Home / Newsletter 2013 / Monthly Newsletter ISSUE n.9 October 2013

Monthly Newsletter ISSUE n.9 October 2013

UK

October 31, 2013

OFT decided it has no grounds to take action in CH Jones bunker fuel case

The OFT has concluded that it has no grounds to take action against fuel cardoperator CH Jones over alleged abuse of dominance.

The OFT investigated the firm following a complaint that CH Jones was engaging in an exclusionary conduct, the objective of which was said to be to remove competition, including its main rival, from providing diesel bunker cards (direct bunkering cards and pay-as-you-go bunker cards) to lorry operators.

Having issued a Statement of Objections, the OFT conducted a careful reassessment of the evidence and considered representations from CH Jones and the complainant. As a result, the OFT considered that it did not have sufficient evidence to demonstrate CH Jones’ dominance. Therefore, the OFT has decided to close its investigation with a formal finding that on the basis of the information in its possession there are no grounds to take action.

More information can be found here

Source: OFT

Switzerland 

October 25, 2013 

New supply policy of watchmaker Swatch Group approved

The Swiss Competition Commission (WEKO) agreed on the new supply policy of Swatch Group, which consists in reducing gradually its mechanic clock units so that by 2018/2019 it will amount to 55% of the volumes sold on average during the years 2009-2011. The gradual reduction was approved under the conditions (i) that clients will be treated without discrimination and (ii) that particular hardships are avoided for small and medium sized companies.

Other supply obligations of Swatch Group regarding “assortiments” (regulated parts) remain unchanged.

More information can be found here

Source: WEKO

 

Italy 

October 24, 2013 

The Italian Antitrust Authority, Autorità Garante della Concorrenza e del Mercato (AGCM) decided to publish the commitments proposal offered by the Ferrovie dello Stato Group [State Railways]

During its meeting of 22 October 2013, the AGCM decided to publish the commitments presented by Ferrovie dello Stato S.p.A., Rete Ferroviaria Italiana S.p.A., Trenitalia S.p.A., Grandi Stazioni S.p.A., Centostazioni S.p.A. and FS Sistemi Urbani S.r.l. Specifically, the AGCM assessed their suitability in correcting the anti-competitive conduct under investigation and published the related proposal on its web site.

As known, last May the AGCM decided to launch an investigation into the FS group that aimed to ascertain whether or not the FS group abused its dominant position in national markets: for access to the railway infrastructure needed for rail passenger transport, for management of advertising spaces in the main rail stations and for high-speed passenger services.

According to the AGCM, FS through its subsidiary would have obstructed NTV to enter as a new competitor into the markets under discussion. This conduct would have been aimed to favour Trenitalia, at the expenses of the end users.

Interested third parties may submit their own observations about proposed commitments by 23 November 2013. In light of this, the investigated group could submit its reply by 23 December 2013.

The legal deadline of the related sub proceeding has been set at 22 January 2014.

More information can be found here

Source: AGCM

 

Switzerland 

October 23, 2013 

Swiss Competition Commission extends investigation into road construction and civil engineering

Since April 2013 the Swiss Competition Commission (WEKO) is investigating the construction sector of the region See-Gaster (Canton St. Gallen) and other neighbouring regions. Now (October 2013) WEKO has broadened its investigations and has carried out dawn raids at premises of several additional companies. The Competition Commissions inquiry found preliminary indications of possible anti-competitive practices in the industry involving bid rigging and agreements concerning the allocation of clients and/or construction projects.

More information can be found here

Source: WEKO

 

Germany 

October 23, 2013 

The German Competition Authority announced on 23 October 2013 that it withdraws abuse of dominance proceedings against Compador Technologies GmbH

The Bundeskartellamt has ended its abuse of dominance proceedings against Compador Technologies GmbH, an affiliated company of Deutsche Post AG (DPAG). The proceedings were initiated after Compador had refused to continue a maintenance service contract for letter sorting machines with PostCon Deutschland GmbH, a competitor of DPAG. Compador has now submitted to PostCon a proposal for a new contract that complies with competition law requirements.

Compador develops, produces and services letter sorting machines for alternative postal service providers. One of its customers is PostCon, a company affiliated with the Netherlands-based PostNL via TNT Post Deutschland B.V.& Co. KG. At the end of 2012, DPAG acquired a minority stake in Compador Technologies GmbH as well as in the newly established Compador Dienstleistungen GmbH, a consolidator and new entrant in the market. Consolidators are companies which collect letter and post items from business customers and hand them over to the DPAG mail sorting centres for delivery. Around the time of DPAG’s acquisition of stakes in Compador, the maintenance services contracts for the sorting machines supplied by Compador to PostCon were terminated.

