April 2007

Anticompetitive practices

The President of the Czech Competition Authority upholds the decision in the gas insulated switchgears cartel case and slightly reduces the € 35 M record fine ("GIS cartel")
University Paris I Panthéon-Sorbonne
In the record time, i.e. three months after the first instance decision, the President of the Office (hereafter the President) confirmed on appeal the decision in the gas insulated switchgears (“GIS”) cartel case. In the first instance decision, rendered by the Office on 9 February 2007 (See Jan (...)

The Hungarian Supreme Court confirms the NCA’s decision having imposed a € 1.1 M fine for price fixing on the basis of Art. 81 EC to major multiplex movie theatres (Budapest Film)
Hogan Lovells (Budapest)
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DIGI (London)
Hungarian Supreme Court (Legfelsobb Bíróság), 25 April 2007, Budapest Film Kft, InterCom Rt, Palace Cinemas Magyarország Kft and UCI CE Magyarország Kft v. Hungarian National Competition Authority (Gazdasági Versenyhivatal) Hungarian Press release The Hungarian Competition Authority (“HCA”) (...)

The German Federal Cartel Office imposes a fine on the producer of small electrical equipment and products for having exerted pressure on dealers in order to induce them to abide by the recommended retail prices and for having encouraged intermediaries to refuse to supply dealers who did not maintain the recommended price levels (Groupe SEB)
Linklaters (Dusseldorf)
Description of the impugned case The case deals with an indirect RPM clause. Groupe SEB Deutschland GmbH and Krups GmbH, two producers of small electrical equipment, exerted pressure on dealers who undercut the recommended retail sale prices i.e by refusing to pay rebates and to supply those (...)

The Portuguese Competition Authority fines € 185.000 three undertakings implicated in a cartel operating on the tug services market in the Port of Setúbal (Rebonave / Rebosado / Lutamar)
University of Lisbon
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Abreu Advogados (Lisbon)
On 23 April 2007 the Portuguese Competition Authority (PCA) imposed fines in the amount of € 185.000 on three undertakings active in the market for tug services in the commercial port of Setúbal, a port located 50 km south of Lisbon which is particularly important for the import and export of (...)

The EU Commission fines Dutch brewers over € 273 million for a beer cartel (Heineken / Grolsch / Bavaria)
European Commission - Legal Service (Brussels)
"Commission fines Dutch brewers over €273 million for a beer cartel"* I. Introduction On 18 April 2007, the Commission fined Dutch brewers Heineken, Grolsch and Bavaria a total of €273 783 000 for operating a cartel in the beer market in The Netherlands. The Commission’s decision names the (...)

The German Higher Regional Court of Frankfurt decides on the relationship between copyright, trademark and title protection law on the one hand and competition law on the other hand (Harry Potter)
Gleiss Lutz (Munich)
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Milbank, Tweed, Hadley & McCloy (Munich)
On 11 April 2007, the German Higher Regional Court of Frankfurt issued a decision on the relationship between copyright, trademark and title protection law on the one hand and competition law on the other hand. The question at stake was whether restrictive clauses concerning the distribution of (...)

A German Court finds an exclusive purchase obligation in breach of Art. 81 EC and replaces a void non-compete obligation in a franchise agreement (The Body Shop)
Blomstein (Berlin)
Background The cosmetics chain The Body Shop (TBS) employs two different types of distribution channels in Germany: On the one hand, it holds a number of proprietary retail outlets and, on the other hand, it distributes its products through a franchise system. Under the franchise system the (...)

The Polish Competition Authority fines a manufacturer of roof gutters systems and its distributors for price fixing agreement (ZTSG)
French National Research Agency - ANR (Paris)
President’s of the Office for Competition and Consumer Protection (Prezes Urzedu Ochrony Konkurencji i Konsumentów), 12 April 2007, Decision n° RKR-32/2007, concerning the vertical agreement concluded between Zaklad Tworzyw Sztucznych Gamrat S.A., a roof gutters systems manufacturer, and its 4 (...)

The Hungarian Competition Office condemns price fixing and bid rigging for public tenders in the construction sector and for the first time opens criminal proceedings (Bau Art)
CCEE-Lawyers (Budapest)
Background Hétszínvirág Institution for the Education of Handicapped Children (Institution) issued a public tender in 2005 for extension and reconstruction works. As a result of a dispute between the successful bidder and the Institution, a new public tender was published for the same (...)

