Competition: Court of Justice of the European Union dismisses Bolloré's appeal against re- adoption of carbonless paper cartel decision

On 8 May 2014, the Court of Justice of the European Union (“CJEU”) handed down a judgment dismissing the appeal by Bolloré against a judgment of the General Court (“GC”) which had likewise dismissed Bolloré’s appeal against the Commission’s re-adoption of its decision in the carbonless paper cartel case. In its decision of December 2001, the Commission imposed fines totaling approximately EUR 314 million on 11 companies for their participation in a cartel in the market for carbonless paper. In 2007, the GC confirmed the existence and duration of the cartel and dismissed the appeals lodged against the Commission’s decision. In its decision of 2009, the CJEU held that the GC had breached Bolloré's rights of defence by not annulling the relevant part of the Commission's decision despite finding that the Commission's statement of objections was not sufficient to enable Bolloré to discover an objection against it or the facts relied on by the Commission. Therefore, the CJEU annulled both the GC's judgment and the Commission's 2001 decision, in so far as they related to Bolloré. In December 2009, the Commission sent a new statement of objections to Bolloré that addressed both the parental liability and the direct involvement of Bolloré in the same cartel. In June 2010, the Commission re- adopted its decision finding that Bolloré infringed Article 101 of the Treaty on the Functioning of the European Union (“TFEU”) through its participation in the carbonless paper cartel. The Commission also re-adopted a fine of approximately EUR 21 million which was reduced from the original fine of approximately EUR 23 million because Bolloré no longer contested the participation of its former subsidiary Copigraph in the early stage of the cartel. Bolloré lodged a further appeal with the GC against the re-adopted decision. The CJEU held that the GC had not erred in finding that Bolloré’s rights of defense had not been breached due, in particular, to the elapse of time between the infringement and the second statement of objections prior to the re-adopted decision. Furthermore, the CJEU found that the GC had correctly held that there had been no breach of the principle of equal treatment in making Bolloré liable for the actions of its subsidiary. Source: Judgment of the Court of Justice of the European Union C-414/12 P – Bolloré v European Commission, 08/05/2014

Competition (Finland): Finnish Competition and Consumer Authority carries out inspections in the market for interpretation services for disabled persons

The Finnish Competition and Consumer Authority (“FCCA”) has announced that it has as of 7 May 2014 conducted inspections at the premises of certain companies active in providing interpretation services  for disabled persons. According to the FCCA, the purpose of the inspections has been to investigate whether the companies have violated the current Finnish Competition Act, the former Act on Competition Restrictions and the Treaty on the Functioning of the European Union (“TFEU”) by engaging in  prohibited practices between competitors. The FCCA will hand down its decision in the matter after it has concluded its investigation. Source: The Finnish Competition and Consumer Authority’s Press Release 12/05/2014

Merger control: Commission opens in-depth investigation into proposed acquisition of Dutch cable operator Ziggo by Liberty Global

The Commission has opened an in-depth investigation into the proposed acquisition of Dutch cable operator Ziggo by the telecommunications group Liberty Global, headquartered in London. Liberty Global is active in the European Economic Area (“EEA”) in the telecommunications sector, operating cable networks in 12 countries. Ziggo is also active in the telecommunications sector in the Netherlands and especially in the markets for the retail provision of TV, fixed internet access and fixed telephony services. Liberty Global, through its subsidiary UPC, and Ziggo both own a cable network in the Netherlands and also operate a premium pay TV film channel there. The Commission’s initial market investigation revealed that the proposed acquisition is likely to raise competition concerns in various Dutch markets as the merger would bring together two main players. According to the Commission, the markets for the acquisition of individual Dutch language audio visual content, the acquisition of TV channels, the wholesale supply of premium pay TV film channels, and the retail provision of fixed internet access, TV and fixed telephony services would be affected. Firstly, at the wholesale level, the Commission has concerns that the transaction could significantly increase the merged entity’s negotiation power towards content owners and TV channel suppliers and thereby could negatively affect its competitors in retail pay TV and Dutch end customers. By combining the only two linear film channels in the Netherlands, Film1 and HBO, the transaction could also reduce the existing competition for the wholesale supply of premium pay TV film channels. Further, at the retail level, the Commission is concerned that the transaction could reduce existing competition in the Dutch retail pay TV and telecommunications markets where the parties hold significant market shares as the companies exert some indirect competitive pressure on each other, despite the fact that their cable networks do not overlap geographically. In the light of the high level of concentration, existing market transparency and high barriers to entry, the removal of Ziggo as an autonomous player could also increase the likelihood that the remaining competitors would coordinate their behavior and increase prices or delay  investments. Finally, the Commission’s investigations indicated that the merged entity might have the ability and incentive to shut out or otherwise hinder so-called “over-the-top” TV service providers, i.e. TV services provided streaming via the Internet, from effective access to its internet network in order to strengthen its own competitive position in various TV-related markets. The Commission has until 19 September 2014 to investigate the proposed transaction and to take a final decision. Source: Commission press release 08/04/2014

