On 9 June 2015, the Commission published a policy brief on Regulation 2015/751 on interchange fees for card-based payment transactions ("MIF Regulation") that entered into force on 8 June 2015. Interchange fees are fees charged by a bank issuing a payment card to a consumer ("issuing bank") to a bank servicing a merchant ("acquiring bank") for each payment transaction at a merchant outlet with a payment card. Interchange fees are usually set by payment card schemes, such as Visa and MasterCard, domestic schemes, such as Italian Pagobankomat or the national banking communities. As merchants generally incorporate interchange fees in the price charged to consumers, the fees increase retail prices of goods and services to all consumers.
The policy brief discusses key competition problems associated with interchange fees and the solutions introduced by the MIF Regulation to address these problems and to create a single market for card payments across the EU. According to the policy brief, a key problem with interchange fees is the market mechanisms in the payments market that drive the fees up. High interchange fees contribute to the disappearance of a number of national and normally cheaper card schemes. Such fees also form a barrier to a seamless and efficient EU payment system because they protect countries with high interchange fees from competition elsewhere and make it more difficult for new players and new methods of payment to enter the market and drive innovation forward. To address these issues, the MIF Regulation introduces a cap on interchange fees for the most frequently used cards; the cap will apply as of 9 December 2015. Furthermore, the MIF Regulation will make it easier for merchants to use banks in other EU Member States and introduces new business rules and transparency requirements. According to the policy brief, the new rules will allow more competition and boost innovation. Source:Competition Policy Brief on Interchange Fees Regulation
On 4 June 2015, the Commission published the Report on Competition Policy 2014 ("Report"), which provides an overview of the Commission's main competition policy developments and enforcement actions in 2014. The Report is accompanied by a Commission staff working document that reviews the Commission's policy and enforcement work in more detail and discusses legislation and policy developments in 2014.
The Report explains how competition policy supports the Commission's efforts to achieve a strong and prosperous EU and reflects this message by discussing the Commission's concrete policy and enforcement work, which has contributed to this objective. One major achievement in 2014 was the adoption of the Directive on antitrust damages which will make it easier for European citizens and companies to receive effective compensation for the harm caused by antitrust violations. The Commission also used competition policy and enforcement actions to build a genuine digital single market and to establish a European Energy Union. Further, the Commission took concrete actions to create a fairer and more transparent financial sector and to boost the competitiveness of European businesses. Finally, the Commission tightened its control of fiscal state aid in relation to aggressive tax planning. Source: Commission Report on Competition Policy 2014, Commission Staff Working Document on Competition Policy and Foreword to Annual Competition Report 2014 by Margrethe Vestager
On 2 June 2015, the Commission published its new best practice guidance concerning the disclosure of information in data rooms in proceedings under Articles 101 and 102 of the Treaty on the Functioning of the European Union ("TFEU") and under the EU Merger Regulation. The new guidance complements prior data room best practices and reflects the Commission's current practice. It provides practical guidance on how and in what situations business secrets and other confidential information obtained in competition proceedings can be disclosed in a restricted manner by using data rooms.
DG Competition uses data rooms when disclosing confidential data relied on in its statements of objections. The guidance is meant to ensure the effective exercise of the addressee's right of defense by allowing their advisors to validate the Commission's analysis and methods. A limited number of external advisors will thus be granted access to the data room, subject to a non-disclosure agreement and strict compliance rules. The external advisors will then prepare a non-confidential report on their findings and conclusions.
Furthermore, the guidance also explains the role of data rooms, the general principles applied by DG Competition in deciding whether to organize a data room in a particular case, the scope of the data included and the organization of data rooms. It also explains how data providers will be informed of the organization of a data room and their possibility to express concerns about data room procedures.Source: Best Practices on the disclosure of information in data rooms in proceedings under Articles 101 and 102 TFEU and under the EU Merger Regulation
On 4 June 2015, the Swedish Competition Authority ("SCA") published updated guidance related to companies' participation in trade association activities. The updated guidance describes the rules that apply to cooperation between competing undertakings within a trade association and addresses some forms of cooperation which the SCA has identified as the most common within trade associations. The guidance will assist undertakings in assessing whether particular forms of cooperation within a trade association are compatible with competition rules. Source: Swedish Competition Authority Press Release 4/6/2015
On 9 June 2015, the Commission approved a proposed acquisition of a group of chlorovinyls businesses belonging to the chemical group INEOS Group AG ("Ineos") by International Chemical Investors Group ("ICIG"). The proposed transaction originates from the commitments offered by INEOS and Solvay SA ("Solvay") in the merger control proceedings relating to the creation of a joint venture between the companies ("INOVYN") in the suspension polyvinyl chloride ("S-PVC") market. In parallel with its clearance decision, the Commission approved ICIG as a suitable purchaser for the assets of INEOS in Belgium, France, Germany, the Netherlands and the UK. ICIG is a Luxembourg industrial holding active worldwide in agrochemicals, fine chemicals, basic chemicals, performance chemicals, finished dose pharmaceuticals and active pharmaceutical ingredients. INEOS, of Switzerland, is the parent of a group of companies which are active in the manufacture of petrochemicals, specialty chemicals and oil products. The INEOS' chlorovinyls businesses to be acquired include the production and supply of S-PVC, sodium hypochlorite ("bleach"), potassium hydroxide ("KOH") and other related products.
Initially, the Commission had concerns that the creation of INOVYN would have removed INEOS' strongest competitor, Solvay, in the commodity S-PVC market in North-West Europe and would have created a marker leader with a market share above 60 per cent on the market for bleach in Belgium, Netherlands and Luxembourg. To alleviate the Commission's concerns, INEOS and Solvay offered to divest some S-PVC plants of INEOS together with the upstream chlorine and ethylenedichloride ("EDC") production assets in Tessenderlo and Runcorn so that the purchaser has a self-standing S-PVC business capable of competing with the new joint venture.
The Commission found that the companies' business activities overlap mainly in the production of KOH that is used for the manufacturing of de-icing liquids, soaps, biodiesel and fertilisers. According to the Commission, the transaction would lead to less concentration on the market because part of the KOH business previously operated by INEOS, the market leader, will be transferred to an independent competitor, ICIG. The Commission also found that a number of other players would remain active in the market. During the divestment procedure, the companies proposed ICIG as their preferred purchaser for the divestitures. The Commission raised preliminary concerns related to certain conditions of the proposed transfer but accepted ICIG as a purchaser following a number of modifications and additions to the proposal. Those included the addition of a portion of INEOS' KOH business at Tessenderlo to the transferring business and a toll manufacturing agreement under which ICIG will supply INOVYN for the proportion of KOH business retained by the latter. Consequently, the Commission approved ICIG as the purchaser and cleared the proposed transaction. Source: Commission's Press Release 9/6/2015
On 4 June 2015, the Stockholm Administrative Court of Appeal ("ACA") rejected an appeal of the Swedish Competition Authority ("SCA") in which the SCA claimed that the state-owned railway company, Swedish State Railways ("SJ"), had violated the rules on public procurement and accordingly should pay a fine of SEK 8,5 million. The ACA rejected the SCA's appeal on the grounds that the rules on public procurement applicable within the Water, Energy, Transport and Postal services sectors were not applicable to SJ as it did not provide transport services in accordance with terms set out by a designated authority. The SCA has announced that appealing to the Supreme Administrative Court is being considered. Source: Swedish Competition Authority Press Release 4/6/2015
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 acquisition of LG II and LG Deutschland's life insurance portfolio by Canada Life
- Commission approves acquisition of Lucchini's wire rods business and Servola's real estate by Feralpi and Duferco