European Commission imposes fines on car equipment suppliers

European Commission imposes fines on car equipment suppliers

The European Commission has imposed fines of a total EUR18.196 million on Brose and Kiekert for their involvement in cartels relating to supplies of closure systems for BMW and Daimler cars in the EEA.

Magna received full immunity from fines under the 2006 Leniency Notice.  As a result, it escaped fines of around EUR6 million.

The decision was reached under the cartel settlement procedure, leading to a reduction of 10 per cent in the fines imposed.

The case marks another event in the Commission’s long running auto-parts investigation dating back to 2013.

The facts of the case go back some ten years. Imposing fines so long after the event raises questions about the compatibility of the investigation with the principle of good administration which requires investigations to be completed within a reasonable time.

https://ec.europa.eu/commission/presscorner/detail/en/ip_20_1774

CMA adopts change to leniency guidance in RPM cases

CMA adopts change to leniency guidance in RPM cases

The Competition and Markets Authority (CMA) has adopted an addendum to its Guidance on leniency and no-action applications in cartel cases (OFT1495).

The Guidance sets out how the CMA will exercise its discretion in relation to the grant of Type B leniency in resale price maintenance (RPM) cases (i.e., where the CMA is conducting a pre-existing investigation and the applicant is the first to report and provide evidence (of significant value) of a cartel.

As a result of the change announced on 24 September and applying to new leniency applications made on or after that date, the CMA would not generally expect to grant immunity or discounts on any financial penalty of more than 50% to Type B applicants in RPM cases.

The CMA consulted on this change in the summer and found that in view of the nature of RPM cases, the value that a Type B applicant can add is unlikely to be sufficient to justify immunity or a discount of up to 100% on any financial penalty.

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/920538/Addendum_to_OFT1495_FINAL.pdf

FCA opens new competition investigation

FCA opens new competition investigation

Details have been published of a new competition law investigation by the Financial Conduct Authority.

The investigation has been added to a list of public Competition Act 1998 cases in the regulated sectors, which is published on the CMA’s website.

The only information provided is that the FCA is investigating suspected anti-competitive arrangements in the financial services sector under Chapter I of the Competition Act 1998.

The case was opened in September 2020.

The FCA has one other ongoing competition investigation, opened in March 2019.

 

https://www.gov.uk/government/publications/competition-act-1998-cases-in-the-sectors-regulated-by-ukcn-members/competition-act-1998-cases-in-the-regulated-sectors

CMA imposes interim measures in airline Atlantic Joint Business Agreement

CMA imposes interim measures in airline Atlantic Joint Business Agreement

The Competition and Markets Authority (CMA) has refused to accept the proposed 10-year binding commitments offered by the International Consolidated Airlines Group (the parent company of British Airways) and American Airlines to address competition concerns arising from their Atlantic Joint Business Agreement (AJBA).

Instead, the CMA will continue its open competition investigation into the arrangements and has imposed interim measures which extend by three additional years commitments accepted by the European Commission in 2010 and which would otherwise expire in July 2020.

This is the first time that the CMA has imposed interim measures in a competition investigation since its incorporation in 2014.

The CMA has identified competition concerns on five routes between London and each of Boston, Chicago, Dallas, Miami and Philadelphia.

https://www.gov.uk/government/news/cma-acts-to-protect-competition-on-uk-us-airline-routes

UK review of competition policy

UK review of competition policy

John Penrose MP has been appointed to lead a root and branch review of competition policy in the UK.

The Government considers that promoting competition will be particularly important in the context of recovery from COVID-19.

Work is also ongoing in relation to digital competition. The Government has accepted the Furman Review recommendations and the Digital Markets Task Force is due to report by the end of 2020.

John Penrose MP has been asked to deliver, by the end of 2020, a short independent report building on and adding to these developments.

