Competition journals: April - June 2007

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1. General - Scope of application

L’impact du droit de la concurrence sur la gestion du patrimoine des personnes publiques, H. Legal (AJDA 14 May 2007, p. 949)

While the EC Treaty does not in any way prejudice the system of property ownership in the Member States, all economic activity is subject to the rules of competition. Under Community law, there are two categories of public goods: those which are involved in an economic activity, to which, in principle, competition law applies, and those which are of a purely proprietary nature and exclude any integration into a market logic. Mr Legal is helping us to divide up these two categories of public goods. Considering the constraint that the holding of an asset participating in an economic activity implies for the public manager, the author concludes that the constraint is heavier for the public manager than for the private entrepreneur since he must be able to establish the economic rationality of his choices from the point of view of the private investor.

Hemat v the medical council: the Wouters legacy revisited, D. Ahern (ECLR, June 2007, Vol. 28, Issue 6, p. 366).

This paper, as well as Hemat v medical council: its implications for irish and EU competition law, P. Gorecki & N. Mackay (ECLR, May 2007, Vol. 28, Issue 5, p. 285), looks back at the Irish High Court’s ruling in Hemat and, in line with the Hoefner and Wouters judgments, examines the answers given to the recurring questions of this type of litigation (definition of enterprise, business association and economic activity).

Fair play: how competition authorities have regulated the sale of football media rights in Europe, C. Hatton, C. Wagner & H. Armengod (ECLR, June 2007, Vol. 28, Issue 6, p. 346).

Overview of important (cartel and merger) decisions by the Commission and the German and Spanish competition authorities concerning the sale of football broadcasting rights.

Does competition law adequately protect consumers, R. Smith & S. King (ECLR, July 2007, Vol. 28, Issue 7, p. 412).

In an approach imbued with economic theory, the authors of this paper describe in a very pedagogical way how the competition rules fail, in their view, to ensure consumer protection. The paper draws on definitions and concepts from classical, neoclassical and behavioural economics, and examines the possible combinations and interactions between them.

Upstream competition and vertical integration in electricity markets, E. T. Mansur (The Journal of Law and Economics, Vol. 50, Issue 1, February 2007, p. 125).

Market analysis in the presence of indirect constraints and captive sales, R. Inderst & T. M. Valletti (Journal of Competition Law and Economics, Vol. 3, Issue 2, June 2007, p. 203).

Solidarity and EC competition law, N. Boeger (Eur. Law Rev., 2007, Vol. 32, Issue 3, p. 319)

The suitability of the more economic approach for competition policy: dynamic vs. static efficiency, I. L. O. Schmidt (ECLR, July 2007, Vol. 28, Issue 7, p. 408).

Notion of undertakings within the meaning of Community competition law: variations around its economic activity (note ss. CJEC 10 Jan. 2006, aff. C-222/04), L. Arcelin (Petites affiches, 17-18 May 2007, No. 99-100, p. 4)

Internal competition law: annual case law chronicle, M. Picard and I. Luc (RJEP/CJEG, n°642, May 2007, p.173)

A year of national case law in competition law (including merger control), with very precise analyses of the substance and procedural issues raised before the Competition Council.

Activity of the Community Courts in competition law (February-March 2007), P. Arhel (Petites affiches, 21 May 2007, No 101, p. 9)

Activity of the Paris Court of Appeal in the field of anti-competitive practices (April-December 2006), P. Arhel (Petites affiches, 18 June 2007, No. 121, p. 7)

Chronique de droit communautaire de la concurrence, G. Decocq (RJ Com. 2006/3, p. 304)

Gazette de droit de la concurrence, edited by J. Philippe and T. Janssens (Gaz. Pal. 4-5 Apr. 2007, p. 2 and 15-16 Jun. 2007, p. 22)

Chronique Droit de la Concurrence, L. Idot and C. Prieto (DRC, Apr. 2007, p. 321)

Chronique Concurrence, L. Idot (Europe, Apr. 2007, comm. 117-118; May. 2007, comm. 142-144)

Chronique concurrence, M. Bazex, G. Decocq and M. Malaurie-Vignal (Contrats, conc., consom., avr. 2007, p. 24; May 2007, p. 21)

Chronique Concurrence (RJDA, May 2007, p. 520; June 2007, p. 640)

Chronique de droit économique, C. Anadon (RLDA Apr. 2007, No. 15, p. 50; May 2007, No. 16, p. 49)

Chronique de jurisprudence de la CJCE, C. Prieto (Journal du droit international Clunet, April-June 2007, n°2, p.659)

2. Agreements

2.1. General

UK tractors, Paris luxury hotels and French mobile telephony operators: are all oligopoly information exchanges bad for competition, F. Lévêque (World Competition, 2007, Vol. 30, Issue 2, p. 231).