Unilateral Practices

The Maltese Competition Authority fines the State undertaking entrusted with exclusive right for fuel provision for discriminatory pricing (Cassar Fuels / Enemalta)
Sciberras & Lia (Valletta)
By an application to the Commission for Fair Trading, the Director of the Office for Fair Trading premised that: (i) on 12th September 2005, the Office received a complaint from Cassar Fuels Limited, an agent and distributor of fuels to local industries including hotels, factories and (...)

The French Competition Council orders the electricity incumbent to amend early termination clauses in supply contracts (EDF)
Kramer Levin Naftalis & Frankel (Paris)
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Eversheds Sutherland (Paris)
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Eversheds Sutherland (Paris)
Background and facts Pursuant to Directive 96/92/EC and subsequently Directive 2003/54/EC, all non-household customers (i.e. any natural or legal persons purchasing electricity which is not for their own household use) became eligible customers as of 1st July 2004, meaning that they are free (...)

The French Competition Council imposes interim measures to the incumbent to safeguard competition on the electricity supply market requesting modification of termination of exclusivity clause (KalibraXE / EDF)
Hewlett Packard (Boulogne-Billancourt)
On 25 April 2007, the French Competition Council ("Conseil de la concurrence") imposed interim measures on Electricité de France ("EDF"), which is historically the national operator, following a referral by KalibraXE. Background KalibraXE was created in August 2005. This new operator does not (...)

The Luxembourg Competition Council renders its first ever decision and negatively applies the essential facilities doctrine in the sector of distribution of domestic heating fuel while holding that trade between Member States is not affected (Rock Fernand Distributions / Tanklux)
Arendt & Medernach (Luxembourg)
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NautaDutilh (Luxembourg)
On 23 April 2007 the new Luxembourg national competition authority that has been created in 2004, the Competition Council (“Conseil de la concurrence”), has handed down its first decision on the merits of a competition case brought before it. The Competition Council has chosen to be very didactic (...)

A Belgian commercial court holds as abusive a refusal to let a team participate in important cycling races (GCA/ASO)
Arendt & Medernach (Luxembourg)
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NautaDutilh (Luxembourg)
Factual background On 23 April 2007 the commercial court of Liège (“Tribunal de commerce”) handed down a decision in a case between the Swedish cycling team Green Cycle Associates (“GCA”) and Amaury Sport Organisation (“ASO”). ASO is a French undertaking that organises several major cycling events, (...)

The Russian Competition Authority imposes a fine of € 35 M for excessive pricing in the potassium chloride market (Silvinit / Uralkalii)
Gibson Dunn (Brussels)
On 23 April 2007, the Russian Federal Antimonopoly Service ("FAS Russia") decided that the two only Russian producers of potassium chloride, Silvinit and Uralkalii, were in breach of Article 10(1) of the Russian Federal Law on the Protection of Competition by abusing their dominant position. (...)

The Greek Competition Authority considers that a cemetery can not be regarded as an undertaking according to competition law (Municipal cemetery)
Hellenic Competition Authority (Athens)
An individual lodged a complaint with the Greek Competition Authority (Hellenic Competition Commission, thereafter HCC) against a municipal cemetery accusing it of acting in a way that consisted to an abuse of a dominant position. The legal issue at stake was not the conduct of the defendant (...)

The Cyprus Competition Authority fines the incumbent telecom provider € 38,000 for refusing to provide access to its SMS centre (CYTA/Golden Telemedia)
University of Tilburg - Center for Law and Economics (TILEC)
On December 19th, 2006 the Cyprus Commission for the Protection of Competition (C.P.C.) found the Cyprus Telecom Authority (CYTA), the incumbent telecom provider, liable for abusing its monopoly position in the upstream market for provision of access facilities necessary for value-added service (...)

The French Competition Authority refuses to order interim measures regarding alleged eviction practices implemented in the sector of shipping transport between Corsica and the continent (CMN / SNCM)
French Competition Authority (Paris)
Press Release published on the official website of the French Competition Authority. Renewal of public service delegation contract / Corsica-Marseilles: New referral by Corsica Ferries: Conseil de la concurrence does not order interim measures but decides to continue the examination on the (...)

