European Commission and Facebook’s Libra

The European Commission is understood to be conducting a preliminary competition investigation of Facebook’s Libra, according to a report by Bloomberg.

The Libra Association is a group of 28 independent companies including Mastercard, PayPal and eBay, who oversee the cryptocurrency.

It appears that the Commission’s concerns relate to how the Libra Association will collect and share customer data, integration within Face book applications such as WhatsApp and Messenger, and whether Facebook could use Libra to foreclose rivals from fintech and related markets.

Facebook is expected to launch Libra and subsidiary, Calibra, to create an application that will allow Libra users to make payments, next year.

The European Commission is not the only regulator to have expressed concerns about Libra. The UK Information Commission and the US Federal Trade Commission have expressed concerns about the privacy risks presented by Libra’s digital currency and platform.

The European Commission also fined Facebook €110 million in 2017 for providing misleading information during the antitrust review of the Facebook/WhatsApp merger.

The European Commission has not commented on the case which is at an early stage at most.  It is likely that should the Commission’s inquiry deepen, the parties will be given an opportunity to amend their governance rules.

Government brings into force EU Withdrawal Act provisions to repeal European Communities Act 1972 on Brexit day

Government brings into force EU Withdrawal Act provisions to repeal European Communities Act 1972 on Brexit day

On 16 August 2019 the government made the European Union (Withdrawal) Act 2018 (Commencement No. 4) Regulations 2019 (SI 2019/1198) (regulations) which brought into force section 1 of the European Union (Withdrawal) Act 2018 (EUWA).

Unlike other significant provisions of the EUWA which came into force when it received Royal Assent, section 1 required the government to make regulations in order to bring it into force.

Section 1 of the EUWA will repeal the European Communities Act 1972 (ECA 1972) on exit day, which is defined in the EUWA as 11.00 pm on 31 October 2019.

The definition of exit day can be amended by the government by secondary legislation (EUWA, section 20(4)).  The making of the regulations does not affect the ability of the government to do this, at least until 31 October 2019, should the date of the UK's withdrawal from the EU change.

The definition of exit day has already been amended twice following successive agreements between the UK and the EU.

CMA consults on Aspen pay for delay settlement

CMA consults on Aspen pay for delay settlement

The Competition and Markets Authority (CMA) is consulting on proposed commitments from Aspen relating to supply of fludrocortisone acetate tablets in the UK.  Aspen has offered to pay the NHS £8m, as part of a wider package of commitments addressed at competition concerns.

The investigation arises from Aspen’s acquisition in 2016 of additional marketing authorisation for the drug in circumstances where it already held the only other authorisation for competing drugs. The CMA maintains that the acquisition strengthened Aspen’s dominant position.

According to the CMA, in 2015 Tiofarma became a competitor to Aspen.  As part of Aspen’s acquisition from Tiofarma of the worldwide and UK rights over the drug, Tiofarma entered a non-compete as well as a supply agreement under which it agreed to supply ambient storage fludrocortisone to Aspen and Aspen agreed to purchase all its requirements of ambient storage fludrocortisone only from Tiofarma for a period of five years.

The CMA has concerns that the arrangements infringe Article 102 TFEU and the Chapter II prohibition.

Aspen has offered to divest its UK rights over ambient storage fludrocortisone to an independent third-party and re-introduce and commercialise its other fludrocortisone product in the UK.

The CMA invites comments by 2 September 2019.

UK food industry asks government to relax competition rules in no deal scenario

UK food industry asks government to relax competition rules in no deal scenario



The Food and Drink Federation has asked the government to permit companies to cooperate to address food shortages after the UK leaves the EU.

The Federation’s members include Bird’s Eye, Cadbury’s, Coca-Cola, Danone, Haribo, Kelloggs and Nestlé.

The Competition Act 1998 allows the secretary of state for “exceptional and compelling reasons of public policy” to issue an order not to comply with competition law.  If used, this would give a defence to companies engaging in forms of cooperation with competitors that would otherwise violate competition law.

The provision has been used three times in relation to the defence industry and for the supply of oil and petroleum in 2012 at a time of fuel crisis.

The Federation says the waiver should be in place now, subject to renewal on a three monthly basis until industry and government can be confident that supply chains are operating efficiently.

Although around 30% of UK food supplies come from the EU, the situation should not require a complete suspension of competition law for the relevant companies, it should be temporary and only in so far as necessary to allow for the cooperation that is needed to avoid any essential supply chain issues. Clear guidelines would be needed on its scope to avoid mixed messages about what businesses can and cannot do to plan for and deal with the aftermath of a no deal Brexit.

The CMA has said that “this is a matter for government”.  A blanket waiver across the entire industry would represent a significant departure from government policy to date.

Court of Justice rules that indirect purchaser can claim in trucks cartel damages action

Court of Justice rules that indirect purchaser can claim in trucks cartel damages action

The Court of Justice has ruled on a request for a preliminary ruling on the interpretation of Article 7(2) of Regulation 1215/2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (the Recast Brussels Regulation).

The case arises out of a claim in the Hungarian national court by Tibor-Trans Fuvarozó és Kereskedelmi Kft (Tibor-Trans) against DAF Trucks in relation to the European Commission’s 2016 trucks cartel decision.

Article 7(2) of Regulation 1215/2012 provides that a person domiciled in a member state may be sued in another member state, in matters relating to tort, delict or quasi-delict, in the courts for the place where the harmful event occurred or may occur.

Tibor-Trans did not purchase trucks directly from the cartel participants.  The trucks at issue were bought by Hungarian dealers who were alleged to have passed on the increased costs to end purchasers, including Tibor-Trans.

The Court of Justice ruled that Article 7(2) of Regulation 1215/2012 must be interpreted as meaning that in respect of a claim for breach of Article 101 concerning collusive arrangements, "the place where the harmful event occurred" covers the place where the market which is affected by that infringement is located.  This is the place where the market is distorted and in respect of which the victim claims that it suffered loss, even if it did not purchase directly from the cartel participants who were the addressees of the Commission’s decision. 

It seems to follow that courts in member states where the damage was felt may hear an action even if this is different from the market where the unlawful conduct occurred.  Usually, these places will coincide but not always.

(Case C-451/18) Tibor-Trans Fuvarozó és Kereskedelmi Kft. v DAF TRUCKS N.V. ECLI:EU:C:2019:635