2.2. Distribution

How to reconcile selective distribution and the Internet: the Competition Council defines the limits, B. Honorat (Contracts, conc., consom., May. 2007, p. 5)

In this paper, Béatrice Honorat reviews the approach adopted by the Competition Council in three recent commitment decisions on the delicate issue of selective distribution of products via the Internet. If the Council does indeed authorise the exclusion by the network heads of "pure players", i.e. resellers marketing products only via the Internet, without first having a licence for a physical point of sale, it is at the price of an unjustified restriction on the freedom of suppliers to organise sales on the Internet. Indeed, in Decision 06-D-28 of 5 October 2006 on practices in the selective distribution of hi-fi and home cinema equipment, it refused to consider that manufacturers of high-end and very high-end products could rely on an objective justification, as formulated by the European Commission in point 51 of the Guidelines on Vertical Restraints, to limit the range of products sold over the internet. Instead, the Council in this case suggested to the head of the network to introduce a clause limiting online sales to customers who could prove that they had listened to the products beforehand at an authorised distributor and had received personalised advice for their installation. In this respect, the author of the article clearly shows the limits and risks of such a solution. On the one hand, the Council’s dogmatic position - no restriction on resale on the Internet for resellers authorised for a physical point of sale - leads it to lose sight of the very essence of online sales. As Béatrice Honorat observes, "one of the reasons for buying on the Internet, in addition to possibly lower prices, is the possibility for the customer not to move when making a purchase if he wishes to do so. So why force them to go to a point of sale? ». On the other hand, the author rightly points out that the solution put in place with the Council’s approval may lead to a reduced form of free riding.

The Competition Council refines its approach to selective distribution on the Internet, J.-C. Bermond (Petites affiches, 27 Apr. 2007, No. 85, p. 6)

Chronique distribution, M. Malaurie-Vignal (Contracts, conc., consom., Apr. 2007, p. 23; May 2007, p. 14)

Chronique Droit de la distribution, S. Lebreton-Derrien (RJ Com. 2007/2, p. 153)

Chronique Droit de la distribution, D. Mainguy, J.-L. Respaud and S. Destours (JCP éd. E, n° 11, March 15, 2007, 1348, p. 23)

3. Abuse of dominance

Which test of proof for Article 82?, F. Lévêque (RLC 2007/11, No. 805)

At a time when we are discussing, on both sides of the Atlantic, the means of identifying exclusionary practices implemented by firms with a dominant position, the author proposes a very didactic paper on the comparative virtues of the different tests - four main ones - proposed by economists to highlight these exclusionary practices. Passing quickly on the so-called "equally efficient competitor" and "profit sacrifice" tests, which are unable to cover all exclusionary situations, François Lévêque shows quite convincingly that the "consumer harm" and "no economic sense" tests are the only ones, in the absence of a perfect and universal test, that can claim to be the general tests for anti-competitive exclusionary practices. So which one to choose? While the "no economic sense" test is easier and therefore less costly to implement since it does not seek to apprehend the effects of the exclusionary practice, it is also more prone to error. Consequently, the choice must be made on the basis of a trade-off between administrative costs and the costs of errors, which is certainly a competition policy decision rather than an economic decision.

Cases against Microsoft: similar cases, different remedies, J. Apon (ECLR, June 2007, Vol. 28, Issue 6, p. 327).

Here is a new article offering a comparative analysis of Microsoft’s business in the United States and Europe. Synthetic and clear, it presents the key issues, explains the possible differences between the American and European assessments and specifically targets the differences, real or apparent, in the solutions adopted.

Exclusionary pricing and consumers harm: the european Commission practice in the DSL market, L. F. Bravo & P. Siciliani (Journal of Competition Law and Economics, Vol. 3, Issue 2, June 2007, p. 243).

Below-cost price alignment: meeting or beating competition ? The France Telecom case, M. S. Gal (ECLR, June 2007, Vol. 28, Issue 6, p. 382)

Competition in Pharmaceuticals: the challenges ahead post AstraZeneca, N. De Souza (Competition Policy Newsletter, N°1, 2007, p. 39)

Three years after Verizon v. Trinko: broad dissatisfaction with the whole thrust of refusal to deal law, R. A. Skitol (Antitrust Source, Apr. 2007, Vol. 6, Issue 4, available at www.antitrust.com).

