EU Competition

EU – Phase I merger notifications published in the Official Journal

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Kraft/Cadbury merger clearance with conditions The European Commission (“Commission”) has cleared the proposed acquisition of Cadbury PLC by Kraft Foods Inc. by way of public offer. The decision is conditional upon the divestment of the Polish and Romanian chocolate confectionery businesses of Cadbury. Click here for more information.

Pharmaceuticals: Commission opens formal proceedings against Lundbeck The Commission has opened a formal antitrust investigation into the international pharmaceutical undertaking Lundbeck to examine potential breaches of EU rules on restrictive business practices and on the abuse of a dominant market position. The Commission intends to investigate unilateral behaviour and agreements by Lundbeck which may hinder the entry of generic citalopram, an anti-depressant drug originally developed by Lundbeck, into markets in the EU. Click here for more information.

Commission launches consultation on best practices in antitrust proceedings The Commission has launched a public consultation on best practices in antitrust proceedings and the submission of economic evidence, and on the role of the Hearing Officers in the context of antitrust proceedings. Interested parties have until 3 March 2010 to submit comments on the consultation documents. Click here for more information.

UK Competition

OFT refers local bus services to Competition Commission The OFT has referred UK local bus services, excluding London and Northern Ireland, to the Competition Commission (“CC”). The decision follows consultation on the results of an OFT market study into the industry. The study found evidence that limited competition between bus operators tends to result in higher prices and lower quality for bus users and may represent poor value for money for taxpayers. The CC has invited evidence from all interested parties and is required to issue a Report by 6 January 2012. Click here for more information.

CAMRA appeals OFT decision at the CAT The Campaign for Real Ale (CAMRA) has brought an appeal at the Competition Appeal Tribunal (“CAT”) against the OFT’s decision of 22 October 2009 in response to CAMRA’s super-complaint in connection with certain features of the market for the supply of beer in the UK. In particular CAMRA complained to the OFT about the impact that the use of beer ties have on consumers, which CAMRA calculated to be in the region of £2.5 billion per annum. However, the OFT found that there is effective competition between pubs at the retail level and that the interests of large pub companies would appear to be aligned with the interests of lessees. The OFT therefore refused to conduct a further market study or to refer the matter to the CC for a market investigation. Click here for a summary of CAMRA’s application to the CAT.

CAT dismisses Carphone Warehouse’s disclosure application The CAT has dismissed an application by Carphone Warehouse for disclosure to an Executive Director of its subsidiary, TalkTalk, of information which is subject to a confidentiality ring. The CAT decided that Carphone Warehouse had failed to put forward any convincing reason why it could not properly conduct its appeal without this disclosure. Carphone Warehouse had applied for disclosure of a complex model created by the Office of Communications (“OFCOM”) during the course of its investigation into the provision by BT Openreach of unbundled local loop services. Carphone Warehouse is currently appealing against a decision by OFCOM which sets a new pricing framework for BT Openreach in relation to unbundled local loop services. Click here for a copy of the CAT’s Ruling.

CAT rules that CC must pay Sports Direct’s costs The CAT has ruled that the CC must pay the reasonable costs incurred by Sports Direct in its application for judicial review of a decision of the CC. In the decision, the CC refused to provide information that had been redacted from certain working papers prepared during its investigation into the completed acquisition by Sports Direct of 31 retail outlets from JJB Sports. The CAT upheld Sports Direct’s application. The CC, supported by the OFT, had submitted that Sports Direct’s application was premature given that the redactions appear in working papers and not in any provisional or final decision and, in any event, may not be relied upon in any such decision. The CAT ruled that Sports Direct’s application was not premature, that Sports Direct was, at least potentially, adversely affected by the suggested findings contained in the working papers and that real injustice could have resulted from the CC’s decision to withhold material information supporting those findings. Click here for a copy of the CAT’s cost order. A copy of the CAT’s Judgement is available on the CAT’s website.