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Competition I Notes

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Competition I Revision

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Revision: EU

[COMPETITION LAW I: ARTICLE 101 TFEU]
Competition Commission = Watchdog Aims: 1) Competitive market economy 2) Prevent barriers to the integration of the single, internal market

Free movement of goods/competition law are two sides of the same coin

REGULATION 1/2003 - THE MODERNISATION REGULATION

Changes to competition law - authority to apply A101 TFEU is devolved from the Commission to the National Competition Authorities (NCAs) - e.g. Office of Fair Trading in UK o

Together the Commission and NCAs create the Competition Network

Regulation: parties to agreements/decisions must themselves decide if it infringes 101/102 o o

Power to apply 101/102 in hands of the Competition network National courts may also apply 101/102 directly and deal with appeals

Fines have been revised upwards: o

Multiplier system and increased fines for companies who refuse to supply info (SGL v Commission)

Elevators and Escalators Cartel: record fine imposed for bid rigging, price fixing, market sharing and exchange of info o o

Dutch company Otis received 100% immunity as a whistle-blower ThyssenKrupp received a 50% increased fine as a repeat offender

Synthetic Rubber Cartel: Bayer got 100% immunity despite being a repeat offender, Dow received 40% reduction for cooperation and Shell received 50% increase as repeat offender

Alternatives to fines being investigated: allowing out of court settlement in return for immediate cartel cessation; encouraging private actions by cartel victims (Escalator), criminal sanctions as in US

ARTICLE 101 TFEU

To protect the normal, competitive working of the single market by prohibiting all agreements btw undertakings, decisions by associations of undertakings and concerted practices which may affect trade btw MSs and which have as their object or effect the prevention, restriction or distortion of competition

'Undertakings': broadly defined: includes any natural/legal person engaged in some form of economic/commercial activity - any entity regardless of the legal status/how it is financed (Hofner &
Else) - even without profit motive

Distribution of Package Tours During the 1990 World Cup : FIFA/Italian FA were undertakings under A101 1

Revision: EU

[COMPETITION LAW I: ARTICLE 101 TFEU]

MOTOE V Elliniko Domosio (A102): ELPA amounted to undertaking as engaged in economic activity despite not for profit and irrespective of its legal form

General Structure of Article: divided into 3 paragraphs:

1. Article 101(1): rule vs. anti-competitive agreements, decisions and concerted practices Drafted so widely that it could capture almost all contracts - need to balance the article with

o

101(3) Key distinction is btw non-collusive (lawful) and collusive (unlawful) behaviour - doesn't really

o

matter what type of collusion: Commission v ANIC - unlawful agreement and concerted practice Width of interpretation - AC Treuhand AG v Commission: enough that there was a sufficiently

o

definite causal link btw activity and restriction of competition i)

Agreements

Wide interpretation of 'agreement' - Tepea - interpreted to include informal agreements/expressions of intention (Hercules Chemicals)


ii)

Usually has to be btw at least two undertakings - not just one (Bayer AG)

Decisions by associations of undertakings

Mainly concerns trade associations - includes non-binding recommendations - Verenining - necessary to consider whether members tend to comply with recommendations

Some recommendations relate to pricing, market strategies or market-related information

ANSEAU/NAVEWA: trade association involved with supply of washing machines - association provided that such goods could only be distributed under common label =
breach

iii)

Concerted Practices

Designed to catch forms of co-op which aren't formal oral/written agreement or decision

Co-ordinated/parallel behaviour

Defined in Dyestuffs - 'a form of coordination' before agreement concluded - will look for evidence of meetings btw companies/identical or similar actions: parallel pricing strategies - CJ - not automatically concerted practices -but may be evidence of them - in this case there was

E.g. of conduct not amounting to concerted practices - Ahlstron - 'Wood Pulp Cartel' Case - parallel pricing found to be normal feature of the market

2. Article 101(2): legal effect of the prohibition - any agreement in breach of A101(1) is automatically void
- this article has retroactive effect

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