EU Mergers

Phase I Mergers

  • M.8542 THE CARLYLE GROUP / CVC / CHINA INVESTMENT CORPORATION / ENGIE E&P INTERNATIONAL (30 October 2017)
  • M.8626 CRH / XI (RMAT) (31 October 2017)
  • M.8643 LEGEND HOLDINGS CORPORATION / BANQUE INTERNATIONALE A LUXEMBOURG (3 November 2017)
  • M.8663 CNP ASSURANCES / MACQUARIE / PREDICA / PISTO (3 November 2017)

EU Competition 

Google appeals Commission decision on shopping comparison services. On 30 October 2017, details were published in the Official Journal of the European Union (OJEU) of an appeal by Google Inc. (Google) and its parent company, Alphabet Inc. (Alphabet), against the European Commission’s (Commission) €2.42 billion fine imposed on Google for breaching Article 102 of the Treaty on the Functioning of the European Union (TFEU). The Commission had found that Google unlawfully promoted its own shopping comparison service. In its appeal, Google has argued that the Commission erred in: (i) finding Google favoured its own shopping comparison service through grouping advertisements; (ii) that the conduct abusively diverted Google search traffic; and (iii) that quality improvements undertaken by Google constituted unlawful conduct. Additionally, Google has argued that the Commission erred in calculating the fine, which, according to Google, is itself not warranted because the Commission advanced a novel theory, selected the case for commitments, and previously rejected agreed remedies.

Appeals against General Court in Guardian Europe cartel proceedings published. On 30 October 2017, details of appeals brought by the European Union (EU) and Guardian Europe Sàrl (Guardian Europe) against the General Court's lengthy handling of proceedings in relation to the flat glass cartel were published in the OJEU. In its appeal, the EU claimed that the General Court erred in its interpretation of limitation rules with respect to continuous loss and causal links and also in its determination of the period when the alleged damages occurred. In its separate appeal, Guardian Europe argued that the General Court erred in its application of the EU law concept of what is meant by an “undertaking” in relation to a breach of the principle of equal treatment, and also its determination that Guardian Europe did not suffer non-material damage.

State Aid

Commission accepts provision of public funding for Polish intermodal transport. On 31 October 2017, the Commission approved a €238 million aid scheme to support the modernisation, construction, and upgrade of Polish intermodal transport infrastructure. The aid scheme will support the purchase of specialised equipment and rolling stock. The Commission determined that the aid is necessary for the improvement of intermodal transport in Poland and that it is line with EU state aid rules. The aid scheme will run until 31 December 2023.

UK Competition

CMA publishes determination notice of Barclays exception to Retail Banking Market Investigation Order 2017. On 1 November 2017, the Competition and Markets Authority (CMA) published a determination notice setting out exceptions to the application of the Retail Banking Market Investigation Order (the Order) for a division of Barclays. The Order, made on 2 February 2017, implements remedies from the CMA’s recent retail banking market investigation which are intended to improve service quality, switching, and information for banking customers. However, the CMA has granted an exception to the Overseas Services division of Barclays International in relation to its provision of personal current accounts and business current accounts which are offered exclusively to customers with investable assets in excess of £250,000 because they are independent of the provision of other such services. The CMA therefore found that these services are beyond the scope of the Order.

CMA announces start of investigation into suspected cartels in the supply of precast concrete drainage products. On 2 November 2017, the CMA announced that it is proceeding with its civil investigation into possible breaches of Chapter I of the Competition Act 1998 and Article 101 of the TFEU in connection with the supply of precast concrete drainage products to construction companies. The investigation was opened originally in April 2016 and was conducted alongside a related criminal investigation. The CMA intends to provide further update on its investigation by March 2018.

CMA publishes information note on leniency applications in regulated sectors. On 3 November 2017, the CMA published an information note detailing the process for leniency applications in relation to the concurrency regime between the CMA and regulators within the UK Competition Network following a consultation process. Whereas previously informal arrangements meant that applicants only needed to approach one authority, the CMA has confirmed that it shall now be the first point of contact for all applicants to ensure a single queue system.

UK Mergers

CMA refers Electro Rent’s acquisition of Microlease to Phase 2 investigation. On 30 October 2017, the CMA published its decision to refer Electro Rent Corporation’s (Electro Rent) completed acquisition of Test Equipment Asset Management and Microlease Inc. (Microlease) to a Phase 2 investigation. The referral is the result of a potential purchaser of certain Microlease assets withdrawing from the process. This was an arrangement which the CMA had previously consulted on and considered to be agreeable, provided an upfront purchaser condition was satisfied. Due to the withdrawal of the proposed purchaser, the CMA has decided that the previous undertakings designed to address competition issues are no longer a comprehensive solution and is therefore launching a Phase 2 investigation into the completed acquisition.

CMA publishes final report following Phase 2 investigation on the acquisition by Euro Car Parts of certain Andrew Page assets. On 31 October 2017, the CMA’s final report on the completed acquisition of the bulk of the assets of Andrew Page Limited, Solid Auto (UK) Limited, and Colton Parts Company Limited (together, Andrew Page) by Euro Car Parts Limited (Euro Car Parts) was published following a Phase 2 investigation. Both parties are active in the distribution of independent aftermarket parts and components to independent motor trade and retail customers. The merger occurred in October 2016 in the wake of Andrew Page’s administration. Although the merger will not adversely affect national competition in this area, the CMA has decided to require divestments in nine locations where, according to the CMA, the transaction will substantially lessen competition.

Brexit

House of Lords EU Internal Market Sub-Committee publishes BEIS evidence regarding post-Brexit UK competition policy. On 2 November 2017, the House of Lords EU Internal Market Sub-Committee published written evidence provided by the Department for Business, Energy and Industrial Strategy (BEIS) in relation to the inquiry into the impact of Brexit on UK competition policy. The BEIS evidence notes that the UK will continue to support effective competition enforcement and work with international competition networks post-Brexit. However, the document also points to a likely increase in the CMA’s caseload and the need for increased resources post-Brexit.

Speeches

Johannes Laitenberger delivers speech on level and open markets. On 30 October 2017, the Commission published a speech by Director-General of Competition Johannes Laitenberger at the 34th Annual Competition Policy Conference in Brussels. In his speech, Mr. Laitenberger outlined the similarities and differences between U.S. and EU approaches to merger control, and also commented on the issue of big data and algorithms, as well as the need for strong international cooperation and information exchange between agencies.