On June 2, 2020, the European Commission opened a public consultation to seek views on the contents of the Digital Services Act (DSA), an ambitious legislative package intended to regulate digital markets in EU.

The European Commission will be seeking feedback from a wide range of stakeholders on issues like online safety, freedom of expression, fairness, and a level playing field in the digital economy. Part of the proposed legislative package also includes a proposal for a new competition tool which would allow enforcers to monitor the competitiveness of the digital market.

Steptoe’s EU Competition team have prepared an analysis of the proposed competition tool and highlighted some of the burning questions that need to be addressed by the European Commission.

Click here to read the full analysis. 

We welcome your comments on the proposed new tool and will be happy to assist you if you may find useful to speak to us before you consider responding to consultations.

Competition law is a powerful tool that businesses can employ to recover from a crisis. Join members of Steptoe’s EU Competition team for a series of short On Demand videos that will help guide your business through the economic uncertainty post-COVID-19.

Click here to access the first video.

Part I – Routes to Market in the New-Normal: A Twist of the Competition Law Kaleidoscope

In this first video, Paul Hughes provides an overview of the potential routes to market in this “new normal” by highlighting what you can do with your distribution agreements and the benefits of removing redundant channel costs. Specific topics for discussion include:

  • Rethinking the channels to market
  • Withstanding shifts in the market over time
  • Vertical agreements as a recovery tool

If you have any questions about the material presented or suggestions for future topics, please contact Steptoe Events. Stay tuned for our next update which will be circulated the coming weeks.

The CMA has provided guidance on its expected approach to merger assessments during the Covid-19 pandemic. While the timescales and substantive assessment of a merger’s effects on competition remain unchanged, the CMA has made a number of adjustments to its working arrangements in order to meet deadlines and progress cases. However, it is likely that some aspects of investigations may be subject to some delay.

Continue Reading CMA Guidance on its Approach to Merger Assessments during the COVID-19 Pandemic

In a series of recent statements, the UK Financial Conduct Authority  (FCA) has set out how it expects the insurance industry to help consumers and businesses affected by the coronavirus.

The FCA would like to see a degree of consistency across the industry in how business interruption claims are handled. To help to achieve such consistency, the FCA is planning to ask the English court to make declarations about the scope of various business interruption (BI) clauses.

Continue Reading FCA’s Statements about Insurance and the Coronavirus: Competition Considerations

On Monday April 13, 2020, DOJ and the FTC issued a joint statement warning employers that COVID-19 does not provide a reason to tolerate anticompetitive conduct that harms workers. The agencies said that they are on alert for collusion and other anticompetitive conduct in labor markets during the crisis. They are focused on agreements to lower wages or to reduce salaries or hours worked, especially in frontline fields like health care and for workers in warehouse and grocery stores.

Click here for the full statement.

Steptoe has been regularly providing antitrust compliance counseling to clients in a number of industries on issues related to the COVID-19 crisis, including issues relating to labor markets. We are proud to facilitate antitrust-compliant actions to help address this crisis.

In the midst of the COVID-19 pandemic, not a single day passes without the news on shortages of medicines or medical equipment.  The issue of ‘shortages of essential products and services’ is not specific to the UK, Italy or Spain.  At these challenging times, the shortages are occurring on a daily basis on a global scale.  Here in Europe, the European Commission (Commission) has published a Temporary Framework Communication, dated 8 April 2020 (C(2020) 3200 final), which sets out forms of cooperation among companies, such as in the health sector, which may be allowed in order to tackle and to avoid “shortages of essential products and services resulting first and foremost from the rapid and exponential growth of demand” (such as in medical supplies needed to treat COVID-19 patients).

Continue Reading COVID-19 and Cooperation Among Companies in the Health Sector

At the beginning of April 2020, the Court of Justice of the EU (CJEU) handed down a preliminary ruling in Case C-228/18, Gazdasági Versenyhivatal v Budapest Bank Nyrt. and others and thus clarifying and reinstating certain aspects of the “by object” assessment. As a reminder, it is a well-established EU competition law principle that if a restriction is considered to be anticompetitive by object, the competition authorities are not required to examine its effects. For example, price fixing, input restrictions, bid-rigging, collective agreements to boycott, resale price maintenance are considered to have negative effects, in particular, on the price, quantity, or quality of goods or services, that they can be regarded as falling within Article 101(1) of the Treaty on Functioning of the EU (TFEU)  without the need to demonstrate any actual or likely anti-competitive effects on the market.

Continue Reading The Court of Justice of the EU Gives a Preliminary Ruling Clarifying and Reinstating Certain Aspects of the “by Object” Assessment

At the EU level, Commission staff have adapted to working from home but are aware of the challenges in dealing with tight timeframes presented by merger notifications (including securing meaningful input from industry participants which may be affected by a transaction).  The Commission has therefore issued an appeal to request parties to delay merger filings as much as possible.  Other authorities have indicated that review timeframes may be extended.

Continue Reading Changes to Merger Rules

In these extraordinary times, economies around the World including Member States are pumping money into their economies.  Businesses and whole sectors are crying out for special support.  State support in the EEA above a low de minimis threshold is subject to strict state aid rules which requires pre-clearance by the European Commission under strict conditions.  Illegally granted state aid can be required to be clawed back.   In the context of Brexit, the UK remains bound by the EU state aid rules during the transition period up to the end of December 2020.  The Commission has until the end of March 2020 to file challenges to aid granted by the UK.  The shape of post-Brexit UK subsidies is unknown.

The Commission has granted speedy clearance to certain state aid applications by a number of member states, including Denmark, Germany, Italy, Portugal and France.  It adopted on 19th March 2020 a Temporary Framework for State Aid measures to support the economy during the COVID-19 crisis.  It will expire on 31st December 2020.  It is focussed on businesses which face difficulties as a result of the pandemic but which were not in trouble on 31st December 2019.

This Temporary Framework is considered in more detail in our State Aid Alert which can be accessed here.

It is important to remember that as businesses struggle in these times to cope with issues like distribution, sourcing ingredients, components and other resources, they may look to collaborate with rivals.   In fact, many businesses have been doing exactly that.  Collaboration between competitors can be perfectly benign and may no anti-competitive effects (for example, in setting standards, lobbying efforts).  However, competition rules do apply and coordination of prices, market sharing, cost allocation, coordinated output reductions or sharing competitive sensitive information, would be prohibited.  Some restrictions are regarded as ‘hard core’ and rarely worthy of exemption (price fixing, customer and market allocations and quantity restrictions).  Penalties for infringement could lead to significant fines and possible private damages litigation.

Continue Reading Collaboration Between Competitors in Times of Crisis