COMMEO

The 28th Annual Competition Conference of the International Bar Association is over. Why these conferences are so fantastic: 🤗 Meeting colleagues from all over the world 💡 Discussions of hot topics among experts; and, with a bit of luck, participating in such a discussion on a panel 🌞 Set against the backdrop of wonderful Florence with its unique combination of magnificent art, breathtaking architecture and bustling commerce ❗ Many thanks to Leonor Cordovil and Kyriakos Fountoukakos for the fantastic moderation of our panel on which we discussed the challenges for “Successful deal execution in the face of tough merger control enforcement” with Ronan Harty, Fernando Castillo de la Torre and Mariam Sabet. #meetingcompetition #florenceinseptember #dealexecution #mergercontrol

Abuse of a Superior Bargaining Position under Japanese Antitrust Law   Japan is not only famous for its motorbikes 🏍, but also for innovative and effective antitrust concepts! Similar to the concept of relative market power under German competition law, the Japanese competition law includes a special type of prohibited single firm conduct that is called “Abuse of a Superior Bargaining Position” (ASBP). The prohibition of ASBP applies to parties in a position of strength, but it has a broader scope of application than the prohibition on private monopolisation (this is how abuse of market dominance is called in Japan). ASBP exists when a party in a relative superior bargaining position ⚖ engages in abusive conduct that runs the risk of being an "impediment to competition". Typical examples of ASBP are forced purchases, requests for economic benefits 🈹, or delaying payments towards the dependent party of the transaction.   🚨 On 30 July 2024, the Japanese competition authority JFTC conducted a dawn raid at the offices of the motorbike company Harley-Davidson Japan on the suspicion of ASBP. The JFTC suspects that Harley-Davidson Japan forced dealers to buy motorcycles out of their own pockets to reach sales quotas prescribed in their dealership contracts. If dealers failed to sell the assigned number of motorbikes, Harley-Davidson Japan allegedly forced them to buy the remaining vehicles by threatening to not renew contracts. It has been reported that dealers thus buy motorcycles under the names of employees or others to meet the sales quotas. Despite not having set wheels on the street, such motorcycles are then considered registered and can only be sold to customers at much lower prices, leading to huge losses for the dealers.   Interestingly, the Japanese prohibition of ASBP does not only apply between businesses. In guidelines published in 2019, the JFCT clarified that consumers 👨👩👧👦 can also be subject to abusive conduct by a superior party. ASBP against consumers can be found, for example, when consumers have no choice, but to accept the detrimental treatment by a digital platform to use the service provided by such a digital platform. Sounds a lot like some of the new DMA features in the EU! 💡 📸 Iroha Slope, a gem for Japanese motorcyclist 🏍, is a pair of spectacular sightseeing roads connecting Nikko-city and the mountainous Lake Chuzenji & Kegon Falls area which our COMMEO Franziska Lange-Schlüter explored (by bus) during her secondment in Japan 🗾   #COMMEOJapanDesk #ASBP #relativemarketpower #dawnraid #motorbikes #meetingcompetition 

COMMEO Quick News: The ECJ with the last word in the “Google Shopping story” The ECJ has spoken, and Google lost its fight against a record-breaking €2.42 billion fine imposed by the EU antitrust regulator for abusing its dominant position on the markets for online general searches and for specialised product searches by favouring its own comparison shopping service. In today’s judgement, the ECJ upheld the Commission’s fine and found that the General Court correctly established that Google’s self-preferencing was discriminatory and violated competition law. Background in brief: 🛒 In 2017, the Commission found that Google had given preference, on its general search results pages, to the results of its own comparison shopping service over those services of Google’s competitors. Throughout the EEA, Google presented the search results of its own service in a primary position and promoted them in “boxes” with accompanying attractive image and text information. The Commission considered this self-preferencing as an abuse of Google’s dominant market position. 🛒 Google challenged the Commission’s decision before the General Court, which largely dismissed Google’s action and upheld the fine in 2021. This led to Google lodging an appeal with the ECJ seeking the judgement of the General Court to be set aside and the Commission’s decision to be annulled. 🛒 Early this year, Advocate General Kokott proposed in a non-binding opinion that the ECJ should dismiss the appeal and confirm the fine imposed on Google. And that is what the ECJ did today! You can find the ECJ’s full decision here: https://lnkd.in/eMZNJyvh #meetingcompetition #GoogleShopping #EUcaselaw #competitionlaw