Les prix prédateurs entre la lettre de la jurisprudence et l’esprit du raisonnement économique (TPICE, 30 January 2007), A.-L. Sibony (Petites affiches, 6 June 2007, No 113, p. 14)

Le droit de la concurrence au soutien du pluralisme ... dans la distribution de la presse écrite, M. Chagny (Comm. com. électr., March 2007, n° 40, p. 33)

Conseil d’État, Société Cégédim, 24 July 2006, conclusions of C. Verot, Government Commissioner, (RJEP/CJEG, No. 642, May 2007, p.191).

4. Restrictive practices

Bilan 2005-2006 des décisions rendues en matière de pratiques restrictives : quels enseignements tirer des rapports présentés à la CEPC, D. Ferré (Contrats, conc., consom., avr. 2007, p. 9)

From false commercial cooperation to false invoices, Mr. Béhar-Touchais (RLC 2007/11, No. 761)

L’indifférence de la qualité de la victime dans la rupture d’une relation commerciale établie, A. Cathiard (D. 2007, note ss. Cass. com., 6 Feb. 2007, p. 1317); V. aussi Rupture brutale d’une relation commerciale au sens de l’article L. 442-6-I-5° du code de commerce : indifférence du statut de la victime, A.-L. Archambault (JCP éd. G, n° 24, 13 June 2007, II, 10109, p. 37)

The abrupt termination of established commercial relations falls within the scope of contractual liability (note ss. Cass. com., 6 Feb. 2007), F. Marmoz (JCP éd. G, n° 24, 13 June 2007, II, 10108, p. 34).

Deadlines for payment: breaking the deadlock, J.-L. Lesquins (RLC 2007/11, No. 807)

5. Concentrations

Merger control: the decisive influence according to the Conseil d’État, theoretical convergence but practical variations, D. Théophile and É. Renaudeau (RLDA Apr. 2007, n° 15, p. 45)

Following the publication in the April 2007 issue of the Revue de jurisprudence de droit des affaires of the main excerpts of the conclusions presented by Government Commissioner Emmanuel Glaser in the case which was overturned by the Council of State in a judgment handed down on 31 January 2007, decision C2006-52 by which the Minister of the Economy had authorized, on 17 May 2006, the l’Est républicain group to purchase from Socpresse, now controlled by the Dassault Group, the company Delaroche, which constitutes Socpresse’s Burgundy and Rhône-Alpes business line, where it operates in particular regional daily press titles: Le Progrès, Lyon Matin, Le Dauphiné Libéré, Le Journal de Saône-et-Loire and Le Bien Public (p. 307), are beginning to publish the first comments of this important ruling concerning the definition of decisive influence. Special mention should be made of the paper by Didier Théophile and Étienne Renaudeau who, on the question of the existence or absence of joint control by the L’Est républicain group and the Banque fédérative du Crédit mutuel over the acquisition vehicle, the EBRA company, adopt a resolutely critical approach. For a simple explanation of the solutions adopted in this judgment, reference is made to the following comments: La concentration entre groupe de presse régionaux, A. Decocq (RJ Com. 2007/2, p. 144); Le contrôle des concentrations dans la presse écrite, F. Lenica and J. Boucher (AJDA. 2007, Chron., p. 789); Règles de la concentration dans le secteur de la presse, G. Marson (JCP éd. E, n° 18, 3 May 2007, 1576, p. 30).

Perfect symmetry? Impala v Commission and standard of proof in mergers, K. Wright (Eur. Law Rev., 2007, Vol. 32, Issue 3, p. 408)

Following the CFI’s Impala judgment of 13 July 2006, the author examines a twofold question of symmetry of the standard of proof: the symmetry between the standard of proof of an existing collective dominant position and that of a potential collective dominant position and the symmetry between the standard of proof of a merger authorisation and that of a prohibition. On the first issue, he concludes that there is symmetry: he interprets the Impala decision as allowing the three criteria in the Airtours case to be indirectly demonstrated by empirical evidence and not as alleviating the probative requirement: it is a question of the nature of the evidence rather than of the standard of proof. On the second issue, he also sees in the Impala judgment a symmetry between the recently reinforced standard of proof of prohibition and that of authorisation (in one specific case, however, the Commission having returned to the conclusions of its Statement of Objections within a very short period of time). The author then raises a number of questions raised by such a situation (on the question of a presumption of compatibility of a concentration with the common market, on the grey area between the standard of proof of prohibition and that of clearance, on the way the Commission will have to draft its statements of objections in the future, ...).

