European Commission issues fine in ‘pay for delay’ pharma investigation after a 9 year probe

 

 

European Commission issues fine in ‘pay for delay’ pharma investigation after a 9 year probe

The European Commission has fined Teva Pharmaceutical Industries Ltd and Cephalon Inc EUR 60.5 million for entering into an unlawful patent settlement, in breach of Article 101 of the TFEU.

The Commission found that Teva agreed to delay for several years the market entry of a cheaper generic version of Cephalon's drug for sleep disorders, modafinil, after expiry of Cephalon's patents.

Teva received cash payments and other side-deals, including a distribution agreement, a licence on Teva modafinil patents, raw materials from Teva, and access to valuable clinical data.

This is the fourth "pay-for-delay" decision that the Commission has adopted.

This one is striking because of the form taken by the payments and value transfers.

https://ec.europa.eu/commission/presscorner/detail/en/ip_20_2220

Court of Justice confirms application of abuse of dominance rules in copyright licensing cases

 Court of Justice confirms application of abuse of dominance rules in copyright licensing cases

The European Court of Justice (ECJ) has given a preliminary ruling on the issue of whether a remuneration model applied by SABAM, a copyright management company, amounts to an abuse of a dominant position under Article 102 of the Treaty on the Functioning of the European Union.

SABAM adopted ‘Tariff 211’ which allowed it to charge a fee based on the revenue of the event holders’ ticket sales. 

The ECJ ruled that it is for the referring court to assess whether the application of the tariff system at issue, here Tariff 211, in so far as it authorises only certain costs to be deducted from these amounts, is likely to impose unfair prices.

It was for the referring court to assess whether there are methods which make it possible to identify with greater precision the musical works protected by SABAM.

It is not necessarily an abuse of dominance for a copyright management company to calculate its tariffs based on the revenue that music event organisers receive from ticket sales.

SABAM v Weareone.World BVBA and Wecandance NV (Case C-372/19), ECLI:EU:C:2020:959

ComparetheMarket: CMA imposes first price parity penalty

ComparetheMarket:  CMA imposes first price parity penalty

The Competition and Markets Authority (CMA) has found that BGL (Holdings) Limited, BGL Group Limited, BISL Limited and Compare The Market Limited (‘ComparetheMarket’) breached the Chapter I prohibition and Article 101 TFEU by imposing wide ‘most favoured nation’ (MFN) provisions.

Wide MFN clauses ban companies from offering rival comparison sites cheaper rates, while narrow MFN clauses ban them from offering lower prices on their own websites.

The CMA imposed a fine of £17.9 million for the infringement, which it found was in operation between December 2015 and December 2017.

The restrictions were imposed on home insurance providers selling through its price comparison platform.  

This is the first time the CMA has fined a company for using wide MFN clauses.

The Office of Fair Trading has previously accepted commitments from Amazon to remove these clauses from contracts with sellers using its marketplace platform.

https://www.gov.uk/government/news/cma-fines-comparethemarket-17-9m-for-competition-law-breach

CMA opens merger review of Liberty Global-Telefónica JV following European Commission acceptance of Article 9 request

CMA opens merger review of Liberty Global-Telefónica JV following European Commission acceptance of Article 9 request

 

The CMA has launched a first phase merger review following the acceptance by the European Commission of an Article 9 reference request concerning the proposed JV between Liberty Global and Telefónica S.A to merge their UK operating businesses (Virgin Media/Virgin Mobile and O2).

It will be recalled that in 2015, the European Commission rejected the CMA’s request for referral of the Hutchison 3G /Telefonica UK merger.  It concluded that, although the merger would affect retail and wholesale mobile telecoms markets in the UK, the Commission was better placed to deal with the case.

The CMA has confirmed the parties have submitted a fast-track reference request.

The CMA invited comments on the merger and fast track reference request by 26 November.

 

https://www.gov.uk/government/news/european-commission-refers-review-of-virgin-and-o2-deal-to-cma

CMA consults on revised merger assessment guidelines

CMA consults on revised merger assessment guidelines

 

The Competition and Markets Authority is consulting on a revised version of its merger assessment guidelines (CMA129).

The revised guidelines propose a number of material changes as well as streamlining.

They aim aid to provide greater clarity on how the CMA will assess evidence, particularly evidence in fast-moving markets.

The revised guidelines also provide for greater flexibility in assessment of the time horizon for counterfactuals exiting firms, and vertical foreclosure effects.

They also seek to address the recommendations of the Furman and Lear report on digital markets.

The revised guidelines also propose simplifying the need to define markets. This may allow the CMA to find a substantial lessening of competition without necessarily making a separate relevant market definition.

The CMA is seeking responses by 8 January 2021.

https://www.gov.uk/government/news/consultation-launched-on-cma-merger-assessment-guidelines?=0

European Commission intensifies competition probes into Amazon

European Commission intensifies competition probes into Amazon

The European Commission has issued a statement of objections to Amazon alleging abuse of dominance as a result of Amazon's use of sensitive data from competing retailers.

The Commission maintains that Amazon's use of sensitive business information from independent sellers on its marketplace allows it to avoid the normal risks of retail competition and leverage its dominance as a platform into retail markets.

The Commission has also opened a second investigation into whether Amazon's commercial practices might artificially distort competition because they favour its own offers and downstream services.  The Commission is examining whether the criteria that Amazon uses to select the winner of the “Buy Box” and to enable sellers to offer products to Prime users amount to self-preferencing of Amazon's retail business.

https://ec.europa.eu/commission/presscorner/detail/en/ip_20_2077

CMA blocks third merger in a year

CMA blocks third merger in a year

The CMA has issued is final report on the completed acquisition of GBST Holdings Limited (GBST) by FNZ (Australia) Bidco Pty Ltd (FNZ).

It finds that FNZ and GBST, two of the four largest suppliers in the supply of retail platform solutions would account for almost 50% of the market.

Market constraints are generally weak with high switching costs, limiting any buyer power.

The CMA has concluded that requiring FNZ to sell the entire GBST business is the only solution that will properly address the loss of competition resulting from the merger.

The decision is the CMA’s third merger prohibition this year. In April, it blocked Sabre’s USD360 million (EUR304.2 million) takeover of airline ticketing software rival Farelogix. A month later, it mandated JD Sports to divest Footasylum.

While merger parties are entitled to complete their merger’s without seeking CMA approval, these cases are a reminder that this is not without risk in cases which raise serious competition issues.

https://www.gov.uk/cma-cases/fnz-gbst-merger-inquiry?utm_source=f4cf4e07-ae36-4395-ac2c-30106a5ebaa8&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate

 

 

General Court orders in Facebook interim measures actions

General Court orders in Facebook interim measures actions

The General Court has published orders in Facebook’s challenges against information requests of the European Commission in its competition investigations into Facebook’s data practices.

The General Court has found that, due to the wide-ranging nature of the search terms used, it cannot be ruled out at this stage that the General Court will find that the measures do not comply with Article 18(3) of Regulation 1/2003.

The General Court held that Facebook had established the urgency of the need for interim measures as regards the disclosure of documents containing sensitive personal data.

The General Court decided that it was appropriate to provide for an ‘ad hoc’ procedure for the examination of documents likely to contain sensitive personal data and in the presence of Facebook’s lawyers.

Facebook Ireland Ltd v European Commission (Cases T-451/20 and T-452/20) ECLI:EU:T:2020:515/6, General Court orders of 29 October 2020)