October 17, 2014

Brussels Antitrust Seminar Demonstrates Shifting European Landscape For Competition Enforcement In Wake Of ECJ MasterCard Judgment

A View from Constantine Cannon’s London Office

By Irene Fraile and Richard Pike

The recent judgment by the European Court of Justice (“ECJ”) in the MasterCard case is sparking a lively debate about how antitrust enforcement of payment system regimes should evolve in the European Union, as evidenced by an antitrust seminar co-sponsored by Constantine Cannon in Brussels on Monday.

The ECJ’s MasterCard judgment was rendered on September 11, 2014, when it dismissed MasterCard’s final appeal against an antitrust infringement decision adopted by the European Commission in 2007 regarding MasterCard’s Multilateral Interchange Fees (“MIFs”) for cross-border payment card transactions. MIFs are the fees paid by merchants’ banks to card-issuing banks to cover the cost of processing card payments. The ECJ held that the level of those fees had “restrictive effects on competition.”

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Categories: Antitrust Enforcement, Antitrust Litigation, International Competition Issues

    September 30, 2014

    Google’s Settlement Offer Sparks European Debate

    A View from Constantine Cannon’s London Office

    By James Ashe-Taylor and Ana Rojo Prada

    Debate continues over Google’s settlement offer in search and advertising investigation as European Commission indicates that more is needed.

    Google and Rupert Murdoch’s News Corp have traded blows publicly following comments by the European Commission indicating that it would reopen its antitrust investigation into Google’s search and advertising business.

    Outgoing Competition Commissioner Joaquin Almunia has indicated in interviews over the last week that Google’s proposals to settle the investigation do not fully address the Commission’s concerns.

    In an open letter to Almunia, News Corp Chief Executive Robert Thomson called Google “a platform for piracy and malicious networks.”  He also alleged that Google deliberately made it difficult to “access information independently and meaningfully,” and that its sudden changes to the ranking and display of search results prejudiced small companies.

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    Categories: Antitrust Enforcement, International Competition Issues

      September 18, 2014

      Regulators Prescribing Higher Dose Of Pharmaceutical Antitrust Enforcement

      By Ankur Kapoor

      Antitrust enforcers returned to their offices after Labor Day, refreshed and ready to tackle what they view to be anticompetitive practices by pharmaceutical companies to delay entry of lower-priced generic drugs.

      In addition to recent enforcement efforts by antitrust regulators, two federal courts have issued opinions supporting the theory underlying the enforcers’ new efforts to police so-called “reverse payments.”

      On September 8, 2014, the Federal Trade Commission (FTC) filed an antitrust complaint in the U.S. District Court for the Eastern District of Pennsylvania against AbbVie Inc. (a spinoff of Abbott Laboratories’ portfolio of proprietary pharmaceutical and biologic drugs) and generic giant Teva Pharmaceuticals. FTC v. AbbVie Inc. is the FTC’s first action against “reverse-payment” or “pay-for-delay” agreements between patent-holders and generic competitors since the FTC’s 2013 Supreme Court victory in FTC v. Actavis, Inc., which held that such agreements could run afoul of the antitrust laws under certain circumstances.

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      Categories: Antitrust Enforcement, Antitrust Litigation

        September 9, 2014

        European Commission Slaps Smart Card Chips Cartel With Fines

        A View from Constantine Cannon’s London Office

        By Irene Fraile

        The European Commission has imposed fines totaling 138 million euros on smart card chips producers Infineon, Philips and Samsung for breaching European Union antitrust laws that prohibit cartels.

        According to the Commission, from September 2003 to September 2005, the companies engaged in a cartel to restrain competition relating to the smart card chips used in mobile telephone SIM cards, bank cards, identity cards, passports, pay TV cards, and various other applications.  The cartel used a network of bilateral contacts in order to coordinate responses to customers’ requests to lower prices and, ultimately, keep prices up.  The companies discussed and exchanged sensitive commercial information on pricing, customers, contract negotiations and production capacity, thereby damaging competition by reducing uncertainty concerning future behavior in the market.

        Although some of the cartelists took measures to conceal the collusion, one of them – Renesas (a joint venture between Hitachi and Mitsubishi) – finally blew the whistle and revealed the existence of the cartel to the antitrust authorities under the Commission’s Leniency Programme.  As a result, Renesas received full immunity and avoided a fine of more than 51 million euros.  Samsung, which also cooperated with the investigation, received a 30 percent reduction in the level of its fine in return for its cooperation.

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        Categories: Antitrust Enforcement, International Competition Issues

          September 4, 2014

          MFNs Becoming A Battleground In FCC’s Review Of Comcast/Time Warner Deal

          By Allison F. Sheedy

          The biggest regulatory review of the year—the Federal Communications Commission’s examination of Comcast Corp.’s proposed acquisition of Time Warner, Inc.—has taken an interesting foray into analyzing competitive tactics, with the FCC’s invitation to media companies to confidentially raise concerns about Comcast’s use of most favored nation (“MFN”) provisions in its contracts to purchase content.

          The Wall Street Journal reported yesterday that the FCC has invited companies, including Discovery Communications, to offer feedback about Comcast’s MFNs to aid its evaluation of the proposed take-over.  The FCC also publicly released a request for information to Comcast that included (among many other items) details about each agreement in which Comcast has used an MFN.

          In a typical form, an MFN is a contractual promise obtained by a buyer from a seller that the seller will not give a better price to any other purchaser.  A buyer usually seeks an MFN clause as a form of protection to ensure that its competitors do not get cost or other advantages.

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          Categories: Antitrust Enforcement, Antitrust Litigation, Antitrust Policy

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