Failing firm defence

Anticompetitive practices

The US District Court for the Southern District of Florida allows a plea of "nolo contendere", while retaining full sentencing discretion in imposing any penalty and fining against a price-fixing conspiracy engaged by an air cargo carrier (Florida West International Airways)
King & Wood Mallesons (Sydney)
This article was originally published on In Competition by King & Wood Mallesons (click here). US District Court blows full time on cartel proceedings against Florida West* The District Court has made the rare decision to accept a plea of no contest from airline Florida West, ending the (...)

The EU Commission announces fines in bathroom fittings cartel tackling the issue of fine discounts on bankruptcy grounds (Artweger / Cisal)
University of East Anglia (Norwich)
Article published on Centre for Competition Policy blog. Dodgy Plumbing: Why Europe’s Willingness to Grant Bankruptcy Discounts is Bad for Cartel Enforcement* A speech by the European Commissioner for Competition may signal a greater willingness to grant discounts in cartel fines on the (...)

The Italian Competition Authority imposes fines of more than €4 million on two leading producers of concrete for predatory pricing and anti-competitive arrangements (Mercato del calcestruzzo cellulare autoclavato)
Ashurst (Brussels)
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Legance - Studio Legale Associato (Rome)
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Iliad (Milano)
Background On 24 October 2007, the Italian Competition Authority (Autorità garante della concorrenza e del mercato) fined two leading producers of autoclaved cellular concrete (ACC), namely Xella International GmbH (Xella) and RDB S.p.A. (RDB) alleging that they had entered into some form of (...)

Failing firm defence in merger control: An overview of EU and national case law
FTI Consulting (Brussels)
The failing-firm argument is a long-standing defence used in mergers and acquisitions involving competitors where the transaction would give rise to significant concerns. In the current recessionary economy, this defence has enjoyed renewed interest, with some speculating that the doctrine may (...)

Mergers

The UK Competition Authority clears at phase II an acquisition of a minority shareholding and certain rights in a food delivery company in its first application of “failing firm” defence (Amazon / Deliveroo) Free
CRA International (London)
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CRA International (London)
On 4 August 2020 the CMA cleared Amazon’s proposed minority investment in Deliveroo. Having previously been concerned that the investment could damage competition by discouraging Amazon from re-entering restaurant food delivery in the UK and altering its competitive incentives in respect of (...)

The UK Competition Authority clears a Big tech’s 16% investment in an online food delivery company after finding that it will not substantially lessen competition (Amazon / Deliveroo)
United Kingdom’s Competition Authority - CMA (London)
CMA clears Amazon’s 16% investment in Deliveroo* Following an in-depth investigation, the CMA has today cleared Amazon’s 16% investment in Deliveroo after finding that it will not substantially lessen competition. The Competition and Markets Authority (CMA) completed an initial ‘Phase 1’ (...)

The Austrian Competition Authority publishes position paper on the macroeconomic effects of "shutdown mergers" in the context of the COVID-19 crisis Free
Austrian Competition Authority (Vienna)
AFCA publishes position paper on the Macroeconomic Effects of Mergers in the Context of the COVID-19 Crisis - "Shutdown Mergers"* The position paper aims to facilitate notifications of Shutdown Mergers. The COVID-19 pandemic and the restrictions put in place to deal with it have triggered a (...)

The UK Competition Authority publishes guidance on its approach to merger control during the COVID-19 pandemic Free
Herbert Smith Freehills (London)
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Herbert Smith Freehills (London)
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Herbert Smith Freehills (London)
The Competition and Markets Authority (CMA) has published guidance on its approach to merger control during the COVID-19 pandemic. The guidance deals with procedural issues as well as substantive assessment, and makes it clear that on the whole the CMA’s approach remains one of ‘business as (...)

The UK Competition Authority publishes its guidance on merger assessments during COVID-19 pandemic Free
Covington & Burling (Brussels)
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Covington & Burling (Brussels)
On 22 April 2020, the UK Competition and Market Authority (“CMA”) published its guidance on ‘Merger assessments during the Coronavirus (COVID-19) pandemic’ (“the guidance”). Prior to the publication of the guidance, there was some speculation about whether the CMA would be more willing to accept (...)

