Commission report on economic impact of competition enforcement on the functioning of EU energy markets. On 15 January 2016, the European Commission (Commission) published a report on the economic impact of enforcement of competition policies on the functioning of EU energy markets. The Commission examined whether EU competition policy enforcement (antitrust, merger control, and State aid) has led to stronger competition in European gas and electricity markets and hence lower prices, higher investment and improved productivity. The report states, amongst other things, that there has been an increase in EU competition policy enforcement activity since 2000; that competition policy is mostly effective in markets where competition is not substituted by heavy regulation; and that commitments and remedies can be effective in addressing potential anticompetitive behaviour and improve the functioning of markets.
General Court dismisses appeals by Mitsubishi and Toshiba against re-imposition of fines for gas insulated switchgear cartel. On 19 January 2016, the General Court dismissed appeals brought by Mitsubishi Electric Corp. (Mitsubishi) and Toshiba Corp. (Toshiba) against the Commission’s decision to re-impose fines for their participation in the gas insulated switchgear cartel, following annulment of its original decision. In July 2011, the General Court annulled the fines imposed on the two companies on the basis that the Commission had breached the principle of equal treatment in calculating the fines. The General Court did, however, uphold the findings of infringement. In 2012, the Commission re-imposed the fines. The General Court held in the current appeal that the Commission did not breach the applicants’ rights of defence, fail to state reasons, or breach the principles of equal treatment or proportionality in its re-calculation of the fines. In particular, as neither Toshiba and Mitsubishi recorded any relevant turnover in 2003, the Commission was correct to rely on the sales made by their joint venture company in that year in calculating the starting point of the fines. The Commission had also not erred in allocating the starting point between the parent companies by reference to their sales in the relevant market in the last year prior to establishing the joint venture, to reflect their respective capacity to contribute to the infringement. The General Court also held that the Japanese companies had contributed to the overall functioning of the cartel.
Toshiba loses EU court appeal in power-transformer cartel. On 20 January 2016, the European Court of Justice (ECJ) handed down its judgment dismissing the appeal by Toshiba against a General Court judgment upholding the Commission’s decision on the power transformers cartel. The ECJ concluded that the General Court had not erred in its finding that Toshiba had failed to establish it was not a potential competitor to the power transformer operators in Europe; in its reasoning of Toshiba’s duration of infringement, nor in its assessment of the Commission’s calculation of the fine (which totalled €13.2 million). In particular, the ECJ also held that the Commission and General Court had operated within the 2006 Fining Guidelines when using Toshiba’s market share worldwide for the calculation of the basic amount, as opposed to using Toshiba’s market share in the directly affected EEA and Japanese markets.
ECJ ruling on relationship between leniency applications made to the Commission and NCAs for same cartel. On 20 January 2016, the ECJ handed down its ruling on a preliminary reference from an Italian court regarding the relationship between leniency applications made under the Commission’s leniency notice, and summary applications made to National Competition Authorities (NCAs) in relation to the same cartel. The ECJ held that DHL Express was appropriately fined €7.2 million for its role in the Italian road-freight cartel, even though it blew the whistle on EU-wide conduct to the Commission. Specifically, the ECJ held that there was no legal link between the application for immunity submitted to the Commission and the summary application submitted to an NCA in respect of the same cartel, with the result that the NCA is not required to assess the summary application in light of the application for immunity.
Phase I Mergers
- M.7862 TDR CAPITAL / EURO GARAGES (15 January 2016)
- M.7855 AGEAS / AXA PORTUGAL (19 January 2016)
- M.7802 AMADEUS / NAVITAIRE (19 January 2016)
- M.7865 LOV GROUP INVEST / DE AGOSTINI / JV (21 January 2016)
Online machine translation service available for all public procurement notices published on TED. On 15 January 2016, the Commission announced that an online machine translation service is now available, free of charge, for all public procurement notices in Tenders Electronic Daily (TED). TED is a website managed by the Publications Office of the European Union which allows companies to find out about public procurement opportunities. The new service is intended to increase transparency in public procurement opportunities as language barriers had been identified as one of the main barriers to cross-border bidding. Under the new service, automatic translations can be requested for any public procurement notice available in TED and will be made available shortly after the request is sent. This service will be available to and from all 24 EU official languages.
