BPO 897 1146 1175 6

665 39 233 176 73 1186 15 1201

This category includes PIS in independent outlets but also 14 PIS in chains, 13 in groceries, 6 in kiosks and 7 in petrol stations.

Source: Replies from retailers to the Authority’s requests for information; letter from Norway Post 23 June 2003 and 25 March 2005..Each retailer has indicated to the Authority the number of PIS within their outlets but not the number of BPO. Norway Post letter dated 25 March 2005 indicates the total number of PIS including also Branch Post Offices. Norway Post has further indicated the number of BPO which were established just before the introduction of the PIS concept in March 2001. The figures for the year 2000 therefore include the number of PIS indicated by the retailers and the number of BPO indicated by Norway Post. Since Norway Post also indicated that there were 378 BPO before the introduction of the PIS, the Authority assumes that there were also BPO in other retail groups.

3 3.1

NUMBER OF OUTLETS TIED TO NORWAY POST Tied supermarkets and groceries 2001

Total number of groceries within NG Number of PIS in COOP Number of PIS in ICA Number of PIS in other groceries Total

3.2

2002

2003

2004

1853

1913

1870

1870

165

200

220

233

75

183

185

176

[14]

[14]

[14]

14

2 107

2 310

2 276

2 306

2000 1 020

2001 920

2002 950

2003 896

Tied Kiosks

Total number

of kiosks in NG Number of PIS Reitangruppen Number of PIS in other kiosks Total

-

2

2

2

[4]

[4]

[4]

[4]

1 024

926

956

902

What do we do with the 400 unprofiled? 3.3

Tied petrol stations

Total number of Shell petrol stations (manned) PIS in other petrol stations TOTAL

3.4

7

2001 546

2002 525

2003 503

[7]

[7]

[7]

7

561

553

532

510

2000 ?

2001 48

2002 52

2003 48

2000

2001

2002

2003

Other tied outlets

PIS in other type of outlets 7 3.5

2000 554

Total tied outlets

Norway Post letter dated 25 March 2005. This figure was arrived at by the deducting the number of groceries, kiosks and petrol stations from the list of submitted by Norway Post as annex 1.

Groceries Kiosks Petrol stations Other Total tied

4

2 107 1 024 561

2 310 926 553 48 3 837

2 276 956 532 52 3 816

2 306 902 510 48 3 751

THE REMAINING OUTLETS

Table []: Remaining outlets (only groceries, kiosks and petrol stations) 2001 2002 3 837 Tied outlets NP 9 255 9 294 Total outlets 8 186 8 129 Remaining outlets

2003 3 816 9 144 8 126

2004 3 751 9 052 7 960 5 301 4 209 41% 47%

2003

2004 3 751 15 700 8 11 949 29.8%

% of foreclosure

Table [] Remaining outlets (including others as alleged by Norway Post) 2001 Tied outlets Total outlets Remaining outlets % of foreclosure

8

2002

This is the figure submitted by Norway Post in its letter dated 23 June 2003 which is slightly higher than the figure which the Authority arrives at i.e. 15 463.

5

AVAILABILITY •

Table [ ] retail outlets which are not available for distributing parcels as a result of Policy decision from the management

2001 Rema 1000 Narvesen Statoil 9 Hydro Texaco 10 Esso 11

2002

2003

2004

340

359

379

375

424 268 182 205 1 419

421 267 179 200 1 426

437 274 174 194 1 458

456 [estimate] 278 168 187 1 464

Available outlets : Using Norway Post figures on kiosks: 3 837 ; According to other sources: 2 745 In addition the fact that DODO petrol stations are free to decide for themselves whether they want to distribute parcels does not mean that they will all be available for that activity. It is likely that a number of them, like their management will not be interested. Number of DODO Stations 2001 Statoil Hydro Texaco 9