The UK Competition Authority clarifies its general approach to assessing mergers and its specific approach to assessing "failing firm" claims during the COVID-19 pandemic Free
United Kingdom’s Competition Authority - CMA (London)
COVID-19: CMA approach to merger assessments* The CMA has today provided more detail on its general approach to assessing mergers during the Coronavirus (COVID-19) pandemic. Following its statement about working practices issued on 18 March, the Competition and Markets Authority (CMA) has set (...)

The Ecuadorian Competition Authority publishes new merger review procedure due to COVID-19 crisis Free
Pérez Bustamante & Ponce (Quito)
COVID-19: New, fast-track merger review procedure introduced in Ecuador Historically, crises have been catalysts of legal and political change. On occasion of the COVID-19 emergency, this week (April 20th, 2020) the Ecuadorian competition agency (‘Superintendencia de Control del Poder de (...)

The UK Competition Authority uses the failing firm defence in a merger between a service provider and a food delivery supplier during the COVID-19 pandemic (Amazon / Deliveroo)
Ashurst (London)
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Ashurst (London)
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Ashurst (London)
While some businesses may choose to delay transactions in light of Covid-19, many transactions will continue, in particular if the target is in financial distress. In such scenarios, the "failing firm defence" may be an available option for obtaining merger control clearance for transactions (...)

The UK Competition Authority provisionally clears an acquisition between an online food delivery business by a global online shopping company (Amazon / Deliveroo)
Bird & Bird (London)
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Bird & Bird (London)
The CMA has provisionally cleared Amazon and Deliveroo merger On 17 April 2020, the Competition and Markets Authority ("CMA") provisionally cleared the anticipated acquisition by Amazon of certain rights and a minority shareholding in Deliveroo. The CMA’s initial analysis of the merger (...)

The UK Competition Authority provisionally clears acquisition of an online food delivery business by a global online shopping company to prevent it from bankruptcy likely to happen due to economic effects of the COVID-19 outbreak (Amazon / Deliveroo) Free
United Kingdom’s Competition Authority - CMA (London)
CMA provisionally clears Amazon’s investment in Deliveroo* In light of a deterioration in Deliveroo’s financial position as a result of coronavirus (COVID-19), the CMA has provisionally cleared Amazon’s investment in Deliveroo. After completing an initial, Phase 1, investigation, the Competition (...)

The EU Commission announces that, amid the current COVID-19 crisis, it stands ready to deal with cases where firms can show very compelling reasons to proceed with a merger notification without delay Free
Freshfields Bruckhaus Deringer (Brussels)
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Freshfields Bruckhaus Deringer (London)
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Freshfields Bruckhaus Deringer (London)
Although many competition authorities are making considerable efforts to ensure “business as usual” during the COVID-19 crisis, the pandemic is inevitably having a material impact on merger control reviews around the globe. In addition to the obvious timing implications, deals are now being, and (...)

The Brazilian Competition Authority implements measures in line with WHO recommendations against the spread of the COVID-19 Free
Mattos Filho Advogados (Sao Paulo)
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Mattos Filho, Veiga Filho, Marrey Jr. & Quiroga (Sao Paulo)
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Mattos Filho Veiga Filho Marrey Jr & Quiroga (New York)
The Brazilian antitrust authority has implemented measures in line with WHO recommendations against the spread of the COVID-19, and activities are being carried out without major impacts, although deadlines in conduct cases are now suspended and delays in certain matters cannot be altogether (...)

The Portuguese Competition Authority clears a merger in the hospital market in applying the failing firm defence (HSGL / HPA Group)
Portuguese Competition Authority (Lisbon)
The AdC adopts a clearance decision on the Grupo HPA Saúde / Hospital São Gonçalo de Lagos merger* The AdC (Autoridade da Concorrência – Portuguese Competition Authority) has adopted a clearance decision on the merger concerning the acquisition of sole control of Hospital São Gonçalo de Lagos (...)

