New frontiers of antitrust 2014 > Demain la concurrence 2014 Concurrences Journal 5th International Conference

Ministry of Economics and Finance, Paris Panel Sponsors

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Social Event Sponsors

EVE’S SPEAKER DINNER

SPEAKER LUNCH

SPEAKER DINNER Contents

Foreword 01 Conference Summary 02 Social Events 16 Press Review 22 Testimonials 30 Appendix 32 Foreword

he fifth edition of the Concurrences Journal T conference "New Frontiers of Antitrust" was attended by 275 persons at the Ministry of Economics and Finance on 21 Feb. 2014. Attendees came from Belgium, France, Germany, Italy, Luxembourg, Netherlands, Switzerland, the UK and the US. This year, we welcomed two keynote speakers: EU Commissioner Joaquín Almunia and Minister Nicolas Charbit Benoît Hamon. The four high level panels gathered The Editor 20 speakers from 7 jurisdictions. The result was a Concurrences Journal day of intense debate and discussion with enforcers, attorneys, in-house counsels and academics. The conference proceedings reflect the intense debates held during this day. The proceedings have been released on line in Concurrences N° 2-2014. The print version will be released as a book in September 2014. We are most thankful to the conference Steering Committee headed by Frederic Jenny and Laurence Idot. Their choice for the four panels was carefully thought out to achieve just the right mix of topical subjects, political issues and scholarship. We are also thankful to the panel sponsors – Cleary Gottlieb, CRA, E.CA, Gibson Dunn, MAPP, Norton Rose, and, Shearman & Sterling - and the social event sponsors – Clifford Chance, Compass, Jones Day, Mayer Brown, Microeconomix, and, White & Case - who helped make this event such a success from the point of view of both scholarship and networking. We look forward to welcoming you to the 6th New Frontiers of Antitrust conference in February 2015 in Paris. Meanwhile, we are delighted to share with you some of the key features of the 2014 conference.

New frontiers of antitrust 2014 Concurrences Special Issue - 1 CONFERENCE SUMMARY*

KEYNOTE SPEECH JOAQUÍN ALMUNIA

Nathalie Homobono (General Director of Direction Générale de la Concurrence, Consommation et Répression des Fraudes) and Frédéric Jenny (Chairman of the OECD Competition Committee, Professor of Economics at ESSEC and President of the Concurrences International Committee) introduced the four topical issues to be dealt with by the different panels. They noted the indefectible presence of Commissioner Almunia at the conference, which he has helped to make an unmissable event in the antitrust community.

oaquín Almunia focused on the interplay between nature of prohibition decisions in the context of the competition and growth in the European Union. merger review process. J Underlining the role of competition law as a means Turning to antitrust, the Commissioner pointed out the to foster production and innovation, the Commissioner damage to the common market caused by absolute reminded the audience about the determination of territorial protection, a reason for the Commission to competition policy to correct market distorsions. The investigate the licenses between American majors and Commissioner stated that the economic difficulties the EU European pay-TV providers. Mr Almunia also explained is facing will not be cured by obsolete means such as that the financial sector remains an area of concern for protectionism and leniency with regard to competition antitrust, as illustrated by the LIBOR scandal. He argued enforcement, but rather by developing an offensive and for a more secure and transparent financial sector focusing dynamic approach based on the internal market promoted on real business. by competition policy. Advocating a stronger and more competitive Europe, the Commissioner called for a more Finally, as regards abuses of dominant position, the effective and integrated internal market, urging for Commissioner focused on the on-going Google case. He noted that after complex discussions, the Commission measures to remove remaining national barriers in high may ultimately adopt an article 9 decision in the coming potential markets such as electronic communication, months but that the procedure is not over yet. He insisted online business and energy. Stating that a common market that no new market test would occur, but that preliminary without barriers and with effective competition among letters would be sent to the formal plaintiffs to explain why firms that leads to improved performance is the winning the proposals seem capable of addressing the competition formula, Joaquín Almunia added that although economic concerns identified. For Mr Almunia, the solution reached recovery needs other strong policies, in terms of job so far would, if implemented, be similar to a specific creation and financial system enhancement in particular, regulation burden imposed on Google. competition policy is key. The Commissioner answered questions from the On the subject of State aid, the Commissioner emphasised attendees. He addressed the issue of extending the scope the fact that the European Commission encourages public of the European merger control regime to non-controlling aid that is properly designed and targeted. Specifying that minority shareholding, saying that an analysis will be about 95% of notified measures are authorised in practice, prepared for the next Commission. Answering a question he mentioned recent guidelines and projects to be adopted on national sovereignty in sectors such as energy and in the next few months (in the energy and environmental electronic communications to increase market efficiency, field in particular) to emphasise that the fact that focusing Mr Almunia pointed out that States are no longer sovereign on State aids that strongly impact the internal market will in these sectors led by powerful operators and called for make about 90% of aids escape the control process. the creation of a strong common market in these sectors. He finally reacted to comments on the LIBOR case, stating As far as merger control is concerned, Joaquín Almunia that more regulation and investment from sector-specific recalled that competition law does not hinder the creation regulators were needed to restore confidence in financial of European champions, specifying the exceptional benchmarks.

2 - New frontiers of antitrust 2014 Concurrences Special Issue 1 1 Frédéric Jenny 2 Nathalie Homobono Nathalie HOMOBONO 3 Joaquin Almunia General Director of Direction Générale 4 Audience de la Concurrence, de la Consommation et de la Répression des Fraudes

Joaquín ALMUNIA * This summary has been prepared by a team of PhD Vice-President of the European students: Baptiste Allard (Paris V), Élise Provost (ULG) Commission - Commissioner and Déborah Thebault (Paris V). The views expressed cannot be deemed to reflect the position of the responsible for Competition Policy speakers’ institutions.

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New frontiers of antitrust 2014 Concurrences Special Issue - 3 PANEL 1 DETECTION OF ANTICOMPETITIVE PRACTICES: SHOULD EXISTING TOOLS BE REVISED OR NEW TOOLS INTRODUCED? LENIENCY, MARKET SURVEYS, FINANCIAL REWARDS ETC.

hairing this first round table session, Laurence Idot information inside the authority; and improving the exchange (Professor, Université Paris II Panthéon-Assas, of information among authorities. He noted that the OFT had C Member of the French Competition Authority, adopted a number of approaches that are used by traditional President of Concurrences Scientific Committee) first laid out law enforcement bodies such as the police. These include the basis for the panel’s discussion. She mentioned that financial rewards for information; a dedicated informant although no new detection tool has ben added to the toolbox telephone line where information can be provided anonymously; of the majority of competition authorities over the last fifteen analysis of communication data to track contacts between years, the debate having focused on reinforcing the existing competitors, and greater sharing of information with traditional tools, reforming the toolbox has now become an important crime enforcement bodies like the police and anti-fraud issue. The reason is twofold: leniency programs have shown agencies, etc. Although these new tools are in their infancy, their limits – their specific scope, the risk of strategic use by early results seem to show that the OFT is uncovering cartels firms, relative lack of use in some Member States) – and the that it might otherwise not have done had it relied exclusively need for a global and proactive approach to markets has on leniency. He noted that the increase in the likelihood of clearly emerged in the last few years. Mme Idot pointed out detection, which this implies, also benefits the leniency policy two possible ways for reforming the detection toolbox: first, by increasing the incentive for cartelists to self-report. He improving current means; second, adopting new tools, in concluded, however, by noting that the use of these new particular to increase information on markets and behaviour, methods is not risk free since they are capable of infringing that is to say diversifying sources of information, methods of human rights laws. To address this issue the UK had adopted collecting data and information scanning. She also pointed out important safeguards including annual reviews of its activities the limitations of certain methods such as the use of « policing » in this area by an independent inspectorate. in an administrative system, as well as questioning the reliability of statistical methods. Chris Fonteijn (Chairman, Netherlands Authority for Ali Nikpay (Partner, Gibson Dunn, Brussels/London) then Consumers and Markets, The Hague), another « pioneer », offered his point of view as a former senior director of an shared a different view on detection. He emphasised the authority (the OFT) which has invested heavily in developing benefits of an Authority in charge of competition, regulation alternative investigative tools to complement its leniency and consumer protection in terms of enabling access to policy. He started by pointing out the link between the increase information about an industry or sector, from several different in cartel enforcement over the last twenty years and the perspectives. In his view, the need is not for new tools but for implementation of leniency programs. He stressed that despite enhancing the performance of existing tools, in particular the huge success of leniency academic research suggests economic uses of statistics, social media such as Twitter, that only a minority of cartels are caught by authorities. In cooperation with other authorities (in the ECN but also with addition, he noted that most cartels that are caught through national authorities in charge of tax, finance issues, etc.) and leniency have been active, and have therefore caused harm, online consultation of the authority’s work. He also stressed for several years. Mr Nikpay then went on to describe the steps the need to act within the framework of Human Rights taken in the UK to increase cartel detection. These include obligations, using as an example a case on the transmission establishing a dedicated team of experienced investigators of information found on wire taps, which is currently under trained in “mainstream” crime fighting methods; centralizing appeal in the Netherlands.

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Laurence IDOT Professor, University Paris II Panthéon-Assas Member, French Competition Authority President, Concurrences Scientific Committee

Ali NIKPAY Partner, Gibson Dunn, Brussels/London

Chris FONTEIJN

Chairman, Netherlands Authority for Consumers and Markets, The Hague

Cristina CAFFARRA Vice-President, Charles River Associates, Brussels – London

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1 Panel Cristina Caffarra (Vice-President, Charles River Associates, 2 Cristina Caffarra Brussels – London), offered an economic approach to this issue. As an introduction, she pointed out that « screens » are not new 3 Chris Fonteijn economic tools as such, and that the paradox of economics is that 4 Ali Nikpay there is often not enough data to carry out an analysis and that 5 Laurence Idot when data is available, economists have difficulty saying exactly what it means. She pointed out that several economists argue that using economic screens could be very useful to increase detection. 3 She took the example of the LIBOR incident to show how using quotes from banks could have helped to detect the cartel. The idea of screening large trading datasets to detect anticompetitive behaviour is thus to be considered, according to Mme Caffarra, although this approach is limited by the lack of individual data and the need to have a high level of expertise regarding each market given the specific features of each of them. As a consequence, Cristina Caffarra defended the view that these data screens would be more effective in addressing compliance analysis needs than in improving detection.

A discussion among panelists took place on the respective roles assigned to factual reports and statistical analysis in cartel cases. 4 Ali Nikpay in particular stressed the fact that other tools can only help to develop a case from the information an Authority gets through the initial divulgation from a plaintiff, an applicant, an authority etc. Mr Nikpay also stressed the difference between South Korean and UK reward programs, the former being much more attractive than the latter. On this issue, a lawyer from the audience raised the fact that rewarding people who share information about competition law violations should not encourage employees to speak to authorities instead of reporting and solving the issue internally.

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New frontiers of antitrust 2014 Concurrences Special Issue - 5 PANEL 2 PATENTS: CAN ANTITRUST AUTHORITIES CONTRIBUTE TO FIXING THE DYSFUNCTIONAL PATENT SYSTEM?

rédéric Jenny (Chairman, OECD Competition delay” agreements for a decade now, but the interpretation Committee – Professor of economics, Co-Director of the rule mentioned in the recent Actavis case is difficult. F of CEDE and ESSEC – President, Concurrences Thus it is unsure whether it really differs from the EU International Committee) opened the debate by reminding approach to the problem, where such agreements are per that globalisation has led to an increase in the number of se antitrust violations. registered patents that national patent agencies have not been able to cope with, in turn leading to antitrust violation On the same subject, Thomas Graf (Partner, Cleary opportunities. He then presented the three main Gottlieb Steen & Hamilton, Brussels) stressed regulatory subthemes: the interaction between IP law and competition differences between the US and Europe, mainly the period law, “pay for delay” agreements, and negotiations for of exclusivity for the first generic entrant existing under the licensing standard essential patents. Hatch-Waxman Act in the US, and the important regulation Hans W. Friederiszick (Managing Director, E.CA Economics of medicine prices in most of the EU. Considering the and Research Fellow ESMT, Berlin) talked about recent European Commission’s practice, he then explained why cases handled by the European Commission and the question of whether reverse payment settlements demonstrated that there has been a clear increase in within the scope of the patent are in fact an infringement patent-related cases in the field of article 102 violations. of EU law is one of many that remain open. The same is true for article 101 violations. These can have many forms, such as excessive patent licensing fees or Mr. Graf then discussed the problem of injunctions for copyright fees, improper use of injunctions, and SEPs under EU competition law. The Commission does interoperability issues. This increase shows the importance not ban them absolutely and may accept them, for of a sound economic and legal approach towards these instance, when an SEP holder seeks an injunction against issues. an unwilling licensee. But considering threats of injunction as antitrust violations may conflict with the right of access Joshua Wright (Commissioner, Federal Trade Commission, to a court and the role of courts in resolving disputes. Mr. Washington DC) first explained that the trend is similar in the US. He then highlighted some categories of cases Friederiszick emphasised that these threats can influence attracting attention at the moment: cases involving the outcomes of licence fee negotiations, but that precisely improper injunctions, risk evaluations and mitigation determining their effect is difficult. Mr. Wright stated that strategies, or reverse payments. On this particular point, disputes over injunctions do not arise primarily as antitrust the Commissioner stressed that the impact of the Supreme cases in the US. Mr. Graf warned that courts would Court’s activism remains uncertain. It has been pushing for certainly take interest in them if European antitrust agencies a rule of reason to determine the antitrust effect of “pay for failed to do so.