2002 127 160

2003 123 157

2004 120 131

Only COCO and CODO Stations have been taken into account Only CODO petrol stations are taken into consideration as the COCO are all unmanned and have therefore already been regarded as unsuitable 11 only COCO and CODO stations are taken into account 10

117 132

Esso Total

153 440

151 431

143 394

142 391

Available outlets if 50% DODO are not interested: Using Norway Post figures: 3 642; According to other sources: 2 549. (According to Privpak 120 Esso petrol stations are available)

6

SUITABILITY

• Other types of outlets S, K (including video shops), PS in a chain are the most suitable. However, it cannot be excluded that , in the absence of other alternative, other types of outlets can be used. Norway Post only use 47 outlets which are not a S, K or PS out of 1201 PIS in 2004. Thus 3% only of Norway Post PIS network is composed of retail outlets which are not a S, K or PS. As regards Privpak, Privpak argues that they have been forced to open commission agents in shops other than G, K and PS. Nevertheless, less than 20 out of 142 commission agents have been established in outlets other than groceries, kiosks (including video shops), petrol stations. Thus less than 14%. • Independents The figures above take into account independent retail outlets. It should, however, be considered whether all independent outlets are suitable. Privpak claims that independent outlets are less suitable than chains or not suitable at all. Some independent outlets may not offer sufficient quality of service (e.g. language skill, cleanliness etc. or may not offer sufficient financial guarantees). Again, the question is what proportion would be unsuitable. Norway Post uses a very small number of independent stores : 59 out of 1201, i.e. 5%. Privpak uses 69 chains compared to 78 independent stores i.e. 53% of independents. Privpak argues that they have been forced to establish commission agents in independents. According to Privpak, there are 2 603 independents outlets, out of which 0 are “most suitable” and 521 are suitable when no other alternative.

• Groceries and supermarkets without counters Privpak alleges that it cannot use groceries which do not have a counter. In [presentation], Privpak alleges that out of its estimates of 4 461 supermarkets stores, 752 are the most suitable to Privpak and 1257 are possible when no other alternative. These figures are not explained. Privpak main argument is that the till cannot be used to deliver parcels (no space for storing the parcels, more waiting time in large supermarkets). In addition, Privpak contend that it would increase its costs significantly if it had to cover for the cost of manning a counter. CSA considers that some supermarkets could therefore be unsuitable for a competitor with a smaller concept and smaller fainanial resources than Norway Post. • Size One can expect that many outlets, especially within independents will not have sufficient space to store parcels.

7

LOCATION OF THE RETAIL OUTLETS

INFORMATION REGARDING THE NORWEGIAN RETAIL MARKET GROCERY MARKETS Name NorgesGruppen Meny & Ultra (Meny, Ultra, Euro Spar, Centra) Spar (Spar, Nærmat, Joker) Kiwi Others (Bunnpris, Dragset Super Spar, safari, Kjøpmannskjedene på vestlandet, Butikkringen i.a) TOTAL

ICA Norge Rimi (formerly Hakon (Stormarked)∞ Gruppen): ICA Supermarked∞ ICA SparMat∞ Maxi∞

2001 7,7☼

Turnover (in billion Norwegian kroner) 2002 2003 2004 2001 8.9◦ 139☼

10☼

6,1☼

5.2◦

2002 141☼

Numbers of stores 2003 2004 134☼ 140◦

973☼

1062☼

714☼

275☼ 466☼

296☼ 414☼

303☼ 719☼

1853*

1913*

1870*

303◦ 476 (based on the reply from NG) 1864◦

29.5*

31.8*

33.7*

15.4

16

16.8

17◦

587

587

587

587◦

1

1

1

0.9◦

13

13

13

13◦

1.9 1.4

1.9 1.5

1.8 1.7

1.8◦ 1.8◦

179 9

178 10

179 13

179◦ 13◦

COOP Norge AS*

Reitangruppen*

1.0

1.1◦

312

291

236

240◦

22*

22.3 incl. VAT (22.9*)