The French Competition Authority clears a merger in the metalworking market (Ascoval / British Steel)
French Competition Authority (Paris)
Metalworking industry* The Autorité de la concurrence clears the takeover of the Ascoval company by the British Steel group. After the decision of the Strasbourg General court of first instance of 2 May 2019, which validated the takeover of the steel plant Ascoval by the British Steel group, (...)

The US District Court rejects a failing firm defence and blocks the merger of nuclear waste disposal companies (EnergySolutions / Waste Control Specialists)
US Federal Trade Commission (FTC)
Federal judge blocks merger of nuclear waste disposal companies rejecting "failing firm" defense* On June 21, 2017, US District Judge Sue L. Robinson blocked EnergySolutions, Inc.’s proposed acquisition of Waste Control Specialists LLC (WCS), applying a strict standard for the “failing firm” (...)

The Irish Competition and Consumer Protection Commission approves a merger following the parties’ submission of a failing division argument (Baxter / Fannin)
European Investment Bank (Luxembourg)
Introduction The Irish Competition and Consumer Protection Commission (CCPC) has approved a merger under the Irish Competition Act 2002 (as amended) following the parties’ submission of a failing division argument. The transaction saw Baxter Healthcare Limited (Baxter) seeking to acquire sole (...)

The Irish Competition Authority clears the first otherwise anticompetitive merger using the failing firm defence (Baxter / Fannin)
Trinity College Dublin
Introduction 1 On 21 October 2015 the Competition and Consumer Protection Commission (CCPC), Ireland’s competition agency, cleared the acquisition by Baxter Healthcare Limited (Baxter) of Fannin Compounding Limited (Fannin), a business division of Fannin Limited which was, in turn, a subsidiary (...)

The Danish Competition Authority requests criminal indictment for withholding in a merger assessment (Metro Cash & Carry)
Gorrissen Federspiel (Copenhagen)
METRO Cash & Carry risks fine in Danish merger case* The Danish Competition and Consumer Authority (DCCA) has reported METRO Cash & Carry (METRO) to the State Prosecutor for Serious Economic and International Crime for failing to submit relevant information regarding a notified merger. (...)

The Competition Commission of Singapore clears an acquisition in the airline sector in a landmark decision (Singapore Airline / Tiger Airways)
Allen & Gledhill (Singapore)
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Allen & Gledhill (Singapore)
On 28 November 2014, the CCS announced that it had cleared the notification for decision in relation to the acquisition of Tiger Airways Holdings Limited (“Tigerair”) by Singapore Airlines Limited (“SIA”) (collectively, the “Parties”) on the grounds of a failing firm defence argument. After (...)

The German Competition Authority clears a merger by applying the failing firm defence on the daily newspapers market (Westfälische Nachrichten / Münstersche Zeitung)
German Competition Authority (Bonn)
Regional daily Westfälische Nachrichten can take over Münstersche Zeitung* The Bundeskartellamt has cleared plans by the Münster-based publishing house Aschendorff Verlag (which publishes Westfälische Nachrichten) to acquire the regional daily Münstersche Zeitung. The daily is sold by the (...)

The UK Competition and Markets Authority refuses to apply the failing firm defence to clear a merger in phase II (Alliance / IBA)
St John’s Chambers (Bristol)
United Kingdom Merger Control: Recent Developments in the Failing Firm Defence* On 15 August 2014, the Competition and Markets Authority (“CMA”) approved Alliance Medical Group’s completed acquisition of IBA Molecular’s radioactive medical tracer business. Although IBA’s business was loss-making, (...)

The Australian Competition and Consumer Commission opposes the proposed acquisition in the radiology industry (Delta Imaging / Sonic Health)
Australian Competition and Consumer Commission (Canberra)
ACCC to oppose Sonic’s acquisition of the assets of Delta Imaging Group* The Australian Competition and Consumer Commission has announced it will oppose the proposed acquisition by Sonic Healthcare Limited (Sonic) of assets of Delta Imaging Pty Limited (in liquidation), Delta Imaging Maitland (...)