Causation in EC merger control, A. Bavasso & A. Lindsay (Journal of Competition Law and Economics, Vol. 3, Issue 2, June 2007, p. 181)

The authors engage in an interesting reflection on a concept that is both fundamental and elusive in competition law, that of counterfactual. They analyse, in the context of merger control, and more specifically in the assessment of the failing firm exception, the Commission’s standard of proof, which they consider to be too high and to which they prefer the approach of the Competition Commission in the United Kingdom.

Welfare standards, substantive tests, and efficiency considerations in merger policy: defining the efficiency defense, A. Renckens (Journal of Competition Law and Economics, Vol. 3, Issue 2, June 2007, p. 149).

Concentration and insurance companies: the example of mergers and partnerships involving mutual health insurance companies, F.-X. Testu and V. Thiré (JCP éd. E, n° 16, 19 Apr. 2007, 1490, p. 19)

6. State aid

The new community framework for state aid for research and development and innovation, T. Kleiner & R. Repplinger-Hach (Competition Policy Newsletter, N°1, 2007, p. 3)

Very informative and synthetic article on the new guidelines on aid for R&D and innovation, which entered into force on 1 January this year. As with the entire body of Community law, the rules on state aid are now based on criteria of a more economic nature. In addition, the new scheme also offers a wider range of aid, in particular for SMEs, large enterprises and specific aid for innovation.

Chronique des aides publiques - 2006, T. Fouquet (Revue du Marché commun et de l’Union européenne, n°509, June 2007, p.395)

7. Public sector and competition

Les conditions de légalité de la création d’un droit exclusif, G. Marson (D. Adm, n°5, May 2007, p.27), commentary under EC, 26 January 2007, Syndicat professionnel de la géomatique

Commenting on the decision of the Council of State of 26 January 2007, the author analyses this important decision which specifies which regulatory or legislative authority is competent to grant an exclusive right to an economic operator. He then analyses the distinction made by the Council of State between monopoly, which can be granted only by the legislative power, and exclusive rights, which fall within the regulatory domain. Finally, the author is surprised by the reasoning of the Conseil d’Etat in view of that of the CJEC concerning the compatibility of an exclusive right under the Community competition rules. See also La légalité de l’octroi d’un droit exclusif à l’Institut géographique national (note ss. CE 26 Jan. 2007, Syndicat professionnel de la géomatique), S. Nicinski (AJDA 9 Apr. 2007, p. 748).

The difficulty of assessing the advantages granted to the companies, M. Bazex and S. Blazy (D. Adm, n°6, June 2007, p.15)

Commenting on the judgment of the CFI of 29 March 2007 in Scott v. Com concerning the method of calculating the value of an advantage granted to an undertaking in order to determine whether that advantage is to be classified as State aid, the authors note that the Court of First Instance no longer simply reviews the manifest error of assessment of the European Commission as in the past when complex economic situations were involved. Indeed, the Court of First Instance now verifies the method and calculation used by the Commission to determine the market value of an asset and requires the Commission to act diligently and to use all the powers at its disposal to obtain the information necessary to assess that market value. By prescribing such a framework of analysis, the Court of First Instance thus fixes a maximum amount of aid in relation to the market value and thus exercises a stricter control than that of the domestic court.

The European Commission terminates the special distribution rights for the Livret A and Blue, N. Lenoir and D. Livrets A and Blue. Roskis (JCP éd. E, n° 22, 31 May 2007, 260, p. 3)

Le droit de la commande publique est-il un droit de la concurrence, B. du Marais (Gaz. Pal. 25-27 March 2007, p. 2)

Les voies de l’extermination des activités de service public, M. Bazex et S. Blazy (D. Adm, n°6, June 2007, p.26)

Chronique Droit public de la concurrence, B. du Marais (Gaz. Pal. 25-27 March 2007, p. 45)

Chronique Concurrence : interventions économiques des personnes publiques, M. Bazex, F. Rolin et P. Subra de Bieusses (Contrats, conc., consom., avr. 2007, p. 13)

8. Procedures

8.1. General

The green paper on damages actions for breach of the EC antitrust rules and beyond: reflections on the utility and feasibility of stimulating private enforcement through legislative action, T. Eilmansberger (CMLR, Vol. 44, Issue 2, Apr. 2007, p. 431).

The enforcement of article 81 EC Treaty before national courts after the House of Lords’ decision in Inntrepreneur Pub Co Ltd v Crehan, A. Andreangeli (Eur. Law Rev., 2007, Vol. 32, Issue 2, p. 260)

Is the structural impartiality of the Conseil d’Etat out of the question? Commentary under ECHR, 9 November 2006, Société Sacilor-Lormines v. France, J-L. Autin and F. Sudre (RFDA, March/April 2007, No. 2, p. 342).

