Rights to intervene in actions for annulment of a cartel decision
In October 2012, the Court of Justice of the European Union (CJEU) published orders dismissing appeals by Schenker AG against the General Court’s refusal to grant it permission to intervene in appeals challenging the European Commission’s decision in the air cargo cartel case. The CJEU confirmed the General Court’s view that the fact that Schenker was a customer of the cartel members, and intends to bring a damages action, is not sufficient to give it a direct and existing interest in the outcome of the appeal proceedings. In particular, the CJEU held that the mere fact that an undertaking might possibly be affected by high prices caused by an alleged cartel does not distinguish it sufficiently from the other economic operators in the relevant sector which are also affected by the anti-competitive practices of the members of a cartel. The CJEU pointed out that the purpose of proceedings relating to an action for annulment of a Commission decision punishing the anticompetitive conduct of an undertaking is not to make possible or facilitate the bringing of civil actions in the national legal system, such as claims for damages.
Third report on patent settlements
In July 2012, the European Commission published its third monitoring report into patent settlements in the pharmaceutical sector covering the period from January to December 2011. The Commission has found that the number of concluded settlements has increased over the last three years. However, 89% are prima facie unproblematic in competition terms. However, there was an increase in potentially problematic settlements during 2011 (although the overall level remains low). The Commission considers that this shows that there is a continuing need for it to continue to examine such patent settlements.
Clearance of two major acquisitions in the audiovisual sector
On 23 July 2012, the French Competition Authority cleared the acquisition of Direct 8 and Direct Star, two free-to-air channels, by Vivendi Universal and Canal Plus, the largest pay TV operator in France. This decision was subject to several commitments, whereby the purchasers accepted for a five year period to (i) limit their acquisitions of rights for American movies, American series and French films, (ii) use specific staff to negotiate the pay TV and free-to-air broadcasting rights and (iii) sell the rights of majorly important sporting events for free-to-air broadcasting. On the same day, the Competition Authority authorised the acquisition of TPS and CanalSatellite by Canal Plus and Vivendi, subject to various injunctions (relating to the purchase of movie rights, distribution of pay TV channels and video on demand), which were ordered to restore sufficient competition in the pay TV market.
Decision of Düsseldorf Higher Regional Court safeguards Bundeskartellamt’s leniency programme
In 2009, the Bundeskartellamt had detected a cartel agreement between coffee roasters on the basis of several leniency applications and imposed fines on the cartel members of approx. €160 million. Two of the coffee roasters appealed the decisions of the Bundeskartellamt and the case went to the Düsseldorf Higher Regional Court. Subsequently, several retailers being customers of the cartel requested access to the files, including the leniency applications. On 22 August 2012, the Higher Regional Court decided (Case reference: V-4 Kart 5 + 6/11 (OWi)) that the leniency applicants’ trust in the confidential treatment of their applications and documents submitted by them prevails over the information interest of the parties requesting access to the files. In the court’s view, the legitimate interest of customers who have suffered damages from a cartel can generally be adequately satisfied by the disclosure of the Bundeskartellamt’s decisions imposing fines.
Düsseldorf Higher Regional Court confirms prohibition of online video platform of RTL and ProSiebenSat.1
In March 2011, the Bundeskartellamt had prohibited a joint venture of RTL and ProSiebenSat.1 regarding the creation and operation of an online video platform. According to the Bundeskartellamt, the creation of the platform in its envisioned form would have further strengthened the collective dominance of the two broadcasting groups on the TV advertising market. In addition, the expected coordination of business interests via the joint venture would have constituted a violation of the prohibition of anti-competitive agreements. With the intended restrictions by RTL and ProSiebenSat.1, the platform would have preserved the competitive conditions on the TV advertising market and transferred them to the market segment of video advertising in online video content. The Higher Regional Court in Düsseldorf now shared the assessment of the Bundeskartellamt and confirmed the prohibition. The companies can still appeal to the German Federal Supreme Court (BGH).
Supermarket fined for abuse of dominant position
In July 2012, the Italian Competition Authority (ICA) held that Coop Estense had abused its dominant position in the market for supermarkets and superstores in the province of Modena by seriously delaying, if not blocking outright, the entry or expansion of one of its competitors (Esselunga) in this province.