The Spanish Competition Court fines € 306.000 tying practices between train transport and boat services (Ferrocarril de Sóller - Excursiones Marítimas Puerto de Sóller)
Spanish Competition Authority (Madrid)
The island of Majorca in Spain is a great tourist attraction and the area of Sóller is one of most visited spots on the island. A typical tour offered by travel agencies and touroperators is the denominated “Vuelta a la Isla”. This tour consists of an itinerary between Palma, Sóller and Sa Calobra (...)

The EU Commission closes investigation against Danish windows manufacturer addressing the issue of rebates (Velux)
DG COMP (Brussels)
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Copenhagen Economics (Brussels)
"The Velux case – an in-depth look at rebates and more"* I. Introduction “The Polish window manufacturer, Fakro, which claims to be the world’s second largest producer of roof windows, alleges it has been squeezed out of certain European markets by Danish rival Velux. The Polish group claims its (...)

Mergers

The Dutch competition authority seeks views on draft revised remedies guidelines
Netherlands Authority for Consumers & Markets (The Hague)
The NMa has launched a public consultation on its draft revised guidelines for remedies. The draft guidelines anticipate the upcoming amendment of the Dutch Competition Act (“DCA”). In addition, the revision is used to update the current (2002) guidelines with the experience gained in remedies by (...)

The Greek Competition Commission clears a merger in the hardware, software and information technology services sectors (Info-Quest/Unisystems)
International Chamber of Commerce (ICC)
Greek Competition Commission (GCC) (Epitropi Antagonismou), 26 April 2007, Info-Quest and Unisystems, Decision n° 337/V/2007 ) I. Factual Background Prior to the proposed acquisition in question, “Info-Quest” held from the 25 of October 2006, 32,976% of the share capital in “Unisystems”. This (...)

The UK Office of Fair Trading and the Secretary of State for Trade and Industry clear a merger in the aviation defence sector subject to behavioural remedies relating to national security and security of supply issues (GE/Smiths Aerospace)
Serle Court (London)
The operation On 15 January 2007 General Electric Corporation (“GE”) announced proposals for GE Aviation UK (“GE Aviation”) to acquire Smiths Aerospace. GE Aviation is active in the aviation sector and is a subsidiary of GE, incorporated in the US. GE is a diversified industrial corporation which (...)

The UK Competition Commission clears in phase II a merger between the two leaders in the egg industry conditional to divestiture remedies (Stonegate Farmers - Deans Food)
Brown Brothers Harriman (BBH) (Luxembourg)
Summary The UK’s Competition Commission has concluded that a completed merger in the egg industry is anti-competitive and therefore the merged entity is required to divest all or part of the business. The decision raises the general question as to what extent a business can legitimately (...)

The Dutch Competition Authority clears sugar “merger to monopoly” (Cosun-CSM)
Netherlands Authority for Consumers & Markets (The Hague)
Dutch Competition Authority (Nederlandse Mededingingsautoriteit), 20 April 2007, Decision n° 5703, Cosun-CSM In a second phase decision, the Dutch Competition Authority (NMa) has approved the concentration between the only two sugar producers in the Netherlands : CSM and Cosun. The NMa’s (...)

The UK Competition Commission cleared a completed merger in the market for the production of eggs in shell and processed form, subject to the divestment of the acquired business (Stonegate/Deans Food)
Serle Court (London)
The operation Stonegate Farmers Limited (Stonegate) is active in the supply of hens’ eggs which it sells in both shell (shell eggs) and processed forms (processed egg). It sources the majority of its shell eggs from independent third parties, and outsources the processing of its eggs. It (...)

The Hungarian Competition Office unconditionally approves a merger between two fixed line telecommunications incumbents (HTTC / Matel)
Morley Allen & Overy Iroda (Budapest)
Background With its decision of 20 April 2007 (Decision), the Hungarian Competition Office (HCO) has approved the acquisition of Matel Holding N.V. (Matel) by Hungarian Telephone and Cable Corporation (HTTC). HTTC controls Hungarotel Távközlési Zrt (Hungarotel). Hungarotel is the incumbent (...)