Merger control: Commission conditionally approves PVC joint venture between INEOS and Solvay

The Commission has conditionally approved the proposed combination of the European chlorvinyls businesses of INEOS AG (“INEOS”) of Switzerland and Solvay S.A. (“Solvay”) of Belgium into a newly created joint venture. INEOS is the parent of a group of companies which are active in the manufacture of petrochemicals, specialty chemicals and oil products. Its subsidiary, INEOS ChlorVinyls, is a European producer of chlor-alkali products and a supplier of polyvinyl chloride ("PVC"). Solvay is the parent of a group of companies which are internationally active in the research, development, production, marketing and sale of chemicals and plastics. Its subsidiary, SolVin, is a European supplier of PVC resins. According to the Commission, the proposed joint venture, as originally notified, would have removed INEOS' strongest competitor, Solvay from the commodity S-PVC market in North West Europe. Furthermore, the Commission’s investigation showed evidence that INEOS held, already before the transaction, a certain degree of market power, which enabled it to increase prices. The  Commission's investigation also revealed that the parties' competitors would have had neither the capacity nor the incentives to expand production sufficiently to outweigh a price increase by the new joint venture. Moreover, in the market for bleach in the Benelux, the proposed joint venture would have created a market leader with a market share above 60 %, whilst Akzo, the other remaining player, would clearly have been unable to sufficiently constrain the proposed entity to avoid price increases for customers. To address the Commission’s concerns, the companies offered to divest INEOS' S-PVC plants in Wilhelmshaven, Mazingarbe and Beek Geleen, together with the upstream chlorine and ethylenedichloride ("EDC") production assets in Tessenderlo and Runcorn. The proposed entity and the purchaser will enter into a joint venture agreement for producing chlorine at Runcorn. The divestment  will provide the purchaser with a fully integrated self-standing S-PVC business. According to the Commission, the commitments remove the overlaps between the parties’ activities in both the market for commodity S-PVC in North West Europe and the market for bleach in the Benelux. Therefore, the Commission concluded that the proposed joint venture would not significantly impede effective competition in the EEA or in any substantial part thereof. Source: Commission Press Release 08/05/2014

Merger control (Finland): Finnish Competition and Consumer Authority approves acquisition of parts of Pöyry’s real estate design and consulting and construction management businesses by Ramboll Finland

On 13 May 2014, the Finnish Competition and Consumer Authority (“FCCA”) accepted an acquisition of parts of Pöyry Oyj’s (“Pöyry”) real estate design and consulting and construction management businesses by Ramboll Finland Oy (“Ramboll”). The FCCA’s investigations revealed that the transaction would not prevent effective competition on the markets for real estate and infrastructure design and consulting, construction management and construction. Following the transaction, the merged entity will still face competitive pressure from various alternative players on the market. Source: The Finnish Competition and Consumer Authority’s Press Release 13/05/2014

Public procurement: Court of Justice of the European Union rules on the time limit for bringing a procurement action

On 8 May 2014, the Court of Justice of the European Union (“CJEU”) handed down its judgment on a reference from an Italian court on the time limits for bringing an action under the Council Directive 92/13/EEC of 25 February 1992 coordinating the laws, regulations and administrative provisions relating to the application of Community rules on the procurement procedures of entities operating in the water, energy, transport and telecommunications sectors, as amended by Directive 2007/66 (“Utilities Remedies Directive”). The referring court asked whether the time allowed for bringing an action for the annulment of the award decision starts to run again where the contracting authority adopts, after the expiry of that period, a decision which may affect the lawfulness of the award decision in question. Furthermore, the court asked whether, in the same situation, a tenderer may bring an action for the annulment of the award decision where it became aware of circumstances underlying that decision which may affect the lawfulness of the contract award procedure in question. The CJEU held that the time allowed for bringing an action for the annulment of the decision awarding a contract starts to run again where the contracting authority adopts a new decision, after the award decision has been adopted but before that contract is signed, which may affect the lawfulness of that award decision. That period starts to run from the communication of the earlier decision to the tenderers or, in the absence thereof, from when they became aware of that decision. When a tenderer becomes aware, after the expiry of the period for bringing an action laid down by national legislation, of an irregularity allegedly committed before the award decision was adopted, an action for the annulment of that decision may be brought only within that period, unless such a right of action is explicitly provided for by national law in accordance with Union law. Source: Judgment of the Court of Justice of the European Union C-161/13 –  Indrodinamica SpurgoVelox srl v Acquedotto Pugliese SpA, 08/05/2014

In addition, kindly note the following merger control decisions by the Commission which are published on the website of the Commission’s Directorate-General for Competition:

  • Commission approves acquisition of sole control over Dalkia International by Veolia Environment