The Danish Competition Council approves merger in the retail sector for furniture (Jysk / IDdesign)
Danish Competition and Consumer Authority (Copenhagen)
Danish Competition Council approves JYSK’s acquisition of IDEmøbler and ILVA* On September 25th 2013 the Danish Competition Council (“DCC”) ap-proved JYSK’s acquisition of IDdesign A/S, the owner of the two retail chains IDEmøbler and ILVA. JYSK Holding A/S, which is owned by Lars Larsen, owns the (...)

The Swedish Competition Authority clears a merger by an acquisition of sole control in the pensions and insurance sector (Pensionsservice / Pensionsförsäkring)
Klarna (Stockholm)
The Swedish Competition Authority (“the SCA”) received notification of a proposed concentration, by which KPA Pensionsservice AB (“KPA”) acquired sole control of SPP Liv Pensionstjänst AB (“SPP”). In the same notification, KPA Pensionsförsäkring AB notified the acquisition of sole control of a life (...)

The Competition Tribunal of South Africa approves a merger in the petrochemical and mining sector within four hours of receiving the Competition Commission’s recommendation (Stefanutti Stocks / Energotec)
Nortons (Sandton)
South African Competition Tribunal approves merger in record time of 4 hours* The South African Competition Tribunal received notice of, heard and approved the acquisition by construction firm, Stefanutti Stocks (Pty) Ltd, of Energotec, which is a division of First Strut (Pty) Ltd, and (...)

The German Competition Authority clears the acquisition of a fireworks business by one of the major domestic suppliers (FKW Keller / Comet Feuerwerk)
German Competition Authority (Bonn)
Bundeskartellamt clears acquisition of fireworks importer FKW Keller, Bochum, by Comet Feuerwerk GmbH, Bremerhaven, in the first phase of merger control* The Bundeskartellamt has cleared the acquisition of the fireworks business of FKW Keller, Bochum, by Comet Feuerwerk GmbH in preliminary (...)

The German Competition Authority clears acquisition of a publishing business of the daily newspaper from an insolvent publishing house (Frankfurter Allgemeine Zeitung / Frankfurter Rundschau)
German Competition Authority (Bonn)
Bundeskartellamt clears acquisition of Frankfurter Rundschau by FAZ* Today the Bundeskartellamt has cleared plans by Frankfurter Allgemeine Zeitung GmbH or rather Frankfurter Societät GmbH, to acquire the publishing business of the daily newspaper Frankfurter Rundschau from the insolvent Druck- (...)

The German Competition Authority examines notified acquisition of daily newspapers (Frankfurter Rundschau / FAZ)
German Competition Authority (Bonn)
Bundeskartellamt examines acquisition of daily newspaper Frankfurter Rundschau by Frankfurter Allgemeine Zeitung (FAZ)* On 30 January 2013, the Bundeskartellamt was notified of plans by Frankfurter Allgemeine Zeitung GmbH, or rather its printing house, to acquire the publishing business of the (...)

The German Competition Authority prohibits hospital merger rejecting failing firm defence (Klinikum Worms / Hochstift hospitals)
Van Bael & Bellis (Brussels)
On 5 October 2012, details were published concerning a 5 September 2012 decision by the German Federal Cartel Office (“FCO”) prohibiting a proposed merger between two hospitals in Worms, a city on the west bank of the Rhine River in southwest Germany. According to the FCO, the proposed (...)

The UK OFT accepts commitments offered by a party to a completed acquisition in lieu of referring the case to the Competition Commission (Vue Entertainment International / Apollo Cinemas)
Herbert Smith Freehills (Brussels)
In May 2012 Vue Entertainment International Limited ("Vue") acquired sole control of Apollo Cinemas Limited ("Apollo"). In its decision of 24 August 2012 published in October 2012, the Office of Fair Trading ("OFT") stated that the acquisition had resulted or may be expected to result in a (...)