The Hungarian Competition Office clears without condition a merger in the telecommunications sector (HTTC / Matel)
Oppenheim (Budapest)
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Oppenheim (Budapest)
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Oppenheim (Budapest)
Hungarian Telephone and Cable Corporation (together with its subsidiaries, HTCC) completed its acquisition of Invitel Távközlési Szolgáltató Zrt. (Transaction) on 27 April 2007 pursuant to the terms of a Sale and Purchase Agreement, dated as of 8 January 2007, between HTCC and Invitel Holdings N.V. (...)

The Dutch District Court of Rotterdam confirms that, unless there is a reason for deviation, the NCA may rely upon a previous EC merger decision for the purposes of market definition (Nederlandse Vakbond Varkenshouders)
The AES Corporation (Amsterdam)
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De Brauw Blackstone Westbroeck (Amsterdam)
District Court of Rotterdam (Rechtbank Rotterdam), 19 April 2007, Nederlandse Vakbond Varkenshouders & Nederlandse Bond van Handelaren in Vee / NMa, Case MEDED 06/1220 VRLK, LJN BA3538 In December 2005 Dumeco notified its intension to the Dutch Competition Authority (hereafter referred to (...)

The Italian Competition Authority cleared an acquisition on the cash and valuable transportation market with remedies including returning public licences (Investimenti /Securcontrol - Metropol)
Clifford Chance
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Chiomenti (Rome)
The operation On 19 April 2007, the Competition Authority cleared with remedies the acquisition by BS, wholly controlled by BS Private Equity S.p.A. (BSPE), of three companies active in securities services, security consulting and in the sale, installation and maintenance of alarm systems. The (...)

The Belgian Competition Council abolishes remedies imposed in a previous merger between the two major cinema operators in Belgium (Kinepolis)
Freshfields Bruckhaus Deringer (Hong Kong)
The operation The Belgian Competition Council abolishes the conditions imposed by its decision of 17 November 1997 (97-C/C-25) on the activities Kinepolis Groep and Kinepolis Filmdistributie, created by the merger of Groep Bert and Groep Claeys The markets The relevant markets have been (...)

The Italian Competition Authority conditionally clears a merger in the banking sector (Banche Popolari Unite/Banca Lombarda e Piemontese)
Clifford Chance
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Chiomenti (Rome)
The operation Banche Popolari Unite (UBI) will absorb Banca Lombarda e Piemontese, which will cease to exist as a legal entity, after the companies met the ICA’s concerns about reduced competition in two Provinces and the conflicting roles with Intesa Sanpaolo, one of the major Italian banking (...)

A German court confirms application of merger rules to public hospital operators holding them as economic undertakings (German public hospitals)
Angermann
Summary of the case The judgement of the appellate court Düsseldorf, which was delivered on the 11th of April 2007, decides the challenge of a decision of the Federal Cartel Office regarding a merger between two private companies that operate several public hospitals that are part of the legal (...)

The Turkish Competition Authority cleared a merger in the air transport market subject to 2 years slots divestiture (Lufthansa - Gunes Express )
Esin (Istanbul)
The operation Lufthansa is an aviation group which is active all over the world together with its more than 400 subsidiaries and affiliates. The main field of business of Lufthansa is the passenger transportation. Other fields of business of Lufthansa are logistics, maintenance and repair, (...)

The Austrian Federal Competition Authority clears in phase II a merger in the Austrian telecommunications sector subject to conditions, including the divestiture of infrastructure, additional wholesale offers and price reductions (Telekom Austria/eTel Austria)
Imperial College Business School (London)
The operation Telekom Austria AG is the incumbent telecommunications provider in Austria. eTel Austria (eTel) is a full range telecommunication services provider with a focus on business customers and fixed line services. The proposed acquisition of eTel by Telekom Austria was notified to the (...)

The German competition authority prohibits the acquisition of an hearing aid producer by a competitor in spite of proposed remedies (Phonak / GN ReSound)
Free University of Berlin
I. Background The hearing aid producer Phonak (market share 20-25%) intended the acquisition of its competitor GN ReSound, the fourth largest producer (market share 5-10%). Other strong competitors are Siemens (market share 32,5-37,5%) and Oticon (market share 20-25%). In Germany the three (...)

