Various national competition authorities (“NCAs”) are continuing to consider sustainability arguments in competition cases. However, NCAs are increasingly diverging in their approach as to whether, and to what extent, they are willing to allow sustainability considerations in the competition law framework. This blogpost highlights a few recent developments in jurisdictions on both sides of the Atlantic.
On April 27, 2023, the Commission presented its draft regulation on SEPs (“Draft SEPs Framework Regulation”, retrievable here).
Under the aegis of DG GROW, but in close consultation with DG COMP, the Commission seeks to address what some have perceived as lack of transparency and predictability in the licensing of SEPs. The Commission had previously expressed its concern in its Intellectual Property (IP) Action Plan of 2020 and 2017 Communication and suggested that this situation could lead to a cumbersome and costly licensing process for both owners and implementers of SEPs. The Commission sought feedback via a public consultation between February and April 2023.
The draft SEPs Framework Regulation would:
- Establish a Competence Centre to register SEPs at the European Union Intellectual Property Office (“EUIPO”) and providing an electronic register and database with extensive information about SEPs;
- Oblige the owners of SEPs to register any claimed SEP in the database;
- Create additional essentiality checks through the Competence Centre;
- Establish an out-of-court procedure to determine fair, reasonable, and nondiscriminatory (”FRAND”) conditions and aggregate royalties for use of a given standard.
On 3 June 2021, the European Court of Justice (“ECJ”) in case C-563/19 P Recylex v Commission dismissed Recylex’ appeal both to adjust its ranking in the leniency process and to receive partial immunity for parts of its participation in the Car Battery Recycling cartel. The judgment, on appeal against the judgment of the General Court (“GC”) of 23 May 2019, provides guidance to companies considering a leniency application when there is already an ongoing European Commission (“Commission”) investigation.
Applying for leniency enables cartel participants to obtain reduced or annulled fines. The 2006 Commission Notice on Immunity from fines and reduction of fines in cartel cases (“Leniency Notice”) sets out the key principles:
- the first company providing the Commission with sufficient evidence for an investigation will be granted full immunity;
- subsequent applicants can receive fine reductions of 30-50%, 20-30% or 20% depending on the timing of their submission; and
- companies can receive partial immunity for providing the Commission with details expanding the scope of the infringement.
On 6 May 2021, the European Commission (“Commission”) published the findings of its evaluation of the horizontal block exemption regulations for Research & Development (“R&D BER”) and specialisation agreements (“Specialisation BER”, together “HBERs”), as well as the accompanying Horizontal Guidelines (“Evaluation”).
The Commission launched the Evaluation in 2019 to assess the future relevance of the HBERs and the Horizontal Guidelines, since their adoption in 2011 and 2012. It gathered a variety of evidence on the functioning of the HBERs, which included:
- findings of an open public consultation running from November 2019 to February 2020;
- responses to the call for contributions on Competition Policy and the Green Deal launched in 2020; and
- an external evaluation support study, which cross checked the public consultation and the responses received with the Commission’s and national competition authorities’ own experiences.
According to the Commission, the results show that, while still relevant and useful to businesses, there is a need for the HBERs and Horizontal Guidelines to better reflect recent socio-economic developments like digitalisation and sustainability. The Evaluation also identified that businesses perceive some rules as unnecessarily strict and unclear.…
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 Digital Markets Act Proposal
In response to the ongoing COVID-19 pandemic, the European Commission (“EC”) is taking steps to stabilise the most affected sectors of the economy. As part of its efforts, the EC has announced its support for the agricultural and food sectors which are severely affected by the pandemic. This includes an exceptional derogation from the EU competition rules for certain sub-sectors.
Continue Reading European Commission Adopts Measures Aimed at Mitigating the Effects of COVID-19 in the Agri-Food Sector
On 8 April 2020, the European Commission published its Communication on the “Temporary Framework for assessing antitrust issues related to business cooperation in response to situations of urgency stemming from the current COVID-19 outbreak” (the “Framework“).
The Commission recognizes that supply chains have been severely disrupted due to COVID-19, combined with “an asymmetric demand shock caused by either an abrupt decline in consumer demand for certain products and services or a steep rise in demand for other products and services”, notably in the health sector. The duration and intensity of the shock is unknown.
These exceptional circumstances “may trigger the need for undertakings to cooperate with each other in order to overcome or at least mitigate the effects of the crisis to the ultimate benefit of citizens” (para 3).
The purpose of the Framework is to:
(i) explain the main criteria that the Commission will follow when assessing possible cooperation projects between undertakings aimed at addressing the shortage of essential products and services during the COVID-19 outbreak;
(ii) describe the exceptional procedure that the Commission has set up to provide, where appropriate, ad hoc ‘comfort letters’ to undertakings in relation to specific cooperation projects.
Continue Reading European Commission Publishes Exceptional Antitrust Guidance for Undertakings Collaborating to Address the Shortage of Essential Products and Services during COVID-19
After her confirmation hearing in front of the European Parliament on Tuesday 8 October, Magrethe Vestager looks certain to remain as Competition Commissioner for a second term and to combine that with a broader responsibility for digital policy development. Both the second term and the combination of the competition portfolio with a policy brief are unprecedented in recent decades.
Several key points, including the way in which she intends to manage digital matters and a potential conflict of interest, emerged from the hearing.…
On 16 January 2019, the European Court of Justice (“ECJ”) rejected the European Commission’s (“Commission”) appeal in Commission v. UPS. The judgment followed Advocate General Kokott’s Opinion of July 2018, and upholds the 2017 judgment of the General Court (“GC”) annulling on procedural grounds the Commission’s decision prohibiting the acquisition of TNT by UPS.
Continue Reading EU Court Confirms the Annulment of the European Commission’s Decision Prohibiting the UPS/TNT Transaction
On 20 November, Johan Ysewyn and Maria Jaspers (DG COMP) presented the highlights of recent EU cartel enforcement in their annual presentation at the Advanced EU Competition Law Conference in Brussels. Their presentation covered their now-traditional three pillars: enforcement, policy and court review.
Continue Reading Advanced Competition Law Conference Brussels – Joint Presentation on Recent EU Cartel Enforcement