Goldman Sachs v Commission: The CJEU further expands the parental liability doctrine — private equity businesses and investors tread carefully

On 27 January 2021, the Court of Justice of the European Union (“CJEU”) confirmed in Goldman Sachs Group Inc. v European Commission that financial investors can be liable where they hold 100% voting rights over an indirect entity that participated in a cartel, even though the investor does not own 100% of the share capital during the relevant infringement period. Crucially, the judgment highlights the importance of conducting careful due diligence and ensuring competition law compliance for all investors, including financial investors, during the acquisition process. Continue Reading

2020 Competition Law Developments – Reviewing a Notable Year and Looking Ahead to 2021

Competition law appears to be at an inflection point. Over the past year, authorities, policy makers, and commentators across the globe have debated whether current laws and enforcement approaches are appropriately calibrated or whether they should be changed, including to try to protect interests that go well beyond the consumer welfare standard that has been applied for decades. Past is often prologue, and the increased competition law enforcement in 2020 highlights why companies should expect to face more challenges to proposed transactions and more scrutiny of their activities in 2021.

Early Termination of HSR Waiting Periods Temporarily Suspended

The Federal Trade Commission (“FTC”) announced on February 4, 2021, that it is temporarily suspending the discretionary practice of granting “early termination” of the Hart-Scott-Rodino (“HSR”) Act waiting period, with support from the Antitrust Division of the U.S. Department of Justice (“DOJ”). The Agencies cited “the unprecedented volume of HSR filings” and “challenging transition period” as the reasons for suspending grants of early termination. Continue Reading

FTC Announces New Lower HSR Filing and Interlocking Directorate Thresholds, Higher Civil Penalties

Today, the Federal Trade Commission (“FTC”) published revised thresholds for the Hart-Scott-Rodino (“HSR”) Act, which will take effect on March 4, 2021. Earlier, the FTC also announced new thresholds for Section 8 of the Clayton Act, which governs interlocking directorates. Each of these thresholds is lower for 2021, than for 2020. This is only the second time the HSR Act thresholds, which—like the Section 8 thresholds—are indexed to gross national product, have fallen since annual adjustments began in 2005. In contrast, the maximum daily civil penalty for violations of the HSR Act, which is tied to inflation, has increased. Continue Reading

Significant Revamp of German FDI Regime – German Government Presents New Rules on FDI Screening

On 22 January 2021 the German Ministry for Economic Affairs and Energy (“BMWi”) published a draft for the 17th amendment (“Draft Amendment”) of the Foreign Trade and Payments Ordinance (“AWV”). While the Draft Amendment remains subject to comments and further consultation, it already provides early guidance on sectors that may come under close Foreign Direct Investments (“FDI”) scrutiny in future. Among other changes, the Draft Amendment defines a number of additional sensitive activities triggering mandatory and suspensive filing requirements.

The new rules can be expected to have significant impact on transactions in particular in the technology sector and will lead to a significant increase in mandatory FDI filings in Germany. Continue Reading

The CJEU provides guidance on the end date in case of a bid-rigging cartel

Introduction

In its preliminary ruling of 14 January 2021, the Court of Justice of the European Union (“CJEU”) clarified that the duration of an infringement in the case of bid rigging ends once the essential characteristics of the public tender are determined – which in practice likely means at the signing date of the contract between the winner of the bid (who participated in the bid rigging) and the contracting authority. As such, this decision sets clear time-limits to competition authorities’ enforcement powers when prosecuting bid-rigging cartels. The CJEU provided this guidance in response to a preliminary question from the Supreme Administrative Court of Finland. Continue Reading

Germany: The wind of change – Substantial competition law amendments

On 19 January 2021, the 10th amendment of the German Act against Restraints of Competition (“ARC”), the so-called ARC Digitisation Act (the “ARC-DA”) entered into force. The ARC-DA brings far-reaching amendments to German competition law, containing inter alia

  • the introduction of a new framework to intervene in the digital sector and a revision of the rules on abuse of dominance including enhanced rules for access to data;
  • significant increases of merger control notification thresholds applicable across industries; and
  • a number of further substantial amendments including a codification of the FCO’s leniency program, the implementation of the European Commission’s ECN+ Directive introducing new powers of the Federal Cartel Office (“FCO”) in the context of inspections, and changes concerning cartel damage claims.

In this blog-post we focus on three core developments: (i) novel powers for intervention in digital markets, (ii) the additional basis for data access claims and (iii) the core amendments to the merger control regime. Continue Reading

Digital Markets Act Proposal

Yesterday, the European Commission published its proposals for the Digital Markets Act (“DMA Proposal”) and Digital Services Act (“DSA Proposal”), proposing new regulation of “intermediary services” and “designated gatekeepers”. The proposals would impose new obligations on providers of digital services and augment enforcement powers. Continue Reading

Expansion of the Procurement Collusion Strike Force

Just over a year after launching the Procurement Collusion Strike Force (“PCSF”), the U.S. Department of Justice’s Antitrust Division (“DOJ”) announced new measures to further its pursuit of antitrust and related crimes in government procurement, grant, and program funding.  These changes expand the PCSF’s enforcement capacity and signal DOJ’s enduring—and intensifying—commitment to the PCSF’s mission.

The PCSF has added 11 new national partners: the Department of Homeland Security Office of the Inspector General, the Air Force Office of Special Investigations, and nine new U.S. Attorneys.  As a result, the growing PCSF coalition now includes 29 agencies and offices, including U.S. Attorneys in 22 federal judicial districts; the Federal Bureau of Investigation; and Offices of Inspectors General at six federal agencies.  The PCSF also named the Antitrust Division’s Daniel Glad as the Strike Force’s first permanent director, solidifying the PCSF’s institutional role at DOJ.  Glad previously served as an Assistant Chief at the Antitrust Division’s Chicago Office. Continue Reading

Antitrust Division Brings First Criminal Wage-Fixing Charge

On December 10th, the Antitrust Division of the U.S. Department of Justice announced its first criminal indictment targeting an alleged conspiracy to reduce employee wages. The DOJ charged the former owner of a therapist staffing company with conspiring to reduce pay rates for healthcare worker contractors, but did not charge the company itself. Specifically, the indictment alleges that, for a six-month period in 2017, the defendant and his co-conspirators exchanged non-public information on rates paid to healthcare workers; discussed and agreed to decrease rates paid to healthcare workers; implemented rate decreases in accordance with their agreement; and paid healthcare workers at collusive and noncompetitive rates. The indictment alleges that the defendant’s behavior constitutes a per se violation of the antitrust laws and seeks penalties including fines and potential imprisonment. The indictment also includes an obstruction of justice charge, stemming from allegedly false or misleading information the defendant provided the Federal Trade Commission during the agency’s investigation of the same subject matter. Continue Reading

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