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Frédéric JENNY Chairman, OECD Competition Committee Professor of economics - Co-Director of CEDE, ESSEC - President, Concurrences International Committee

Hans W. FRIEDERISZICK Managing Director, E.CA Economics and Research Fellow ESMT, Berlin

Joshua WRIGHT Commissioner, Federal Trade Commission, Washington DC

Thomas GRAF Partner, Cleary Gottlieb Steen & Hamilton, Brussels

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New frontiers of antitrust 2014 Concurrences Special Issue - 7 PANEL 3 THE EUROPEAN COMPETITION NETWORK 10 YEARS AFTER EC REGULATION 1/2003: CAN COOPERATION BE EXTENDED TO MERGER CONTROL AND ADVOCACY?

runo Lasserre (Chairman, Autorité de la possibilities of diverging decisions by national agencies is concurrence, Paris) introduced this roundtable by desirable. But with the exception of Eurotunnel and Akzo, B pointing out that national rules on mergers apply there do not appear to be so many problematic cases. when the EU thresholds are not reached. This leads to Chairman Freeman thus warned against the temptation to important divergences between merger rules in the various introduce ambitious legislation based on isolated cases, member States, both in terms of procedure – time rules, “hard cases making bad law”, especially because above all, vary widely – and substantial law. President ill-considered harmonisation may result in the loss of useful Lasserre recalled that the adoption of the SIEC test by national rules. most national authorities has not been enough to resolve divergences, the choice of different contra factual scenarios Mélanie Thill-Tayara (Partner, Norton Rose Fulbright, still possibly leading to contradictory outcomes among the Paris) then carried out a detailed analysis of the recent national authorities involved. report by the Autorité de la concurrence on cooperation between national agencies in the field of mergers. This Andreas Mundt (President, German Bundeskartellamt, report addresses real concerns on the part of companies Bonn) pointed out that it is the right time to put a spotlight facing merger notification requirements in several EU on divergent merger decisions by national competition authorities that have reviewed the same case in parallel member states. Me Thill-Tayara advocated reform to investigations (e.g. Akzo/Metlac, Eurotunnel). He stated ensure that the various procedures are coherent, efficient, that he was convinced that closer cooperation would simple and inexpensive. probably have prevented divergent outcomes, at least in Wouter Wils (Hearing Officer, European Commission, the Akzo/Metlac case. However, different timetables were Brussels – Visiting Professor, King’s College London) an obstacle in this case, as they are in other cases. Merging compared relations between national agencies in the field parties could contribute to more cooperation between the of cartels and market dominance, which are covered by NCAs by timing the notifications in a way that allows the the TFUE (articles 101 and 102), and in the field of mergers, NCAs to investigate the case at the same time. President Mundt proposed a “stop-the-clock” provision that would which is not. He pointed out that diverging decisions also enable the authority with the earlier time limit for a decision exist in article 101 and article 102 cases, but that they to bring its investigation in line with the timetable of the remain rare. In both fields, harmonisation already occurs second authority investigating a case. Harmonisation of through ECJ case law. The lack of a legal basis for the the tests could also help, and should therefore not be ruled extension of ECN to mergers is not a real concern as out, but he was less sure whether agreement would be cooperation can be the result of soft law. realistic. Finally, the panellists discussed the subject of advocacy. Peter Freeman (Chairman, UK Competition Appeal Mr. Lasserre called for more cooperation and better Tribunal, London) stated that extending the ECN to merger coordination of sector inquiries, while others expressed control may seem to be a good thing as reducing the concern over the real nature of such inquiries.

8 - New frontiers of antitrust 2014 Concurrences Special Issue 1 Bruno LASSERRE Chairman, Autorité de la concurrence, Paris

Andreas MUNDT President, German Bundeskartellamt, Bonn

Peter FREEMAN Chairman, UK Competition Appeal Tribunal, London

Mélanie THILL-TAYARA Partner, Norton Rose Fulbright, Paris

Wouter WILS Hearing Officer, European Commission, Brussels – Visiting Professor, King’s College London

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New frontiers of antitrust 2014 Concurrences Special Issue - 9 PANEL 4 RESTRUCTURING FIRMS IN THE CONTEXT OF CRISIS: WHAT IS THE ROLE OF MERGER POLICY?

ntroducing this round table discussion, Anne Perrot capital into the banks, as it did within the new entity Lloyds (Partner, MAPP, Paris/Brussels) explained that Banking group. State aid conditions include branch I competition policy takes place within a set of economic divestments to address the impact on competition. But policies that all have an influence on the way France State aid packages remain less effective than merger behaves. Some of these are clearly short-term policies; remedies. The OFT stated that divestment will have only a others are more mid-term or long-term. This is probably the limited impact on competition. case with competition policy, which is not really designed to solve short-term problems. Howard Shelanski (Office of Information and Regulatory Affairs, White House, Washington DC) recalled that, in time Alexander Italianer (Director General, DG COMP) of crisis where mergers are often presented as the solution explained that there is no need to relax merger control rules to a problem of a firm’s failure or even more broadly a because they are flexible enough to deal with the crisis. sector’s failure, a very well-defined group of stakeholders Moreover, merger controls do not block the rise of arises. These stakeholders could be the owners, the European champions but on the contrary protect European employees, the shareholders or the customers over a companies from the harm that comes from excessive particular sector which, momentarily or for a relatively short market power. Without merger control, European term, finds itself affected by the economic crisis. They companies would suffer from higher prices for semi-finished would attempt to push for special treatment in order to products and raw materials they need for production, achieve certain gains. The history of the USA is replete with leaving the consumer to foot the final bill. Besides, public examples where merger scrutiny has been reduced in interest rules in merger regulation are sufficient because times of economic crisis. Every analysis would show that they frame the basic objective of competition. Therefore, where the mergers did not in fact save a firm or a sector economic crisis can’t be presented as an excuse to from crisis, some other policy did. This means that it postpone remedies, because mergers are usually structural remains important for merger authorities to be flexible in phenomena. the process. Unfortunately, at times of economic crisis, notice and transparency tend to be sacrificed. But this is Matthew Readings (Partner, Shearman & Sterling, exactly the moment when they should be most salient. At London) used the UK experience to illustrate some key a time when normal well established standards are not issues. Intervention on public interest grounds is an going to be applied, the process needs to be treated more additional basis for objecting to and imposing remedies, like a public regulatory process. or even for prohibiting them. Competition concerns are overridden by public interest considerations. The UK Mario Monti (Senator, Rome) observed that the 2008 government can step in on specified public interest crisis might have caused substantial harm to the principles grounds, for example to clear a merger notwithstanding of competition policy. However, the member States all competition concerns. Early in the financial crisis, the UK worked hard to modernize competition policy. After strong government acknowledged that HBOS was on the brink tensions, the heads of State governments in 2012 of collapse due to the crisis of confidence that was affecting unanimously decided that there was a need to stabilise financial markets. The Government-brokered merger with financial markets in order to restore confidence. Both Lloyds TSB reassured depositors and restored confidence. financial and competition instruments were managed at The OFT had competition concerns in retail banking the EU level within the same body, i.e. the Commission. In markets. But the Government intervened to clear the order to achieve the single market, it is therefore necessary merger in order to maintain the stability of the UK financial to have both a hardy merger control system and sound system. It is still necessary for the Government to inject financial policy.

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2 6 Anne PERROT Partner, MAPP, Paris/Brussels Alexander ITALIANER Director General, DG COMP Matthew READINGS Partner, Shearman & Sterling, London Howard SHELANSKI Office of Information and Regulatory Affairs, White House, Washington DC Mario MONTI 3 Senator, Rome

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1-8 Anne Perrot 2-6 Alexander Italianer 3-8 Matthew Readings 4-6 Howard Shelanski 5-6 Mario Monti 7 Panel 8

New frontiers of antitrust 2014 Concurrences Special Issue - 11 Closing Keynote Speech BENOÎT HAMON

Ministre délégué à l’économie sociale et solidaire

INTRODUCING FRENCH CLASS ACTION: A DETERRENT AND A PUNITIVE TOOL AGAINST ANTI-COMPETITIVE PRACTICES

enoît Hamon first quoted Vladimir Ilitch Oulianov’s both French consumers and companies. Price fixing thoughts, recalling that the fight against private cartels between undertakings lead to an average price B monopolies and the implementation of competition increase of 25% according to Prof. John Connor. As a policies is part of the left wing’s political tradition. result, class action allows consumers to be compensated Competition is not an aim but a tool for achieving fair funds in the form of purchasing power. allowance and promoting growth, employment, and ultimately social inclusion. Moreover, competition policy is Second, the French class action has been implemented not in conflict with other tools that pursue same objectives. for reasons of social justice. The aim of the competition authorities’ decisions is not to compensate for damage After having recalled the various efforts of the Government endured by the consumer, but to punish those who carry in favour of consumers (in particular concerning the price of eyeglasses), Benoît Hamon presented the draft bill out harmful practices. The unfairness consists in punishing introducing for the first time in French law a class action a cartel by a fine paid to the State, whereas the victims (bill to be examined by the Constitutional Council at the never get their damage remedied, except those who are time of the conference). willing to take action against well-armed and well-equipped firms which in practice hardly ever occurs. By redressing The scope of the class action will apply to all economic this balance, the French class action will secure both the areas. No field is excluded as long as an economic damage right to effective remedy and the right to a fair trial. can be assessed. However, there will be another class action dedicated to health issues in the draft public health Lastly, it will be a way to reinforce competition regulations bill supported by Minister Marisol Touraine. A further class and competition efficacy by using class action as a action may be envisaged in the near future for environmental deterrent. Class action is designed to deter firms from issues, but it remains difficult to estimate environmental drawing up agreements that would be doubly harmful to damage; discussions are still under way on this subject. them as they would have to pay a fine and compensate Benoît Hamon then talked about the three reasons that the consumer to the last euro. French class action will help have justified the implementation of class action in the field protect the consumer and preserve “competitive public of competition. First, competition has to be of benefit to order”.