After the conclusion of the proceedings, PostCon has decided not to conclude a new maintenance service contract with Compador because of other business considerations.

More information can be found here

Source: Bundeskartellamt

 

Luxembourg 

October 23, 2013 

The Luxembourg competition authority, Conseil de la Concurrence, (the Authority) has fined two undertakings in the railway sector for having concluded an illicit agreement 

The Authority has issued a decision on 23 October 2013 establishing a breach of competition law for an unlawful agreement between two German undertakings active in the production and sale of railway tracks for the Luxembourg National Railways Company (CFL). The fine imposed reached a total of almost €1.3 million.

The two German undertakings, Voestalpine BWG and Schreck-Mieves GmbH, together with the company Kihn S.A. and its subsidiary, had entered into a cartel with the objective to restrain competition in the public bid riggings issued by the CFL over the period 2005-2011.

The Authority has found that the two undertakings had agreed in a secret and illicit mode in order to reserve to the producer of the railway tracks Kihn the exclusivity of the public bid riggings in Luxembourg. In exchange Kihn had undertaken not to enter on the German market for the railway tracks.

Kihn and its subsidiary have reported first the cartel following the leniency procedure and as such have been exonerated from the sanction. In assessing the fine level to the two German undertakings the Authority has taken into account the duration of the cartel and the cooperation during the investigation procreedings.

The fined companies have within three months to appeal the Authority’s decision, otherwise the decision will be final.

More information can be found here:

Source: Conseil de la Concurrence
UK 

October 22, 2013 

The UK Competition Authority, OFT launched a call for information on undergraduate higher education in England

The OFT has launched a call for information on the provision of undergraduate higher education in England by universities and other institutions. Universities play a crucial role in the UK economy. They contribute directly to economic growth, employment and local economic activity, delivering skilled workers into the wider economy, and contributing to export earnings. In many respects, UK universities are world leaders in research and teaching. Recent reforms in England have aimed to give students greater choice and to drive greater competition between universities, within policies designed to achieve Government objectives such as ensuring fair access to higher education. In launching this project, the OFT wants to understand whether universities are able to compete effectively and respond to students’ expectations. It also wants to understand whether students are able to make well-informed choices, which help to drive competition, to support them in acquiring the skills and knowledge necessary for themselves and the wider economy.

More information can be found here

Source: OFT

 

Germany 

October 17, 2013 

The German Competition Authority, Bundeskartellamt concluded cartel proceedings against manufacturers of household porcelain

The Bundeskartellamt imposed on October, 17th a fine totalling just under € 900,000 on the companies Porzellanfabrik Christian Seltmann GmbH and KAHLA/Thüringen Porzellan GmbH, the ceramic industry association (Verband der Keramischen Industrie) and two individuals involved. With this fining decision it has concluded its investigation proceedings against manufacturers of household porcelain on account of anticompetitive agreements.

The proceedings were triggered by an application for leniency by the company Villeroy & Boch AG. In February 2011 the Bundeskartellamt had carried out searches at six porcelain manufacturers in Germany and their trade association. The investigations which followed have shown that the porcelain manufacturers agreed, inter alia, to raise their prices as of 1 October 2006 in order to implement the increase in value-added tax which only came into effect on 1 January 2007. The association actively assisted the members of the cartel with their agreements. Two of the companies concerned could not be prosecuted due to their insolvency and the proceedings against two other parties involved were discontinued for other reasons.

A settlement could be reached with the company Kahla, which had cooperated with the Bundeskartellamt during the proceedings and with the ceramic industry association.

The fining decisions are not yet final and can be appealed against to the Düsseldorf Higher Regional Court.

More information can be found here

Source: Bundeskartellamt

 

Austria 

October 16, 2013 

Austrian Cartel Appeal Court clarified on the requirements for judicial dawn raid orders and referred to a minimum-effects criteria for applying § 1 section 4 Austrian Cartel Act, which regulates recommendation-cartels

The Austrian Cartel Appeal Court confirmed a decision of the Austrian Cartel Court which rejected an application for issuing a judicial dawn raid order brought forward by the Austrian Federal Competition Authority (Bundeswettbewerbsbehörde, BWB). The Cartel Appeal Court found that when requesting a dawn raid order, the BWB must bring forward (i) legally conclusive allegations for the competition law infringement, (ii) circumstantial evidence on which the reasonable suspicion is based, and (iii) arguments why the dawn raid is required and proportionate to substantiate the suspicion.