The European Court of Justice's decision Illumina/Grail, merger control under Art. 22 ECMR and other below threshold review options   If you want to get some background information on the landmark ECJ ruling that the whole (antitrust) world 🌎 is discussing this week, check out Franziska Lange-Schlüter's and Isabel Oest's latest newsletter! It explains the legal saga surrounding the Illumina/Grail merger and the – now limited – scope of the Art. 22 ECMR referral mechanism. The newsletter also sheds further light 💡 on other options for reviewing transactions 🔍 that do not meet the EU or national merger filing thresholds, namely the Towercast doctrine under Art. 102 TFEU and the emerging trend of call-in powers of national competition authorities in Europe.   A German version of the newsletter can be found here: https://lnkd.in/e8aabysj #IlluminaGrail #Article22ECMR #ECJ #mergercontrol #callinpowers #Towercast #meetingcompetition

COMMEO Quick News   Breaking: The ECJ ends the battle over the limits of the European Commission's merger examination power with a bang - The Commission’s new Article 22 “below threshold referral policy” is invalidated, and the Illumina/Grail appeal upheld.   The ECJ has had the last word in the Illumina/Grail saga: In today’s judgment, it sets aside the judgment of the General Court and annuls the decision by which the Commission accepted requests from national competition authorities asking the Commission to examine the Illumina/Grail merger. According to the ECJ, the Commission is not authorized to encourage or accept referrals from national competition authorities of concentrations that do not have an EU dimension and that the national competition authorities are not competent to review under their own national law.   Background in brief: ♟️US-based global genomics company Illumina announced its plans to acquire Grail, a US company developing blood tests for the early detection of cancer, in September 2020. ♟️Following the French Competition Authority’s referral request under Article 22 EUMR, the Commission examined and prohibited the merger – even though the transaction had no EU dimension and failed to reach any relevant national thresholds. ♟️Illumina challenged the decision arguing that the Commission lacked jurisdiction to review the deal. The General Court dismissed the action in July 2022, which led to Illumina and Grail each lodging an appeal against that judgment. ♟️Advocate General Emiliou said in a non-binding opinion in March 2024 that the General Court had erred in its interpretation and application of Article 22 EUMR. Today, the ECJ agreed.   #meetingcompetition #Art22finalpart #EUcaselaw #competitionlaw

During my secondment at Atsumi & Sakai in Japan 🗾, I had the great honour of giving an online seminar at the monthly meeting of the Japanese Competition Law Forum and discussing the filing requirements for M&A transactions in Germany with Japanese competition lawyers, in-house counsel, and members of the Japanese competition authority. Many thanks to Setsuko Yufu for arranging this unique opportunity and to saori Kato (Hanada) for moderating the discussion!   #JCLF #mergercontrol #FDI #FSR #meetingcompetition

COMMEO Quick News: CJEU and EU General Court Competition Law Rulings – September Preview   As summer draws to a close and September approaches, the docket of CJEU and the EU General Court already promises a breathless month for all competition law enthusiasts, with many landmark rulings on the horizon.   What to expect:     💉 3/9/2024: Illumina/Grail Merger – Judgment of the CJEU in Cases C-611/22 P and C-625/22 P on the below threshold referral system under Art. 22 EU Merger Regulation 🥕 4/9/2024: Conserve Italia – Judgment of the EU General Court in Case T-59/22 on the annulment of the Commission’s decision to fine Conserve Italia for its participation in the canned vegetables cartel 🛒 10/9/2024: Google Shopping – Judgment of the CJEU in Case C-48/22 P on whether the record fine of €2.4 billion imposed on Google under Art. 102 TFEU for favouring its own comparison shopping service shall be upheld 📀 11/9/2024: Qualcomm – Judgment of the EU General Court in Case T-671/19 on the Commission’s Qualcomm decision of 2018 (predatory pricing) 🔎18/9/2024: Google AdSense for Search – Judgment of the EU General Court in Case T-334/19 on another Google decision under Art. 102 TFEU including a €1.5 billion fine, this time concerning online advertising 🛏 19/9/2024: Booking. com – Judgment of the CJEU in Case C-264/23 i.a. on whether Booking’s parity clauses constitute an ancillary restraint in the context of Article 101(1) TFEU (preliminary ruling) 🌊 26/9/2024, Orlen v Commission – Judgment of the CJEU in Case C-255/22 P on the annulment of the Commission’s decision under Art. 102 TFEU in relation to Gazprom’s gas supplies in CEE   #interstingmonthahead #courtdocket #Art22finalpart #EUcaselawinthemaking #meetingcompetition

