In May 2004 two providers of tourist bus tours, De Boeck Invest NV and Nidco NV established a non full-function joint venture, Brussels City Tours (“BCT”), which would distribute tickets for “hop on hop off” tours and “one day trip” tours in/from the Brussels Capital Region and organised by its parent companies. The parties to the joint venture also agreed that BCT would coordinate the schedules and routes of the tours they offered.
In July 2004 these agreements were notified to the Competition Council in order to obtain negative clearance on the basis of Article 6, § 1 of the old Competition Act of 1999. In 2006 the new Competition Act (which abolished the system of negative clearance) came into force, which meant that the notifications that were made under the former Act were no longer valid. However, the Competition Prosecutor decided to initiate an ex officio investigation into the agreements concerning BCT and issued a Statement of Objections to the parties. After the receipt of the Statement of Objections, the undertakings concerned set out commitments (pertaining to the way the price of the “hop on hop off” tickets would be calculated and the way the parties would approach potential customers and relate to competitors) in order to remove the competition concerns identified by the Competition Prosecutor. However, these commitments were found not to resolve the concerns as there were serious reservations regarding their effectiveness and the Competition Prosecutor transferred the case to the Competition Council.
The Competition Prosecutor alleged the existence of an agreement on price, as the parties fixed the selling price which BCT should use for the various tours. He also found that there was an allocation of markets, as the distribution agreement provides a precise breakdown of “hop on hop off” and “one day trip” activities between De Boeck and Open Tours. This would result in coordinated behaviour between De Boeck and Open Tours eliminating all competition between the two companies on prices, the frequency of stops, the number of vehicles, etc. According to the Prosecutor, this would mean that the agreement would have as its object the restriction of competition contrary to Article 2, §1 of the Competition Act.
However, the Competition Council ruled that in the context of cooperation between the parties these contractual restrictions were in fact necessary. This decision was in particular based on § 90 of the European Commission Guidelines on horizontal cooperation, which stipulates that an agreement on production or prices will not be assessed separately, but in light of the overall effects of the joint venture on the market to determine whether Article 81, §1 of the EC Treaty applies. In light of the nature of the joint venture agreement and the structure of the market in which it operated, the Council decided that the agreement did not constitute a restriction of competition. The Council noted as well that the Prosecutor had not demonstrated that the restrictions stemming from the cooperation agreement had, or may have had, anticompetitive effects, or significantly altered the structure of the market or were able to do so. The Council also concluded that there was no restriction by effect and therefore that the agreement did not infringe Article 2, § 1 of the Competition Act.