The notion of “requirement” for the dawn raid is assessed in relation to the reason that triggered the investigation. Such reason cannot be changed during appeal proceedings and must be defined at first instance. In addition the Cartel Appeal Court found that in regards to § 1 section 4 Austrian Cartel Act (recommendation cartels) a certain de-minimis rule shall be applied. Recommendations must exert certain appreciable commercial pressure. Following the Cartel Appeal Court’s ruling “granting a bonus of approx. 1,5% would evidently not fulfil this requirement.”

More information can be found here

Source: Legal Information System of the Republic of Austria (RIS), Austrian Federal Chancellery

 

UK

October 15, 2013 

CC finalised measures to open up audit market

The Competition Commission (CC) has today published changes that will open up the UK audit market to greater competition and ensure that audits better serve the needs of shareholders in future.

In a summary of its final report on the supply of statutory audit services to large companies in the UK, the CC has confirmed that competition is restricted in the audit market due to factors which inhibit companies from switching auditors and by the incentives that auditors have to focus on satisfying management rather than shareholder needs. The final report follows the provisional findings report which was published in February, as well as theprovisional decision on remedies in July.

The full final report will be published shortly. All information relating to the investigation can be found on the audit market home page.

The CC has set out a package of remedies in response to these findings which includes measures to improve the bargaining power of companies and encourage rivalry between audit firms; measures to enhance the influence of the Audit Committee; and measures to promote audit quality and shareholder engagement in the audit process.

More information can be found here

Source: CC

 

UK 

October 15, 2013 

The British competition Authority, OFT launched market study into the supply of public sector ICT services

The OFT has launched a market study into the supply of information and communications technology (ICT) goods and services to the public sector.

This study will focus on the degree of competition between the companies which supply these goods and services, in a sector that is vital for the efficient and cost effective delivery of all public services. It also accounts for a significant proportion of total public sector expenditure, with an estimated £13.8 billion spent in 2011-12.

The market study follows an OFT call for information (CFI) which raised a number of issues that the OFT believes merit further analysis. Most notably, concerns were raised that certain businesses appear to have a large share of contracts in some areas of the sector, that there are high barriers to entry and expansion (especially for smaller scale ICT businesses) and that public sector organisations face difficulties and high costs in switching suppliers.

During the CFI, issues were also raised regarding public sector procurement practices. The market study will examine the extent to which these practices interact with the market structure and suppliers’ behaviour.

Existing reports and ongoing initiatives to improve public sector procurement will inform the study. The OFT aims to avoid duplicating other recent or ongoing work concerning public sector procurement.

More information can be found here

Source: OFT
Italy

October 14, 2013

The Autorità Garante della Concorrenza e del Mercato (AGCM) decided to launch an investigation into Acquedotto Pugliese S.p.A. (AQP) for possible non-compliance of a commitment agreement

On its meeting of 23 September 2013, the AGCM decided to launch an investigation into AQP for possible infringement of article 14-ter, paragraph 2, of Italian Competition Law.

The decision follows several reports presented by both consumers and a consumer association which denounced the impossibility to change to undertakings different from the AQP in order to obtain the water and sewerage services in the Region of Puglia.

According to the AGCM, this conduct would not be coherent with the commitments offered by AQP and rendered binding by the AGCM.

As known, on 30 October 2008 the AGCM accepted the commitments proposed by AQP during an investigation that begun on 8 November 2007 into the possible abuse of a dominant position in the provision of fresh water and the management of waste water. In light of this, the investigation was concluded without officially ascertaining a violation and without levying a fine. On the basis of the said commitments inter alia AQP would have changed its charging policy for public services so as to leave open the possibility for interested users to arrange their own connections to the water or sewerage systems and not be obliged to use AQP’s services for the purpose.

More information can be found here

Source: AGCM

 

France 

October 14, 2013 

The French competition Authority issued three opinions to the French Telecommunications and Posts Regulator on the analysis of wholesale call termination markets for the 2014-2016 period

On October 14, 2013, the French competition Authority – following a request for opinion from the French Telecommunications and Posts Regulator (ARCEP) – issued three opinions in the context of the analysis of wholesale voice call (fixed and mobile) and SMS termination markets. These opinions form part of the third and fourth stages of analysis of these markets and specifically follow up previous opinions already issued in this context (opinion n° 11-A-07, concerning the fixed call termination, opinions n° 10-A-17 and 11-A-19, concerning the mobile call termination and opinion n° 10-A-12, concerning the SMS call termination).

