EU Competition

UBS, HSBC and five others targeted in Swiss metals-trading probe. On 28 September 2015, the Swiss Competition Commission announced in a statement that it has launched an investigation among seven banks into illegal agreements on bid-ask spreads in the trading of precious metals such as gold, silver, platinum and palladium. This follows an announcement last month made by the European Commission (Commission) that it is investigating alleged anti-competitive behaviour among companies involved in the spot trading of precious metals.

Timab Industries appeal against General Court judgment in animal feed phosphates cartel. On 28 September 2015, details were published in the Official Journal of an appeal by Timab Industries (Timab), and its parent company CFPR, against a judgment of the General Court delivered on 20 May 2015 that dismissed their challenge against a fine imposed by the Commission for their role in facilitating the animal feed phosphates cartel. The appellants claim that the General Court erred in law, breached various legal principles and misconstrued the scope of its unlimited jurisdiction in reviewing the fine imposed on Timab and the duration of its involvement in the cartel. The appellants also claim that the proceedings before the General Court were unreasonably long, disregarding the appellants’ right to a fair trial.

EU Mergers

Phase I Mergers

  • M.7691 Apollo / OMG (25 September 2015)
  • M.7740 Apollo Management / CDG (25 September 2015)
  • M.7753 SACYR / Fluor Corporation / Fluor Spain (25 September 2015)
  • M.7756 Providence Equity / Chime (29 September 2015)
  • M.7712 KSPG / HASCO / COSMO / JV (29 September 2015)
  • M.7532 Interseroh / ALSO Deutschland / ALSO Bringback (30 September 2015)
  • M.7697 Aeroports de Paris / Select Service Partner Group / JV (30 September 2015)
  • M.7761 Permira / OTPP / GFKL Group / Lowell Group (1 October 2015)
  • M.7743 Trailstone / E2M (1 October 2015)
  • M.7595 TDR Capital / Leaseplan (1 October 2015)

State Aid

Commission opens in-depth investigation into the exemptions for transfer and transit passengers from Irish air travel tax. On 28 September 2015, the Commission announced its decision to launch an in-depth state aid investigation into the exemptions granted by Ireland to airlines from paying air travel tax for transfer and transit passengers. This follows a General Court judgment in November 2014, which upheld an action by Ryanair to challenge the Commission’s 2011 decision that the non-application of the air travel tax to transit and transfer passengers did not constitute state aid because the disputed measure was not selective. The General Court concluded, however, that the Commission’s preliminary investigation and analysis of the issue of selectivity was incomplete and insufficient. It held that the Commission should have initiated the formal investigation procedure to gather any relevant information to verify whether the disputed measure was selective and to allow interested third parties to present their observations. The Commission states that it will now investigate whether the tax exemption provides certain companies with a selective advantage, for the purposes of Article 107(1) of the Treaty on the Functioning of the European Union. It will examine, in particular, whether the exemption serves to avoid levying the tax twice on the same journey, and whether exempting transfer flights only when they were booked in a single-booking discriminates against airlines not applying a single-booking policy. The opening of an in-depth investigation gives interested third parties an opportunity to submit their comments but does not prejudge the outcome of the investigation.

Hungarian power provider loses bid to overturn EU decisions on state aid. On 1 October 2015, the European Court of Justice (ECJ) handed down its judgment on appeals brought by Hungarian power-station operator, Dunamenti Erőmű Zrt. (Dunamenti Erőmű) and Electrabel SA (Electrabel) against the General Court ruling upholding a Commission decision. The parties lost their bid to overturn a finding by the Commission in 2008 that it received illegal state aid in the form of long-term power purchase agreements (PPA). In 2008, the Commission ordered Hungary to terminate the PPAs under which the country’s state-owned electricity distributor purchased a fixed-volume of electricity at a set price from Dunamenti Erőmű and Tisza Erőmű. The Commission stated that the agreements amounted to illegal subsidies to power generators and ordered the Hungarian government to recover the aid as it stifled competition. As regards Electrabel’s appeal, the ECJ concluded that the appeal was inadmissible, as it had not been a party to the proceedings before the General Court. Regarding Dunamenti Erőmű’s appeal, the ECJ found that the General Court had made no error in classifying the PPAs as state aid; nor had it erred in confirming the methodology used by the Commission for the purposes of calculating the amount of aid to be repaid.

UK Competition

Entry into force of the Consumer Rights Act 2015. On 1 October 2015, the right to bring consumer collective actions for anti-competitive behaviour under the Consumer Rights Act 2015 came into force. The provisions, which provide for both opt-out collective actions and opt-out collective settlements will mean claimants are automatically included in the action unless they “opt-out” in a manner as decided by the Competition Appeals Tribunal (CAT) on a case-by-case basis. The opt-out aspect will only apply to UK-domiciled members of the relevant class (class members domiciled outside the UK will be required to expressly opt-in if they wish to join the collective proceedings), and will apply to claims brought on or after 1 October 2015, even if the infringement of competition law to which the claim relates occurred prior to that date. The legislation also introduces a “fast-track” procedure for relatively straight-forward claims brought before the CAT. In such cases, the main substantive hearing should commence as soon as practicable and, in any event, within six months of an order of the CAT stating that the particular proceedings are to be subject to the “fast-track” procedure.

CMA consults on revised undertakings in lieu in Muller/Dairy Crest merger. On 30 September 2015, the Competition and Markets Authority (CMA) issued a consultation on a revised version of the undertakings that it intends to accept in lieu of referring the proposed acquisition by Müller UK & Ireland Group LLP of Dairy Crest’s dairy operations to a Phase II investigation. The modified undertakings include a new price review mechanism, a new pricing obligation, the transfer of know-how, an enhanced firewall and increased compliance monitoring. The CMA has taken the preliminary view that the modifications are appropriate to remedy, mitigate or prevent various competition concerns. The CMA invites comments on the modified undertakings by 7 October 2015 and is expected to make a final decision on whether to accept the modified undertakings or refer the merger for a Phase II investigation by 19 October 2015.

CAT publishes new Guide to Proceedings 2015. On 1 October 2015, the CAT published the new Guide to Proceedings 2015 (Guide). The Guide describes the statutory functions of the CAT and its constitution, provides commentary on the Competition Appeal Tribunal Rules 2015 (CAT Rules) and deals in detail with private actions, collective actions and the CAT’s procedure. The Guide applies to the conduct of proceedings before the CAT commenced on or after 1 October 2015 in accordance with the CAT Rules.

Speeches & Publications

National regulators should approach EU Commission promptly when conclusions diverge, Lasserre says. On 29 September 2015, Bruno Lasserre, the head of the French Competition Authority, speaking at the Georgetown University Law Center Global Antitrust Enforcement Symposium, Washington D.C., said that national regulators should approach the Commission promptly if there is a chance they will arrive at a divergent conclusion to the Commission in antitrust investigations. This view centres around the disparity among competition agencies in relation to the investigation into online travel agencies including Priceline’s, Expedia and HRS and their contracts with hotels. Lasserre was of the view that the Commission could have centralised the case.