Antitrust Law Daily Wrap Up, ANTITRUST NEWS: EC Vice President Almunia speaks at last European Competition Day, (Oct 10, 2014)

By Greg Hammond, J.D.

Speaking at his last European Competition Day as Vice President of the European Commission responsible for Competition Policy, Joaquin Almunia reviewed his past successes and ideas for the future. His remarks, delivered today, highlighted Regulation 1/2003 and the 2004 Merger Regulation.

“Regulation 1/2003 decentralized enforcement of articles 101 and 102 of the Treaty to national competition authorities,” stated Almunia, “whereas the Merger Regulation kept the centralized review of mergers over a certain threshold while opening to companies the referral process from member States to the Commission and vice versa.”

According to Almunia, Regulation 1/2003 has led to a number of positive results, including: (1) EU antitrust rules have been applied more effectively, and in a wider manner; (2) cooperation among competition authorities has exceeded expectations, and enforcement is consistent across Europe; and (3) a common competition culture is emerging, particularly in the European Competition Network (ECN).

However, there are also new challenges facing the ECN, including e-commerce and online bookings markets. “As actual cases are analysed across Europe, and with e-commerce evolving at a fast pace, it is essential to discuss within the ECN how to best apply those principles and arrive at consistent individual decisions,” Almunia said. “If we want to promote pan-European business models, we need to give legal certainty to the business community.”

Almunia also noted a number of issues that the EC and national competition authorities (NCAs) should discuss in order to achieve a genuine common enforcement area in Europe. These issues included the lack of provisions governing independence and the tools and sanctions NCAs can use; not all NCAs have the same amount of independence as others, and not all EU governments provide them with the resources they need to carry out their responsibilities; some NCAs cannot inspect non-business premises, or cannot gather data stored on mobile phones and tablets; other NCAs cannot issue enforceable requests for information; and some NCAs cannot issue fines, hold parent companies liable, or offer leniency programs, which are essential in busting cartels.

Similarly, the 2004 Merger Regulation has led to positive results in ensuring that potentially problematic deals do not create anti-competitive market structures. However, Almunia also discussed two main proposals that would require amending the regulation to improve merger control across Europe, including extending the EC’s power to review the acquisition of non-controlling minority shareholdings and streamlining the system for referring cases from NCAs to the EC and vice versa. Specifically, Almunia noted that the EC is currently inviting discussion on two points to improve the referral system: (1) “A fast-track system that companies can use to notify directly to the [EC] mergers that are subject to control in several Member States – this, provided no competition Member State objects,” and (2) “A mechanism to make sure that when one or more Member States wish to refer to the [EC] a merger already notified to them, the [EC] would look at the transaction for the whole of the [European Economic Area] so as to avoid parallel investigations.”

In closing, Almunia wished his successor, Margrethe Vestager, “every success as she takes up her new responsibilities as Commissioner for Competition.” He encouraged the ECN to “continue working as closely as possible with her and her team.”

News: Antitrust AcquisitionsMergers