The French competition Authority notes a general shift towards unlimited all-network offers and a switch towards the IP interconnection mode.

The French Authority is in favour of maintaining ex ante regulation over the 2014-2016 period for SMS, but considers that such regulation is not justified for MMS; and so as not to penalise the French operators, it calls for an accelerated and generalised application of the European regulatory framework for international calls.

The full text of the three opinions (in French) can be found herehere and here

The press release, in English, can be found here.

Source: Autorité de la Concurrence

 

France 

October 10, 2013 

The Court of appeal of Paris confirmed the decision of the French Competition Authority in the pet food cartel and, in doing so, confirmed that the French guidelines on competition fines does not violate any fundamental principle

On October 10, 2013, the Court of appeal of Paris confirmed the decision n° 12-D-10 dated 20 March 2012, according to which the French Competition Authority has imposed a fine of 35 million € to Nestlé, Mars, Colgate-Palmolive and its subsidiaries which have limited the competition between 2004 and 2008, at the stage of wholesale distribution for pet food.

In this ruling, the Court of appeal of Paris confirms that the guidelines dated 16 May 2011 of the French competition Authority on the method of setting fines, does not violate any fundamental principle or defence rights.

The Court of appeal also defines the scope of its power to control decisions of the French Competition Authority and states that it is not bound by the method of setting fines provided by the guidelines of the French competition Authority, but only by the provisions of the French commercial code, as they are only guidelines and therefore bear no legal value.

As regard to the fines, the Court of Appeal of Paris reviews the various arguments raised by the parties and rules that when the French Competition Authority imposes a fine, it shall take into account the specific situation and elements of each company.

The full text of the ruling (in French) can be found here

Source: Cour d’appel de Paris

 

Spain 

October 2, 2013 

The Spanish Competition Authority (CNC) sanctioned several associations related with container transport at Valencia port

The CNC considered that some companies related with container transport at Valencia port agreed on sharing the market on highway transportation prices and other benefits linked with transportation, as well as a coordinated application of CPI or diesel increases.

The Board of the CNC concluded that it was a unique and continuous behaviour that started on 1998 and lasted at least until 2011 when the proceeding initiated.

For all above CNC solved to impose fines close to €43 million as follows:

– Asociación de Empresas de Logística y Transportes de Contenedores AELTC, € 12.692.462

– TRANSCONT COMUNIDAD VALENCIANA, € 3.048.395

– la Asociación de Transportistas de Contenedores Valencianos TRANSCONVAL, € 9.910.829

– FVET, 200.000 €

– La Asociación Naviera Valenciana ANV, 3.307.783 €

– Asociación de Transitarios Expedidores Internacionales y Asimilados ATEIA-OLT VALENCIA, € 13.144.444

– TCV Stevedoring Company S.A. TCV, € 403.096

– Noatum Ports Valenciana SAU NOATUM, € 561.390

– Mediterranean Shipping Company Terminal Valencia S.A MSCTV, € 252.318

– Autoridad Portuaria de Valencia APV, € 100.000

More information can be found here

Source: CNC

 

 

October 2, 2013 

The new Directive is getting closer 

These are crucial weeks in Brussels because of the parliamentary proceedings for analysis and approval of the proposal for a Directive on antitrust enforcement published by European Commission last June.

The proposal for a Directive approved by the Commission after three long years, had surprised the antitrust community for the lack of structural incentives to damage actions based on a breach of the EC antitrust rules, in particular, related to the absence of regulation on collective actions.

We still cannot exclude that the European Parliament introduces a discipline in antitrust class actions in the text of the proposed Directive which is nowadays under discussion and parliamentary exam.

One possible amendment to this effect has been proposed by the parliamentary Olle Schmidh

(The full text of the proposal is available in English here)

According to the amendment draft: “There should be an integrated approach to collective redress to ensure consistent treatment of damages, such as consumer protection laws. Since such horizontal measures are still not reality, the rapporteur would like to introduce them in this Directive. Given the low number of actions for damages more has to be done to encourage consumers to claim their rights. Collective actions will lower the threshold for consumers to approach national courts”.

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© Osservatorio Permanente sull’Applicazione delle Regole di Concorrenza, Università degli Studi di Trento, 2013.