The European Commission has sent a Statement of Objections to UPM-Kymmene Corporation and Sappi Limited over their proposed joint venture, saying it may restrict competition in several markets for communication paper used in printed materials such as magazines and books.
UPM and Sappi are the two largest manufacturers of communication paper products in the European Economic Area (EEA), the Commission said. The proposed joint venture would combine UPM’s communication paper business in Europe and the US with Sappi’s communication paper business in Europe, alongside part of Sappi’s speciality paper business and other ancillary activities, it added.
The Commission said it is concerned the deal could allow the joint venture to increase prices and reduce customer choice.
The regulator opened an in-depth investigation on 28 April 2026 to assess whether the transaction would reduce competition for magazine paper and coated wood free paper in the EEA, the UK and Switzerland, according to the Commission. Coated wood free paper is typically used for printed products such as books and promotional materials.
Concerns over price rises and quality
Following its investigation, the Commission said it is concerned the joint venture would gain market power that could allow it to increase prices and decrease quality for coated mechanical paper — a type of magazine paper — and for coated wood free paper.
The Commission said it is currently unconvinced that integrating the businesses would bring enough benefits, such as cost savings or environmental or resilience improvements, to offset potential harm.
A Statement of Objections is a formal step in an investigation that sets out the Commission’s concerns in writing, and does not prejudge the final outcome, the organisation said. It added that UPM and Sappi can reply, consult the case file and request an oral hearing.
The transaction was notified to the Commission on 19 March 2026, and the Commission said it has until 11 November 2026 to take a final decision.
