European Court of Justice upholds Google Shopping Abuse Decision

 

European Court of Justice upholds Google Shopping Abuse Decision

The European Court of Justice has dismissed the appeal by Google LLC and Alphabet Inc (Google) against the General Court's judgment that largely rejected Google's appeal against a European Commission's decision that Goggle had abused its dominant position by giving preference to its own search engines and imposing a fine of EUR 2.4 billion.

The appeal relates to a decision in 2017.  The Commission found that Google had abused its dominant position on the market for online general search services in 13 countries in the EEA by favouring its own comparison shopping service over competing services.

The General Court rejected Google's arguments that its actions amounted to competition on the merits.

The ECJ held that the General Court did not err in its consideration of the Bronner criteria that apply in essential facilities cases and in concluding that this was not a case in which the Bronner criteria were applicable.

The ECJ also found that the General Court had not erred in finding that Google's practices deviated from competition on the merits.

Further, the ECJ found that the General Court had not erred in dismissing Google's arguments in relation to the application of the "as-efficient-competitor" test.

The original decision was a landmark development in the application of EU competition law, not only to Big Tech companies but also on the scope of Article 102 TFEU to deal with a dominant company favouring its own operations. Now, almost a decade later, the ECJ has provided useful guidance and clarified that the competition authority can “rely on a range of evidence, without being required systematically to use any single tool” to prove its case.

Case C-48/22) Google LLC and Alphabet, Inc v European Commission EU:C:2024:726

Court of Appeal reinstates CMA hydrocortisone fines

 

Court of Appeal reinstates CMA hydrocortisone fines

The Court of Appeal has upheld an appeal against a judgment by the Competition Appeal Tribunal (CAT) that overturned around £100 million in fines two drugs manufacturers, describing the CAT procedure as “inappropriate” and “unjust”.

In September 2023, the CAT upheld the CMA's findings that Auden/Actavis UK had reached agreements with AMCo/Advanz to delay the entry of their own 10mg hydrocortisone tablets, in breach of the Chapter I prohibition under the Competition Act 1998. However, the CAT raised concerns about due process, relating to the CMA's failure fully to cross-examine Advanz's witnesses. It, therefore, held a further hearing to consider this issue.

In March 2024, the CAT found that the CMA had breached due process, rendering the substantive findings on cartel infringements as set out in the September 2023 judgment unsafe.

The Court of Appeal allowed the CMA's appeal against this ruling, finding that the CAT had erred in assuming that the CMA’s case involved allegations of dishonesty or misconduct and that these matters were not properly put to witnesses.

The CAT should have dismissed the companies' appeals without requiring the CMA to cross-examine a witness on dishonesty or misconduct. It was inappropriate and unjust for the CAT to deliver a provisional judgment and adjourn for a further due process hearing

Allergan plc, Amidpharm UK Ltd, Amidpharm UK Ltd, Advanz Pharma Services (UK) Ltd, Advanz Pharma Corp Ltd, Cinven (Luxco 1) S.a.rl and others, Auden Mckenzie (Pharma) Limited and Accord-UK Limited v Competition and Markets Authority [2024] EWCA Civ 1023

Back to School – CMA Blog on School Uniform Policy and Competition Law

 

As the summer holidays draw to a close, and due to ongoing affordability concerns, the Competition and Markets Authority (CMA) has published a blog on whether school uniform policies might be at risk of breaching competition law.

This is not the first time that the UK competition authorities have been concerned about competition law and school uniform policy. Particular concerns have been raised about exclusive supply arrangements with uniform suppliers.

In 2015, the CMA wrote to schools and suppliers to remind them about their obligations under competition law.

The CMA is urging school leaders to consider whether their uniform policy is in the best interest of pupils and parents.  The CMA provides a number of suggestions: 

1.        Schools and their governing bodies and academy trusts should consider how to use competitive tender processes to get the best results when awarding contracts.

2.        If a contract has been awarded to a manufacturer for sale through third party retailers, care should be taken that there are no provisions that fix the minimum price that the uniform can be sold at, which could constitute resale price maintenance.

3.        Consideration could be given to how many items of uniform are branded or highly tailored to the school and whether this reduces the number of suppliers who will choose to invest in a stock uniform that can only be sold to a small pool of customers.

4.        Schools give consideration to extending the lifespan of uniform, for example by offering a pre-loved uniform shop.

https://competitionandmarkets.blog.gov.uk/2024/08/23/school-uniforms-is-your-policy-at-risk-of-breaking-the-law/

Reintroduction of Litigation Funding Agreements (Enforceability) Bill

 

Reintroduction of Litigation Funding Agreements (Enforceability) Bill

The Ministry of Justice has issued a statement in response to a written question regarding whether the government plans to reintroduce the Litigation Funding Agreements (Enforceability) Bill (the Bill) and other related issues.

The statement confirms that the government "will take a more comprehensive view of any legislation to address issues in the round" once the Civil Justice Council (CJC) concludes its report on third party civil litigation funding (anticipated in summer 2025).  

The Bill was originally introduced in the last Parliamentary session but was not completed before Parliament was prorogued on 24 May 2024.

 

If passed, the Bill would have reversed the impact of the Supreme Court's decision in R (PACCAR Inc and others) v Competition Appeal Tribunal and others [2023] UKSC 28.

