Antitrust

Austrian ‘dark fibre’ rule approval to boost EU wireless operators. On 18 June 2014, the Commission published its Decision approving Austria’s inclusion of “dark” fibre-optic cable in its market for leased lines—high- speed telecom connections typically used by businesses. The decision by the Commission could prove a boon to mobile operators, which need a large volume of high-capacity connections for their base stations. In Austria, it promises to offer more affordable connections via state-of-the-art networks, whilst regulated “dark fibre” access could also give operators access to markets where former state phone monopolies still own a large share of the fixed telecom infrastructure. The decision may also be used by mobile operators to coax other national authorities to adopt a similar approach.

Cartels

ECJ dismisses appeal by FLS Plast against industrial bags cartel judgment. On 19 June 2014, the European Court of Justice (ECJ) handed down its judgment dismissing an appeal by FLS Plast A/S against the General Court’s judgment relating to its participation in the industrial bags cartel (Case C-243/12 P). The ECJ ruled that the General Court was right to presume that, during the relevant period, FLS Plast had exercised decisive influence over Trioplast Wittenheim (TW), given its 100% stake in TW over that period. The ECJ affirmed the Commission’s discretion to grant reductions in fines for co-operation but refused to make its own assessment of the facts to decide whether FLS Plast should have been awarded the same reduction as another participant, Bonar.

Appeal by Evonik Degussa against General Court judgment on calcium and magnesium reagents cartel. On 16 June 2014, details were published in the Official Journal of an appeal by Evonik Degussa GmbH and AlzChem AG against a General Court judgment that largely dismissed their action to challenge the calcium and magnesium reagents cartel decision. The appellants claim that the General Court erred, in particular, in relation to attribution of liability for the infringement and also in the assessment of the fine imposed.

EU Mergers

  • M.7228 – Centrica / Bord Gais Energy (13.06.2014)
  • M.7249 – ParexGroup / CVC (13.06.2014)
  • M.7251 – Gates / Blackstone (16.06.2014)
  • M.7260 – Tecgas / COGA / Grana y Montero / Enagas / CPPIB (18.06.2014)

State Aid

Commission adopts new rules to support important projects of common European interest. On 13 June 2014, the European Commission announced the criteria under which Member States can support transnational projects of strategic significance for the EU and for the achievement of Europe 2020 objectives, in line with EU state aid rules (IP/14/673). This is part of the Commission’s State Aid Modernisation (SAM) initiative, aimed at fostering growth and competitiveness in the EU. The communication will enter into force on 1 July 2014.

UK Antitrust

CMA decides no grounds for action in sports bra investigation. On 13 June 2014, the Competition and Markets Authority (CMA) announced that it has decided to close its investigation into alleged resale price maintenance by a manufacturer of sports bras and three UK department stores without taking further action. The Office of Fair Trading (OFT) had issued a Statement of Objections in September 2013. However, having reviewed the companies’ submissions, which disputed the allegations, the CMA’s Case Decision Group concluded that they had provided credible alternative explanations for certain evidence relied on by the OFT. Therefore, the CMA decided that it had no grounds for action in relation to the allegations set out in the statement of objections.

CMA announces guilty plea in criminal investigation into the supply of galvanised steel tanks for water storage. On 17 June 2014, the CMA announced that an individual charged with the criminal cartel offence under section 188 of the Enterprise Act 2002 has pleaded guilty (CE/9623/12). In January 2014, the Office of Fair Trading (OFT) announced that Peter Nigel Snee was charged with dishonestly agreeing with others to divide customers, fix prices and rig bids between 2004 and 2012 in respect of the supply in the UK of galvanised steel tanks for water storage.

UK Mergers

CMA publishes OFT decision on acquisition by Marlowe Holdings Investments of Western Electrical Holding. On 13 June 2014, the CMA published the full text of the Office of Fair Trading’s (OFT) Decision on the completed acquisition by Marlowe Holdings Investments Ltd of Western Electrical Holding Ltd. The OFT announced its decision not to refer this merger on 10 March 2014. The parties overlapped in the supply of wholesale electrical products in the south west of England. However, in each overlapping local area, the OFT found that the parties will face a range of credible competitors. This will provide sufficient rivalry and competition in the supply of electrical products to customers in these areas.

CMA decision on acquisition by Care Monitoring & Management of Panztel. On 17 June 2014, the CMA published the full text of its Decision on the completed acquisition by Care Monitoring & Management Limited of Panztel Limited. The parties are two of only three providers active in the supply to local authorities of centralised monitoring of external providers, and have a high combined share in this segment. However, the CMA also found that the parties are subject to strong remaining constraints within a changing market, including the switching, or threat of switching, by local authorities, to hybrid and devolved models of monitoring where there are many more providers present, the likely entry of one devolved model provider into the centralised model, and the threat of entry by further devolved model providers. The CMA considers that these constraints are sufficient to ensure that no realistic prospect of a substantial lessening of competition will arise as a result of the merger.

Speeches & Publications

European Council “Conclusions on energy prices and costs, protection of vulnerable consumers and competitiveness”, 13 June 2014. Conclusions

Competition and Markets Authority (CMA) “Cost pass-through: theory, measurement, and potential policy implications”, 17 June 2014Report