The Italian Competition Authority authorizes with conditions the acquisition of certain assets of a shipping company by a company jointly controlled by a private equity firm and by another shipping company (Compagnia Italiana di Navigazione / Ramo di Azienda di Tirrenia di Navigazione)
Legance - Studio Legale Associato (Rome)
1. The sale process of Tirrenia and the proceeding before the European Commission The present concentration concerns the sale of the main assets of the shipping company Tirrenia, previously controlled by the Italian State. Due to the economic and financial difficulties suffered by Tirrenia, on (...)

The Swedish Competition Authority clears in second phase a merger in the dairy market in a case raising failing firm issues (Arla Foods / Milko)
Cosmetics Europe (Brussels)
Background The parties to the transaction, i.e. Arla Foods amba ("Arla Foods") and Milko ekonomisk förening ("Milko") are two independent producers and suppliers of dairy products to Swedish customers. Both parties are organised as farmer cooperatives which collect raw milk from farmers for (...)

The Chinese MOFCOM issues new interim provisions on the assessment of anticompetitive effects of mergers
Linklaters (Beijing)
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Linklaters (Shanghai)
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Euclid Law (London)
On 2 September 2011, the PRC Ministry of Commerce (the “MOFCOM”) published on its website the Interim Provisions on Assessment of Competitive Impact of Concentrations of Business Operators (the “Interim Provisions”), which came into effect on 5 September 2011. The Interim Provisions elaborate on (...)

The EU Commission blocks a merger as its clearance would have resulted in a quasi-monopoly on the Greek air transport market (Olympic Air / Aegean Airlines)
University of East Anglia (Norwich)
Article published on Centre for Competition Policy blog. EU Commission Steers Clear of another Antitrust Disaster in Greek Air Transport, but for how long?* This month, the European Commission blocked the proposed merger between Greece’s two main airlines, Olympic Air and Aegean Airlines. What (...)

The Brazilian Council for Economic Defense clears merger between two ammunition companies resulting in monopolization of the relevant market (CBC/Rossi)
Madrona Advogados (São Paulo)
The author gives thanks to Ms. Natali de Vicente Santos, who gave support in research that was very useful to build this article. I. Summary of the case For the first time, CADE applied the “declining markets” argument to justify that the transaction between two ammunition companies was not (...)

The US FTC sues to undo completed acquisition in the healthcare industry approved by bankruptcy court (LabCorp / Westcliff)
Jones Day (Washington DC)
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Jones Day (Washington DC)
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Skadden, Arps, Slate, Meagher & Flom (Washington DC)
The Federal Trade Commission has filed an administrative lawsuit seeking to undo Laboratory Corporation of America’s (« LabCorp ») acquisition of Westcliff Medical Laboratories, Inc. (« Westcliff »). According to the agency’s December 1 complaint, the merger will substantially lessen competition (...)

The US FTC sues to undo completed acquisition in the healthcare industry approved by the Bankruptcy Court (LabCorp / Westcliff)
Jones Day (Washington DC)
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Jones Day (Washington DC)
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Skadden, Arps, Slate, Meagher & Flom (Washington DC)
The Federal Trade Commission has filed an administrative lawsuit seeking to undo Laboratory Corporation of America’s (« LabCorp ») acquisition of Westcliff Medical Laboratories, Inc. (« Westcliff »). According to the agency’s December 1 complaint, the merger will substantially lessen competition (...)

The Latvian Competition Council allows merger decreasing competition in meat products market (Rīgas Miesnieks / Jelgavas gaļas kombināts)
Klavins Ellex (Latvia)
Introduction On 8 June 2010 the Competition Council conditionally cleared a merger, imposing certain behavioural remedies, between AS “Rīgas Miesnieks” (Rīgas Miesnieks) and AS “Jelgavas gaļas kombināts” (JGK), two companies involved in manufacturing and sales of meat products. Background Rīgas (...)

The UK Competition Appeal Tribunal accepts argument that Competition Commission finding on counterfactual was irrational (Stagecoach)
Herbert Smith Freehills (Brussels)
Introduction and background to the CAT judgment The merger of Stagecoach Group Plc (“Stagecoach”) and Preston Bus Limited (“PBL”) was referred to the UK Competition Commission (the “CC”) by the UK Office of Fair Trading on 28 May 2009. According to section 36 of the Enterprise Act 2002 (the “Act”), (...)

