Competition Law Update | July 2016

Written on 12 Jul 2016

The news over the past few weeks has been dominated by the UK’s vote to leave the EU. From a competition law perspective, the UK has its own well-established competition law regime, which is closely modelled on the EU regime. Whatever trading relationship is ultimately agreed between the UK and EU, decisions made under UK competition law are unlikely to diverge materially from EU competition law in the short to medium term (read more).

Despite the Brexit vote, it remains business as usual from a competition law perspective. This month has seen important cases across the full spectrum, from abuse of dominance in France (read more) to Spanish football clubs penalised for illegal state aid (read more) and the launch of an investigation against AB InBev for allegedly restricting parallel trade (read more).

Whether you are doing business in the UK or outside, compliance should remain a high priority. In this edition, our experts provide valuable insight into how to minimise competition law risk across Europe (read more) and deal with dawn raids in Spain (read more).

Where Brexit may have a more immediate impact is competition litigation, with England currently a forum of choice for international cartel damages litigation. Coupled with the implementation of the Damages Directive in Europe, we consider where you should bring your follow-on claim in the future. Read more here.

Brexit may also affect the European Commission’s Digital Single Market initiative, with the UK a well-established and liberal player when it comes to tech, media and comms. We explore how the DSM might apply to UK businesses post-Brexit (read more) – and what the UK is doing itself on competition law and e-commerce (read more).

In Germany, our experts examine the FCO’s working paper on the market power of platforms and digital networks, guidance which is likely to be important across Europe (read more).

For more information on the potential implications of Brexit for your business, click here.

Please do contact our experts to discuss any of the issues raised in this Update.

Competition Compliance – minimising liability across Europe

As a top priority in risk management, competition law liability is recognised as posing a serious threat not only to businesses but individuals across a number of jurisdictions. Read more here about how you and your business can avoid falling foul of compliance requirements and thereby reduce the risk of competition law infringement.

German competition authority publishes working paper on market power of platforms and digital networks

On 9 June 2016, the German Federal Cartel Office published a working paper on the special characteristics of multi-sided platforms and networks and how they should be treated in antitrust cases. For further information on how the German competition authority analyses the competitive harm caused by large internet businesses, click here.

UK targets restrictions on online sales and RPM

Online sales continue to attract the attention of the CMA, particularly where suppliers are found to restrict the ability of resellers to offer discounts online. In May this year, Ultra Finishing Ltd was fined £786,668 for engaging in illegal resale price maintenance via internet sales. In June, ITW Limited was fined £2.2 million for issuing an illegal ‘discount policy’. Click here for updates on how to avoid infringing the competition rules when engaging in online sales.

Brexit and the Digital Single Market – what does this mean for your business?

Following the UK’s vote to leave the European Union, businesses are facing uncertainty as to how (and if) EU competition law will continue to apply to the UK. In particular, it is unclear what impact the Commission’s Digital Single Market will have on UK companies or companies trading online with the UK. For an update on how EU laws might apply post Brexit, read more here.

Where should I bring my follow-on claim in future? The impact of Brexit and the Damages Directive on international cartel damages litigation

Antitrust litigation is popular in jurisdictions such as the UK, Germany and The Netherlands, including ‘follow-on claims’ arising from cartel decisions in the EU Commission. It is too soon to predict whether the UK’s recent Brexit vote, coupled with the Damages Directive (which is designed to harmonise the laws across Member States), will change this position. We consider issues around choice of jurisdiction and the impact of the Directive here.

While the UK remains an attractive forum for claims, the UK competition authority is encouraging private enforcement in a number of ways. A new procedure was introduced by the Consumer Rights Act 2015, which allows claimants to bring straightforward claims using a ‘Fast Track’ process. In the first claim under this process, the Competition Appeal Tribunal has taken the claimant-friendly step of capping costs – read more here.

Dominance abuse in France – UMICORE fined €69.2 million

On 23 July, the Belgian group UMICORE was fined €69.2 million for implementing a trade policy which forced distributors into illegal exclusive agreements. The agreements were found to be anti-competitive due to UMICORE’s strong market position. Read more here about the threats made by UMICORE in its attempt to ‘tame’ the market.

Football Clubs pay the penalty for illegal public support

Seven Spanish football clubs, including FC Barcelona and Real Madrid, have been ordered to repay millions of Euros of illegal state aid. Read more here about how the Commission sought to establish a level playing field in respect of the financial support from Spanish public authorities.

After successful mega merger, AB InBev under scrutiny from European Commission

AB InBev is the world’s largest brewer and recently acquired the second largest, SABMiller. Just one month after the successful acquisition, AB InBev is facing renewed scrutiny by the Commission, but this time for alleged abuse of dominance for deliberately hindering imports of its beer from cheaper neighbouring countries, such as France and the Netherlands, into the more expensive Belgian market. Find out more here.

Upcoming events

  • 13 July 2016 – Annual Competition Conference, CNMC headquarters, Madrid