22.7◦

1100

1079

1028

1032◦

21.2

22.4

23

23.1◦

978 (ms 24, 3%)

980 932 (ms (ms 23, 24, 3%) 7%)

910◦

14

15.4

16.8

16.2◦

340 (ms 16, 5%)

359 379 (ms (ms 16, 7%) 17, 4%)

375◦

Other associates (Livi Nærkjøp, Fokus and Servicemat) ∞ Total∞

1.3

21 incl. VAT (18.8*)

Coop Mega, Coop Obs!, Coop Prix, Coop marked, Coop annen dagligvare Rema 1000

10

Lidl (Champion) Other grocery stores* TOTAL ∞

* ☼

ms

87.1

92.2*

ICA annual reports Calculations made on bases of Dagligvarefasiten Annual Report NorgesGruppen Market Shares

97.04*

42 (ms 0 7%) 4313 (4489*)

47 (ms 0, 6%) 4378 (4409*)

35 (ms 0.7%) 4244 (4295*)

◦ 

Calculations made on bases of Dagligvarekartet 2004/2005 Article in Dagbladet and Opplysningskontoret for frukt og grønnsaker

Total number of Grocery stores* Annual sales/turnover* MARKET SHARES* Name 2001 34% NorgesGruppen ICA Norge (formerly Hakon Gruppen) COOP Norge AS Reitangruppen (Rema 1000)

2001 4489

2002 4409

2003 4295

86.95

92.24

97.04

2002 34, 5%

2003 34, 7%

24.5%

23, 9%

23, 6%

24, 3% 16, 5%

24, 3% 16, 7%

23, 7% 17, 3%

2004

Other grocery 0 7% 0, 6% 0.7% stores * Calculations made on bases of Dagligvarefasiten

Norway Post has signed agreements with the following retail outlets: NorgesGruppen (Kiwi, Spar Joker, Bikuben, Bunnpris, Centra, Eurospar, K-kjøpmann, Meny Nærmat, Spar, Ultra) ICA Norge (formerly Hakon Gruppen): consists of RIMI, ICA Supermarked, MAXI og ICA Sparmat. Coop

Shell

TOTAL RETAIL OUTLETS IN NORWAY: 2002 2003 39531• 38094•

2004 38242•

2004 Hairdressers and beauty treatment • Sport shops• Shoe shops• • Official statistics

KIOSKS Name 2001 6.1 ☼ Mix Butikkene AS (Mix Kiosk, Mix Handleriet, Mix Mett & og, Mix Scene 1, Jafs) (NorgesGruppen) (Gyda Butikkene BA)

Narvesen (Reitangruppen) 7 Eleven (Reitangruppen)

Total number 6822 4776 989

2002 6.3 ☼

Turnover 2003 6.3 ☼

0.7

Numbers of stores 2001 2002 2003 1020 920☼ 950☼ (Market share 47%)☼ 203◊ 300©

4,9 ©

2.4◦

433◊

432©

920 millions

0.8◦

71◊

77©

388 millions ◊ 2.4

750 millions

864 millions

2004

©

2004

©

ICA Norge Butikkringen COOP

26◊ 124◊ 21 10◊ (based on 20 the reply from COOP)

Others Deli De Luca Total ©

• ⌂ ◊ ☼

1.1

(based on the reply from COOP)

491◊

2436◊

20

15

(based on the reply from COOP)

(based on the reply from COOP)

11⌂

Hvem er hvem i nordisk dagligvarehandel (AC Nielsen, Dagligvarehandelen) Official statistics Økonomisk Rapport Calculations made on bases of Servicehandelsrapporten 2003, AC Nielsen Annual Report NorgesGruppen