According to the ICA, Coop Estense had implemented a strategy from 2001 to 2009 in which the company systematically meddled in its competitor’s efforts to open new grocery sales points, intervening instrumentally in the administrative procedures which had been initiated by Esselunga to obtain the necessary permits. These practices enabled Coop Estense to uphold and strengthen its dominant position in the related markets which reached 66% of the superstore market and 47% of the supermarket market in the Province of Modena in 2011. The ICA imposed a 4.6 million euro sanction on Coop Estense.
Refusal to grant full immunity to first leniency applicant in vertical resale price case
On 30 August 2012, the OCCP announced that it had refused full immunity for IMS Sofa Sp z.o.o. The company revealed in a leniency application that it had set minimum resale prices, and had applied for full immunity, which under Polish law is possible even for vertical arrangements. The OCCP reduced the fine by half, but refused to grant full immunity on the grounds that the distribution agreements in question were concluded on the basis of a template provided by the company, and thus the company could be considered as the initiator of the anti-competitive practice (decision RGB - 19/2012).
Fine for exploiting weaker contractual parties
On 27 August 2012, the OCCP fined Mennica Polska, the only distributor of public transport tickets in the city of Wrocław, Euro 37 000 for abuse of a dominant position by exploiting weaker contractual parties (decision RWR - 29/2012). Contracts proposed by the company to its retailers provided for onerous terms as they granted only to Mennica Polska a right to demand contractual penalties and a right to terminate the agreement without notice.
First fine on an individual
On 28 September 2012, the Spanish Competition Commission (“SCC”) imposed a fine of €50,000 on Mr. Joan Gaspart, the current Chairman of the Tourism Board of the Spanish Confederation of Business Organisations (Confederación Española de Organizaciones Empresariales, “CEOE”) for recommending to the hotel management sector a price increase in hotel prices. In particular, the SSCC considered that his intervention in a specialist forum for tourism where he stated the need for increasing hotel prices led to a common course of action for hoteliers. Furthermore, Mr Gaspart reaffirmed his point of view a week later, when he quantified the increase in a specific percentage (6 to 7%).
A fine of €150,000 was also imposed on CEOE for its joint responsibility for the price signaling infringement.
This is the first fine ever imposed upon an individual for an infringement of the Spanish Competition Act 2007.
Spanish Government partially overturns SCC’s decision in Antena 3/La Sexta
On 27 August 2012, the Council of Ministers (the “CoM”) amended the conditions previously imposed by the SCC upon the merger of TV operators Antena 3 and La Sexta.
On 13 July 2012, following an in-depth Phase 2 investigation, the SCC approved the merger subject to relatively strict conditions. Antena 3 publicly announced that the conditions imposed made the transaction virtually impossible since they neutralized all the synergies and therefore any foreseeable benefit for the parties. Moreover, the TV company claimed that the conditions imposed upon the recent merger of Telecinco and Cuatro (the other two open TV channels) were significantly softer.
The CoM finally decided to significantly amend the SCC’s conditions so that they resembled more closely the conditions imposed in the Telecino/Cuatro case, using its powers to review SCC decisions when the general public interest is at stake. The CoM in particular considered that should the merger not take place technological innovation and media pluralism would be negatively affected.
New fining guidance
Following a public consultation earlier this year, the OFT published its revised guidance as to the appropriate amount of a penalty under the Competition Act 1998. One of the key changes is the revised threshold for calculating the starting point of a fine, which has been increased from 10% to 30%. The revised guidance came into effect on 10 September 2012, and applies to cases where a statement of objections is issued after that date.
Court of Appeal judgment on “anchoring” of defendants
On 13 September 2012, the Court of Appeal dismissed an appeal against a High Court judgment that refused to strike out an action brought against a UK company that was not an addressee of a European Commission cartel decision (KME Yorkshire Ltd and others v Toshiba Carrier UK Ltd and others). The court held that the claimants had alleged sufficiently clearly in their particulars of claim that the UK subsidiary of KME had participated in and implemented the cartel arrangements with knowledge of the cartel agreement.