The Danish Competition Council approves the creation of a joint venture between two television broadcasters subject to 17 remedies due to a risk of coordination effects between the parent companies (TV2 / MTG / TV2 Sport JV)
Kromann Reumert (Copenhagen)
The operation TV2 was a state-owned television broadcaster. TV2 owned and operated a number of television channels. Its core channel, named ‘TV2’, was financed primarily through advertisements, whereas other channels were financed through a combination of subscription fees and advertisements. (...)

The Swiss Competition Commission approved a merger in the financial sector with remedies intended to ensure free access to the market for the electronic trading of Swiss stocks (SWX/SIS/Telekurs)
NERA (Berlin)
The operation The three-party merger between SWX (SWX Group and Verein SWX Swiss Exchange), SIS (SIS Swiss Financial Services Group AG) and Telekurs (Telekurs Holding AG) was approved by the Swiss Competition Commission (WEKO) in October 2007 in a Stage 1 decision. This was possible as the (...)

The European Commission refers the assessment of an acquisition in the food and non-food retailing sector to the Polish Competition Authority (Carrefour/Ahold Polska)
JG Associates (Brussels)
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DG COMP (Brussels)
"Merger control: Main developments between 1 January and 30 April 2007"* On 10 April 2007, and following the request of the Polish Competition Authority, the Commission referred the assessment of the acquisition of Ahold Polska of Poland by Carrefour of France to the Polish Competition (...)

The Bulgarian Competition Authority clears an hypothetical foreign-to-foreign merger in the bus and lorries sector (Scania/MAN)
US Federal Trade Commission (FTC)
The Bulgarian Commission for the Protection of Competition (the Commission or CPC) authorised a foreign-to-foreign merger by which the German lorry and engine maker MAN AG (MAN) was to acquire the Swedish company Scania AB (Scania), active in the same industries. Prior to the CPC decision, the (...)

The Italian Competition Authority clears a merger in the financial sector with remedies, including the granting of non discriminatory access (SSB/Cedborsa)
Clifford Chance
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Chiomenti (Rome)
The operation Società per i Servizi Bancari (SSB) will absorb Società Interbancaria per l’Automazione-Cedborsa (SIA). SSB is controlled by five major national banks - Unicredito, Intesa SanPaolo, Capitalia, Monte dei Paschi di Siena and BNL -, which are also the clients of SSB and SIA. The (...)

The European Commission, after an in-depth investigation, unconditionally approves a merger in the satellite equipment manufacturing industry (Thales/Meccanica/AAS/Telespazio)
JG Associates (Brussels)
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DG COMP (Brussels)
"Merger control: Main developments between 1 January and 30 April 2007"* Following an in-depth investigation the Commission decided on 4 April to grant an unconditional clearance to the proposed acquisition by Thales of France of Alcatel‘s shareholdings in the Alcatel Alenia Space (AAS) of (...)

State Aid

The Spanish Supreme Court brings a preliminary question before the ECJ on State aid issue relating to obligatory investments for the financing in advance of European and Spanish cinematographic and TV films (Unión de Televisiones Comerciales Asociadas)
Hogan Lovells (Madrid)
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Allianz (Brussels)
Factual Background: An appeal before the Supreme Court by the Union of Associated Commercial Televisions ("UACT") against Royal Decree 1652/2004 on obligatory investments for the financing in advance of European and Spanish cinematographic and TV films ("Royal Decree 1652/2004") on the grounds (...)

The Cyprus Commissioner for State aid control authorizes several aid schemes for the provision of training aid, having concluded that they fall within EC Reg. No. 68/2001 and No. 800/2008 (Training programmes)
University of Tilburg - Center for Law and Economics (TILEC)
Factual Background Decision No. 267: On 27.03.2007 the Human Resource Development Authority of Cyprus (HRDA) notified a draft aid scheme entitled “multi-company continuing training programmes abroad” to the Commissioner for State Aid Control. The aid measure aims to encourage employers and their (...)

The Spanish National Audience confirms the incompatibility between different types of national regional aid to agriculture (Grupo Kalise Menorquina)
Hogan Lovells (Madrid)
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Allianz (Brussels)
Brief description of the facts and legal issues: A company brought an appeal before the National Audience against a decision of the Ministry of Economy refusing the granting of a State aid for regional incentives. The Ministry of Economy’s refusal was based on the fact that the appellant’s (...)

