EU Competition

Commission amends Société Générale fine in respect of Euro interest rate derivatives cartel. On 6 April 2016, the European Commission (Commission) issued a press release confirming that it had amended the fine it had imposed on Société Générale (SocGen) for SocGen’s involvement in a cartel in respect of Euro interest rate derivatives. Having used the cartel settlement procedure to determine the EUR 445,884,000 fine, the Commission subsequently found errors in the data originally submitted by SocGen, and on this basis has reduced the fine to EUR 227,718,00 to reflect the corrected value of sales provided by SocGen.

Commission imposes fine on Riberebro for involvement in canned mushrooms cartel. On 6 April 2016, the Commission issued a press release confirming that it had fined Riberebro EUR 5.1954 million for collusion with respect to illegal price-fixing and customer allocation in the canned mushrooms sector. Riberebro did not participate in the settlement procedure and so its activities were investigated under the standard procedure.

Commission announces early release of Deutsche Bahn from its commitments. On 8 April 2016, the Commission announced that it had released Deutsche Bahn from the commitments Deutsche Bahn provided in December 2013 to address competition concerns that its pricing system for providing traction current to railway companies may have reduced the margin of its competitors. The Commission reports that the design and implementation of these commitments proved successful and that as a result of the measures, several energy providers have entered the traction current market.

AG Opinion on Hungarian court referral regarding claim for recovery of interest on competition fine. On 8 April 2016, Advocate General Wahl (AG) handed down his opinion on a request for a preliminary ruling from a Hungarian Austrian court on whether the concept of a claim in matters relating to quasi-delict under Article 5(3) of Council Regulation 44/2001 covers a claim for recovery of interest on a fine imposed by the Hungarian competition authority (Authority) on Siemens Aktiengesellschaft Österreich (Siemens), which is domiciled in Austria. Siemens challenged the Authority’s original fine, but paid the penalty pending the decision of the Hungarian court. The Hungarian court reduced the fine, and the Authority subsequently reimbursed Siemens for the amount of the reduction plus interest. However, a further appeal by the Authority found the original fine to be correct. Siemens paid the remaining amount of the fine, but refused to repay the interest. The Authority therefore, brought an action against Siemens for restitution of the interest amount on the grounds of unjust enrichment. Upon referral to the European Court of Justice (ECJ), the AG considered that the ECJ should respond to the referring court by finding that a claim for restitution on the grounds of unjust enrichment with regard to a penalty imposed in competition proceedings does not constitute a civil and commercial matter for the purposes of the Brussels I Regulation. The AG further considered that on a proper construction of Article 5(3) of the Brussels I Regulation, such a claim does not constitute a matter relating to tort, delict or quasi-delict within the meaning of that provision.

EU Mergers

Phase I Mergers

  • M.7849 MOL HUNGARIAN OIL AND GAS / ENI HUNGARIA / ENI SLOVENIJA (7 April 2016)

State Aid

Commission approves French aid scheme for households affected by the reallocation of spectrum. On 5 April 2016, the Commission announced that it had approved a French scheme under EU State aid rules which provides support to households in order to access free-to-air TV channels that are affected by the reallocation of frequency used for TV broadcasting to wireless broadband services. France has allocated a EUR 56.9 million budget to compensate households most affected by extra costs linked to the reallocation of the 700 MHz band, to assist its migration from April 2016 onwards. The aid is intended to be used to buy the necessary equipment, for technical assistance and for maintaining reception of free-to-air TV channels after the reallocation of frequencies.

Public Procurement

ECJ hands down judgment in action brought by Puligienica Facility Esco. On 5 April 2016, the ECJ handed down a judgment in respect of the request made in proceedings between Puligienica Facility Esco SpA and Airgest SpA (Airgest) concerning the lawfulness of the award by Airgest of a public services contract to Gestione Servizi Ambientali Srl and Zenith Services Group Srl. The case concerned an action that had been brought by the unsuccessful bidder of a public tender and the subsequent counterclaim of the successful bidder. The question for the ECJ to consider was whether national case law, pursuant to which the national courts were required to examine a counterclaim first and, if successful, dismiss the main action as inadmissible without any examination of its merits, was compatible with Article 1(1) and Article 1(3) of Directive 89/665. The ECJ concluded that, the main action could not, “be dismissed as inadmissible under national procedural rules which provide that the counterclaim lodged by the other tenderer must be examined first”.