8.2. Sanction Policy - Clemency - Settlement - Undertakings

Le projet de révision du programme de clémence français, V. Ledoux and J.-C. Roda (Contrats, conc., consom., Apr 2007, p. 2)

In the context of the leniency programme harmonisation process initiated by the Commission and the members of the European Competition Network (ECN) around the ECN’s "Model Leniency Programme", the aim of which is to smoothly harmonise the 20 (soon 22) leniency programmes in force in the EU by minimising as far as possible the problem of multiple leniency applications, we will read with interest the article by Valérie Ledoux and Jean-Christophe Roda on the draft procedural notice of January 29, 2007 submitted by the Competition Council to public consultation and which has since been translated into the procedural notice of April 17, 2007 on the French leniency program.

Libre propos sur la procédure de lémence: loyauté, dénonciation et droit de la concurrence (intervention at the conference of 30 November 2006 on the theme "Duty of loyalty and duty of denunciation), D. Redon (Gaz. Pal. 23-24 March 2007, p. 10) Towards a progressive consecration of a European model in competition law: today, leniency; tomorrow, damages actions, L. Idot (Europe, Apr. 2007, p. 2)

Les procédures alternatives aux sanctions en droit communautaire de la concurrence, C. Vilmart (JCP éd. E, No. 20-21, 17 May 2007, 1648, p. 16).

The European Commission’s 2006 guidelines on antitrust fines: a legal and economic analysis, W.P.J. Wils (World Competition, Vol. 30, Issue 2, p. 197).

European Competition Law: The "new" policy of the Commission in setting fines, F. Puel (JTDE, June 2007, No. 140, p. 161)

The sanctions imposed for infringements of European competition law under Article 23 of Regulation 1/2003 EC in the light of general principles of law, J. Schwarze (RTD eur. January-March 2007, p. 1-24)

Fine: the ECJ broadens the notion of recidivism, N. Coutrelis and M. Le Luherne (Les Échos, 3 May 2007, p. 12)

9. Regulations

Special file: the law of 7 December 2006 on the energy sector: General presentation of a polyptych, M. Lombard; Regulated sales tariffs and reorganisation of public distribution, C. Barthélemy; Reform of the Energy Regulation and Consumer Protection Commission, V. Loy, (RJEP/CJEG n°641, May 2007, p.127)

The authors give a summary presentation of the very complex law of 7 December 2006, recalling its guiding principles and the general context, both national and Community, in which it was passed and which will determine its application. This law, described by one of the authors as a "polyptych", is primarily aimed at opening up the energy markets and is accompanied, in order to implement it, by provisions concerning the reform of the CRE, the installation of the national energy mediator, the introduction of provisions on consumer law, the separation of distribution and supply activities, and, finally, the privatisation of Gaz de France. A number of issues that are currently being hotly debated are dealt with in detail: the issue of specific State action, the maintenance of regulated tariffs, the new TRTAM regime, the various measures relating to social cohesion, and the spin-off of distribution network operators.

Effective unbundling of energy transmission networks: lessons from the Energy Sector Inquiry, P. Lowe, I. Pucinskaite, W. Webster & P. Lindberg (Competition Policy Newsletter, No. 1, 2007, p. 23).

Solving problems at the sources: why telecommunications regulation should focus on wholesale, not on retail, market, I. Gurpegui & P. Kordasiewicz (Competition Policy Newsletter, No. 1, 2007, p. 49).

Railway excellence: new prospects for Europe, J. Barrot (Revue du Marché commun et de l’Union européenne, No 508, May 2007, p.283).

L’articulation entre droit commun de la concurrence et droit de la régulation sectorielle, S. Naugès (AJDA, 2 Apr. 2007, p. 672)

Competition and Regulatory Law News, L. Richer, P-A. Jeanneney and S. Nicinski (AJDA, 11 June 2007, p. 1105)

10. International policy

Vers une politique aérienne extérieure de l’Union européenne, D. Bourqui (Revue du Marché commun et de l’Union européenne, No. 507, April 2007, p. 254).

Increasing the bite behind the dark: extradition in antitrust cases, J. W. Rowley, D. M. Low & O. K. Wakil (Antitrust Source, Apr. 2007, Vol. 6, Issue 4, available at www.antitrust.com)

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Umberto Berkani, Alain Ronzano, Christelle Adjémian, Competition journals: April - June 2007, September 2007, Concurrences N° 3-2007, Art. N° 13807, pp. 201- 204

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