Horizontal agreements

Special rules and exemptions

Do any special rules or exemptions apply to the assessment of anticompetitive agreements between competitors in digital markets in your jurisdiction?

The standard EU competition rules apply to the assessment of such agreements: there are no special rules or exemptions for digital agreements.

The Commission may propose new legislation and revised guidance in the near future, in part motivated by increased digitisation of the economy. In relation to horizontal agreements in particular, the Commission is currently evaluating how to update the R&D Block Exemption Regulation, the Specialisation Block Exemption Regulation and its Guidelines on Horizontal Co-operation. In March 2022, the Commission published draft revised Horizontal Block Exemption Regulations and Horizontal Guidelines for consultation. The revisions provide (among other things) additional guidance on data pooling and data sharing. 

Access to online platforms

How has the competition authority in your jurisdiction addressed horizontal restrictions on access to online platforms?

The Commission has not brought any enforcement actions addressing horizontal restrictions on access to online platforms.

The Platform to Business Regulation, while not specifically competition legislation, imposes several obligations on providers of online intermediation services (ie, platforms). In particular, a platform must give reasons where it restricts the ability of businesses to offer goods and services to consumers through means other than the platform.

The Commission's Digital Markets Act (DMA) includes provisions regarding access to a gatekeeper platform. The EU institutions have reached agreement on the final text and it is likely to come into force around October 2022 and apply from around April 2023. 

Algorithms

Has the competition authority in your jurisdiction considered the application of competition law to the use of algorithms, in particular to algorithmic pricing?

The Commission has not brought any enforcement actions specifically related to algorithmic pricing or algorithms in a horizontal context. It summarised its position on use of algorithms in a horizontal context in a submission to an OECD roundtable on algorithms and collusion in 2017. It identified that algorithms may be used in various horizontal settings. First, to monitor prices agreed between competitors, and thus detect deviations. Second, to implement a price agreed through separate collusion. The Eturas (2016) case, referred by the Lithuanian courts to the Court of Justice of the European Union (CJEU) is an example of this. Several Lithuanian travel agencies used a common online travel booking system, and the system administrator proposed implementing a software rule (iealgorithm) limiting discounts. The CJEU considered this would be a concerted practice under article 101 if it were proven that the travel agencies were aware of the message. The case focused on this awareness, namely, the existence of collusion, and not on the algorithm that was the means of implementing the collusion. Third, the Commission identified that algorithms may be used as a means of communication to engage in explicit collusion (ie, online competitors colluding about using particular repricing parameters and strategies in their pricing algorithms to lead to aligned and higher prices, including through ‘hub and spoke’ collusion and signalling). The Commission also considered a fourth scenario, in which algorithms are used to engage in tacit collusion (ieto coordinate pricing with no human input); however, it considered it too early to discuss this possibility in depth. The Commission’s submission concludes that, to a large extent, pricing algorithms can be analysed by reference to traditional reasoning and categories used in EU competition law, and notes that firms involved in illegal pricing practices cannot avoid liability on the grounds that their prices were determined by algorithms. 

This approach by the Commission is also set out in its proposed revised Horizontal Guidelines (paragraphs 418, and 432 to 436.) 

Data collection and sharing

Has the competition authority in your jurisdiction considered the application of competition law to ‘hub and spoke’ information exchanges or data collection in the context of digital markets?

The Commission has not brought any specific enforcement actions with regard to hub and spoke information exchanges in the context of digital markets. In its proposed revised Horizontal Guidelines,  the Commission recognises that a hub and spoke scenario may arise where an online platform acts as a hub in cases where it facilitates, coordinates or enforces anti-competitive practices among the users of its platform services. It specifically notes that online platforms may for example enable information exchanges between platform users to secure certain margins or price levels, and that platforms might facilitate infringements by imposing operational restrictions on the system preventing platform users from offering lower prices or other advantages to final consumers (as in the Eturas case considered by the CJEU). The Commission also considers that other indirect information exchanges may involve reliance between (potential) competitors on a shared optimisation algorithm that would take business decisions based on commercially sensitive data feeds from various competitors, or the implementation in the relevant automated tools, of aligned/ coordinated features or mechanisms of optimisation. While using publicly available data to feed algorithmic software is legal, the aggregation of sensitive information into a pricing tool offered by a single IT company to which various competitors have access would amount to horizontal collusion. 

Other issues

Have any other key issues emerged in your jurisdiction in relation to the application of competition law to horizontal agreements in digital markets?

The Commission is also aware that algorithms can increase market transparency and be used for easier monitoring of anticompetitive vertical agreements, which then exacerbates effects across markets. For example, where a supplier uses algorithms to engage in monitoring of resale price maintenance of its downstream retailers and other suppliers also monitor the market, this can exacerbate the effects of the resale price maintenance (see the Commission’s cases against Asus, Denon & Marantz, Philips and Pioneer).