On June 9 2017, the 9th amendment to the German Competition Act (ARC) finally comes into force. The main reason behind this substantial change of German competition law was the implementation of the EU directive 2014/104/EU on Antitrust Damages Actions. German legislators have taken this opportunity to make further changes to the existing competition law regime: The new provisions expand the competence of the Federal Cartel Office in the areas of merger control, digital markets, and private antitrust enforcement. Also, gaps in the enforcement of fines have been closed. The major changes fall into six relevant areas:
- An additional transaction value based threshold has been added to the existing turnover thresholds. Now, transactions have to be notified even when the target has no or little (below EUR 5 million) turnover in Germany if the total transaction value is more than EUR 400 million, one of the undertakings concerned achieves a yearly turnover in Germany of more than EUR 25 million and the combined worldwide turnover of all undertakings concerned exceeds EUR 500 million.
- The new filing obligation applies only if the target company is “significantly active” in Germany.
Private Antitrust Enforcement
- The new law implements a statutory rebuttable presumption that a cartel causes damages.
- Passing-on defense is now specified in the law. Subject to certain conditions, there is now a rebuttable presumption in favor of indirect customers that a surcharge has been passed on to by the direct customer.
- The current limitation period for damage claims has been extended to five years.
- Small and medium sized enterprises and leniency applicants may be exempted from joint and several liability.
- Discovery rules are introduced providing that “required” internal evidence must be disclosed to the other party.
Liability for Fines
- The so-called Sausage Gap (“Wurstlücke”) has been closed which allowed companies to escape liability by smart restructuring during the cartel proceedings. It is now easier for the Federal Cartel Office to levy a fine against the parent company having direct or indirect decisive influence on the economic entity concerned, even after the latter cease to exist.
Digitalization of Markets
- There are also new provisions addressing the specifics of digital markets, in particular bi- or multilateral internet platforms such as Facebook or Twitter which provide their services usually free of charge. The law now explicitly clarifies that there can be a market even where services are offered for free.
- New criteria have been introduced to facilitate the evaluation of market power and competition conditions in the digital sector. These criteria include access to competitively relevant data and innovation-driven competition pressure, direct and indirect network effects and parallel, simultaneous use of several services, as well as, the barriers to change providers.
- A new deadline provides that a request for ministerial authorization will be deemed rejected upon the expiration of six months without ministerial decision, unless the parties have applied for an extension of additional two months.
- Competition authorities and other regulators may now exchange general and case-related market information more easily. Certain cooperations between print media companies have been exempted from the cartel prohibition.
- The so-called “Anzapfverbot” has been revised. This is a specific law protecting suppliers against buyer power and prohibiting a retailer from requiring suppliers to grant certain benefits without any objective justification.
Finally being in force after a long time of discussions, the 9th ARC amendment now has to show its effect in legal practice which may be significant. Remaining gaps have to be filled by the jurisprudence likely until a further amendment to the ARC will be introduced in some years time.