General Court dismisses calcium carbide cartel appeal. On 13 December 2013, the General Court dismissed an appeal by Holding Slovenske elektrarne d.o.o. (HSE) against the 2009 European Commission (Commission) decision on the calcium carbide cartel (COMP/39.396). According to HSE, the Commission incorrectly concluded that HSE and its subsidiary TDR formed a single economic unit. The General Court, however, found that the Commission had been entitled to find that HSE formed a single economic unit by virtue of its majority shareholding in the subsidiary and had correctly imputed to HSE liability for the unlawful conduct of that subsidiary. The General Court further held that the Commission had not breached the presumption of innocence with respect to HSE notwithstanding that HSE had been unaware of the unlawful conduct. Finally, the Commission had acted correctly in applying an increase for deterrence and in not taking into account the mitigating circumstances put forward by HSE (Case T-399/09 – Holding Slovenske elektrarne d.o.o. v European Commission, Judgment of 13 December 2013).
Commission fines J&J and Novartis €16 million for delaying market entry of fentanyl. On 10 December 2013, the Commission imposed fines on Johnson & Johnson (J&J) (€10,798,000) and Novartis (€5,493,000) (AT.39685). The Commission has determined that an agreement concluded in 2005 between the Dutch subsidiaries of the two companies (Janssen-Cilag and Sandoz, respectively) is contrary to Article 101 TFEU. According to the Commission, the agreement delayed the market entry of a cheaper generic version of the pain-killer fentanyl in the Netherlands for 17 months. The so-called “co-promotion agreement” provided strong incentives for Sandoz not to launch a generic equivalent to fentanyl and, in particular, featured monthly payments that exceeded the profits that Sandoz expected to obtain from selling its generic product. According to internal documents Sandoz would abstain from entering the Dutch market in exchange for “a part of [the] cake”. Instead of competing, the companies agreed on cooperation so as “not to have a depot generic on the market and in that way to keep the high current price”. Janssen-Cilag did not consider any other existing potential partners for the so-called “co-promotion agreement” but focused only on its close competitor Sandoz. Ultimately, Sandoz engaged in very limited or no actual co-promotion activities (IP/13/1233). The Commission is actively monitoring “pay-for-delay” agreements in the pharmaceutical sector by way of follow up to the 2009 Commission pharmaceutical sector inquiry. Relatedly, the Commission published its Fourth Monitoring Report on Patent Settlements on 9 December 2013. For further information, see the Client Briefing European Commission 4th Report on the Monitoring of Patent Settlements.
Article 101/102 TFEU Procedure
ECN publishes Recommendations on key investigative and decision-making powers. On 10 December 2013, the ECN published Recommendations setting out the ECN’s position on the recommended powers of national competition authorities:
- ECN Recommendation on Investigative Powers, Enforcement Measures and Sanctions in the context of Inspections and Requests for Information
- ECN Recommendation on the Power to Collect Digital Evidence, including by Forensic Means
- ECN Recommendation on Assistance in Inspections conducted under Articles 22(1) of Regulation(EC) No 1/2003
- ECN Recommendation on the Power to set Priorities
- ECN Recommendation on Interim Measures
- ECN Recommendation on Commitment Procedures
- ECN Recommendation on the Power to Impose Structural Remedies
General Court dismisses Microsoft / Skype merger appeal. On 11 December 2013, the General Court dismissed an appeal by Cisco and Messagenet against the Commission’s clearance of the Microsoft / Skype merger in October 2011 (M.6281) (Case T-79/12 - Cisco Systems and Messagenet v European Commission, judgment of 11 December 2013) (General Court Press Release 156/2013) (MEMO/13/1137).
Phase I Clearances
- M.7090 – Vopak / Swedegas / GO4LNG JV (simplified review) (06.12.2013).
- M.7016 - Mitsubishi Heavy Industries Ltd (MHI) / Hitachi Ltd / MHPS (simplified review) (06.12.2013).
- M.7010 – Bolton / Tri Marine / JV (09.12.2013).
- M.7081 – Centerbridge Partners / Corsair Capital / Rainbow Assets (simplified review) (09.12.2013).
- M.7073 – KKR / Arle Capital / Hilding Anders (simplified review) (11.12.2013).
- M.6996 – Secop / ACC (11.12.2013).
- M.7085 – CBRE / NHL (MEX 13/12/2013).
- M.7019 - TRIMET / RIO TINTO ALCAN / EDF (MEX 13/12/2013).
- M.7092 – LIXIL / DBJ / Grohe Group (simplified review) (MEX 13/12/2013).
OFT announces settlement with pharmaceutical company. On 12 December 2013, the Office of Fair Trading (OFT) announced a settlement with Hamsard 3149 Limited (Hamsard) related to a market-sharing agreement with Lloyds Pharmacy Limited. Hamsard has agreed to pay a fine of £387,856 for breach of the Chapter I prohibition of the Competition Act 1998 (reduced from £646,426 to reflect Hamsard’s admission and agreement to co-operate under the OFT’s leniency policy and the settlement) whereby the parties agreed not to supply prescription medicines to each other’s existing care home customers. Lloyds Pharmacy benefited from immunity pursuant to the OFT’s leniency policy (OFT Press Release 82/13).
Speeches & Publications
Speech by the Vice President of the European Commission responsible for Competition Policy, Joaquín Almunia. Intellectual property and competition policy (SPEECH/13/1042).
Overview of State aid decisions and on-going in-depth investigations in the context of the financial crisis (MEMO/13/1147).