Commission opens in-depth State aid investigation into support for Port of Antwerp terminal operators. On 15 January 2016, the Commission announced that it has opened an in-depth State aid investigation into whether reductions in compensation payments granted by the Port of Antwerp (which is managed by the Antwerp Port Authority, a public authority) to two container terminal operators, gave them an undue advantage over competitors in breach of EU State aid rules. The reduction in compensation payments arose when the Antwerp Port Authority indirectly revised downwards compensation penalties due from the two terminal operators for failing to handle a minimum amount of containers in a port every year. Following complaints from a competitor, the Commission is examining whether a private investor would have accepted the reduction in compensation in a similar manner, such that no State aid issue arises.
Commission approves public service aid to two Swedish airports. On 19 January 2016, the Commission announced that it has decided to approve Swedish plans to grant compensation for public service obligations linked to the management of two regional airports (Sundsvall Timra and Skelleftea), in accordance with its guidelines on State aid to airports and airlines and also the 2012 framework for State aid for services of general economic interest. The airports are in sparsely populated areas and provide a service that is important to inhabitants and businesses in these areas.
Commission orders Belgium to recover aid granted to steelmakers. On 20 January 2016, the Commission announced that support, totaling €211 million, granted by the authorities in the Walloon Region of Belgium to several steel companies in the Duferco Group, between 2006 and 2011, breached EU State aid rules and must be recovered. The Commission found that a market-based fund manager would not have exclusively invested in the Duferco Group in the same way. In particular, the Commission concluded that the support gave the beneficiaries an unfair advantage.
Commission State aid decisions on taxation of ports in the Netherlands, Belgium and France. On 21 January 2016, the Commission announced that it has taken three decisions in respect of the taxation of ports in the Netherlands, Belgium, and France. The Commission has requested the Netherlands to take steps to remove an exemption from corporate tax which gives six publicly-owned Dutch ports a selective advantage that distorts competition, in breach of EU State aid rules. The Commission has also requested Belgium and France to adapt their legislation to ensure that public or private ports pay corporate tax on their economic activities in line with other companies in Belgium and France.
CMA issues reminder about guidance on high-strength alcohol schemes. On 18 January 2016, the Competition and Markets Authority (CMA) announced that it has written to local authorities reminding them about the need to ensure that schemes aimed at reducing consumption of high-strength alcohol do not breach competition law. Such schemes can take a variety of forms and sometimes include local authorities encouraging retailers to remove high-strength alcohol products from sale for health and safety reasons. The CMA issued guidance for local authorities on such schemes in December 2014, warning of competition law risks where they act as a mechanism to co-ordinate the commercial decision-making of independent businesses; encourage or facilitate the sharing of commercial information between businesses; or encourage or broker agreements between businesses to raise or fix prices or to set minimum prices. The CMA’s guidance makes clear that retailers can make an independent decision to join a scheme and stop selling high-strength alcohol provided they do not discuss this or agree to this with other retailers.
Speeches & Publications
Competition in a big data world. On 17 January 2016, the EU’s Competition Commissioner, Margaret Vestager, announced in a speech that the Commission is watching out for potential antitrust abuses when companies collect and use vast sets of personal information, i.e. Big Data. According to the Commissioner, when a few companies control the data needed to satisfy customers’ needs and cut costs, it could give them power to force competitors out of the market. However, Vestager clarified during the speech that companies will not be penalised simply because they possess a lot of data. The comments come as the German and French competition authorities prepare a joint study on the role of Big Data and competition law. To date, no competition-related abuses from the use of Big Data have been found.
UK Government response to European Commission consultation on unjustified geo-blocking and other forms of geographically-based discrimination. On 15 January 2016, the UK government published its response to the Commission’s consultation on tackling geographically-based forms of discrimination against customers shopping and accessing information online across borders within the EU. The government does not believe that consumers should be prevented from seeing prices offered to consumers in other Member States and supports a ban on blocking users upfront from accessing specific content. The government also opposes charging consumers different prices for goods on the sole basis of their location as a willingness to pay differing prices.