The Lithuanian Supreme Administrative Court holds that an exclusive operator in the field has not been granted any advantage within the meaning of State aid provisions when operating beyond the boundaries of the secure network and rules that the nature and the purpose of products on devices determines whether a monopoly is lawful (TEO LT - Omnitel - Bite Lietuva)
Raidla Lejins & Norcous
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Valiunas Ellex (Vilnius)
Factual background Pursuant to the order of the Minister of Internal Affairs No 1V-167 dated 14 May 2004, the public undertaking Infostruktura was authorised to act as the exclusive operator of the secure data transmission network in Lithuania. Consequently, providers of similar electronic (...)

Procedures

The Lisbon Court of Commerce quashes decisions fining pharmaceutical companies on procedural grounds (Abbot, Bayer, Johnson & Johnson, Menarini and Roche)
PLMJ (Lisbon)
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PLMJ (Lisbon)
In its judgement of 26 March 2007 the Lisbon Court of Commerce (the “Court”) quashed on procedural grounds two decisions adopted by the Portuguese Competition Authority (the “PCA”) fining five pharmaceutical companies (Abbot, Bayer, Johnson & Johnson, Menarini and Roche). The PCA had found that (...)

The UK OFT publishes discussion paper on private enforcement
Linklaters (London)
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Linklaters (London)
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Linklaters (London)
The OFT have published (on 18 April 2007) a Discussion Paper entitled "Private actions in competition law: effective redress for consumers and business", launching an informal consultation process on how to encourage private actions by consumers and businesses for breaches of competition law. (...)

The French Competition Council publishes a revised leniency programme in line with the European Model Leniency Programme launched by the European Competition Network
International Chamber of Commerce (ICC)
The French Competition Council has published a revised leniency programme which aligns the French model to the European Model Leniency Programme launched by the European Competition Network (hereinafter: the “ECN”) in September 2006. The European Model Leniency Programme was introduced in order (...)

A French commercial tribunal rules on its own competence to decide on a competition related issue in spite of the the new courts’ competition specialisation (Quaron/Roquette Frère)
University Paris I Panthéon-Sorbonne
Court of first instance of Béthune, Commercial division (Tribunal de Grande Instance de Béthune (TGI)), April 4th 2007, SA Quaron vs. SA Roquette Frère (Not yet published; on-line publication expected for the 5th September at the lattest) In this case, Quaron company summoned Roquette Frères (...)

The UK Competition Appeal Tribunal widens the scope for the Office of Fair Trading to close a case based on administrative priority (Cityhook)
British Institute of International and Comparative Law
The facts On 21 February 2002, Cityhook made a complaint to the OFT about an alleged collective boycott of Cityhook in relation to its submarine cable laying and landing technology by the United Kingdom Cable Protection Committee (‘UKCPC’), and in relation to the collective setting of fees (...)

The US Antitrust Modernization Commission (AMC) releases report and recommendations to Congress and President Bush
Skadden, Arps, Slate, Meagher & Flom (Washington DC)
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Skadden, Arps, Slate, Meagher & Flom (New York)
On April 2, 2007, the Antitrust Modernization Commission (“AMC”) released its Report and Recommendations to Congress and President Bush. The bipartisan AMC was commissioned by the Modernization Act of 2002 to examine whether antitrust law needed to be modernized, solicit views from interested (...)

Regulatory

The UK Gas and Electricity Markets Authority accepts the former gas incumbent’s practices for re-contracting switching customers (British Gas Trading)
Jacobs (Glasgow)
Ofgem, 17 April 2007, Decision in relation to the appeal raised by British Gas Trading Ltd (BGT) against the Master Registration Agreement (MRA) Forum decision upholding the MRA Executive Committee (MEC) determination dated 25 July 2006, that BGT is in breach of Clause 38.1 of the MRA (...)

The German Ministry of Economics issues a draft ordinance implementing incentive regulation for regulating energy network access charges
Hengeler Mueller (Dusseldorf)
German Federal Ministry of Economics and Technology, Draft ordinance regarding a regime of incentive regulation for energy networks (“Verordnung über die Anreizregulierung der Energieversorgungsnetze” - Anreizregulierungsverordnung, ARegV On 13 July 2005, the new German Energy Industry Act (...)

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