The European Commission has opened a Phase II investigation into the proposed graphic paper joint venture between UPM and Sappi, the companies said on April 28.
The move signals a deeper level of scrutiny after initial concerns were not fully resolved during Phase I.
UPM announced in December 2025 that it had signed a non-binding letter of intent with Sappi to combine certain graphic paper operations into a joint venture, a move aimed at addressing structural overcapacity and declining demand in the European graphic paper market, as previously reported by Paper Advance.
The transaction remains subject to regulatory approvals in multiple jurisdictions, including the European Union, the United States and China.
UPM said it continues to engage with the European Commission to address the issues identified during the preliminary review.
The company said the planned joint venture would strengthen the resilience of graphic paper supply in Europe, as the sector continues to face structural overcapacity and declining demand.
Sappi is a global producer of paper and fiber-based materials, including graphic papers and packaging grades.
UPM is a Finland-based producer of fiber-based materials, including communication papers, with operations worldwide.
