Commission closure of investigation into Apple's rules for developers of e-book/audiobook apps

 

Commission closure of investigation into Apple's rules for developers of e-book/audiobook apps

On 22 November the European Commission announced that it had closed its investigation into allegedly anti-competitive behaviour by Apple over some of the terms it applies to competing e-book/audiobook app developers for use of its App Store in the EEA.

The step follows the withdrawal of the complaint filed against Apple by an e-book and audiobook distributor. Meanwhile the Commission states that it will continue to monitor business practices in the European tech sector, including those of Apple.

The evolution of the concept of abuse of dominance and the interaction between the Commission’s enforcement priorities and practice as well as the Court’s jurisprudence towards a more economics-based approach has a particular significance in digital markets. This is not least because of the enactment of ex ante regulation in digital markets. An important illustration of this trend is the Digital Markets Act (‘DMA’)  which introduces regulation of certain large digital platforms (‘digital gatekeepers’).

The DMA applies regardless of the existence of any effects of commercial practices on competition, competitors or consumers. However, it is widely accepted that the rules in the DMA are based on antitrust proceedings.  Furthermore, the Commission may enforce Article 102 in digital markets  and national authorities continue to enforce Article 102 but have no corresponding powers to enforce the DMA.

This context raises the prospect of differences in treatment between equivalent practices under Article 102 and under the DMA when adopted by gatekeepers (or in relation to non-gatekeeper digital platforms). This bifurcation of enforcement tools is likely to be a feature of the decisional practice and jurisprudence under Article 102 and the DMA in the coming years and which is perhaps inevitable given the legal framework established by these rules.

https://ec.europa.eu/commission/presscorner/detail/en/mex_24_6024

CMA reports interim concerns and potential solutions in infant formula market study

 

The Competition and Markets Authority (CMA) has published its provisional report on its market study into infant formula and follow-on formula in the UK. The CMA invites comments on its interim report by 29 November 2024.

The study concerns infant and follow-on formula as defined by European Commission Regulation 2016/127, and formulas labelled as foods for special medical purposes that can be sold without prescription under Regulation 2016/128.

The CMA found that the market has a highly concentrated structure.  It identified  concerns relating to the unintended consequences of regulations designed to support public health goals, a lack of timely, clear and impartial information for parents about formula, and companies' responses to regulations around marketing.

The CMA raised concerns about how this impacts pricing, and limited competition on formula prices at the retail level.

The CMA has explored potential solutions. Recommendations cover the provision of clear, accurate and impartial information, including on the nutritional sufficiency of infant formula products, in both healthcare and retail contexts.

The CMA recommends strengthening labelling and advertising rules to moderate the role of brand awareness in decision-making in the market.

The CMA’s provisional findings echo concerns raised by customers.  The provisional findings bring together multiple tools from competition law oriented remedies to consumer protection measures around promotions at the retail level.

The deadline for the CMA to publish its final report is 19 February 2025.

https://www.gov.uk/government/news/infant-formula-cma-sets-out-concerns-and-potential-solutions

CAT rules in favour of self-represented claimant in RPM case

 

The Competition Appeal Tribunal (CAT) has ruled in a claim by Up & Running (UK) Limited against Deckers UK Ltd (Deckers), a retailer of specialist running shoes. The case appears to be the first time a self-represented claimant has been successful in the CAT.  It is only one of few claims that have undergone the fast-track procedure.

The CAT found that the Deckers selective distribution system did not meet the criteria for establishing that a selective distribution agreement has a legitimate goal and falls outside Article 101(1) of the TFEU (being relevant at the time the relevant practices occurred).  The CAT found that the system lacked transparency, it employed some quantitative criteria and was applied in a discriminatory manner.

The CAT held that a supply agreement that allowed Deckers to prevent Up and Running from creating a secondary website to sell shoes at a discount, was a ‘by object’ infringement of UK/EU competition rules because it pursued “no plausible material objective” other than to restrict competition.

The CAT found that the agreement contained hardcore restrictions so that the EU Vertical Block Exemption did not apply.

The CAT concluded that Up & Running has suffered loss as a result of the infringements of the Chapter I prohibition (the amount of which will be determined separately).

However, the CAT declined to make an injunction requiring Deckers to supply the relevant product to Up & Running.

The ruling can be understood in light of its very specific facts.  Nevertheless, it is likely to cause a number of retailers and their lawyers to pause for thought on whether their distribution systems and supply practices are compatible with competition law.

Up & Running (UK) Limited v Deckers UK Limited [2024] CAT 61