12 - New frontiers of antitrust 2014 Concurrences Special Issue New frontiers of antitrust 2014 Concurrences Special Issue - 13 Social Events SPEAKER EVE'S DINNER

Areva Autorité de la concurrence Avisa BPCE Cleary Cottlieb Coca-Cola Colas Compass Lexecon Competition Appeal Tribunal 1 DG COMP EDF European Commission General Electric Google Groupement Cartes Bancaires Hachette JC Decaux Keolis 1 Anne Perrot, Nicolas Charbit, 6 Ali Nikpay, Cristina Caffarra, Jacques Lafitte Wouter Wils Lazard 2 Peter Freeman 7 Joaquín Almunia Moet Hennessy 3 Cleary Gottlieb 8 Antoine Winckler Netherlands Authority for Consumers & Compass Lexecon and Markets 9 François Brunet, Peter Freeman 4 Frédéric Jenny Qualcomm 10 Bruno Lasserre, David Sevy, 5 Bruno Lasserre Valérie Meunier Société Générale Suez Environnement Vallourec Veolia Vivendi

14 - New frontiers of antitrust 2014 Concurrences Special Issue 1 Social Events Dinner sponsored by Cleary Gottlieb Compass Lexecon

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New frontiers of antitrust 2014 Concurrences Special Issue - 15 VIPs LUNCH CERCLE DES DIRECTEURS, HÔTEL DES MINISTRES MINISTÈRE DE L’ECONOMIE ET DES FINANCES

Air Liquide Servier Areva SFR Autorité de la concurrence Société Générale Avisa Suez Environnement BPCE Total BNP Paribas Thales Bouygues Telecom University Paris Coca-Cola Panthéon-Assas Colas Valeo Competition Appeal Tribunal Vallourec Credit Agricole Veolia 1 DG COMP Vivendi 3 EDF ESSEC Federal Trade Commission General Electric Google Goodyear Dunlop Groupement Cartes Bancaires Hachette JC Decaux Keolis King’s College London Lafarge 2 Lagardere Lazard Lactalis Moet Hennessy Netherlands Authority for Consumers and Markets Pfizer Qualcomm Roullier

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16 - New frontiers of antitrust 2014 Concurrences Special Issue 6 VIPS Lunch sponsored by Clifford Chance Jones Day, MAPP Mayer Brown, Norton Rose

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1 O. Ancelin, B. Genin, C. Lemaire 2 V. Beaumeunier, V. Meunier 3 É. Barbier de La Serre, A. Marie, P. Kirch 4 M. Trabucchi 5 Hans W. Friederiszick 6 N. Jalabert-Doury, J. Fourquet 7 Guests

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New frontiers of antitrust 2014 Concurrences Special Issue - 17 SPEAKER DINNER

PÉNICHE

Air Liquide Autorité de la concurrence BNP Paribas Bouygues Telecom Coca-Cola Competition Appeal Tribunal Credit Agricole European Commission Federal Trade Commission Goodyear Dunlop King’s College London Lafarge Lagardere Lazard Lactalis Microeconomix Pfizer Roullier Servier SFR Total Thales Valeo White & Case

1 Bruno Lasserre 2 François Lévêque, Gildas de Muizon 3 J.-P. Tran Thiet, W. Wils et P. Spilliaert 4 Joshua Wright, Assimakis Komninos 5 Juliette Goyer 6 Mario Monti 7 Nicolas Charbit, Peter Freeman 8 François Lévêque

18 - New frontiers of antitrust 2014 Concurrences Special Issue Dinner sponsored by Microeconomix and White & Case

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New frontiers of antitrust 2014 Concurrences Special Issue - 19 Press review CONTENTS

Can antitrust authorities contribute Restructuring firms in the context of crisis: EC Google pact not 'gentlemen’s agreement' 27 to fixing the dysfunctional patent system? What role for merger policy? Evelina Kurgonaite, Policy and Regulatory Report Interview with Dr. Alexander Italianer 24 Interview with Frédéric Jenny 20 EU studying ‘a lot of information’ Matthew Readings, Concurrences Journal Dc. Hans Friederiszich, Concurrences Journal on alleged forex manipulation, Google deal is no "gentlemen's Détection des pratiques anticoncurrentielles : Almunia says 27 Il existe un consensus... Matthew Newman and Lewis Crofts, MLEX agreement", says EU antitrust chief 21 Entretien avec Laurence Idot 24 Foo Yun Chee , Reuters Timing of merger reviews in EU countries Concurrences Journal could be streamlined BKartA chief 28 The ECN & EC Reg. 1/2003: Almunia says EU is transparent Evelina Kurgonaite, PaRR Can cooperation be extended to merger on Google pact 26 French Finance Ministry Is Advised by control? Interview with Bruno Lasserre 22 Aoife White, Bloomberg Mélanie Thill-Tayara, Concurrences Journal Competition Authority Staff To Streamline Almunia Will Examine FX ‘With Same European Union Merger Control System Patents: Can antitrust authorities Energy’ as Libor Probe 26 Procedures 29 contribute to fixing the dysfunctional Aoife White, Bloomberg Barbara Casassus, Antitrust & Trade Regulation Daily patent system? Interview with Joshua Mundt calls for EU law to harmonize Almunia defends auction system ingoogle's Wright 23 merger test after divergent rulings 26 antitrust settlement 30 Thomas Graf, Concurrences Journal Matthew Newman, MLEX Matthew Newman, MLEX

CAN ANTITRUST AUTHORITIES CONTRIBUTE TO FIXING THE DYSFUNCTIONAL PATENT SYSTEM?

DC. HANS FRIEDERISZICH INTERVIEW WITH FRÉDÉRIC JENNY > Concurrences Journal, 15 Sept. 2013

he New Frontiers of Antitrust 2014 con- achieve allocative efficiency and (possibly) dyna- true that in some circles, there was concern that ference will be held on 21st February 2014 mic efficiency through innovation. one or two EU decisions (for example, the Magill T at the Ministry of Economics in Paris. The two set of laws are complementary in the long decision or the IMS decisions) might indicate that Professor Hans Friederiszich - E.CA - has inter- run as Aghion, Howitty and Prantlz have recently the European Commission was prepared to use viewed Frédéric Jenny - OECD Competition shown. Policies that increase product market its competition law powers to offset the effect of Committee - who will chair their panel: "Patents: competition increase innovation most in countries "weak patents". But those fears have proved to Can antitrust authorities contribute to fixing the which have strong IP laws and for industries which be unfounded. Competition authorities share the dysfunctional patent system?". Other panel rely most on patent protection to innovate. view that undermining patent law through the use speakers include: Joshua Wright - Federal Trade Although the two set of laws have complementary of competition law instruments would only add Commission, Washington - and Thomas Graf - confusion and increase legal uncertainty for firms. Cleary Gottlieb Steen & Hamilton, Brussels. goals, they use different instruments. Competition law uses the competitive process to promote This being said, over the last decade there has Hans Friederiszich: Are patent and competition (mostly static) efficiency; patent law uses some been quite a lot of support for improving the dia- law pursuing the same goals or are they in con- form of protection from competition to promote logue between competition authorities and patent flict to each other? (mostly dynamic) efficiency. This can occasionally offices. In the Competition Committee of OECD lead to tensions on the proper scope of patents we have held several roundtables on the relation- Frédéric Jenny - Patent laws reward innovation or on the acceptable behaviour of firms which ship between innovation , patents, and competi- by giving the innovator a time-limited exclusivity have IP rights. But those tensions are limited by tion and we have welcomed the active participa- on its innovation in order to allow the innovator to the fact that competition law prohibits only the tion of patent offices. Consideration of the recoup its R&D expenses. Underlying patent law abuse of market power and not market power implications of patent design and of the patenting is a trade between society and innovators. Society itself. process for competition might be a useful and is willing to confer some market power on inno- relevant consideration for patent offices. vators for a limited time in exchange for an Hans Friederiszich: Many of the current antitrust increase in the general stock of knowledge when issues are related to weak patents – should we Hans Friederiszich: Do you see benefits in a the innovators' patents expire. The goal of patent not improve the patent granting process instead more industry specific patent system? law is thus to promote innovation, an important of (mis)using antitrust enforcement resources? Frédéric Jenny - From an economic standpoint it form of dynamic efficiency, and possibly (future) Frédéric Jenny - First, I do not think that compe- seems that there are different types of innovative allocative efficiency. Competition law seeks to tition authorities misuse their antitrust enforce- processes in different sectors. First, there are only promote competition on markets in order to ment resources to " correct" weak patents. It is a limited number of sectors which rely heavily

20 - New frontiers of antitrust 2013 Concurrences Special Issue N°2 - 2013 on patents to innovate. In other sectors, being the countries to pay the high price of patented drugs medicine but more dependent on the delivery of first on the market to come up with a new product when they are faced with a severe health situation health services both in developed and developing or process is more important than getting a such as an epidemic. The TRIPS agreement has countries. This will in all likelihood make intellec- patent. Second, in sectors which rely heavily on to a certain extent dealt with this issue by esta- tual property rights less important for the promo- patents to innovate (for example in the chemical blishing conditions and a procedure under which tion of innovation in the pharmaceutical sector. sector or in the pharmaceutical sector), there are developing countries faced with an epidemic can Hans Friederiszich: More specifically and related also major differences in the innovation process. order compulsory licensing and allow the distribu- to current antitrust cases: Shall SEP-holders be In some of those sectors the innovation process tion of generic medicine. If there is a consensus allowed to seek an injunction? develops through major breakthrough in pro- that the TRIPS agreement is unsatisfactory, it cesses or in products whereas in other sectors could be renegotiated in the context of the WTO Frédéric Jenny - This is a difficult question. the innovation process is more gradual and Doha round. Under which conditions can one consider that involves successive improvements to pre-existing But I think that there is a wider issue. In developed the exercise of a right under a law (patent law) is innovations. Finally, there are sectors which are countries, as well as in developing countries, an abuse under another law (competition law). technologically fairly stable and others where the public health systems are facing severe budge- Does the threat by the holder of a SEP of an technology changes very rapidly and sometimes tary constraints and have more and more difficul- injunctive relief against an infringer amount to takes turns which are difficult to predict. It is far ties affording the high price of patented drugs. bad faith on the part of the SEP holder in the from obvious that the patent regime should be Hence their efforts to encourage the use of gene- negotiation of a FRAND agreement with the the same in all those sectors with regard to the ric drugs rather than princeps whenever it is potential licensee? I am a strong believer that breadth of the patents granted or to the length of legally possible. At the same time the cost for drug the use of a right can only be an abusive practice the patents granted. If the goal of patent law is to manufacturers of R&D is increasing. This means in exceptional circumstances. Along those lines, promote innovation, it is worth thinking about that the “blockbuster” business model in the phar- in ITT Promedia (1998), the General Court stated whether our current instrument is too blunt to maceutical industry , whereby pharmaceutical that it is only in “wholly exceptional circums- effectively promote innovation in some sectors or firms invest a lot of money in R&D and recoup their tances” that bringing legal proceedings may may even deter innovation. investment through the high price of a few suc- constitute an abuse of dominance. Hans Friederiszich: Shall and can the patent law cessful patented drugs, is doomed. In the phar- The issue now in front of the Court of Justice is take distributional concerns into account, e.g. maceutical industry, there will inevitably a move what are the criteria one should use to assess regarding free licensing in developing countries? toward a business model based on “health ser- whether the circumstances are exceptional. Is it Frédéric Jenny - What you call “distributional vices” rather than on “blockbuster drugs”. So in sufficient that the infringer has declared its readi- concerns”, is, if I understand well, the inability of the near future pharmaceutical firms will be less ness to enter into negotiations or does it have to health systems in a number of developing dependent on the high price of a few successful have submitted an unconditional offer?

GOOGLE DEAL IS NO "GENTLEMEN'S AGREEMENT", SAYS EU ANTITRUST CHIEF

FOO YUN CHEE , REUTERS

U antitrust chief says welcomes criticism proposals, calling them significant concessions tigation. Its first two attempts to resolve the case Says will investigate Google's Android which had allayed competition concerns. failed. Under its latest proposals, Google, which E software in coming weeks However rival firms said the plans did not go far has a 75 percent share of the European search enough and would only entrench Google's domi- market according to consultancy comScore, will The EU antitrust chief defended a deal with nance of Internet searches. And sources told let three rivals display their logos and web links in Google over how it displays web search results, Reuters a third of the members of the European a prominent box, and content providers will be following criticism from rival firms and his own Commission also opposed the deal, underlining able to decide what material Google can use for colleagues, saying there had been no gentle- the political sensitivity of the matter. its own services. Google will also scrap restric- men's agreement to close the case. The world's Almunia brushed aside the criticism. "I have also tions that prevent advertisers from moving their most popular search engine has been under heard people say that the Commission has ente- campaigns to rival platforms such as Yahoo!'s investigation for three years by the European red a gentlemen's agreement with Google which search tool and Microsoft's Bing. Commission, which acts as the bloc's antitrust would lead to a way of dropping the charges or The company must stick to the deal for the next regulator, over complaints it was blocking com- closing the file. Not at all," he told a Concurrences five years. petitors in search results. More than a dozen Journal conference on Thursday. He said an inde- companies, including Microsoft, price compari- pendent trustee would monitor Google to ensure Almunia, however, said Google continues to be son site Foundem and online mapping company that there would not be any anti-competitive prac- under regulatory scrutiny over its Android opera- Hotmaps, have accused it of squeezing them out tices. Almunia still needs the majority of his fellow ting system for smartphones. "We are in the pro- of the market. Earlier this month, Google agreed commissioners to push through the deal, but said cess of investigating Android in the next few to make concessions to display rivals' links more he welcomed the criticism. "It is logical. There are weeks," he said. Google gives away Android for prominently, hoping to end a case that could have 28 commissioners, each having his own views. It free. The software, which is available on three out led to a fine of up to $5 billion (3.6 billion euros). is good that each one can share his views," he of four smartphones sold worldwide, essentially European Competition Commissioner Joaquin said. It was the third attempt by the world's most helps the company extend its core search busi- Almunia said last week he would accept Google's popular Internet search engine to settle the inves- ness and boost its usage in the mobile world.

