The European Commission (“Commission”) has accepted binding commitments from Areva SA and Siemens AG in connection with a joint venture non-compete obligation. In 2001, Areva and Siemens established a joint venture, Areva NP, which combined their activities in the field of nuclear technology. The agreement between Areva and Siemens included a non-compete clause with a maximum duration of 11 years from the termination of the joint venture. Areva acquired Siemens’s share of the joint venture in 2009.
The Commission subsequently opened an investigation into the scope of the non-compete clause. It took the view that the post-2009 scope of the clause was excessive, because (i) the clause prevented Siemens from competing in markets where Areva NP was only a re-seller of Siemens’ products; and (ii) a duration of three years would have been sufficient to protect the joint venture’s confidential business information. To address the Commission’s concerns, Areva and Siemens offered to limit the scope of the non-compete clause to Areva NP’s core products and services and to a period of three years following Siemens’ exit. In a statement dated June 18, 2012, the Commission confirmed that these commitments had allowed it to close its investigation. The investigation provides a reminder that non-compete clauses risk infringing competition law if their scope or duration extends further than necessary to protect the joint venture from competition from its parents. The case also illustrates the continuing relevance of the Commission’s Notice on Restrictions Directly Related and Necessary to Concentrations.