The Hungarian Competition Office clears concentration between two major salami producers (Bonafarm (Pick)/Herz)
Lakatos, Köves (Budapest)
In December 2009, Bonafarm Zrt. (Bonafarm), and Herz Szalámigyár Zrt.(Herz) concluded asset transfer agreements for the transfer of all the assets of Herz, including trademarks, used for the production of salami. Herz, originally founded in 1888, was the second largest salami manufacturer in (...)

The US FTC requires an unusual method of testing for a less anticompetitive purchaser by offering the sale before completing the requisite due diligence, then clearing the merger in the acute care facilities industry (King’s Daughters Hospital / Scott & White)
Milbank, Tweed, Hadley & McCloy (New York)
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Jones Day (San Francisco)
Healthcare reform and concerns about consolidation in the health care industry juxtaposed with continuing economic distress provided a fascinating backdrop for the Federal Trade Commission’s (FTC’s) recent investigation of Scott & White Healthcare’s consummated acquisition of King’s (...)

The US FTC employs a creative remedy, requiring the offer of divestiture to determine the existence of a viable alternative purchaser, before approving the merger of acute care hospitals (King’s Daughters Hospital / Scott & White)
Cleary Gottlieb Steen & Hamilton (Cologne)
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Cleary Gottlieb Steen & Hamilton (Washington)
After a decade of what was perceived by many as relatively restrained merger enforcement, the Obama administration has repeatedly and vocally vowed to “reinvigorate antitrust enforcement” and to “take effective action to stop or restructure mergers that are likely to harm consumer[s]”. Many (...)

The UK Competition Commission authorizes the purchase of two distressed local bus operators (Stagecoach Group of Eastbourne Buses - Cavendish Motor Services)
Giannino SI (Monserrato)
By a decision taken on 22 October 2009 the Competition Commission (CC) has changed its provisional findings of August and unconditionally cleared the Stagecoach acquisition of two local bus operators in Eastbourne, Eastbourne Buses Limited (EBL) and Cavendish. The CC was referred the (...)

The UK’s Office of fair trading clears merger in newspaper and magazine distribution sector by reference to forward-looking counterfactual (Smiths News Trading / Surridge Dawson)
Herbert Smith Freehills (Brussels)
On 28 August 2009, the UK’s Office of Fair Trading ("OFT") announced that it had unconditionally cleared the acquisition of assets by Smiths News from Surridge Dawson (the "Transaction"). Both parties were active in the supply of wholesale newspaper and magazine distribution in the UK. The (...)

The UK OFT accepts the application of the "Failing Firm Defence" in retail stores acquisition (HMV, Zavvi)
Linklaters (Hong Kong)
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Sidley Austin (London)
On 14 May 2009, the Office of Fair Trading (OFT), the UK’s competition agency, allowed an application of the « failing firm defence » under UK competition law, thereby clearing the HMV/Zavvi retail store acquisitions to proceed. The UK is one of the few jurisdictions to have explicitly recognised (...)

The UK OFT refers two mergers in the market for local bus services to the Competition Commission (Stagecoach Group of Eastbourne Buses - Cavendish Motor Services)
Giannino SI (Monserrato)
The Office of Fair Trading (OFT) has recently referred to the Competition Commission (CC) two mergers between local bus operators . In October and December 2008, Stagecoach acquired the entire share capital of two Eastbourne local bus operators, first Eastbourne Buses and Cavendish Motor (...)

The UK OFT accepts failing firm defence to clear entertainment retail merger (HMV / ZAVVI)
Herbert Smith Freehills (Brussels)
On 28 April 2009, the Office of Fair Trading (“OFT”) announced that it had decided to clear the acquisition of 15 stores belonging to the Zavvi entertainment retail chain by HMV plc (“HMV”) on the basis that the Zavvi stores were a “failing firm”. The so-called failing firm defence can override prima (...)