New frontiers of antitrust 2013 Concurrences Special Issue N°2 - 2013 - 21 PRESS REVIEW

THE ECN & EC REG. 1/2003: CAN COOPERATION BE EXTENDED TO MERGER CONTROL? INTERVIEW WITH BRUNO LASSERRE

MÉLANIE THILL-TAYARA > Concurrences Journal, 15 Sept. 2013

he New Frontiers of Antitrust 2014 will be competent authorities and of course grant the NCAs to an extensive interpretation of their held on 21st February 2014 in Paris. Me necessary waivers, when these are required. powers? Moreover, before considering an T Mélanie Thill-Tayara, Partner, Norton Allowing for the parties’ good faith cooperation, extension of advocacy at international level, Rose Fulbright, has interviewed Bruno Lasserre, exchange and dialogue between authorities may should there not be first an in-depth reflection on President of the French Competition Authority still stumble upon the procedural and substantive the scope of the NCAs’ advocacy role? who will chair their panel: "The ECN and Reg. discrepancies between national systems. Should Bruno Lasserre - Advocacy is about soft power 1/2003 10 years after: Can cooperation be even these discrepancies be lifted, there is always and comes in various forms, from counseling the extended to merger control and advocacy?" the possibility that several authorities reviewing State to auditing the competitive impact of exis- Other panel speakers include: Peter Freeman, the same merger will simply diverge in their ting norms or commercial practices, conducting Competition Appeal Tribunal Chairman, Andreas assessments. With the remaining prevalence of Mundt, Bundeskartellamt Chairman, and, multijurisdictional filings within the EU, this is a risk an assessment of the state of play in a sector or Wouter Wils, Hearing Officer DG COMP, Visiting which must be addressed, as the outcome of the simply speaking up in a public debate. On the Professor, King's College London. recent Eurotunnel/Sea France cross-border mer- other hand, advocacy stops when enforcement ger reviews demonstrates. begins. At the French level, the inherent difference Mélanie Thill-Tayara: What is your evaluation of My opinion is that while some headway can still between opinions, on the one hand, and enforce- the effectiveness of the cooperation between be made as regards the tools for cooperation, e.g. ment decisions, on the other, was underscored NCAs organised by the Best Practices of Novem- by allowing competition authorities reviewing the by the Conseil d’Etat in several judgments: in the ber 2011 on multi-jurisdictional mergers, espe- same merger to exchange confidential informa- context of its advisory role, the Autorité is entitled cially regarding transactions which might give tion without requiring a waiver and strictly for the rise to competition issues? to make any recommendation it deems appro- purpose of reviewing the said merger, it is para- priate, these recommendations having no bearing Bruno Lasserre - The current level of cooperation mount that there is a broader convergence of on the individual legal situation of the concerned in merger control within Europe is a by-product of national rules in the case of cross-border merger operators. This mix of explaining and fining as part the early development of national regimes, espe- reviews to avoid inconsistencies. In particular, the of an overall continuum is, in my opinion, essential cially in the biggest economies of Germany, Britain application of the same substantive law to cross- to promote an effective competition policy. and France, which pre-existed attempts to articu- border mergers, as advocated by Mario Monti in Indeed, all stakeholders stand to benefit from late an EU-wide framework. When EU legislation 2010, together with an alignment of procedural NCAs’ advocacy efforts. For instance, the Autori- was adopted in 1989 and revamped in 2004, the deadlines, should significantly reduce the risk of té’s power in recent years to conduct sector focus was on the “vertical” organization of alter- conflict. The application of the same substantive nate competences between the European Com- law and timing could in turn pave the way for the inquiries ex officio has allowed it to go beyond a mission and national competition authorities establishment of mechanisms aimed at reconci- case-by-case approach and monitor an entire rather than on the setting up of a proper “horizon- ling decisions which are anticipated to be conflic- sector, stepping up in the process its knowledge tal” network of authorities underpinned by both ting or inconsistent. These as well other options of the sector-specific competitive dynamics and soft and hard law instruments of convergence, as are explored in the report which was drafted by thereby increasing the quality and expertise of is the case for the European Competition Network Fabien Zivy on behalf of the Autorité and recently future investigations. At the same time, the busi- in the field of antitrust enforcement. submitted to the French minister of the economy, ness community can benefit from a detailed ana- However, important steps have since then been Pierre Moscovici. lytical framework set out in a transparent manner made to increase cooperation and consistency on which it can base its commercial decisions and amongst national competition authorities, not Mélanie Thill-Tayara: Is there any risk that the engage compliance efforts. least by setting up a dedicated EU working group cooperation between NCAs would be under- In light of the significance of the contribution made on mergers in 2010, of which the Autorité de la mined by the intervention of governments concurrence currently assumes co-chairmanship. authorised to approve or prohibit transactions by advocacy to a competition authority’s man- The 2011 Best Practices are useful in helping fill regardless of the decision made by the relevant date, the Autorité, together with its Mexican coun- the gap in the field of horizontal cooperation in the NCA, such as France and Germany? terpart and the input of some 20 members of the context of multijurisdictional filings. They set out a Bruno Lasserre - Public interests other than the International Competition Network (ICN), is cur- non compulsory path for cooperation amongst preservation of a competitive level-playing field rently working on a set of recommendations concerned authorities to ensure consistent or at may exceptionally justify government intervention which will help younger agencies put their exper- least non conflicting outcomes when serious into mergers. Provided such intervention remains tise to effective use and maximize the impact of common issues arise. An added benefit of such within the bounds set by national and EU law, it their advocacy work. At the ECN level, because cooperation lies in the timely assessment it allows, does not carry any risk of impairing cooperation sector inquiries in particular constitute a useful through the limitation of unnecessary duplication amongst NCAs which begins and ends with the springboard for the formulation, by competition of efforts. Let me stress nonetheless an important application of competition law. authorities, of policy recommendations, I strongly caveat, which is that the parties’ close coopera- Mélanie Thill-Tayara: You promote the NCAs’ believe that enhanced cooperation amongst tion is a prerequisite: they must be proactive, advocacy mission but don’t you think that a too NCAs would further increase the profile of our submit consistent information before the different ambitious approach of advocacy could lead separate national initiatives.

22 - New frontiers of antitrust 2013 Concurrences Special Issue N°2 - 2013 PATENTS: CAN ANTITRUST AUTHORITIES CONTRIBUTE TO FIXING THE DYSFUNCTIONAL

PATENT SYSTEM? INTERVIEW WITH JOSHUA WRIGHT

THOMAS GRAF > Concurrences Journal, 13 Nov. 2013

he New Frontiers of Antitrust 2014 con- cerned about clauses that condition a FRAND business model attributed to PAEs and other ference will be held on 21st February license on the licensee not challenging validity of patent aggregators. T 2014 at the Ministry of Economics in the patents. Is competition necessarily threat- In my view, there is no evidence at this point that Paris. Thomas Graf - Cleary Gottlieb Brussels - ened if the licensee forgoes validity challenge? PAEs’ particular business model creates a new or has interviewed Joshua D. Wright - Commis- Can this not be addressed through other means, unique antitrust problem, or warrants more or less sioner, Federal Trade Commission, Washington for example by applying a probabilistic valuation scrutiny than others as a matter of antitrust ana- DC - who will participate in panel: "Patents: Can where validity has not been tested? lysis. The evidence thus far simply does not antitrust authorities contribute to fixing the Joshua D. Wright - Assessing patent strength or suggest any need to depart from the established dysfunctional patent system?". Other panel validity is generally important if one wants to antitrust framework in order appropriately to speakers include: Frédéric Jenny - OECD Com- understand whether any particular agreement has address patent arrangements, and the standard petition Committee - and Professor Hans Frie- had or is likely to have anticompetitive effects. An antitrust framework is fully capable of reaching deriszich - E.CA. evidence-based approach to antitrust analysis that conduct and providing adequate remedies. Thomas Graf: On a different topic, what conclu- Thomas Graf: The judgments in Microsoft/ should embrace the ability of courts and agencies Motorola and Cisco/Innovate resolved FRAND to gain a better understanding of the competitive sions do you draw from the Actavis judgment for issues based on patent and contract law princi- effects of a particular agreement or business reverse patent settlements in the pharma ples. What scope for antitrust law do you see in practice. industry? Has the judgment helped to clarify the this area after these cases? The structure of the rule of reason is flexible legal situation or has it increased uncertainty? Joshua D. Wright: In Actavis, the Supreme Court Joshua D. Wright - As I mentioned in a speech enough to incorporate analysis of the strength of ruled that reverse payment settlement agree- last September, the antitrust laws are not well the patent where appropriate and efficient to do ments between branded and generic pharmaceu- suited to govern contract disputes between pri- so. That said, I am also a strong believer in the tical companies are subject to antitrust scrutiny vate parties, such as those that relates to FRAND, proposition that private parties can best align their and should be analyzed under the traditional, but in light of remedies available under contract or incentives and create value through voluntary not necessarily full-blow, rule-of-reason. patent law. The same concerns extend to agreements with one another. The Court's decision represents a significant vic- attempts by antitrust agencies to influence SSOs' I worry that a rule that categorically forbids a tory for the Federal Trade Commission because it IPR policies, many of which include FRAND licen- patent-holder from making a license offer that brings these agreements firmly within the scope sing terms. Economists have long viewed the obligates the licensee not to challenge the validity of the antitrust laws and rejects the “scope of the hold-up problem and ex post opportunism more of the underlying patent would increase transac- patent” test. In so doing, the decision provides generally as a problem sounding in contract law tion costs and reduce the number of license important guidance to federal district courts and with its default substantive rules and remedies agreements. Patent licensing negotiations can be the Commission about how to analyze such rather than in antitrust law. complex and multi-faceted, and any legal requi- reverse payment settlement agreements. A critical The risk of imposing antitrust remedies in pure rements imposed by a court or an antitrust next step is to begin to answer the important contract disputes can have harmful effects in agency must account for this complexity. questions left open by Actavis. terms of dampening incentives to participate in Thomas Graf: So far much of the antitrust debate Although the Court’s decision puts reverse pay- standard setting bodies and to commercialize inno- on patents has centered on unilateral action. ment settlement cases squarely within the rule-of vation. These would be unfortunate consequences What are your thoughts on multilateral arrange- reason framework, a key issue going forward is of policy reforms and enforcement efforts designed ments, such as patent purchase and enforce- identifying what legal burdens and presumptions to improve the competitive process. In my view, ment consortia or privateering arrangements? apply to analysis of such agreements. For ins- the sanctions available to address patent hold-up Joshua D. Wright - Multilateral arrangements tance, although the Court rejected a general and related concerns under other legal regimes are involving patents, including activities associated presumption that reverse payment settlements more than adequate to provide optimal deterrence with PAEs or PAE-like behavior by operating com- are unlawful, it is possible that a case-specific against patent hold-up. panies, are not immune from the antitrust laws. presumption could arise from general evidence Antitrust enforcement remains available in cases For example, using PAEs to coordinate collusive that a particular type of agreement is always or of true anticompetitive price-fixing or deceptively agreements that violate Section 1 of the Sherman almost always anticompetitive based on econo- manipulating standards. In the absence of robust Act are either clearly or likely unlawful under stan- mic and judicial learning. empirical evidence to suggest that SSOs’ adap- dard antitrust analysis. This is an area where the Commission should tation of FRAND licensing policies have been Conduct that raises rivals’ costs and harms com- continue to put its institutional advantages in inadequate in minimizing the probability of hold- petition can certainly violate the antitrust laws, and research and reporting to good use. Another open up, there is little reason to bring to bear the blunt arrangements fitting this description should be question is to define the precise contours of the weaponry of antitrust rules and remedies to subject to appropriate scrutiny. However, much rule-of-reason analysis in reverse payment settle- micromanage the competitive process. of the policy debate involving PAEs contemplates ment cases. Although Actavis rules out the scope Thomas Graf: In these two cases, the courts set a broader role for antitrust than is appropriate, and of the patent test, it would be surprising if courts the FRAND royalty rate without first looking at stretches the standard analysis beyond its limits did away with patent validity as part of their ana- validity. In Europe, the EU Commission is con- in an attempt to discourage use of the particular lysis altogether.