The concept of kiosk does not have any uniform definition in Norwegian law. According to the regulation on sale of alcohol 12, kiosk is understood to be a shop that mainly sells kiosk products. In the opinion of the Norwegian Ministry of Health and Care Services the legislator used the word Kiosk to refer to what people normally associate with that business, namely a sales outlet that sells typical kiosk products such as tobacco and tobacco supplies, news-papers, magazines, writing materials, sanitation products, sugar- and chocolates-products, baker- and confectionery-products etc. The development has gone towards more “big kiosks” with a broad selection of grocery products. It is therefore difficult to have a clear division between the kiosk and the grocery market. We have based our calculation regarding the kiosks on information from ABC Nielsen and annual reports from some of the major retail stores. We might have calculated some kiosks twice, since the kiosks could also have been counted under the grocery stores. This means that the number of kiosk and grocery should at least not be higher than our calculation. We therefore find it strange that

12

Regulation of 11.12.1997 number 1292

the figures given by Norway Post are higher than our calculation. Consequently, we have chosen to calculate the foreclosure on the bases of the total retail market which includes both kiosks and grocery stores.

PETROL STATIONS Name Hydro Texaco Rema

2001

Turnover 2002 2003 2004 1.5•

2001 401# 35#

Conoco Jet ESSO (NorgesGruppen)

1.9 •

34# 458#

Shell (NorgesGruppen)

2.8•

614#

Statoil

2,5•

453#

Unmanned stations

213#

Total

1995#

Numbers of petrol stations 2002 2003 398# 312◊ 407# 35#

1782 (independent petrol stations)

#

•

35# 431# 335◊ 606# 494◊ 439# 427◊ 283# 306◊ 1944#

36# 418#

1661 (independent petrol stations)

1604 (independent petrol stations)

Norwegian Petroleum Industry Association (Norsk Petroleumsinstitutt) Calculations made on bases of Servicehandelsrapporten 2003, AC Nielsen

MARKET SHARES#

2004

351

585# 458# 300# 1904# 1734•

Name Hydro Texaco Conoco Jet ESSO Shell Statoil Others Sum

2001 13.4% 1.1% 21.8% 29.9% 31.2% 2.6% 100%

2002 13.8% 1.1% 21.2% 30% 31.3% 2.6% 100%

2003 2004 14.2% 1.1% 21.5% 29% 31% 3.2% 100%

Norwegian Petroleum Industry Association (Norsk Petroleumsinstitutt)

#

Marked shares, sum of all products Year

Esso

Fina

Hydro

Hy:Tex

Jet

Mobil

Shell

Statoil

Texaco

others

Sum

2001

21.8

-

-

13.4

1.1

-

29.9

31.2

-

2.6

100

2002

21.2

-

-

13.8

1.1

-

30.0

31.3

-

2.6

100

2003

21.5

-

-

14.2

1.1

-

29.0

31.0

3.2

100

2004

21.2

-

-

13.5

1.1

-

28.8

32.3

3.1

100

-

Norway Schenker Privpak Outlets 13: Privpak has a total number of 129 outlets in Norway. Most (79) of the outlets are located around the Oslo area with a radius of about 200 km. In the south of Norway, Privpak has 27 outlets and the rest of the outlets (ca. 20) are divided over western, middle and northern Norway.

13

Information provided by Privpak

(NorgesGruppen ASA Company Profile: NorgesGruppen (Norwegian Group) leads the Norwegian supermarket industry with more than 3,000 supermarkets, convenience stores, newsstands, and restaurants. Founded in 1994, the group is made up of independent retailers, but it also owns some chains. Store banners include Meny, Kiwi, Spar, Ultra, and MIX (convenience stores and kiosks). NorgesGruppen feeds patrons at more than 300 mostly fast-food outlets (such as Dolly Dimples and Hardy Sportsbar), and it supplies food offshore and to other outlets and public institutions. Norwegian businessman Johan Johannson controls about 79% of NorgesGruppen. NorgesGruppen is the largest actor in the Norwegian food retail industry. The company has a market share of 34 % and represents about 2.000 grocery stores. In addition there are 1.050 kiosk and convenience stores connected to the company, representing a market share of 35% in this sector 14.)

14

Genus AS