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Competition Survival Pack

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Competition Survival Pack Competition Survival Pack CMS Cameron McKenna Fifth edition 2011 CMS Cameron McKenna’s proposal to the selling shareholders July 2011 Table of contents Introduction .....................................................................................1 About us..........................................................................................2 Competition law in the EU and UK - basic principles ......................6 Restrictive agreements .................................................................16 Vertical agreements ......................................................................39 The technology transfer block exemption......................................59 Horizontal agreements..................................................................67 The cartel offence .........................................................................79 Trade associations........................................................................85 Market definition and market power ..............................................93 Abuse of a dominant market position............................................98 Pricing Issues..............................................................................116 Test your competition law knowledge .........................................122 Compliance programmes............................................................133 Competition authorities’ powers of investigation .........................141 What you need to know about dawn raids ..................................161 Dealing with the authorities .........................................................165 Concurrent powers of regulators in the UK .................................174 Litigating competition ..................................................................179 EU merger control and merger checklist.....................................186 National merger control in the UK and UK merger checklist .......196 Introduction All businessmen and women and their advisers need to know about EU and UK competition law. Our Competition Survival Pack provides an overview of the essentials and explains the impact of new legislative developments on your business. It is relevant to in-house counsel, company directors and those responsible for competition compliance. Competition reforms The reforms to the competition regime at EU and UK level in the period 2002-2004, such as decentralisation of EU competition law enforcement, the accompanying rise of self-assessment of competition compliance, introduction in the UK of a criminal cartel offence and reform of the UK merger regime, are now firmly established. The next set of reforms in the UK is on the horizon with proposals including the amalgamation of the Office of Fair Trading with the Competition Commission, further changes to the UK merger control system and to the system for reviewing markets, as well as potential enhanced roles for sector regulators and the new financial services regulator. Businesses will wish that any changes made meet the Government’s objective of promoting productivity, innovation and economic growth. What does this mean for business? Businesses can never afford to take their eye off the daily realities of doing business in compliance with current competition law. The self-assessment competition culture cannot be ignored. Companies must take full responsibility for their competition compliance. Directors have special responsibilities in this regard. It is therefore crucial to understand the importance of competition law compliance when doing business in the EU, including the UK. Versions of this Survival Pack The Survival Pack is available in hard copy and in pdf. Updated versions of the Survival Pack and additional chapters will be loaded onto our website at www.law-now.com. This fifth edition of the Competition Survival Pack is updated to 1 September 2011. It takes note of the review of the regimes on vertical agreements and insurance specific agreements (new block exemptions in force 2010) and of the EU’s review of horizontal agreements and the block exemptions on specialisation and R&D. In the UK we note the introduction of Short Form Opinions and the revocation of the Land Agreements Exclusion Order, as well as issues flowing from the long running inquiry into groceries markets. Other materials have been updated to reflect changes in law and practice. 1 About us CMS Cameron McKenna CMS Cameron McKenna is an award-winning international commercial law firm with 13 offices in the UK, Central and Eastern Europe and beyond. The Firm has more than 120 equity partners and employs more than 1,000 fee earners in total. Each jurisdiction has a dedicated competition team. CMS Cameron McKenna’s competition practice includes 10 primarily non-contentious partners and a further group of partners leading on the contentious side together with a team of other fee earners. The team based in London advises on UK competition law and merger control in the Competition Act 1998 and Enterprise Act 2002, as well as on EU competition law in Articles 101 and 102 of the Treaty on the Functioning of the European Union, EU and multijurisdictional merger control notifications, and state aid submissions. We have broad experience of dealing with the UK and EU authorities including the European Courts of Justice and UK Competition Appeal Tribunal. We have a very strong practice in Central Europe, with specialist competition lawyers in Bratislava, Bucharest, Budapest, Kyiv, Moscow (joint CMS office), Prague, Sofia and Warsaw advising on EU and domestic competition law and merger clearance. Many of our team have worked in our Brussels office, now a joint specialist CMS EU Law Office. The team liaises with commercial lawyers in other offices on the application of competition law to their clients’ activities, both across European borders and in those jurisdictions where competition law is still developing. Within the wider association of the transnational legal services organisation, CMS, we have more than 140 competition law specialists in 23 countries available to provide advice on domestic merger and competition law making it one of the largest competition teams in Europe. Competition specialists – core London team contacts Two partners lead our core practice in London. Please feel free to contact either of them: Susan Hankey Tel: +44 20 7367 2960 Email: [email protected] David Marks Tel: +44 20 7367 2136 Email: [email protected] 2 Our Central Europe practice Our specialist lawyers in Bratislava, Budapest, Bucharest, Prague. Kyiv, Sofia, Moscow and Warsaw advise on competition, public procurement and state aid issues at EU and domestic levels. In the first instance, please contact: Bratislava Bucharest Nada Spustova Horea Popescu [email protected] [email protected] Tel: +421 2 54433 490 Tel: +40 21 407 3824 Budapest Kyiv Dora Petranyi Olexander Martinenko [email protected] [email protected] Tel: +36 1 483 4820 Tel: +380 44 391 7 704 − Moscow Prague Maxim Boulba Barbora Dubanska [email protected] [email protected] Tel: +7 495 786 4000 Tel: + 420 296 798 3000 Sofia Warsaw Pavel Hristov Małgorzata Urbanska [email protected] [email protected] Tel: +359 2 921 99 10 Tel: +48 22 520 5555 In China, we also have a joint office with other CMS firms in Shanghai – contact Steve Yu on [email protected] or tel +86 21 6289 6363. How can we help? There are a number of ways in which we can help you review your agreements and business practices generally to ensure compliance with competition law. Possibilities include: a competition audit to review agreements, flush out inappropriate behaviour and to formulate best practice a mock dawn raid, including a debrief and discussion of issues arising creation of a tailored in-house checklist of do’s and don’ts an IT audit, led by forensic IT specialists with expertise in technology used in information searches in legal cases 3 reviewing with you your compliance procedures, for example, developing compliance strategies and monitoring systems coaching your management in competition law compliance holding a short focus session with your legal and/or contract teams to create a methodology for reviewing existing arrangements and documents helping tailor a competition compliant marketing strategy to your own company’s particular needs holding an in-house workshop with your legal and/or contract teams to examine the impact of competition law in various scenarios and how you should respond. tailored on-line competition compliance training (‘e-learning’). Contact points London Aberdeen CMS Cameron McKenna LLP CMS Cameron McKenna LLP Mitre House 6 Queens Road 160 Aldersgate Street Aberdeen AB15 4ZT London EC1A 4DD T +44 20 7367 3000 T +44 1224 622002 F +44 20 7367 2000 F +44 1224 622066 Also in Edinburgh and Bristol Brussels Bratislava CMS EU Law Office Ruži čka Csekes s.r.o. in association with Avenue des Nerviens 85 members of C´M´S´ 1040 Brussels Vysoká 2/B Belgium 811 06 Bratislava Slovakia T +32 2 650 0450 F +32 2 650 0459 T +421 2 323 33 444 F +421 2 323 33 443 Bucharest Budapest CMS Cameron McKenna SCA CMS Cameron McKenna LLP 11-15 Tipografilor Str. Ybl Palace B3-B4, 4th Floor 3rd Floor 013714 Bucharest Károlyi Mihály u. 12 Romania 1053 Budapest Hungary T +40 21 407 3800 F +40 21 407 3900 T +36 1 483 4800 F +36 1 483 4801 4 Kyiv Moscow CMS Cameron McKenna LLC CMS Moscow 6th Floor Gogolevsky Blvd, 11 38 Volodymyrska Street 119019 Moscow
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