New frontiers of antitrust 2013 Concurrences Special Issue N°2 - 2013 - 23 PRESS REVIEW

RESTRUCTURING FIRMS IN THE CONTEXT OF CRISIS: WHAT ROLE FOR MERGER POLICY?

MATTHEW READINGS INTERVIEW WITH DR. ALEXANDER ITALIANER > Concurrences Journal, 12 Dec. 2013

he New Frontiers of Antitrust 2014 con- Matthew Readings: What mechanisms are Alexander Italianer - Already now, the Member ference will be held on 21st February 2014 available under the EU Merger Regulation to States can invoke public security, media plurality T at the Ministry of Economics in Paris. allow efficient and proportionate enforcement of and prudential rules for financial services regar- Matthew Readings - Shearman & Sterling the merger regime in times of economic crisis? ding mergers that we have cleared. London - has interviewed Alexander Italianer - Alexander Italianer - Normally, mergers go ahead Public interest is very often of relevance at the Director General, DG COMP, Brussels - who will only after our formal approval, but in some urgent national level, and I would prefer that we only have participate in panel: "Restructuring firms in the cases we may permit companies to start earlier. This context of crisis: What role for merger policy?". to take competition concerns into account. We happened in the case of the BNP Paribas/Fortis Other panel speakers include: Mario Mont - have some other mechanisms to solve problema- merger in 2008. Still, we usually advise companies Senator, Roma - , Howard Shelanski - Office of tic cases, in the interest of financial stability. A Information and Regulatory Affairs, White House, to simply notify us of the merger rather than applying case in point is the BNP/Paribas- Fortis case, for permission to start early. The ordinary procedure Washington DC - , and Anne Perrot - Economist, where we gave permission to start the merger is very swift as it is, and any outstanding competition Mapp, Paris / Brussels. before our formal approval. issues are usually resolved through remedies. Another example: A number of governments Matthew Readings: Should enforcement of We have also applied the “failing firm defence”. A bailed out several banks during the crisis by natio- merger policy in the EU be softened or sus- recent example is the merger of Greek airlines pended in times of economic crisis – either in Aegean and Olympic. We allowed this despite the nalising them. As the banks now had one owner terms of the substantive intervention test or in fact that the new firm would be dominant on internal – the state – this could be seen as a merger. We the design of remedies? Does the financial flights, as it was clear that Olympic would have gone treated the banks as separate entities, on the sector merit special treatment in this regard, out of business anyway, so consumers would not condition that they maintained independent given its importance to the economy as a whole? have been better off without the merger. power of decision from the government. Alexander Italianer - To give you a short answer: Matthew Readings: Is there a case to expand the Matthew Readings: Is the current level of inter- No. We actually very rarely prohibit mergers – in the use of derogations under the EU Merger Regulation action between merger policy and State aid last five years we have prohibited only four transac- to mitigate the impact of the mandatory regime in optimal? Is there more scope to apply merger tions. The great majority of cases is cleared without crisis situations where there is urgency but also a remedy principles in the context of State aid intervention. If we do find competition problems, prima facie substantive competition issue? restructurings (e.g. where the divested business then these can almost always be resolved through Alexander Italianer - No. As I said, there is no is a carve-out and/or there is a limited pool of remedies. The remedies cases make up around five need. Our deadlines for deciding on cases are divestment buyers) so as to create more viable per cent of cases. very short, normally just five weeks. If we do find As it is, our merger regulation is flexible enough to competition concerns these are solved through and effective competitors? take economic crises into account. In particularly remedies. We rarely ban mergers. In cases of Alexander Italianer - Now I can finally answer one urgent cases, parties can ask for permission to start great urgency we can allow mergers to take place of your questions by simply saying: ‘Yes.’ Our merging before our approval. But we should not and ahead of schedule. Task Force Financial Crisis contained staff from do not soften our enforcement efforts. Don’t forget both State aid and merger units. State aid teams that the merged companies will still be there once Matthew Readings: Would EU merger policy be are always supported by merger specialists who the crisis is over. If we turn a blind eye now, then improved by explicitly permitting public interest advise them on remedies. Working together in consumers will suffer the consequences long after exceptions to be considered under the EU the economy has recovered. Merger Regulation in appropriate cases / cir- practice on the team level, I don’t think interaction cumstances (e.g. to maintain financial stability)? gets more optimal than that.

DÉTECTION DES PRATIQUES ANTICONCURRENTIELLES : IL EXISTE UN CONSENSUS... ENTRETIEN AVEC LAURENCE IDOT

> Concurrences Journal, 11 Jan. 2014

a conférence « Demain la concurrence » Vice-Président de Charles River Associ- Laurence Idot - Le fait de disposer de pouvoirs « New frontiers of antitrust » se tiendra ates et Ali Nikpay, Associé au cabinet d’enquête est effectivement l’un des traits caracté- L à Paris le 21 février 2014, au Ministère Gibson Dunn. ristiques des autorités spécialisées en droit de la de l'Économie et des Finances. Concur- concurrence et il est également incontestable que rences a interviewé le Professeur Lau- Concurrences : Les autorités de concur- rence Idot qui présidera une table ronde rence disposent déjà d’importants outils l’on a assisté ces dernières années à un renforce- sur ce sujet avec Bill Kovacic, Professeur de détection des pratiques anticoncurren- ment sensible de ces pouvoirs. Le constat peut être à Washington University, Cristina Caffarra, tielles. Ne sont ils pas suffisants ? fait pour toutes les autorités. Si l’on se limite aux

24 - New frontiers of antitrust 2013 Concurrences Special Issue N°2 - 2013 IL EXISTE DESORMAIS UN CONSENSUS SUR LE FAIT QUE LES AUTORITES NE PEUVENT SE REPOSER UNIQUEMENT SUR LES OUTILS HABITUELS ET QU’ELLES DOIVENT MENER UNE POLITIQUE PRO-ACTIVE DE DETECTION.”

exemples de la Commission européenne et de Plus que les méthodes utilisées, dont certaines Concurrences : Existe-t-il des obstacles au l’Autorité française, les dernières réformes ont sont, on le sait, débattues, et sur lequel un groupe développement de ces nouveaux outils au toutes contribué à renforcer les pouvoirs d’en- de travail au sein du Réseau européen de concur- sein de l’Union européenne ? quête « classiques ». Il suffit d’évoquer les innova- rence réfléchit, les autorités se heurtent par Laurence Idot - Le benchmarking permanent qui tions introduites dans le règlement n° 1/2003 exemple à la délocalisation des serveurs. existe désormais en cette matière conduit néces- (modification des règles applicables aux demandes sairement à réfléchir à l’opportunité d’élargir la de renseignements et aux inspections ; introduc- Concurrences : Quels sont alors les axes de boîte à outils des membres du Réseau européen tion des déclarations orales et des inspections aux réflexion ? de concurrence. S’agissant des obstacles, il faut domiciles privés), ou encore dans les lois fran- Laurence Idot - Les recherches portent essen- sans doute distinguer entre les « outils écono- çaises (2001, 2008, en particulier). Par ailleurs, tiellement sur les cartels, ce qui de mon point de miques » et les « outils juridiques ». pour les cartels, les schémas traditionnels ont été vue est quelque peu réducteur, car une politique Pour les premiers, ils sont faciles à identifier. Les bouleversés par le développement des pro- de concurrence ne peut se réduire à cela, mais il difficultés sont identiques chaque fois que l’on grammes de clémence qui fonctionnent dans semblerait que pour les pratiques autres, les outils généralise les analyses économiques. Les pro- l’immense majorité des situations en liaison avec de détection existants soient jugés pour le blèmes rencontrés ne sont pas propres aux « les pouvoirs d’enquête traditionnels. Les moment suffisants. screens ». L’on se heurte au manque de moyens demandes de clémence de type I.B sont très des autorités de concurrence, à l’accessibilité aux rares. A cela, s’ajoute, pour les pratiques autres Pour les cartels, les économistes se sont emparés informations pertinentes, à la fiabilité des modèles. que les cartels, l’utilisation d’un outil connu dès le du sujet. Il y a actuellement de nombreuses Il n’est pas question de les rejeter par principe, règlement n° 17/62, à savoir les enquêtes de mar- études, notamment aux Etats-Unis, mais égale- mais ces nouveaux outils ne peuvent être conçus, ché. La généralisation des enquêtes sectorielles, ment en Europe, au sein de la Commission euro- me semble-t-il, que comme des aides supplé- tant par la Commission, que par des autorités péenne et au Royaume-Uni sur l’intérêt de multi- mentaires à la détection. nationales, comme l’Autorité de la concurrence, a plier les analyses économiques préalables (le d’ailleurs déjà fait l’objet d’une table ronde lors de screening), l’objectif étant d’identifier les secteurs Pour les nouveaux « outils juridiques », l’on se l’édition 2010 de la conférence « Demain la dans lesquels les risques de collusion sont impor- heurte aux mêmes difficultés qu’il y a maintenant concurrence ». tants. Différentes méthodes coexistent, mais la presque 20 ans lorsqu’on a découvert les pro- première question qui se pose est celle de leur grammes de clémence en Europe. Indépendam- Dans une perspective internationale, l’on a assisté utilisation par les autorités de concurrence. Par ment du débat moral qui pourrait renaître, d’un également à un accroissement sensible de la coo- exemple, s’agissant du LIBOR, plusieurs études point de vue technique, il n’est pas toujours aisé pération entre autorités. L’exemple le plus achevé avaient mis en lumière les risques de collusion, d’insérer ces outils conçus dans un schéma ins- est bien évidemment celui du Réseau européen mais aucune autorité de concurrence n’en avait titutionnel particulier dans le modèle européen, de concurrence, qui a ajouté à la traditionnelle qui demeure principalement administratif. coopération verticale descendante, Commission tenu compte. On reproche beaucoup à ces nou- européenne/ANC, une coopération horizontale veaux outils d’être essentiellement académiques Un constat identique peut être fait au demeurant entre ANC. Il n’est pas utile de revenir sur l’affaire et quelque peu déconnectés des réalités. Le sujet pour le renforcement des moyens d’investigation du carburéacteur, premier exemple significatif de est pour le moins controversé. En toute hypo- traditionnels. Aux Etats-Unis, le DOJ peut colla- l’application de l’article 22 du règlement n° thèse, quels que soient les modèles utilisés, le borer avec le FBI… Bien évidemment, la Commis- 1/2003. Au-delà de l’Union européenne, la coo- point de départ demeure le rassemblement des sion européenne ne dispose pas d’une telle pération internationale entre autorités s’est égale- informations. possibilité et, dans les Etats membres, en-dehors ment développée et, en-dehors des réflexions En-dehors de cet éclairage économique préa- du cas particulier de l’OFT qui pouvait s’appuyer communes notamment au sein de l’ICN ou de lable, et d’un point de vue plus juridique, un autre sur le SFO pour l’application de l’infraction de cartel offense, je ne pense pas qu’il y ait d’équi- l’OCDE, les accords bilatéraux se sont multipliés axe consiste à prolonger les programmes de valent. ces dernières années. clémence. On connaît déjà le principe du leniency Pourtant, le nombre de cartels ne semble pas avoir plus dans l’hypothèse de la révélation d’un cartel Concurrences : Voyez-vous d’autres axes de diminué, d’où une réflexion sur l’efficacité des sur un marché annexe adopté par exemple par réflexion ? outils de détection actuels. Les études récem- l’OFT au Royaume-Uni, mais ce n’est pas géné- Laurence Idot - Certainement, et ce n’est pas en ment menées semblent montrer que les pro- ralisé en Europe. Au-delà, certaines autorités ont une table ronde que l’on pourra épuiser ce sujet. grammes de clémence ont atteint leurs limites et mis en place des systèmes de récompenses des Je me bornerai à trois observations. En premier sont désormais intégrés dans la stratégie des individus. Là encore, on peut mentionner lieu, l’on se place ici du côté des autorités de entreprises. Le scandale du LIBOR a joué en l’exemple britannique avec l’ informant reward concurrence, mais il ne faut jamais perdre de vue quelque sorte comme un révélateur. Il existe scheme, dans lequel la récompense allouée peut les droits des entreprises poursuivies. En deu- désormais un consensus sur le fait que les autori- aller jusqu’à 100 000 £. Si l’on admet le whistle- xième lieu, et c’est encore plus vrai pour les car- tés ne peuvent se reposer uniquement sur ces blowing, en d’autres termes, la dénonciation tels, la dimension internationale ne peut plus être outils devenus habituels et qu’elles doivent mener individuelle, cela nécessite l’adoption d’un enca- négligée. Enfin, je voudrais revenir au point de une politique proactive de détection. L’on pourrait drement juridique. Aux Etats-Unis, vient d’être départ et au constat qu’il ne faut pas raisonner y ajouter les difficultés liées à la territorialité des adopté en 2013 par le Congrès le Criminal Anti- uniquement sur le cas des cartels. Pour les pra- pouvoirs d’enquête dans des domaines où les trust Anti-Retaliation Act qui vise précisément à tiques autres, les plaignants ont également un rôle données sont de plus en plus dématérialisées. protéger les whistleblowers. important à jouer.

