Phase I Mergers
- M.8204 BARLOWORLD SOUTH AFRICA / BAYWA / JV (9 January 2017)
- M.8325 KKR / HILDING ANDERS (9 January 2017)
Gascogne awarded €50,000 in damages claim against General Court. On 10 January 2017, the European Court of Justice (ECJ) awarded French industrial-bag maker Gascogne Sack Deutschland (formerly Sachsa Verpackung) and Gascogne (formerly Group Gascogne) just over €50,000 in damages. In February 2006, Gascogne Sack Deutschland and Gascogne brought actions before the General Court seeking the annulment of a decision adopted by the European Commission (Commission) in a case concerning a cartel in the industrial plastic bags sector. In November 2011, the General Court dismissed those actions. On appeal, in November 2013, the ECJ upheld the judgments of the General Court. However, the ECJ noted the two companies could bring actions for damages which the companies may have suffered as a result of the excessive length of the proceedings before the General Court. In turn, the companies’ brought claims for damages totalling nearly €4 million. In handing down its judgment, the ECJ noted that the European Courts may incur non-contractual liability if the relevant institution’s conduct was unlawful, actual damage was suffered by the party to the proceedings and there is a causal link between the unlawful conduct and the damages pleaded. The ECJ held that these conditions were satisfied and awarded damages of €47,064.33 to Gascogne for the material harm it suffered (due to the costs that it had to pay during the unjustified period of inactivity of the General Court in relation to the bank guarantee provided to the Commission) and damages of €5,000 to each of the two companies for the non-material harm they suffered as a result of the excessive length of proceedings before the General Court. The ECJ also awarded interest on these amounts, as well as additional late payment interest.
General Court dismisses action by Topps against the Commission. On 11 January 2017, the General Court dismissed an action by collectible football cards seller Topps Europe (Topps) against a decision by the Commission to reject Topps’ complaint concerning alleged antitrust breaches by its competitor Panini SpA, Fédération internationale de football association (FIFA), the Union of European Football Associations (UEFA), the French Football Association, the Italian Footballers’ Association, the Royal Spanish Football Federation, and the German Football Association in relation to the licensing of and the grant of intellectual property rights for the purposes of producing stickers and trading cards relating to the FIFA Football World Cup and UEFA European Football Championship tournaments. The Commission decided not to investigate Topps’ allegations because the Commission believed the alleged grants of exclusive intellectual property rights were unlikely to breach antitrust legislation and that there was only a limited likelihood of establishing an infringement. The General Court ruled that the Commission was correct and held that the Commission had not breached Topps’ rights of defence by denying full access to the documents in the file. Further, the General Court also found that the Commission had not committed any of the “manifest errors of assessment” alleged by Topps in deciding not to pursue Topps’ complaints. In particular, the General Court held that the Commission had not erred in its assessment of the relevant market definition, in its consideration of alleged exclusive purchasing obligations, in its assessment of dominance, and in concluding that the practices complained of were unlikely to breach Article 102 of the TFEU.