 

Answering the written question Lord Ponsonby noted that the CJC is considering such issues, plus others, in its review of third party civil litigation funding.

It is understood that the CJC hopes to report in summer 2025.

https://questions-statements.parliament.uk/written-questions/detail/2024-07-29/hl449

Judgment granting collective proceedings order in claim by Road Haulage Association

 

 

The Competition Appeal Tribunal (CAT) has given judgment in a claim brought by Road Haulage Association Limited (RHA) under section 47B of the Competition Act 1998, to commence a collective action to seek damages from various truck manufacturers. 

The claims follow on from the European Commission's 2016 and 2017 truck cartel decisions.

In June 2022 the CAT preferred the RHA’s opt-in application and rejected a proposed opt-out claim brought by UK Trucks Claim Limited (UKTC).  In July 2023 the Court of Appeal mainly dismissed an appeal against the CAT’s June 2022 judgment.  However, finding a potential conflict of interest between new and used trucks claimants the Court of Appeal remitted the case to the CAT for it to consider whether to grant the collective proceedings order (CPO) on the basis of revised arrangements, in particular relating to separate legal and expert representation.

The CAT first ruled that it was not necessary to make separate provision in the class definition for companies which had been dissolved but might be restored to the register.

The CAT ruled that it would be appropriate for claims for leases, other than the first lease of a new truck, to be included in the used truck sub-class. Those claims are, therefore, subject to a longer run-off period (until 31 January 2015).

The CAT also ruled that the funding arrangements are adequate.

The CAT also concluded that arrangements put in place to separate the claims in relation to new trucks and claims relating to used trucks were adequate. A new company, RHA Used Trucks Ltd (RUTL), has been established to act as the proposed sub-class representative for class members with claims for used trucks. This has appointed separate solicitors, counsel and expert.

The CAT, therefore, decided to authorise RUTL as a sub-class representative and to make a CPO in favour of RHA as the class representative.

Road Haulage Association Limited and RHA Used Trucks Limited v Traton SE and others [2024] CAT 51

Call for inputs on review of assimilated Technology Transfer Block Exemption

 

Call for inputs on review of assimilated Technology Transfer Block Exemption

 

The Competition and Markets Authority (CMA) is seeking views as part of its review of the assimilated Technology Transfer Block Exemption Regulation (Regulation 316/2014) (TTBER) and the accompanying European Commission guidelines on technology transfer agreements (the Guidelines).

The assimilated TTBER expires on 30 April 2026.

While the TTBER may seem a relatively small matter when navigating compliance of licensing arrangements with competition law, for IPR licensors and licensees it has proven to be a useful instrument.  The review is important as it offers the scope for some divergence between the approaches under EU and UK law.

The assimilated TTBER automatically exempts certain types of technology transfer agreements from the Chapter I prohibition if they meet certain conditions (including market share thresholds, hard core restrictions and excluded restrictions).

The CMA will review whether the assimilated TTBER continues to meet its intended purpose and will take account of any specific features of the UK economy and interests of businesses and consumers.

The CMA is seeking views on whether technology transfer agreements covered by the assimilated TTBER continue to produce benefits outweighing their potential harmful effects on competition (and what these harmful effects are), including whether the TTBER contributes to promoting competition and economic benefits in the UK.

The Guidelines set out general principles for the assessment of technology transfer agreements and provide guidance on the application of the TTBER. Experience of the various incarnations of the TTBER over the years suggests that the 200+ Guidelines can tend to be of more practical utility than the TTBER itself.

The CMA invites responses by 6 September 2024.

https://connect.cma.gov.uk/technology-transfer-block-exemption-regulation

Judgment on payout of costs as part of damages in Mclaren collective settlement

The Competition Appeal Tribunal has given judgment on an application by Mark McLaren Class Representative Limited (the CR) for an order that the costs and part of the damages paid to it by one settling defendant be used to cover part of the CR’s costs, fees and disbursements in connection with the proceedings.

The order relates to sums paid by the Twelfth Defendant (Compania Sudamericana de Vapores SA) pursuant to a settlement agreement in the Mark McLaren Class Representative Limited v MOL (Europe Africa) Ltd and others collective proceedings.

The approved settlement figure is £1.5 million, comprising 1) the damages sum of £1.12 million; 2) the costs of the application for approval of the settlement, of £100,000; 3) the Twelfth Defendant's share of the CR’s costs in the proceedings, of £280,000 (proceedings costs sum).

The CAT considered it does have jurisdiction, under Rule 53(2)(n) of the CAT Rules 2015, to make the order sought. However, it decided it would not be appropriate to assess what sums should be paid to funders before the outcome of the proceedings is known. The CAT found that payment of the “relatively small” sums at stake would do little to lessen the funder’s “exposure and duration risk.”

The CAT, therefore, did not permit the use of any part of the damages sum at this stage. It stated it was, however, prepared to apply an additional £71,000 from the proceedings costs sum to be dealt with in the same way as the £100,000 application costs sum to cover the CR’s costs of the Collective Settlement Approval Order application.

While in this case the CR may not use a settlement agreed with one defendant towards costs in ongoing litigation, the CAT has left open a possibility for future cases.

 

Mark McLaren Class Representative Limited v MOL (Europe Africa) Ltd and others [2024] CAT 47 (Related Costs Application)