The Dutch Competition Authority conditionally clears in phase II an hospital merger based on efficiency arguments (Ziekenhuis Walcheren / Oosterscheldeziekenhuizen)
DG COMP (Brussels)
Background to the case More than 3.5 years after the first notification of the merger, the Dutch competition authority (NMa) cleared the merger between Ziekenhuis Walcheren and Oosterscheldeziekenhuizen, two hospitals in Zeeland (the Netherlands). The merger process started in September 2005 (...)

The Turkish Council of State orders stay of execution of Competition Board’s remedies inherent to its conditional clearance decision in daily political newspapers market (Vatan Newspaper / Dogan Group)
Hewlett Packard (Istanbul)
Background On 10 March 2008, the Turkish Competition Board has conditionally cleared the acquisition of Vatan Newspaper (Vatan) by Doðan Gazetecilik A.Þ. (Doðan Group) - the biggest media holding both in terms of audience and advertisement revenues- , by accepting the “failing company defense”. (...)

The UK OFT publishes a restatement of its position concerning "Failing Firm" Defence in merger reviews
Sidley Austin (London)
The UK antitrust authority, the Office of Fair Trading (OFT), published on 18 December 2008 a restatement of its position on the « failing firm » defence in merger reviews. In current economic conditions, this is timely confirmation of the relevant principles and practice. It is also a reminder (...)

The Italian Antitrust Authority approves subject to remedies the airlines merger to monopoly take off: the Alitalia privatization saga nears its conclusion (CAI / Alitalia / Airone)
Freshfields Bruckhaus Deringer (Rome)
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Eversheds Bianchini (Roma)
On 3 December 2008, the Italian Antitrust Authority (IAA) approved the transaction through which Compagnia Aerea Italiana S.p.a. (CAI) will acquire the operating assets of Alitalia Linee Aeree Italiane S.p.a. (Alitalia) as well as sole control over AirOne S.p.A. (AirOne). Alitalia is the (...)

The UK Government is reported to have assured a bank that its aim to create the UK’s largest retail bank would not be subject to competition scrutiny (Lloyds / HBOS)
Ofcom (London)
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Compass Lexecon (London)
Summary On 18 September 2008 Lloyds TSB announced that it was to purchase HBOS, in a move that would create the UK’s largest retail bank . Although such a merger would normally cause serious competition concerns, the Government is reported to have assured Lloyds that the deal would not be (...)

The Turkish competition board, while accepting the failing company defense, clears a merger conditional to remedies in the daily political newspapers market (Vatan Newspaper / Dogan Group)
Erdem & Erdem (Istanbul)
The Turkish Competition Board (hereinafter referred to as the “CB”) in its decision numbered 08-23/237-75, dated March 19, 2008 granted conditional authorization for the acquisition of the sole control of Bagımsız Gazeteciler Yayıncılık A.S. and Kemer Yayıncılık ve Gazetecilik A.S. (hereinafter (...)

A German court confirms application of merger rules to public hospital operators holding them as economic undertakings (German public hospitals)
Daimler (Brussels)
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 German Federal Cartel Office gives guidance on the interpretation and application of the failing company defence while clearing a merger in the TV advertising sector (RTL / n-tv)
Gleiss Lutz (Munich)
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Milbank, Tweed, Hadley & McCloy (Munich)
On 11 April 2006, the German Federal Cartel Office (FCO) unconditionally cleared the acquisition of shares in n-tv Nachrichtenfernsehen GmbH & Co. KG by RTL Television. The case concerned the question whether a merger strengthening the collective dominant position of RTL and ProSiebenSat.1 (...)

The Czech Competition Office authorises as a rescue operation a merger in the insurance market subject to a capital increase (CPP / Kooperativa)
Gide Loyrette Nouel (Prague)
In this contribution we provide a summary of the Office’s first instance decision authorising an acquisition of an insurance company, Èeská podnikatelská pojiš ovna, a.s. (“CPP”), by another one, Kooperativa, pojiš ovna, a.s.(“Kooperativa”). The Office received a request by Kooperativa to approve its (...)