European Ombudsman publishes conclusion regarding Commission’s alleged failure to ensure that Greek hospitals comply with EU public procurement law. On 4 April 2016, the European Ombudsman (Ombudsman) published its conclusion in respect of the decision in Case 25/2013/ANA,concerning the Commission’s role in ensuring that Greek hospitals’ tenders for medical supplies comply with EU public procurement law. The Ombudsman inquired into the issue and suggested that the Commission re-examine the complaint against Greece. The Commission re-examined and concluded that Greece had adequate measures in place. However, the Ombudsman found that the Commission had not examined the complaint with proper diligence. The Ombudsman’s further recommendation to the Commission was to carry out a proper examination in respect of the allegation. The Commission accepted the Ombudsman’s recommendation and opened an investigation into the matter under the EU Pilot procedure for dealing with infringement cases. Therefore, the Ombudsman has closed the case.

UK Competition

CMA publishes full text of its decision on acquisition of First TransPennine Express franchise by First TransPennine Express. On 4 April 2016, the Competition and Markets Authority (CMA) published the full text of its decision on the acquisition of the First TransPennine Express franchise by First TransPennine Express (a wholly owned subsidiary of FirstGroup plc). The CMA found that the award of the franchise would not reduce the number of bidders for future franchises or provide the parties with an advantage in future bids.

CMA publishes full text of its decision on LEO Pharma’s acquisition of Astellas Pharma assets. On 5 April 2016, the CMA published the full text of its decision in respect of LEO Pharma’s acquisition of certain dermatological pharmaceutical products and assets from Astellas Pharma. The CMA found that the parties met the share of supply test based on their combined share of the market for nonsteroidal products for inflammatory skin disorders. However, the CMA found that the parties’ dermatological products were not the closest alternatives/substitutes to each other and that a number of competitors would remain in the market.

CMA publishes full text of its decision on LN-Gaiety Holdings Limited’s acquisition of MAMA & Company Limited. On 7 April 2016, the CMA published the full text of its decision on the acquisition of MAMA & Company Limited by LN-Gaiety Holdings Limited (a joint venture between Live Nation (Music) UK Limited and Gaiety Investments Limited). The share of supply test was met on the basis of the companies’ combined share of live music venues in certain geographical locations. However, the CMA determined that while the companies’ venues were geographically close, there was limited evidence of strong competition between them, and certain venues faced stronger competition from the venues of other competitors.

CMA publishes merger enquiry letter template. On 7 April 2016, the CMA published a merger enquiry letter template that the CMA intend to use when commencing an investigation into a merger in respect of which they have not been formally notified by the parties. The CMA has confirmed that the template will be tailored to the facts of the merger under consideration.

CMA accepts interim undertakings in Clariant acquisition of Kilfrost assets. On 8 April 2016, the CMA published the interim undertakings that it has accepted from Kilfrost Group Public Limited Company (Kilfrost) pending the completion of the CMA’s Phase 2 investigation of Clariant AG’s (Clariant) acquisition of the European aircraft de-/anti-icing fluid (ADF) business, the rail de-/anti-icing fluid (RDF) business and associated assets of Kilfrost. Kilfrost has agreed not to take certain pre-emptive action without first obtaining the consent of the CMA.

Commission opens investigation into potential illegal Romanian aid provided to Oltchim. On 8 April 2016, the Commission issued a press release confirming that it has opened an investigation into support provided to Oltchim, a Romanian petrochemical company, which is the only producer in Central Europe of liquid caustic soda and the only producer in Romania of chlorine and polyether polyols. The Romanian State has a controlling stake of 54.8% in the company. Oltchim has a long history of economic difficulties and State support through debt cancellations and restructurings. The Commission will now assess whether the public measures gave Oltchim an economic advantage over its competitors and constitutes State aid, or whether a private creditor would have accepted to act in the same way.

Speeches & Publications

Commission meets with African Union Commission to discuss African development. On 7 April 2016, the Commission issued a press release in respect of their discussions at the recent 8th College to College Meeting in Ethiopia regarding African development. Other attendees included the AU New Partnership for Africa’s Development, Planning and Coordination Agency. The meeting was also open to the African Regional Economic Communities, the United Nations Economic Commission for Africa, the African Development Bank and the European Investment Bank.

Commission and Chile conclude agreement on trade in organic products. On 7 April 2016, the EU announced that it had concluded its negotiations with Chile in respect of an agreement on trade in organic products. This agreement means that the EU and Chile will mutually recognise the equivalence of their organic production rules and control systems.

Ofcom announces consideration of TelNG and Three’s dispute over National Telephone Numbering Plan. On 4 April 2016, Ofcom announced that it would be considering a dispute between Hutchinson 3G UK Limited (Three) and TelING Limited (TelING) under section 185 of the Communications Act 2003 (the Act) concerning TelNG’s compliance with General Condition 17.21 and the National Telephone Numbering Plan. In particular, it argued that TelNG’s UK03 service, which enables consumers to call international destinations using 03 numbers, constitutes revenue sharing as TelNG uses the termination charge it receives for terminating the 03 call to pay for the international call as an additional service, which is prohibited by Ofcom.