EU Antitrust

Request from Latvian court for ruling on need for personal engagement of officer of undertaking in breach of Article 101. On 16 February 2015, details were published in the Official Journal of a request for a preliminary ruling from a Latvian court (the Augstākā tiesa) about the interpretation of Article 101(1) of the TFEU. The question referred asks whether Article 101(1) must be interpreted as meaning that, to establish that an undertaking has participated in an agreement restricting competition, it must be shown that an officer of the undertaking has personally engaged in conduct or been aware of, or consented to, conduct by persons providing an external service to the undertaking and at the same time acting on behalf of other parties to a possible prohibited practice (Case C542/14 – VM Remonts and Others v Konkurences padome (OJ 2015 C56/6).

EU Cartels

Gascogne Sack brings damages action against Commission for excessively long cartel proceedings. On 16 February 2015, details were published of an action brought by Gascogne Sack Deutschland and Gascogne (together Gascogne Sack) to claim damages from the European Commission for harm suffered as a result of delay by the European Courts in adjudicating its appeal against the industrial bags cartel. Gascogne Sack is seeking both  material and non­material damages as a result of the failure of the General Court to adjudicate within a reasonable time, in breach of its fundamental right to a hearing within a reasonable time under Article 47 of the Charter of Fundamental Rights of the European Union (Case T­843/14 – Gascogne Sack Deutschland and Gascogne v European Commission (OJ 2015 C56/27)).

EU Mergers

Phase I Mergers

  • M.7487 – Onex Corporation / SIG Combibloc Group AG of Switzerland / SIG Holding USA, LLC (18/02/2015)
  • M.7495 – Apax Partners LLP / Evry ASA of Norway (16/02/2015)
  • M.7505 – TCG Financial Services II, L.P. / Carlyle Group L.P. / Warburg Pincus LLC / DBRS Holdings Limited of Canada (17/02/2015)
  • M.7509 – OBI GmbH / Brico Business Corporation Srl of Italy (16/02/2015)

State Aid

State aid recovery interest and reference rates from 1 March 2015. On 18 February 2015, a European Commission notice on state aid recovery interest rates and reference/discount rates for all 28 EU member states applicable from 1 March 2015 was published in the Official Journal (OJ 2015 C58/7). The interest rates have been reduced for Romania and Sweden. The rates have been published in accordance with Article 10 of Commission Regulation 794/2004 and the base rates calculated in accordance with the Commission Communication on the method for setting the reference and discount rates. Depending on the use of the reference rate, the appropriate margins have still to be added as defined in the Communication. For the discount rate, this means that a margin of 100 base points has to be added. Regulation 271/2008 amending Regulation 794/2004, foresees that, unless otherwise provided for in a specific decision, the recovery rate will also be calculated by adding 100 points to the base rate.

Commission opens in­depth state aid investigation into UK support for Lynemouth power plant. On 19 February 2015, the European Commission announced that it has decided to open an in­depth state aid investigation into the UK government’s plans to support the conversion of the Lynemouth coal power plant to operate entirely on biomass. The Commission is concerned that the public support could overcompensate the generator and also result in distortions of competition in the biomass market. It intends to examine further whether the benefits of the state aid, in terms of meeting environmental targets, are outweighed by any negative effects on competition.

ECJ rules that BBVA and Telefónica do not have standing to challenge state aid  decision. The European Court of Justice (ECJ) has handed down an order in appeals by Banco Bilbao Vizcaya Argentaria SA (BBVA) and Telefónica SA (Telefónica) against General Court orders that found that BBVA and Telefónica’s appeal against a European Commission state aid decision were inadmissible. The Commission had found that a Spanish tax scheme, of which BBVA and Telefónica were beneficiaries, comprised unlawful state aid. The aid that BBVA and Telefónica had received under the scheme was not, however, subject to a recovery order. The ECJ held that the General Court had been correct to find that BBVA and Telefónica’s appeals were inadmissible. The General Court had correctly found that the state aid decision entailed implementing measures. BBVA and Telefónica could challenge those measures in the national court. However, they were not individually concerned by the Commission’s decision such that they had standing to challenge it under Article 263 of the TFEU (Joined cases C­5878/13 P – BBVA v Commission and C­588/13 P Telefónica SA v European Commission, Order of 15 January 2015 (not yet available in English)).

UK Mergers

UK Competition

CMA continues investigations into suspected anti­competitive practices in bathroom fittings and commercial catering sectors. On 16 February 2015, the Competition and  Markets Authority (“CMA”) amended its administrative timetables in relation to its ongoing investigations into suspected breaches of the Chapter I prohibition of the Competition Act 1998 and Article 101 of the TFEU in the bathroom fittings sector and commercial catering sector. In each case the CMA is investigating suspected breaches of competition law relating to vertical arrangements between certain suppliers and resellers. The CMA has decided to conduct further investigations into the suspected anti­competitive practices, including further analysis and potential further information requests and stakeholder meetings. It aims to reach a decision on whether to proceed with or to close the investigations in June 2015.

Speeches & Publications

FCA announces market study into investment and corporate banking following review of wholesale markets. On 19 February 2015, the Financial Conduct Authority (FCA) announced that it plans to launch its first wholesale market study into investment and corporate banking. This follows the FCA’s review of wholesale markets, launched in June 2014. The FCA has found indications that the investment and corporate banking sectors may not be working well. In particular, it has identified possible competition issues in relation to the transparency of information and the bundling or cross­selling of services, as well as possible conflicts of interest. These issues will be the focus of the market study. The FCA intends formally to launch the market study and publish the terms of reference in spring 2015.