The Competition Authority's Annual Report for 2010 identifies the Authority's achievements and difficulties in 2010. The report also addresses the significant challenges it faces in 2011.

The Authority reported that it was ranked first in the EU (together with the Netherlands) for institutional efficiency of its merger review system. The Global Merger Control Index surveyed 257 experts from over 60 jurisdictions, with Canada topping the list globally, following by Ireland and the Netherlands, along with the United States, in shared second place.  

The Authority's merger division saw a notable increase in its workload, receiving 46 merger notifications, up significantly from the 27 received in 2009 and exceeding the 38 received in 2008. The Authority expects that figure to increase yet again in 2011. The Authority initiated two phase 2 investigations and completed one further such investigation which was launched in 2009. Two phase 1 mergers were cleared subject to commitments. While the failing firm argument was raised in three merger notifications, each was approved without the necessity of establishing whether there was, in fact, a failing firm.

In terms of other successes, the highest profile result for the Authority was the conclusion of its long running case against the Beef Industry Development Society Ltd (BIDS). BIDS withdrew its argument before the Irish courts for an exemption under Article 101(3) of the Treaty on the Functioning of the European Union (TFEU) (i.e the provision which allows an anti-competitive arrangement to be exempted) in respect of its attempt to rationalise the Irish beef industry, and agreed to pay a substantial contribution towards the Authority's legal costs.

In terms of enforcement, 235 complaints were received by the Authority during 2010, of which 109 were resolved at the screening stage, 112 were assessed and 14 were added to existing files. 31 new complaints were made in respect of alleged criminal cartel behaviour of which 9 are still being assessed, while 135 new complaints were received in respect of anti-competitive agreements and abuse of a dominant position of which 22 remain open.

Of the 6 criminal cartel allegations investigations ongoing throughout 2010, one was completed with a file sent to the DPP recommending a number of prosecutions on indictment. This file, which was ongoing for a number of years, concerns an extremely complex and substantial investigation, which will represent a significant draw on resources going forward.

It is notable that this is the first time since the Competition Act 2002 was enacted that no District Court warrants (required to conduct dawn raids under the Act) were issued to the Authority. This is consistent with the ongoing steep decline in the number of warrants issued annually since the record high of 42 warrants in 2005 and raises question marks about the ongoing enforcement of competition law.

Of the 7 civil investigations ongoing during the year, 3 remain open, while 2 were closed when the parties involved initiated private actions.

With the successful conclusion of the BIDS case, the report outlines the status of two further competition cases before the Irish courts:

  • subject to the Supreme Court's findings in a consultative case stated, the Authority may pursue a prosecution against one remaining individual allegedly involved in the Heating Oil cartel; and
  • a trial has been fixed for June 2011 in respect of the Irish Rail/Hedge Cutting case.

The Authority reviewed all of its existing Declarations during 2010. Declarations identify specified categories of agreements, decisions or concerted practices which are deemed exempt from the application of the prohabition in the Competition Acts 2002-2010 on anti-competitive arrangements. Amendments were made to the Vertical Agreements Declaration (which subject to conditions, exempts vertical agreements (i.e., agreements between undertakings operating at different levels of the supply and distribution chains)) and the Cylinder LPG Declaration (which concerns exclusive purchasing agreements for cylinder liquefied petroleum gas (LPG) where a reseller agrees with a supplier to sell a particular brand of Cylinder LPG). The Motor Fuels Declaration (concerning exclusive purchasing arrangements for the resale of petroleum products in service stations) was allowed to lapse. No decision has yet been made in respect of the Bulk LPG Declaration (which concerns exclusive purchasing agreements for bulk LPG) as the Authority is carrying out further research on the relevant market.

In addition to maintaining an active role at EU and international level, the Authority also continued its advocacy activities at a national level, with particular focus on public restrictions on competition. As well as advising numerous State bodies and departments in respect of competition law, it also made submissions to:

  • the National Transport Authority in respect of bus licensing;
  • the Commission for Energy Regulation in respect of deregulation of the retail electricity sector;
  • the Department of Environment, Heritage and Local Government in respect of waste management costs; and
  • the various bodies in relation to the need for reform of the State's system for subsidising GP services (following on from its comprehensive market study into market for GP services).

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