New frontiers of antitrust 2013 Concurrences Special Issue N°2 - 2013 - 25 PRESS REVIEW

ALMUNIA SAYS EU IS TRANSPARENT ALMUNIA WILL EXAMINE FX ON GOOGLE PACT ‘WITH SAME ENERGY’ AOIFE WHITE, BLOOMBERG AS LIBOR PROBE oogle Pact Will Rein In World’s Largest Search Engine EU Antitrust Commissioner Joaquin Almunia says Google settlement, if finalized, AOIFE WHITE, BLOOMBERG G would impose “very precise constraints for Google to respect” in its search results. “We are advancing to the next stage of the procedure” to settle with Google, Almunia oaquin Almunia says he will look at says at Paris conference “I believe, contrary to certain opinions, the procedure was foreign exchange market “with same completely transparent and allows us to take all interests into account”. Almunia says J energy” as investigations into the rigging he needed to take a decision; “There can’t be constant back-and-forth”. Regulating of the Libor benchmark rate Google’s search algorithm “isn’t desirable” and would be difficult for the EU to do. “One of the main aims” is to to allow rival services “to be visible in the same way without “Similar practices were recently brought to our preventing Google from innovating and from developing new services,” he says. attention in the foreign exchange market and we will examine these practices with the same EU probe into Google was “large and exhaustive”; market tests of previous Google energy,” he says in Paris speech. EU has proposals received “more than 100 responses each time”. 18 complainants “will have “received a lot of information,” he tells repor- the chance to analyze our reasoning in detail and inform us of their point of view”. ters at press conference in Paris. Still, he says, Paying Google for rival links ‘recognizes that Google will be required to give up space it is “too soon” to formally open a probe. EU is usually sold to its own customers.’’ “trying to figure out if there are real issues from the antitrust perspective” such as monopoly EU competition enforcers can’t resolve publishers’ complaints over Google News’ use abuse or cartel behavior, he says. “If we consi- of newspaper articles; “competition law can’t rule on everything, especially the way der there are good reasons to open this inves- different market players share advertising revenue” tigation, we can do it,” he says.

MUNDT CALLS FOR EU LAW TO HARMONIZE MERGER TEST AFTER DIVERGENT RULINGS

MATTHEW NEWMAN, MLEX

ndreas Mundt, president of the substantive rules.” Mundt’s call for greater coor- German antitrust regulator, says the dination follows a recent report by the French A European Commission should Competition Authority, which proposed a series propose legislation to harmonize the legal and of measures to increase cooperation between I DOUBT WE COULD economic test used by national authorities to authorities on mergers (see here). Companies review mergers. seeking approval for mergers face more than 30 HAVE BLOCKED IT different regimes across Europe. There is also His call for EU legislation follows two merger a debate on whether procedures and “substan- WITH THE DOMINANCE reviews in which national competition authori- tive” tests — economic and legal reviews — TEST “ ties reached different conclusions about the should be harmonized. In the 28-member EU, same transaction. In November 2012, the national authorities apply different substantive decisions between member states. Competi- French agency cleared Eurotunnel to acquire tests on whether transactions would harm com- three vessels owned by ferry operator Sea- petition. In most countries, authorities apply the tion authorities have different procedures, such France, subject to certain conditions. But the Significant Impediment to Effective Competition as the length of their investigations and the UK authority prohibited the same transaction test, while in the UK and Ireland, authorities use amount of information they can demand from (see here). Similarly, in the AkzoNobel-Metlac the Substantial Lessening of Competition test. companies, he said. Divergent decisions could case, Germany’s Bundeskartellamt cleared the Another group uses the dominance test, Mundt be avoided if authorities were to agree on “stop- deal in March 2012, after which the UK agency said. In the AkzoNobel case, the substantive ping the clock” of merger reviews. There wasn’t blocked it. “There are gap cases, there are test played a role because Germany was using a possibility to do this in the AkzoNobel case, cases where the substantive test plays a role, the dominance test at that time. “I doubt we because the German authority approved the and I’m convinced that the EU legislator could could have blocked it with the dominance test,” transaction a month before the UK’s Competition play a role to have more harmonization in he said. Germany recently adopted the Signifi- Commission began its review, Mundt said. Europe,” Mundt said at a conference* today in cant Impediment to Effective Competition test. Paris. “We should be able to apply the same * “New Frontiers of Antitrust,” sponsored by Concurrences, Mundt pointed to several reasons for divergent Paris, Feb. 21, 2014

26 - New frontiers of antitrust 2013 Concurrences Special Issue N°2 - 2013 ALMUNIA WILL EC GOOGLE PACT NOT 'GENTLEMEN’S AGREEMENT' EXAMINE FX ‘WITH SAME ENERGY’ EVELINA KURGONAITE, PARR

AS LIBOR PROBE he European Commission's (EC) decision law. I also explained to them the procedures requiring commitments concerning the tying of its Internet to accept Google's latest "unprece- that every time commitments are made they should Explorer browser to its Windows operating system, AOIFE WHITE, BLOOMBERG T dented" commitments proposal is not an be reviewed," said Almunia. But the rules do not as previously reported by PaRR. informal agreement with the company, EU Com- require us to market test again except when the But "it is neither possible nor desirable to regulate petition Commissioner Joaquin Almunia said. substance and the structure of a proposal has chan- Google's ranking algorithm," remarked Almunia. ged in a later proposal version, he continued. This is "With what means and which objective in mind "I hear allegations that the EC engages in a ‘gentle- not the case here as the third Google proposal has men’s agreement' with Google that would lead to a not changed substantively, and its structure remains would a competition authority do that?" he ques- form of surrender of charges or the closing of the the same. "We cannot keep on market-testing as the tioned. The EU's antitrust chief said he also wished case," said Almunia speaking at the New Frontiers overall antitrust proceedings might get lost in the to respond to the criticism over the auction system of Antitrust conference organised by Concurrences market testing," said the commissioner. proposed in the commitments. "Contrary to what in Paris on 21 February. "Not at all," said the com- has been said, it will not always be necessary for missioner. Requiring commitments and making them However, "this is not the end of this investigation," competitors to pay Google to appear in its specia- Almunia noted. "Formal plaintiffs will be able to com- binding, as the EC often does, do not equal "closing" lised search service results," he said. the deal, he continued. The Brussels regulator ment on our preliminary conclusion, so they will have recently announced that it received an improved a chance to express their position," he continued. Payment will be necessary when Google displays commitments proposal from the California-based "This has been a very transparent procedure, but at competing links in a space that is normally financed online search giant to close the ongoing antitrust one point we have to take a decision," he said. by sites promoted by Google, he added. "This merely recognises that Google will be forced to give investigation the EC launched in November 2010. "Our daft letter to the complainants rejecting their up a space that would normally be sold to its own The EC has concerns over the way Google ranks claims will not be a two-pager," noted Almunia. "In links to its own vertical search services differently than some cases it will be even thicker than the 80-page clients." it does for links to competitors, as well as the way Google commitment proposal," he added. "It will be However, when Google displays links to competi- the company copies content from competing vertical a very comprehensive and reasoned document." tors in an area of the site which is free of charge, search services and uses it in its own offerings. The commissioner said the EC is "a very rational rivals will not have to pay, and will be selected based “The procedure is not over yet,” said the commissio- authority and listens to all the concerns”. If the under- on the results of an organic search, emphasised the ner. "Let me remind you that we have consulted with takings were accepted, Google's behaviour would commissioner. Beyond competition law, other many players," he said. "This was a wide-ranging be closely monitored by the EC for the period fore- aspects of the company's practices may lead to and exhaustive exercise; we received very detailed seen in the commitments. concerns, noted Almunia, such as tax optimisation, comments in hundreds of contributions," he added. The recent example of Microsoft's breach of com- the collection and use of personal data, IP issues. "I have explained to my fellow commissioners the mitments shows that failure to comply can lead to "But do not be mistaken," he cautioned. "An inves- type and nature of the commitments made by a heavy penalty, noted the commissioner. The EC tigation under Article 102 TFEU may not and must Google and consequences in terms of competition fined Microsoft EUR 561m for non-compliance with not be used to solve such kinds of problems."

EU STUDYING ‘A LOT OF INFORMATION’ ON ALLEGED FOREX MANIPULATION, ALMUNIA SAYS

MATTHEW NEWMAN AND LEWIS CROFTS, MLEX

U antitrust chief Joaquín Almunia said Almunia said. “If we consider that there are good order to sustain our fragile economic recovery, we today that his office has received “a lot of arguments to formally open this investigation, we need another kind of financial sector that is safer, E information” about possible manipula- can do it,” he said. “If we don’t see that there is more transparent and more focused on the finan- tion of foreign-exchange rates at banks. But he evidence, we can continue to ask for more evi- cing of the real economy,” he said. Eric Van Gin- hasn’t decided whether to open a formal inves- dence, information or contributions.” But he said derachter, director of cartels at the commission’s tigation, he said. it was “still too soon” to decide whether to open competition department, today told a confe- rence** in Rome that the agency was “looking Speaking to journalists today in Paris, Almunia a formal probe. Last December, the commission fined seven banks 1.7 billion euros ($2.3 billion) closely at forex to see if collusion has taken place said that the European Commission was working or not. We are at early stage.” “My feeling, my for manipulating the market for interest-rate deri- “very hard” on analyzing the information. The EU intuition is that forex might not be the last financial vatives. Earlier today, Almunia told a conference* regulator has since last September been looking case the European Commission will investigate,” in Paris that “similar practices have recently been into possible abuses in the foreign-exchange he said. market (see here). “We’re trying to figure out if brought to our attention in the foreign-exchange market.” He said his staff would exert “the same *“ New Frontiers of Antitrust,” sponsored by Concurrences, there are real issues from an antitrust perspective, Paris, Feb. 21, 2014 and this means abuse of dominance or cartel,” energy” to “shed light on these practices.” “In **10th International Cartel Workshop, ABA/IBA, Rome, Feb. 19, 2014

New frontiers of antitrust 2013 Concurrences Special Issue N°2 - 2013 - 27 PRESS REVIEW