COMMEO Quick News: First court decision concerning the Foreign Subsidies Regulation (FSR)   On 12 August 2024, the EU General Court dismissed Nuctech’s application for interim relief following a dawn raid carried out by the EU Commission in the security equipment sector – the first court order in the context of FSR!   🔎 The facts  In April 2024, the EU Commission carried out its first dawn raid under the “new” FSR and searched two EU subsidiaries of the (partly state-owned) Chinese company Nuctech in Rotterdam and Warsaw. The EU Commission claimed to have indications that Nuctech, a manufacturer of body and luggage scanners used at airports, had received foreign financial contributions which could qualify as foreign subsidies eventually capable to distort competition in the EU internal market under the FSR. Nuctech challenged this investigation before the EU General Court and applied for interim measures relating to the EU Commission’s request to provide internal documents and emails stored at its parent company in China.   👩⚖️ The decision  The General Court dismissed Nuctech’s application for a temporary suspension of the Commission’s document request. The court held that the EU Commission is entitled to request information from undertakings located outside the EU to assess whether their conduct infringes EU law. Otherwise, the EU Commission would not be able to carry out its investigation effectively, jeopardising its ability to hold non-EU entities liable for conduct substantially affecting the internal market. According to the General Court, Nuctech had, inter alia, failed to explain how Chinese law could prevent them, as entities active and established in the European Union, from responding to the EU Commission’s requests and why provisions of Chinese law are relevant to them. The court emphasized that the validity of the challenged Commission decision must be assessed in the light of EU law and not of Chinese law.   ❔ What will come next?  The decision of 12 August only related to Nuctech’s separate application for interim relief. We are thus still waiting for the General Court’s substantive assessment of the main appeal which will hopefully clarify important questions concerning the FSR and the EU Commission’s jurisdiction to enforce the new regulation. The current ruling, however, already seems to give the EU Commission strong tailwinds in its practice to make use of the full range of tools available under the FSR. You can find the full text of the court order here: CURIA - Dokumente (europa.eu) #FSR #foreignsubsidiesregulation #dawnraids #interimrelief #meetingcompetition

COMMEO Friday Quick News: Reform of the EU Court of Justice – impact on competition law? After reading the Official Journal of the EU on Monday, it is now clear: The reform of the Court of Justice’s statute will see the light of day on 1 September 2024 – providing for some major changes to the preliminary reference procedure: 🇪🇺 First things first: The reform will transfer preliminary reference cases (Art. 267 TFEU) from the Court of Justice to the General Court in five specific areas (incl. VAT, excise duties, customs code etc.). Fortunately, competition law preliminary rulings remain a Court of Justice matter 🤝 🇪🇺 New transparency: Written observations submitted by an interested person, including the parties’ submissions, will be made public on the Court’s website once the case has been closed – unless they object ! #meetingcompetition #quicknews #CJEU #CJEUstatutereform #competitionlaw #samesamebutdifferent https://lnkd.in/eXHusa9W

Competition Law Enforcement in Japan 🗾 🏯   Out of reading material in your summer vacation? Check out what our COMMEO Franziska Lange-Schlüter is learning about the enforcement of Japanese competition law during her time in Tokyo:   🕵♂️ 📜 Who is the competition authority? The Japanese Fair Trade Commission (JFTC) is the enforcer of the Japanese competition law, stipulated in the Antimonopoly Act. The JFTC also enforces the Subcontract Act which regulates unreasonable conduct regarding prescribed subcontract transactions.   🔎 What are the JFTC’s enforcement activities? In 2023, the JFTC opened 152 investigations and took nine legal measures. The authority issued cease and desist orders and commitment decisions, e.g., concerning price fixing for wood working drill bits, bid rigging for city gas quotations, or the abuse of superior bargaining power against an operator of furniture stores.   💲 ⛔ How about fines? The JFTC can also impose fines on companies for violations of the competition law. In 2023, those fines amounted to JPY 223 million (EUR 1.4 million) concerning a total of 16 companies. Recently, the JFTC issued fines of approx. JPY 710 million (EUR 4.4 million) against manufacturers of valves for LP gas cylinders in June 2024 (Do you remember the German liquid gas cartel which kept the German courts – and COMMEO – busy for almost 15 years? ⏳).   💼 M&A’s favourite topic – what about merger control? In 2023, the JFTC received 345 notifications and cleared all but 10 cases that were withdrawn in Phase I. Apart from merger notifications, the JFTC can also investigate mergers that do not require notifications. The authority made use of this ex-officio competence in 13 cases in 2023 (in some cases, the parties had consulted the JFTC beforehand).   📱 JFTC’s response to Big Tech? Japan has recently introduced the Act on Promotion of Competition for Specified Smartphone Software. This “Smartphone Act” targets tech giants like Apple and Google and aims to make the smartphone-related markets more competitive. Similar to the EU’s DMA, the Smartphone Act contains Do’s and Don’t’s for designated companies, such as anti-steering rules and a ban on self-preferencing. The Act was adopted in June 2024 and will likely come into force in the second half of 2025.   📸 The JFTC is located just a stroll trough the beautiful Hibiya Park away from the A&S office in Tokyo.   #COMMEOJapanesedesk #JFTC #antitrustenforcement #goodoldFlüssiggaskartell #meetingcompetition