EU Antitrust

European Commission (Commission) opens formal Article 101/102 proceedings to investigate Amazon’s e­book distribution arrangements. On 11 June 2015, the Commission announced that it has opened formal proceedings to investigate whether business practices by Amazon in the distribution of e­books infringe Article 101 and/or Article 102 of the Treaty on the Functioning of the European Union (TFEU). The Commission is investigating clauses included in Amazon’s contracts with publishers that require publishers to inform Amazon about more favourable or alternative terms offered to Amazon’s competitors and/or offer Amazon similar terms and conditions as to its competitors, or through other means ensure that Amazon is  offered terms at least as good as those for its competitors. Initially, the Commission’s investigation will focus on e­books in English and German.

EU Mergers

Phase I Clearance

  • M.7421 – ORANGE / JAZZTEL (8 June 2015)
  • M.7562 – CANADA LIFE GROUP / LGII (8 June 2015)

EU State Aid

Commission approves restructuring aid for Slovenian Cimos Group. On 8 June 2015, the Commission announced that, following an in­depth investigation, it has decided to approve, under the 2004 Guidelines on rescue and restructuring aid, modified Slovenian plans to grant restructuring aid worth EUR97 million to automotive components manufacturer Cimos Group. Under the updated plan, the banks and the Slovenian State have agreed to restructure Cimos’ bank debt through a debt­for­equity conversion and extend the repayment period.

Commission orders Estonia and Poland to provide information on tax practices. On 8 June 2015, the Commission announced that it has ordered Estonia and Poland to provide information required to enable the Commission to assess whether certain tax practices breach the state aid rules. The Commission has been gathering information on tax ruling practices in various member states since June 2013. Using its powers under Regulation 659/1999, the Commission has issued information injunctions to Estonia and Poland, requiring the submission of the requested information within one month. The Commission has also asked 15 member states to provide a substantial number of individual tax rulings.

Commission approves creation of Latvian development institution to facilitate financing for small and medium­sized enterprises. On 9 June 2015, the Commission announced that it has decided to approve a Latvian project to establish a financial institution, the Latvian Single Development Institution (SDI). The SDI will facilitate access to finance for small and medium­ sized enterprises and other players that face obstacles to raise financing in the market. The Commission is satisfied that the SDI will address such market failures without unduly distorting competition in the internal market.

European Ombudsman finds maladministration in Commission’s handling of state aid complaint. On 10 June 2015, the European Ombudsman published a decision finding that the Commission failed to inform a complainant within a reasonable period of time whether his complaint regarding allegedly unlawful state aid was a priority case or not. This constitutes maladministration. The Code of Best Practice for the Conduct of State Aid Control Procedures requires that the Commission use its best endeavours to inform complainants of the priority status of their complaints within a two­month period. The Ombudsman found that the Commission did not provide the complainant with the relevant information until more than a year after he had lodged his state aid complaint.

Public Procurement

Advocate General gives Opinion on location requirement in procurement procedure. On 11 June 2015, Advocate General Szpunar gave an Opinion on a preliminary reference ruling from a Basque court regarding a location requirement in a call for tenders for public health services. The Advocate General considered that the requirements in the tender specifications limited the number of economic operators who would be able to bid in breach of Articles 2 and 23 of Directive 2004/18. The Advocate General considered that such requirements could not be justified in this case, although this was a matter for the referring court to decide based on the facts of the case.

Speeches & Publications

The Competition and Markets Authority (CMA) publishes further case studies and working paper in retail banking market investigation. On 5 June 2015, the CMA published two case studies and a working paper on Prospective entrants, as part of a series of papers to accompany the updated issues statement in the retail banking market investigation. The working paper considers the findings of the case studies, identifying a number of potential barriers to entry: customer inertia; the need for a physical presence/branches; and capital holdings requirements.

The Financial Conduct Authority (FCA) publishes policy statement and final rules to improve competition in the guaranteed asset protection (GAP) insurance market. On 10

June 2015, the FCA published a policy statement setting out its decisions on rule changes to improve competition in the GAP insurance market. In broad terms, the final rules will require firms distributing add­on GAP insurance to provide retail and commercial customers with prescribed information to encourage them to shop around and be more engaged when making decisions about purchasing the product. The final rules will also introduce a deferral period, with the result that GAP insurance cannot be introduced and sold on the same day.

Commission publishes study on ex post economic evaluation of competition policy enforcement. On 10 June 2015, the Commission published a staff paper reviewing the  literature on ex post economic evaluation of competition policy enforcement. The paper looks at the main lessons to be learnt for ex post evaluation practice; conclusions to be drawn from the empirical work on the micro­ and macro­economic impact of competition policy; and proposals for areas for further research.