The US DoJ requires rescission of a merger-to-monopoly and puts conduct remedies in place to ensure competition in the market for local newspapers in a city in West Virginia (Daily Gazette / MediaNews)
Akin Gump Strauss Hauer & Feld (Dallas)
The DOJ entered into a consent decree with two local West Virginia newspaper owners, requiring them to rescind a merger three years after its consummation. The Daily Gazette Company and MediaNews Group, Inc. had entered into a two-to-one merger, creating a monopoly from the only two local (...)

The EU Commission gives the green light to the merger between the two existing satellite pay-TV platforms in Italy subject to a complex package of conditions (Newscorp / Telepiù)
DG COMP (Brussels)
"The Commission closes probe into pay-TV industry in Italy approving Newscorp/Telepiù merger deal"* On 2 April 2003, after an in-depth investigation, the Commission gave the green light to the merger between the two existing satellite pay-TV platforms in Italy subject to a complex package of (...)

The Italian Competition Authority conditionally clears a merger in the media sector (Groupe Canal+ / Stream)
Clifford Chance
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Chiomenti (Rome)
The operation On 13 May 2002, the Competition Authority approved with conditions the acquisition by Group Canal+ (Canal+) of Stream S.p.A. (Stream) by way of purchase of shares. Canal+ is solely controlled by the French group Vivendi Universal. Canal+ is active in the production, distribution (...)

The German Competition Authority allows an exemption from the ban on putting the merger into effect (Deutsche Post)
German Competition Authority (Bonn)
Deutsche Post allowed to put merger with trans-o-flex into effect subject to strict obligations* The Bundeskartellamt has lifted the ban on putting into effect the planned increase by Deutsche Post AG (DP AG) of its share in trans-o-flex Schnell-Lieferdienst GmbH, Weinheim (trans-o-flex) from (...)

The European Commission approves the acquisition of Belgian chemical firms by German industrial company, applying the ’failing firm’ defence (BASF/Pantochim/Eurodiol)
DG COMP (Brussels)
"BASF/Pantochim/Eurodiol: Change of direction in European merger control?"* In the context of competition policy, probably nothing can be discussed with greater relish than the concept of the rescue package merger, known as ‘failing firm defence’. The debate begins by considering whether a (...)

The OECD holds a roundtable on failing firm defence
OECD - Competition Division (Paris)
Key documents: Background note The perilous financial condition of a merging firm may change the analysis by a competition authority of an otherwise anticompetitive merger. The authority should assess not only what will happen if the merger is permitted, but also what will happen if it is (...)

State Aids

The EU Court of Justice annuls the General Court’s decision which ruled that the Greek authorities should have known about the State aid public loan when there was no proof that they were aware of it (Larko)
College of Europe (Bruges)
Advantage Must be Proven, Not Assumed* Introduction When a company gets into financial trouble, public subsidies may provide a temporary respite but hardly ever a permanent solution if the company does not undertake painful restructuring. More than 10 years ago, Larko, a Greek mining (...)

Procedures

The Belgian Competition Council adopts new fining guidelines
Van Bael & Bellis
In a press release issued on 6 January 2012, the Belgian Competition Council announced the adoption on 19 December 2011 of new Guidelines regarding the calculation of fines for EU and Belgian competition law infringements (the “Guidelines”). The Guidelines describe the methodology that the (...)

The Belgian Competition Council adopts new fining guidelines
Court of First Instance of Namur
In a press release issued on 6 January 2012, the Belgian Competition Council announced the adoption on 19 December 2011 of new Guidelines regarding the calculation of fines for EU and Belgian competition law infringements. The Guidelines describe the methodology that the Competition (...)

Regulatory

The OECD holds a roundtable on the failing firm defence
OECD - Competition Division (Paris)
Executive summary, by the Secretariat Considering the discussion at the roundtable, the delegates‘ written submissions and the Secretariat‘s background paper, several key points emerge: (1) The failing firm defence (FFD) may arise more frequently during financial and economic crises. During (...)

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