Competition: Timab appeals against General Court judgment in animal feed phosphates cartel

On 28 September 2015, details of an appeal by Timab Industries ("Timab"), and its parent company Cie financière et de participations Roullier ("CFPR"), against a General Court ("GC") judgment were published. The GC's judgment dismissed their action, challenging the Commission's decision to fine Timab and CFPR for their role in facilitating the animal feed phosphates cartel. When the Commission informed the parties of the range of fines it intended to set, Timab discontinued the settlement procedure. It became the only party to the Commission's standard administrative procedure and, together with CFPR, received a fine of nearly EUR 60 million.

Timab and CFPR claim that the GC erred in law; breached various legal principles, such as the burden of proof, rights of the defense and the right not to self-incriminate; and misconstrued its unlimited jurisdiction in reviewing the fine on the parties and the duration of their involvement in the cartel. In addition, Timab and CFPR claim that the GC proceedings were unreasonably long. Source: Case C-411/15 P, Timab Industries and Cie financière et de participations Roullier (CFPR) v Commission, Official Journal 2015 C 320/27, 28/9/2015

Merger control: Commission opens in-depth investigation into proposed acquisition of Office Depot by Staples

On 25 September 2015, the Commission opened an in-depth investigation (so-called "Phase II") into the proposed acquisition of Office Depot by Staples. Staples and Office Depot, both of the US, are active in the distribution of office products via a number of sales channels, including wholesale, retail, direct sales (online and via catalog), and national or international supply contracts. Their customers include companies in the private sector and public administrations.

The Commission's initial investigation showed that Staples and Office Depot, together with their largest European competitor Lyreco, are the main suppliers of office products to business customers through international contracts in the European Economic Area. The remaining smaller competitors have a more limited geographic presence and may not be able to exercise a sufficient competitive constraint on the merged entity. According to the Commission, the transaction could eliminate an important competitor and reduce the choice of suitable suppliers in already concentrated markets, which could lead to price increases. The Commission's initial investigation also indicated possible competition concerns in the market for the supply of office products to business customers through national contracts in the Netherlands and Sweden. Especially regarding Sweden, the Commission noted that the merging parties appear to have no significant competitors who offer a wide portfolio of products.

The Commission now has 90 working days, until 10 February 2016, to investigate the proposed acquisition and determine whether these initial concerns are confirmed or not. The opening of an in-depth inquiry does not prejudge the result of the investigation. Source: Commission Press Release 25/9/2015

State aid: Commission opens in-depth state aid investigation into exemptions from Irish air travel tax

On 28 September 2015, the Commission opened an in-depth investigation into an exemption granted by Ireland to certain airlines relieving them from paying air travel tax for transfer and transit passengers. This follows a General Court ("GC") judgment of November 2014, which annulled the Commission's 2011 decision finding that not applying the air travel tax to transit and transfer passengers did not constitute state aid.

The Commission concluded in 2011, without opening an in-depth state aid investigation, that the disputed measure was not selective. However, the GC concluded that the Commission's preliminary investigation and analysis of the issue of selectivity was incomplete and insufficient. The GC held that the Commission should have initiated a formal investigation procedure to verify whether the disputed measure was selective and to allow interested third parties to submit their observations and comments.

The Commission states that it will now investigate whether the air travel tax exemption provides certain companies with a selective advantage, within the meaning of Article 107(1) of the Treaty on the Functioning of the European Union ("TFEU"). The Commission will particularly examine whether the exemption avoids levying the tax twice on the same journey, and whether exempting transfer flights only when they were booked in a single-booking discriminates against airlines that do not apply a single-booking policy. Source: Commission Press Release 28/9/2015

In addition, kindly note the following merger control decisions by the Commission which are published on the website of the Commission’s Directorate-General for Competition:

  • Commission approves joint venture by Interseroh and Impaso for sale of used electronic equipment
  • Commission approves acquisition of Chime by Providence
  • Commission approves acquisition of controlling stake in HASCO's Chinese automotive casting components activities by KSPG
  • Commission approves acquisition of OM Group by Apollo
  • Commission approves acquisition of Casual Dining Group by Apollo Management
  • Commission approves acquisition of controlling stake in Fluor Spain by Sacyr