The report should consider how the UK’s competition regime can best:

1.     Play a central role in meeting the challenges of the post COVID-19 economy and in driving the recovery

2.     Contribute to the government’s aim of levelling up across all nations and regions of the UK?

3.     Increase consumer trust

4.     Support UK disruptors

5.     Make best use of data, technology and digital skills which are vital to the modern economy

https://www.gov.uk/government/publications/terms-of-reference-for-john-penrose-mp-report-on-competition-policy/terms-of-reference-john-penrose-mp-report-on-competition-policy

UK plans for new subsidy control regime

UK plans for new subsidy control regime

On 9 September the Business Secretary outlined plans for the UK’s new subsidy control regime, expected to take effect on 1 January 2021.

The announcement heralds the expectation and default position that the UK would follow World Trade Organisation (WTO) subsidy rules and other international commitments, replacing the EU state aid laws.  He indicated that clear guidance on WTO rules will be published before the end of the year.

The announcement is not unexpected.  It will come as a disappointment to any expectation that the UK regime for subsidy control would follow the EU model at the end of the transition period.

There will be public consultation on the design of the new regime in the coming months.  The form that would take remains to be fleshed out.  At the very least it should have an independent regulator and reflect competition law principles. 

https://www.gov.uk/government/news/government-sets-out-plans-for-new-approach-to-subsidy-control

CMA fines Amazon for failure to comply with information requests in Deliveroo merger investigation

CMA fines Amazon for failure to comply with information requests in Deliveroo merger investigation

 

The Competition and Markets Authority (CMA) has imposed total penalties of £55,000 on Amazon.com, Inc (Amazon) for failing, without reasonable excuse, to comply with requirements imposed in information notices in the context of the acquisition by Amazon of certain rights and a 16% minority stake in Roofoods Ltd (Deliveroo).

189 documents were provided between a few days and more than two months late, and only after follow-up by the CMA.

The CMA imposed separate penalties of £25,000 and £30,000 to reflect the different fact patterns of the breaches.  The penalties, each of which is subject to the statutory maximum of £30,000, were imposed under section 110 of the Enterprise Act 2002.

The CMA concluded that the breaches indicated behaviour by Amazon which amounted to failure to adopt an adequate approach in responding to the CMA's information notices and that this adversely affected the conduct of the CMA's investigation.

https://www.gov.uk/cma-cases/amazon-deliveroo-merger-inquiry

CMA closes fourth abuse of dominance investigation into pricing of hand sanitiser

CMA closes fourth abuse of dominance investigation into pricing of hand sanitiser

The Competition and Markets Authority (CMA) has closed the final abuse of dominance investigation it started in June 2020 into suspected unfair and excessive pricing of hand sanitiser by four pharmacies and convenience stores.

The CMA closed three of the investigations in July.

The CMA closed the fourth investigation having had regard to its prioritisation principles.

The CMA considers that it is unlikely that the suppliers’ prices infringe competition law.  It concludes that further investigation to reach a definitive view would deliver limited, if any, consumer benefits.

The CMA’s decision to close the case does not prevent it from opening an investigation in the future if it were to receive new evidence that changed its assessment.

https://assets.publishing.service.gov.uk/media/5f50df3f8fa8f535b650435c/3_September_2020_case_closure_statement.pdf

CMA secures director disqualification in pharmaceutical cartel proceedings

 

 

CMA secures director disqualification in pharmaceutical cartel proceedings

The Competition and Markets Authority has secured a competition disqualification undertaking by Mr Robin Davies, director of Alissa Healthcare Research Limited.

The disqualification undertaking relates to his involvement in breaches of UK and EU competition law in relation to the exchange of commercially sensitive information in connection with the drug nortriptyline.  Alissa and King Pharma admitted to the illegal conduct and received fines of £174,912 and £75,573, respectively.  Lexon did not settle and was fined £1.2 million.

The Company Directors Disqualification Act empowers the CMA to ask the court to disqualify a director from holding company directorships or performing certain roles for a specified period, if the director’s company has breached competition law.

Davies undertakes not to act as a director of any UK company for two years as of 24 November 2020.

Davies is the 18th director to agree to a director disqualification undertaking.

Separately, but arising out of the same competition law investigation the CMA has applied to the High Court to seek the disqualification of Mr Pritesh Sonpal, a director of Lexon (UK) Limited.

 

https://www.gov.uk/cma-cases/suppliers-of-antidepressants-director-disqualification