TIMING OF MERGER REVIEWS IN EU COUNTRIES COULD BE STREAMLINED BKARTA CHIEF

EVELINA KURGONAITE, PARR

ther economic test meant different cedure to transactions that trigger merger thres- started its Phase II review in May." Mundt said he results for Akzo Nobel/Metlac deal. holds in at least two European countries. It also regretted that timing of concurrent reviews made O BKartA head cautious about full har- discusses a more comprehensive initiative on cooperation between authorities "not very easy." monisation of merger control systems convergence of national merger control rules, He advocated that regulators should be able to While full harmonisation of merger control rules introducing more consistency in both substantive "stop the clock" in order to align the timing with across Europe might not be necessary, it may be merger analysis and procedures, inspired by a useful to adjust differences in the timelines of similar aspiration of former EU Competition Com- other authorities reviewing the deal, as previously reviews by multiple authorities, said the head of missioner Mario Monti. reported by PaRR. the German competition authority Bundeskartel- In various EU countries, "we apply different tests "Even if parties are not very keen on parallel inves- lamt (BKartA) Andreas Mundt. The most notable for merger analysis," said Mundt. "More than a tigations, it would be very useful for authorities to difference in merger regimes of the 28 EU mem- half of competition authorities apply the significant be able to do so anyway," suggested Mundt. This ber states is review timing, noted Mundt, speaking impediment to effective competition (SIEC) test, could also help to avoid divergence in results of at the conference of New Antitrust Frontiers orga- but the 'dominance test' is still applied by a large, nised by Concurrences in Paris on 21 February. yet decreasing number of authorities," he merger analysis by several authorities, he said. "I His comments came amidst the discussion initia- said. Using different economic tests in itself swear if Bruno [Lasserre] and I had to take a deci- ted by the L'Autorité de la Concurrence, which would not automatically lead to diverging out- sion and issue a joint press release on the same had been tasked by the French Ministry for the comes of merger reviews, yet the authorities may day, we would unlikely end up saying that one Economy to prepare a report assessing whether indeed come to different conclusions, he said. In authority is clearing and the other one is blocking more consistency in merger control rules of Euro- the review of Akzo Nobel/Metlac transaction, for the same transaction." pean countries is warranted, following different example, the use of the economic test "played a But Mundt was somewhat cautious about the outcomes of merger reviews of the Eurotunnel/ role," said Mundt. "I very much doubt that even if SeaFrance deal in the UK and France, as pre- we had exactly the same information that we idea of full harmonisation of merger control sys- viously reported by PaRR. The French authority would have blocked this deal on the basis of the tems. In some of EU countries, national merger cleared Eurotunnel’s acquisition of certain Sea- dominance test," he said. In 2012, the BKartA proceedings are shorter and less burdensome France assets in Phase I subject to behavioural greenlighted the Akzo Nobel’s attempt to increase than filing with the EC, he noted, referring to his remedies. The UK Competition Commission (CC) its shareholding in Metlac, but the metal packa- native Germany where transactions can be clea- blocked it last June. On appeal, the Competition ging coatings deal was subsequently vetoed in red in two or three days. "I am not sure whether Appeals Tribunal (CAT) largely upheld the CC’s the UK. There are also differences in national such quick decisions were possible if we intro- decision on the merits, but quashed it on jurisdic- merger review procedures, noted Mundt. Some tional grounds, as reported. authorities require a great deal of information from duced a waiting period to identify first which In the report, drafted by Fabien Zivy on behalf of the deal parties upfront, while others – like the authority the case should be allocated to." the French Authority, the Authority has outlined a BKartA – request only very targeted deal-specific Improving harmonisation should not be discou- number of recommendations on how merger input, he continued. While in most jurisdictions raged, commented Peter Freeman, judge at the control rules in different EU jurisdictions could be pre-closure filings must be made, some authori- made more coherent, said Bruno Lasserre, the UK CAT. "It is good for business and good admi- ties carry out the ex-post merger investigations, recently reappointed president of France's com- nistration." But this should rather be achieved said the BKartA president. petition watchdog. As previously reported by through best practices and "soft cooperation" and The time limits and expediency of proceedings PaRR, among some dozen recommendations the across various EU countries are “extremely dif- making the existing systems work more smoothly, report explores the possible extension of the ferent,” he remarked. "For instance, we cleared he said, adding that his preferred approach was European Commission (EC) “one-stop shop” pro- Akzo Nobel/Metlac in April 2012, and the UK CC "evolution rather than revolution."

USING DIFFERENT ECONOMIC TESTS IN ITSELF WOULD NOT AUTOMATICALLY LEAD TO DIVERGING OUTCOMES OF MERGER REVIEWS, YET THE AUTHORITIES MAY INDEED COME TO DIFFERENT CONCLUSIONS”

28 - New frontiers of antitrust 2013 Concurrences Special Issue N°2 - 2013 FRENCH FINANCE MINISTRY IS ADVISED BY COMPE- TITION AUTHORITY STAFF TO STREAMLINE EUROPEAN UNION MERGER CONTROL SYSTEM PROCEDURES

BARBARA CASASSUS, ANTITRUST & TRADE REGULATION DAILY

he French Competition Authority has urged merger to the European Commission to be reduced ger regulation and will see a change of European changes to the European Union merger from three to two, at least for transport and other Commission leadership. Discussion on amend- T control system to streamline procedures and networks. If not referred, all cross-border mergers ments to the current regulation or a new text could foster consistency of outcomes when deals are too or even those just with cross-border effects should start soon after the European elections in May and small for one-stop shop investigation by the Euro- be reviewed under European, rather than national, the new commission has taken office on Nov. 1 and pean Commission. merger law, as has been the case with antitrust law could be adopted by qualified majority vote, which since EU regulation no. 1/2003 came into force is weighted by member countries’ populations. The report, ordered by French Finance Minister more than a decade ago. Pierre Moscovici, comes in the wake of two recent Zivy noted that a number of interviewees had war- cases where national agencies came to opposite “The single law would have a huge disciplining ned against the risk that simplification would miss its conclusions on the same transaction—the takeover effect,” Zivy added. It would narrow the risk of dif- target that minor mergers continue to be handled of SeaFrance ferries by Eurotunnel and of Metlac ferent interpretation, which is a problem with national with “the same amount of care, precautions and SpA by Akzo Nobel NV. In both cases, the national laws that are broadly similar but may be interpreted time as major ones.” The most frequently mentioned agencies—the French authority and Germany's differently. It could also spur authorities to reach the worries were longer pre-notification periods, more Bundeskartellamt—cleared the deals, but the UK's same conclusion, if only to prevent the courts having requested information and more complex proce- Competition Commission rejected them. to rule on who is right and who is wrong. dures. Conflicting decisions are rare, but the risk they reveal Other recommendations include standard procedu- The idea of ironing out wrinkles in cross-border “is only the tip of the iceberg,” according to the ral rules. Among them is the use of turnover, rather merger review is not new. In a report to European report, which was prepared and submitted to Mos- than market share, as the reference threshold for Commission President José Manuel Barroso on covici on Dec. 16 by Fabien Zivy, former French notification, although the level could vary for reasons May 9, 2010, former European Competition Com- Competition Authority legal director and chief of staff such as size of national economies. Market share is mission Mario Monti urged “greater convergence as of President Bruno Lasserre and now a legal secre- now used only in 3 of the 28 EU Member States— regards how mergers are assessed on the subs- tary at the European General Court. Portugal, Spain and the United Kingdom. tance and the review process at national level.” The one-stop shop for larger mergers has been a A model notification form, perhaps based on the In remarks prepared for Bloomberg BNA, Andreas success since it was introduced in 1989, the report German format, should be introduced for filing to all Mundt, President of Germany's Bundeskartellamt, acknowledged. But, despite progress in conver- the relevant merger authorities at the same time, and said he believes that the report was right to take up gence over the past 20 years, “the swarm of national a maximum period should be set for the review the issue of divergent merger decisions but that the merger rules multiplies the burdens, costs and process, allowing agencies to suspend the proce- issue “should not be exaggerated” and that he is delays that weigh on business, and especially mid- dure if necessary, the report proposed. An alterna- “very skeptical about some of the recommenda- cap companies,” it added. “Each part works better tive would be single notification to the EMN, it tions.” than the whole” in the “fragmented system.” Moreo- added. Applying the concept of the European Competition ver, there is no collective governance like there is for Whenever feasible, the EMN could appoint the Network (ECN) would not be a solution because anticompetitive practices, telecoms regulation and “best-placed” authority to lead the investigation into “merger control is very time sensitive” and the com- prudential supervision and soon could be intro- a cross-border merger. Unlike the ECN with anti- mission “would not have time to play the same role duced for data protection. trust, it would not hand over cases to the commis- in mergers as it does in the antitrust field.” Speedier Paradoxically, 15 years after the failed tie-up of sion when divergent decisions were on the horizon. referrals in both directions would be positive, but General Electric and Honeywell (case no. In the absence of a lead authority, a joint high-level lowering the threshold for those sent to Brussels “is COMP/M.2220), many of Zivy's interviewees said committee would be convened to take an urgent not the right response,” he said. that the EU-U.S. partnership now operates more decision if agencies were about to go off in opposite “I am sure that more intelligent solutions are possible smoothly than Europe's 31-agency network. Impro- directions. In addition, authorities should be allowed than an increase in centralization,” Mundt added. vements suggested to the European Commission to exchange all information, whether confidential or Instead “a solution that is more in line with the prin- in its recent public consultation go in the right direc- not, as part of their joint investigation. ciple of subsidiarity and strengthens the national tion but do not solve all the long-term problems, Zivy Zivy also suggested a fast-track procedure for deals level seems to be more appropriate for tackling the said. Hundreds of mergers are notified each year in not posing serious competition problems. A simpli- challenges Europe faces today.” more than one country—in one case in 15 of them. fied notification form—now in use in Denmark, He said synchronizing merger control procedures is To remedy the shortcomings, Zivy listed 10 recom- Estonia, Greece, Italy and Spain—should be adop- vital for strengthening cooperation between national mendations to help prevent conflicting decisions, to ted throughout the EU, and, at most, a system of competition authorities in parallel merger investiga- harmonize national competition laws, to boost coo- administrative declaration should be created for tions and should include a stop-the-clock provision. peration and collective governance among agen- deals unlikely to produce anticompetitive effects on cies, and to create a European Merger Network their own markets. Joint ventures set up and selling Even though issues in the report may not be (EMN), building on the success of the European outside the EU are “regularly cited as examples of included in the commission's current merger reform, Competition Network (ECN) but adapted to the deals that give rise to unnecessarily bureaucratic “it is important to discuss [them] now since the needs of merger control. procedures,” Zivy said. reform focuses only on minority interests and refer- rals,” Mundt added. A move to the significant impe- Specifically, he called for the number of jurisdictions As to timing of the reforms, he suggested 2014, diment of effective competition (SIEC) test at national th qualifying for referral of a proposed cross-border which is the 10 anniversary of the current EU mer- level to foster convergence “is worth considering,”

New frontiers of antitrust 2013 Concurrences Special Issue N°2 - 2013 - 29 PRESS REVIEW

but meanwhile soft convergence at national level close cases, the salient points are contained in [François] Hollande enjoying record low popularity “could help with that issue as well as flexibility on internal documents. “Eurotunnel claimed that its in the polls, one can well imagine that the [autho- timing.” bid for the assets was primarily a defensive mea- rity] might have had some incentive to approve Speaking at the New Frontiers of Antitrust confe- sure and that the deal would help add additional the transaction to protect those jobs.” rence in Paris on Feb. 21, Peter Freeman, one of transport capacity to further reduce prices,” Although the Zivy report was submitted to Mos- four chairmen of the UK's Competition Appeal Tri- according to John DeQ. Briggs and Daniel K. covici as scheduled last Dec. 16 and has been bunal (CAT) and a former Competition Commission Oakes, partner and associate of Axinn, Veltrop & posted on the EurActive• and Les Echos websites Chairman, said that “evolution, rather than revolu- Harkrider LLP in Washington, D.C. since Feb. 19 and 20, respectively, it has not yet tion,” is the best way forward. Agencies should But “internal documents tended to suggest, been published officially. continue to coordinate their merger control prac- however, that the main reason for the acquisition Moscovici was due to announce it to the compe- tices, their timings in particular, in order to ensure was to prevent the assets from falling into the tition law community on Feb. 13 at a reception the that international cooperation works as smoothly as hands of DFDS (Seaways), whom it was feared authority held to mark the start of its second five- possible, he added. might use them to provide unwelcome price com- year term since it acquired new powers. Instead, Joseph Vogel, of Vogel & Vogel in Paris, welcomed petition,” they said in their article, which was billed the minister sent written remarks that were read the report. “It pinpoints an important flaw in national as presenting a U.S. view. out by Authority Chairman Bruno Lasserre but merger controls that can lead to irreconcilable solu- Although the authority is an independent agency, made no mention of the report. tions and makes some useful recommendations to Briggs and Oakes also suggested that the French Despite the absence of an official release, the limit such risks,” he told Bloomberg BNA. “It also Competition Authority might have cleared the deal report was discussed publicly at the New Fron- addresses the problem of the wide diversity of natio- with conditions for political reasons. If the UK's tiers of Antitrust conference. In addition to the nal merger controls, which create excessive admi- incoming Competition and Markets Authority articles in Concurrences, it will be the topic of nistrative charges for companies seeking a multina- (CMA) concedes that the transaction is not a mer- debate at a roundtable organized at the Paris tional merger.” ger, “this would no doubt be satisfying to the offices of Freshfields Bruckhaus Deringer LLP on In one of a series of articles on the Zivy report French, since there are some 600 jobs, mostly March 17. Moscovici's press office did not res- published in the French competition policy journal French, at stake in the transaction,” they said. pond to Bloomberg BNA's telephone and email Concurrences, two U.S. lawyers noted that, as in all “And with the administration of French President requests for an explanation for the delay.

