Anticompetitive agreementsAssessment framework
What is the general framework for assessing whether an agreement or concerted practice can be considered anticompetitive?
The CPA generally reiterates article 101 of the TFEU and prohibits all types of agreements between undertakings, decisions by associations of undertakings and concerted practices that have, as their object or effect, the prevention, restriction or distortion of competition within the relevant market, and in particular those that:
- directly or indirectly fix purchase or selling prices or any other trading conditions;
- share markets or sources of supply;
- limit or control production, markets, technical development or investment;
- apply dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage; or
- make the conclusion of contracts subject to acceptance by the other parties of supplementary obligations that, by their nature or according to commercial usage, have no connection with the subject of such contracts.
The law provides for an exemption from the prohibition for agreements of minor importance, which applies where the total share of the undertakings or participants on the market of commodities and services, subject to the agreement, the decision or the concerted practice, does not exceed the following:
- 10 per cent of the respective market if the participants are competitors; or
- 15 per cent of each of the respective markets, if participants are not competitors.
However, the exemption will not apply if the agreements, decisions or concerted practice have as their objective or result:
- direct or indirect fixing of prices;
- allocation of markets or clients, or both; and
- restriction on production and sales.
To what extent are technology licensing agreements considered anticompetitive?
Technology licensing agreements and the effect they may have on competition in the pharmaceuticals sector have not yet been considered by the CPC.Co-promotion and co-marketing agreements
To what extent are co-promotion and co-marketing agreements considered anticompetitive?
There are no precedents of co-promotion and co-marketing agreements examined by the CPC in the pharmaceuticals sector.Other agreements
What other forms of agreement with a competitor are likely to be an issue? How can these issues be resolved?
Agreements with actual or potential competitors are likely to raise issues if they impose hardcore restrictions, such as limiting output, allocating either customers or markets or fixing prices, as well as if they concern the sharing of commercially sensitive information (trade secrets of any kind).Issues with vertical agreements
Which aspects of vertical agreements are most likely to raise antitrust concerns?
Hardcore restrictions in vertical agreements are generally considered anticompetitive. In 2014, the CPC considered whether standard clauses in contracts of Abbott Products and Sting, as well as their trade practice, could constitute a restriction on parallel exports and distort competition. The CPC, however, concluded that, based on the facts, no violation existed.Patent dispute settlements
To what extent can the settlement of a patent dispute expose the parties concerned to liability for an antitrust violation?
The CPC has not yet considered the implications of settling patent disputes in terms of competition, but should a case arise, it will probably follow the European Commission’s Technology Transfer Guidelines.Joint communications and lobbying
To what extent can joint communications or lobbying actions be anticompetitive?
Antitrust violations may arise where:
- ‘pay-for-restriction’ or ‘pay-for-delay’-type settlement agreements are involved, whereby a value transfer from one party in return for a limitation on the entry or expansion on the market of the other party exists;
- the entry of a competing generic product has been delayed as a result of the settlement and, in return for the delay in entry, the generic manufacturer obtains some form of consideration from the incumbent originator (value transfer);
- parties cross-license each other and impose restrictions on the use of their patents, including restrictions on their licensing to third parties; and
- restriction of the freedom to challenge an intellectual property right is not part of the specific subject matter of an intellectual property right and may restrict competition.
To what extent may public communications constitute an infringement?
If public communications contain misleading statements about the characteristics of the medicinal products or misleading and comparative advertising, these will infringe competition rules. See question 33.Exchange of information
Are anticompetitive exchanges of information more likely to occur in the pharmaceutical sector given the increased transparency imposed by measures such as disclosure of relationships with HCPs, clinical trials, etc?
Whether exchange of information in the pharmaceutical sector is more likely to occur remains to be seen. However, the CPC has published guidelines on the sharing of information between competitors, which adopt a case-by-case approach to sharing of information. To fall within the scope of antitrust law, it is necessary to establish that there is an agreement between undertakings, a decision of an association of undertakings or a concerted practice between undertakings on the grounds of which the undertakings exchange information or transfer it to an association that has as its objective the centralisation, structuring and processing of the information prior to providing it to the undertakings.