EU Competition

Details of British Airways appeal published in Official Journal. On 30 May 2016, the Official Journal published details of an appeal brought by British Airways plc (BA) against the General Court’s decision to partially annul the European Commission’s (Commission) air freight cartel decision. The Commission’s decision concerned the coordinated behaviour of 21 air freight carriers to fix prices, which infringed Article 101 of the Treaty on the Functioning of the European Union (TFEU). The General Court limited the scope of its annulment of the contested Commission decision to the form of order sought by BA in its original application for annulment. BA is therefore, seeking an order to annul the Commission’s decision in full.

Official Journal publishes details of Orange Polska appeal. On 30 May 2016, the Official Journal published details of an appeal brought by Orange Polska SA (Orange Polska) against the General Court’s decision to uphold the Commission’s finding that Orange Polska had infringed Article 102 TFEU by preventing new entrants to the Polish broadband markets from gaining access to its network and broadband services. Orange Polska was found to have refused to provide reliable and complete information, delayed negotiations, unreasonably refused orders from other operators, and imposed unreasonable conditions for access. Orange Polska is arguing that the General Court erred in law and also distorted evidence in order to uphold the decision of the Commission. Orange Polska has also challenged the General Court’s failure to require the Commission to demonstrate any legitimate interest it had in adopting its decision, given that it related to historic conduct.

General Court hands down judgment dismissing pre-stressing steel cartel appeals. On 2 June 2016, the General Court handed down its judgment dismissing the appeals made by Moreda-Riviere Trefilerías, Trefilerías Quijano, Trenzas y Cables de Acero PSC, and Global Steel Wire against the Commission’s pre-stressing steel cartel decision. The companies had argued that the Commission had erred in its assessment of attribution of liability, in its finding that there was a single and continuous infringement, and in its calculation of the fine.

EU Mergers

Phase I Mergers

  • M.7949 NORWEGIAN / SHIPHOLD / OSM AVIATION (31 May 2016)
  • M.8007 AVRIL / BPIFRANCE / BPT ISRAEL / EVERTREE (30 May 2016)
  • M.8012 HAL INVESTMENTS / COOLBLUE (1 June 2016)

State Aid

Commission investigates Portuguese State aid provided to railway maintenance company. On 2 June 2016, the Commission announced that it had opened an in-depth investigation into whether financial support provided to EMEF (a state-owned Portuguese railway maintenance company) by Comboios de Portugal (CP) (of which it is a subsidiary) gave EMEF a selective advantage in breach of State aid rules.  The investigation, in particular, centres on capital increases, loans and guarantees provided to EMEF which amounted to EUR 90 million, during a period in which EMEF, for the most part, was loss-making. The Commission will look at whether the measures were granted on market conditions.

Public Procurement

ECJ rules that replacing a consortium member in the procurement process does not breach the principle of equal treatment. On 24 May 2016, the European Court of Justice (ECJ) handed down its judgment following a request for a preliminary ruling on the interpretation of the principle of equal treatment of economic operators, set forth in Article 10 of the Utilities Directive 2004/17. The reference related to proceedings brought by MT Højgaard A/S and  Züblin A/S against Banedanmark, a Danish railway infrastructure operator, challenging its decision to award a contract to a competitor which had submitted a tender in its own name, after a consortium of which it was part of and had originally submitted a tender, was dissolved  following the insolvency of a consortium member. MT Højgaard and Züblin argued that, by allowing the company to substitute the original consortium, Banedanmark was in breach of Article 10. The ECJ, however, held that Banedanmark would not be in breach of Article 10 so long as the company met the requirements laid down during the procurement process and so long as its participation did not put other tenderers at a competitive disadvantage.

UK Competition

CMA publishes Issues Statement as part of Phase II investigation of ICE acquisition of Trayport. On 31 May 2016, the UK Competition and Markets Authority (CMA) published an Issues Statement as part of its Phase II investigation into the acquisition by Intercontinental Exchange Inc. (ICE) of Trayport Inc. and GFI TP Ltd. (Trayport). ICE is active in the trading of energy commodities and utilities derivatives through exchanges and clearinghouses. Trayport licenses software products to traders, brokers, exchanges, and clearinghouses active in the wholesale markets for European utility derivatives and commodities. The issues statement sets out the focus of the CMA’s examination, which is expected to conclude on 18 October 2016.

Court of Appeal allows appeal against Patent Court’s decision to strike out competition law defence raised by Samsung. On 27 May 2016, the Court of Appeal handed down its judgment partially allowing an appeal made by Samsung against the Patents Court’s decision to strike out one of the competition law defences that it had raised in its action against Unwired Planet. Samsung had argued that an agreement transferring patents from Ericsson to Unwired Planet was unenforceable as Ericsson’s obligations to provide the patents on fair, reasonable and non-discriminatory terms under the European Telecommunications Standards Institute (ETSI) Rules had not been fully transferred, as the transfer had been to a non-ETSI member. This argument was struck out, but the Court of Appeal accepted Samsung’s argument that the particular terms of the agreements could lead to discrimination between licensees, thereby infringing Article 101 and breaching ETSI Rules.

CMA revokes McKesson Initial Enforcement Order. On 3 June 2016, the CMA published a revocation order in respect of its enforcement order (IEO) against McKesson UK Finance I Limited and McKesson Corporation (together, McKesson), and AAH Pharmaceuticals Limited (AAH). The IEO was issued in respect of the proposed acquisition by AAH (a McKesson group entity) of Medical Advisory Services for Travellers Abroad Limited and Sangers (Northern Ireland) Limited from UDG Healthcare plc.

Ofcom publishes provisional determination in respect of TelNG and Three’s dispute over National Telephone Numbering Plan. On June 2016, Ofcom published its provisional determination supporting Hutchinson 3G UK Limited’s (Three) argument that TelNG Limited (TelNG) had not complied with all of the restrictions and requirements under General Condition 17 of Ofcom’s General Conditions of Entitlement and, more specifically, the National Telephone Numbering Plan. Three had argued that TelNG’s UK03 service, which enables consumers to call international destinations using 03 numbers, constituted revenue sharing as TelNG uses the termination charge it receives for terminating the 03 call to pay for the international call as an additional service, which is prohibited by Ofcom.

Speeches & Publications

Trade Ministers meet to progress WTO Environmental Goods Agreement negotiations.On 2 June 2016, the Commission announced that Trade Ministers and senior officials from Australia, Canada, the EU, Japan, Korea, New Zealand, and the United States had met to progress negotiations in respect of an Environmental Goods Agreement, with a view to committing to eliminating “tariffs on a broad range of environmental goods”, providing environmental protection, promoting  economic growth, and creating green jobs.

European Council authorises EU to enter into agreement with the South African Development Community EPA Group. On 1 June 2016, the European Council announced that it had provided its authorisation to the EU to sign the South African Development Community (SADC) economic partnership agreement (EPA). The SADC EPA Group is comprised of Botswana, Lesotho, Mozambique, Namibia, South Africa, and Swaziland.