ALMUNIA DEFENDS AUCTION SYSTEM INGOOGLE'S ANTITRUST SETTLEMENT MATTHEW NEWMAN, MLEX

U antitrust chief Joaquín Almunia has lator’s concerns about the potential manipulation of decisions involve a constant monitoring of a com- defended the auction system that is part search traffic. pany, and the commission has cracked down on E of Google’s offer to settle an antitrust But the announcement sparked protests from trade companies that don’t follow through with their com- investigation, arguing that there are situations groups, rivals and users. mitments. This was the case in March 2013, when when rivals won’t have to pay the search giant to it fined Microsoft 561 million euros ($770 million at F airSearch and IComp, associations of businesses have their websites displayed. current rates) for failing to comply with a settlement including Microsoft, Foundem and others, were in an antitrust case. Almunia, speaking at a conference* in Paris today, scathing of the move, saying it would make matters also said that antitrust rules can’t solve all the issues worse not better. A week ago, Google released the “I also hear that the commission engages in a ‘gent- raised about Google, such as copyright and certain full details of its offer. lemen’s agreement’ with Google that would lead to abandoning its charges or closing the case. This tax advantages. Under the offer, Google will display rival specialized isn’t the case,” Almunia said. The competition commissioner was responding to search services with the same-sized images and “Requiring commitments and making them binding, critics who say that the European Commission has text as its own search results. This concession as the commission often does, does not mean it’s allowed Google to entrench its dominant position in represents a significant change from two previous ‘closing’ a case. If the commitments were accepted, search by forcing rivals to pay to have their services offers, which proposed to display links to rival ser- the behavior of Google will be closely monitored by displayed alongside Google’s. vices on its search page. Google will auction the space for rival specialized search services. the commission via a trustee throughout the dura- EU antitrust officials have been investigating Google tion of the commitments,” he said. Today, Almunia said that — contrary to what critics since November 2010, concerned that the way it have argued — “it will not always be necessary for Almunia said that an investigation based on antitrust presents search results and “scrapes” content from competitors to pay Google to appear along with its laws can’t be used to address all problems. other websites breaks rules against market abuse. specialized search service.” He mentioned recent accusations that Google is In April, Google proposed formal concessions to put “There will be payment when Google will display avoiding corporate taxes, breaking data-privacy an end to the probe without fines and a finding that these links in a space that is normally paid for the rules and misusing intellectual property. “These are it broke antitrust law. It offered to present links to sites promoted by Google,” Almunia said. “This is all topics that will probably be the agenda of public other search engines and to allow publishers to nothing else than the recognition that Google will be authorities,” he said. block their content from display on certain Google forced to give a space that would normally be sold He pointed to the problem of news websites, which pages. to its own clients.” have criticized Google for not respecting their intel- After two offers were rejected as insufficient to “However, when Google displays links to competi- lectual property. He said that publishers can opt out address the commission’s concerns, Google said it tors in an area of the site which is free, competitors of being included in Google News, without being would set aside more space to display links to rival won’t have to pay anything and will be selected excluded from general websites. companies offering price-comparison services. based on the results of organic search,” he said. “But competition law cannot regulate everything, Almunia said on Feb. 5 that the search engine’s third Almunia also defended his preliminary decision to especially how the different market players will divide set of concessions was enough to satisfy the regu- accept Google’s latest offer. He said that settlement the revenue from advertising,” he said.

*" New Frontiers of Antitrust," sponsored by Concurrences, Paris Feb. 21, 2014

30 - New frontiers of antitrust 2013 Concurrences Special Issue N°2 - 2013 Testimonials OFFICIALS

That this conference is THE It was a pleasure to participate in the competition event in France is evident New Frontiers of Antitrust Conference. both from the standard of speakers, It was expertly organized and and the quality of audience.” executed, and even more importantly, it was a delightfully educating and CHRIS FONTEIJN intellectually stimulating exchange Chairman, Netherlands Authority for Consumers and Markets, The Hague focused precisely upon the most important questions facing competition lawyers, economists, judges, and regulators around the world.” This conference was the best kind of high level discussion - current JOSHUA WRIGHT Commissioner, Federal Trade Commission, competition issues and participants Washington DC from all sides willing to engage with them.” PETER FREEMAN ATTENDEES Chairman, UK Competition Appeal Tribunal, London

Each year, during 24 hours, one could believe that Paris has become the A very well organised and highly center of a Competition Law world topical event.” without frontier: so great speakers from everywhere in the world, together in ALEXANDER ITALIANER the same place, discussing challenging Director General, DG COMP, Brussels issues. And so many opportunities to talk to top practitioners, academics and policy makers during the breaks and events. In brief: "un rendez-vous à ne pas manquer ! Looking forward to attend next round.” As always, it was a pleasure to attend the New Frontiers conference this year. PASCAL GIANARDI This conference is unique in its capacity Antitrust Counsel, Société Générale, Paris to draw from a diverse and select pool of academics, practitioners and law enforcers, with the aim of ensuring an invigorating exchange on the issues of foremost interest to the antitrust New Frontier of Antitrust" is the essential community.” annual event in France. The topics are always at the forefront and treated with BRUNO LASSERRE great relevance. It is always a pleasure Chairman, French Competition Authority to come together again with the Concur- rences Community.”

PATRICK DE BONNIÈRES Trustee, Advolis, Paris It was a pleasure to take part in the panel on the ECN and merger control. The topic was timely and the debate stimulating. Many aspects relating to cooperation and convergence will A high level conference with state of the probably fuel further discussion.” art speakers and topics – a full day of intellectual “grist to the mill” for all who ANDREAS MUNDT relate to competition law and practice.” President, German Bundeskartellamt, Bonn CAROL XUEREF Director for Legal Affairs and Group Development, Essilor, Paris

New frontiers of antitrust 2013 Concurrences Special Issue N°2 - 2013 - 31 SPONSORS

If I am to limit my attendance in Europe The conference was an excellent to one competition law conference per opportunity to meet inspiring practitio- year, it will always be the annual Concur- ners. We were thrilled to sponsor the rences New Frontiers event in Paris. In no dinner cruise organized at the end of the time at all, this event has established an conference. It was a perfect combination enviable reputation, getting the balance of a wonderful setting and great right between the quality and range of company.” speakers and the chosen panel topics. Impressive also is the venue and the GILDAS DE MUIZON Managing partner, Microeconomix, Paris overall organisation.”

PETER ALEXIADIS Partner, Gibson Dunn, Brussels

One of the best panels I have had the privilege of participating in. Thank you all for the stimulating and enlightening It is important that we speak with one debate.” voice in antitrust enforcement – between Europeans and Americans, between MATTHEW READINGS Partner, Shearman & Sterling, London lawyers and economists. This conference contributes significantly to this objective offering an exchange of ideas between an inspiring group of panelists and audience.” The New Frontiers conference represents a major international rendez-vous for HANS W. FRIEDERISZICK Managing Director, E.CA Economics, Berlin top-level enforcers and practictioners in the competition community, with highly stimulating panels and a flawless organization.”

The New Frontiers Conference is always a DAVID SEVY Executive Vice-President, Compass Lexecon, great event and this year’s edition counted Paris & Brussels among the best: an unprecedented combination of hot topics, distinguished panelists and depth. Congratulations.”

NATHALIE JALABERT-DOURY New Frontiers is one of the few events Partner, Mayer Brown, Paris where major stakeholders are gathered to reflect on the future of competition laws. All the panels and subject matters were selected with particularly great care An excellent conference. The organization this year and it was a real pleasure to was flawless and the discussions were exchange views with the other speakers both informative and thought provoking. It in such a high level environment. An was a great pleasure to participate.” applause for the 1st class organization.”

THOMAS GRAF MÉLANIE THILL-TAYARA Partner, Cleary Gottlieb Steen & Hamilton, Brussels Partner, Norton Rose Fulbright, Paris

32 - New frontiers of antitrust 2013 Concurrences Special Issue N°2 - 2013 Antitrust Writing Awards & Ranking 2014

Washington DC 25 March 2014

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Read the best antitrust articles published in 2013

Ranking of the best 30 antitrust newsletters

www.awards.concurrences.com New frontiers of antitrust Concurrences Journal 5th International Conference

PARIS 21 February 2014 I 8.30 - 19.00 Ministère de l’économie et des finances - 139 rue de Bercy, Paris | M° Bercy

08.30 Registration & Continental breakfast 14.30 European Competition Network 10 years after & EC Regulation 1/2003: 08.45 Introductory remarks Can cooperation be extended to merger Nathalie Homobono I Managing Director, control and advocacy? DGCCRF, Paris Bruno Lasserre I Chairman, Frédéric Jenny I Chairman, OECD Competition Autorité de la concurrence, Paris Committee I President, International Committee Peter Freeman I Chairman, of Concurrences I Professor of economics, Co-Director UK Competition Appeal Tribunal, London Centre Européen de Droit et d’Economie, ESSEC Andreas Mundt I President, 09.00 The State of the Union: German Bundeskartellamt, Bonn Antitrust in the EU in 2014 Wouter Wils I Hearing Officer, European Commission, Brussels I Visiting Professor, King’s College London Joaquín Almunia I Vice-President, European Commission, Commissioner responsible Mélanie Thill-Tayara I Partner, for competition policy Norton Rose Fulbright, Paris

09.45 Detection of anticompetitive practices: 16.15 Coffee break Should existing tools be revised or new tools introduced? Leniency, market 16.30 Restructuring firms in the context surveys, financial reward… of crisis: What role for merger policy? Laurence Idot I Professor, University Panthéon-Assas, Mario Monti I Chairman, Senator, Roma Paris I Member, Autorité de la concurrence, Paris I Howard Shelanski I Office of Information and President, Scientific Committee of Concurrences Regulatory Affairs, White House, Washington DC Bill Kovacic I Professor, George Washington Alexander Italianer I Director General, DG COMP, Law School, Washington DC Brussels Chris Fonteijn I Chairman, Netherlands Authority Matthew Readings I Partner, Shearman & Sterling, for Consumers and Markets, Den Haag London Cristina Caffarra I Vice President, Head of Europe, Anne Perrot I Economist, Mapp, Paris / Brussels Charles River Associates, Brussels / London Ali Nikpay I Partner, Gibson Dunn, London 18.00 Keynote speech 11.15 Coffee break Benoît Hamon I Ministre délégué à l’Économie 11.30 Patents: Can antitrust authorities sociale et solidaire contribute to fixing the dysfunctional patent system? 18.20 Drinks Frédéric Jenny I Chairman, OECD Competition Committee I Professor of economics, Co-Director CEDE, ESSEC I President, Concurrences International Committee Joshua Wright I Commissioner, Federal Trade Commission, Washington DC Hans W. Friederiszick I Managing Director, E.CA Economics, Berlin * To be confirmed

Thomas Graf I Partner, Cleary Gottlieb Languages: English – French (Translation) : +33 6 67 29 85 43 - www.ybgraphic.fr Buliard Création : Yves Steen & Hamilton, Brussels 13.00 Lunch