ECJ confirms €59.85 million cartel fine imposed on Roullier group. On 12 January 2017, the ECJ rejected an appeal and upheld a fine of €59.85 million imposed jointly and severally on Timab Industries and its parent company Compagnie Financière et de Participation Roullier (together, the Roullier group) by the Commission in 2010 for the Roullier group’s involvement in a cartel relating to the animal feed phosphate market. During the Commission’s settlement procedure, the Roullier group were given an indication of the amount of the fine the Commission was planning to impose against the Roullier group (which included a 10% settlement discount). Once the Roullier group had received the estimated fine, they decided not to participate in the Commission’s settlement procedure and instead contested their involvement in the cartel. As no settlement procedure discounts were available, during its final decision, the Commission handed down a larger fine to the Roullier group than was indicated in the settlement procedure. The Roullier group brought an action before the General Court to appeal the Commission's decision, which the General Court dismissed in 2015. The Roullier group then appealed the fine, alleging that the Commission had awarded a punitive fine because the Roullier group did not choose to settle. The Roullier group further argued that although they did not dispute the duration of the cartel taken into consideration by the Commission (1978 to 2004), during the standard procedure, the Roullier group successfully argued that its participation in the cartel was limited to a shorter period between 1993-2004, for which they paradoxically were awarded a larger fine. The ECJ found that the Roullier group had suffered no discrimination for not settling the case. The ECJ held that the Commission was entitled to "review" the fine to be imposed on the Roullier group as new information had come to light after the company declined to proceed with the settlement. The higher fine awarded for a shorter period of infringement was explained by the fact that the Commission had been willing, during the settlement procedure, to grant further reductions to the Roullier group for the information provided by that group in respect of the period 1978-1993. The ECJ confirmed that the fine imposed on the Roullier group reflected the “gravity and duration of the infringement” and was an “accurate application of the rules concerning the calculation of fines”. The Roullier group’s additional claim that the General Court did not give a ruling within a reasonable period (the proceedings lasted approximately four years and nine months) was struck out by the ECJ due to the absence of evidence of harm.
Commission conditionally approves restructuring plan of French Areva Group. On 10 January 2017, the Commission announced it has conditionally approved plans by France to support restructuring plan of the French Areva group with a capital injection of State aid in the amount of €4.5 billion. Areva is 86.5% directly and indirectly owned by the French State, and is active across the nuclear fuel cycle market. It is in serious financial difficulty and as a result, France submitted a restructuring plan to the Commission for assessment in April 2016. The plan provided for certain divestments and increased focus on the production of electricity from nuclear power reactors. The Commission has now conditionally approved this plan, noting that Areva’s withdrawal from the nuclear reactor business will allow the group to focus on a clear and profitable nuclear fuel cycle activities business, and will significantly reduce the group's activities in the nuclear sector and thereby limit any distortions of competition. Noting that Areva will finance a significant part of the restructuring costs with proceeds from planned asset sales, and that restructuring aid is not payable until the satisfaction of certain regulatory tests, the Commission also approved an interim loan of €3.3 billion from the French state. The conditions for the Commission’s approval include a positive outcome of a test on the Flamanville III nuclear power plant and the clearance of the divestment of Areva's nuclear-reactor business under EU merger rules. The French authorities will submit regular monitoring reports to the Commission until the restructuring period of Areva comes to an end in 2019.
Commission approves support for Delimara Gas and Power Energy Project in Malta. On 11 January 2017, the Commission announced that it has decided, under the state aid rules, to approve support for the Delimara Gas and Power Energy Project in Malta. The Project comprises the development of a floating liquid natural gas storage unit and a new combined cycle gas fired power plant. The storage unit will supply gas to the new power plant as well as to an existing plant. Electrogas Malta, the operator of the Delimara plant, will receive payments from Malta for providing energy to Maltese public electricity company Enemalta. According to the Commission, it is satisfied that this measure compensates Electrogas for the additional cost of fulfilling this public service obligation, without any overcompensation, and is in line with the Commission's 2011 rules on services of general economic interest.
CMA accepts undertakings in Novomatic / Talarius merger. On 11 January 2017, the Competition and Markets Authority (CMA) announced that it had accepted undertakings in lieu of a reference for the completed acquisition by Novo Invest GmbH acting through Novomatic UK Ltd of Talarius Limited.
CMA clears VTech / LeapFrog merger. On 12 January 2017, the CMA announced that it has formally cleared the merger of children’s toymakers, VTech and LeapFrog. According to the CMA, an in-depth investigation by a group of independent CMA panel members has confirmed that the merger may not be expected to result in a substantial lessening of competition. The group found that while the companies are close competitors in the supply of learning toys for 0 to 5 year olds, there are numerous other credible suppliers in the sector, and VTech and LeapFrog were not each other’s closest competitor. The group also found that the market for child tablets and content is evolving rapidly, with new entrants and an increasing number of alternatives available for child-appropriate content on electronic devices.