March 30, 2015

The Antitrust Week In Review

Here are some of the developments in antitrust news this past week that we found interesting and are following.

Amex to Ask for Stay of Ruling Prohibiting Merchants From Promoting Other Cards.  American Express has announced that it will be seeking a stay of a ruling that could ban the company’s longstanding practice of prohibiting merchants from encouraging customers to pay with lower-cost cards.  Judge Nicholas G. Garaufis of the U.S. District Court for the Eastern District of New York ruled last month that the practice violates U.S. antitrust laws.  The court is currently in the process of considering proposed remedies.

EU antitrust regulators to investigate ecommerce.  European Union regulators plan to investigate ecommerce in an effort to remove barriers to cross-border trade in the 28-nation bloc, according to the EU’s antitrust chief.  The investigation could lead to action against companies that deliberately block online sales.  European Competition Commissioner Margrethe Vestager said she decided to launch the inquiry because such anticompetitive hurdles are hampering the growth of online sales.

F.T.C. Addresses Its Choice Not to Sue Google.  Several members of the Federal Trade Commission are defending the actions taken by the agency in its antitrust investigation of Google, nearly a week after an internal document from 2012 came to light, revealing that some staff attorneys  had wanted to sue Google for anticompetitive practices.  However, the FTC’s five commissioners ultimately voted not to sue.  The three commissioners who were at the FTC at that time defended the decision and issued a joint statement asserting that the report represented “a fraction” of the “voluminous record and extensive internal analysis” that was conducted on the matter.

German Business Leaders Clash With Google, Antitrust Officials.  German business leaders are clashing with Google and European Union antitrust officials in a heated public debate over how to deal with the power of U.S. Internet firms.  Mathias Döpfner, the chief executive of German publishing house Axel Springer SE, and Deutsche Telekom AG Chief Executive Timotheus Höttges have both attacked the business practices of certain U.S. Internet firms in Europe, and expressed frustration at the lack of action by competition authorities.  The dispute is occurring as the EU prepares to announce the next steps in its long-running antitrust investigation of Google, which has been fruitless to date, despite three attempts at a settlement.

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Categories: Antitrust Litigation, International Competition Issues

    March 26, 2015

    UK Passes Consumer Rights Bill Introducing Opt-Out Antitrust Class Actions

    A View from Constantine Cannon’s London Office

    By Richard Pike

    The United Kingdom announced today that the Consumer Rights Bill has passed its final legislative hurdle and has been adopted as the Consumer Rights Act 2015 – heralding a major overhaul of consumer protection law in the UK.

    Schedule 8 of the Act contains radical new provisions designed to boost private antitrust enforcement in the UK.  Most noteworthy is the adoption of an opt-out class action remedy specifically, and uniquely, for claims alleging infringement of UK and European competition law.  Never before has there been any form of opt-out action in the UK for any purpose.

    The class action provisions are intended to strike a balance between enhancing access to justice and avoiding the creation of what has been termed an “American litigation culture.”  As such, there are a number of limits on what will be possible.  First, the opt-out class will be limited to persons domiciled in the UK.  All other persons would have to opt in to obtain the benefit of actions that are brought, or else bring their own claims.  Second, contingency fees will be prohibited, and it is likely that the arrangements for fees and funding will effectively be set by the Competition Appeal Tribunal at the outset.  Third, it will be for the Tribunal to decide in each case whether it is appropriate to allow the case to proceed on an opt-out basis, an opt-in basis or not as a collective action at all.  The Tribunal will also be tasked with deciding whether the lead plaintiff is an appropriate person to represent the class.

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    Categories: Antitrust Legislation, International Competition Issues

      March 23, 2015

      The Antitrust Week In Review

      Here are some of the developments in antitrust news this past week that we found interesting and are following.

      Take Google to Court, Staff Report Urged F.T.C.  The Federal Trade Commission is facing renewed questions about its handling of its antitrust investigation into Google, after documents revealed that an internal report had recommended stronger action.  The 2012 report, from the FTC’s bureau of competition, recommended suing the Internet search giant for anticompetitive practices, according to anonymous sources who saw the report.  In early 2013, the FTC voted unanimously against bringing charges after an investigation.  Google’s critics and competitors are arguing that the FTC failed to take appropriate action, and are urging the European Union to take action to rein in Google.

      Tour Bus Companies Agree to Settle Antitrust Lawsuit.  Two of New York City’s biggest tour bus operators have agreed to pay $7.5 million and give up almost 50 of their stops in Manhattan to settle antitrust claims brought by the U.S. Department of Justice and the New York State Attorney General.  The proposed settlement could reshape an industry that was allegedly monopolized after the two companies, City Sights and Gray Line New York, formed a joint venture called Twin America.

      Sysco, FTC Battle Over What Stays Secret in Antitrust Tussle.  Sysco is accusing the Federal Trade Commission of failing to provide necessary information about its witnesses in advance of a hearing that will be crucial in determining whether the food distributor can rescue its merger with rival US Foods Inc.  The FTC filed a lawsuit in February asking the U.S. District Court for the District of Columbia for a preliminary injunction blocking the $3.5 billion merger while an FTC administrative law judge holds a parallel proceeding to determine if the deal should be scrapped.

       

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      Categories: Antitrust Law and Monopolies, Antitrust Litigation, International Competition Issues

        February 9, 2015

        European Commission Fines London-Based Broker ICAP 14.9 Million Euros For Facilitating Yen Libor Cartels

        A View from Constantine Cannon’s London Office

        By Yulia Tosheva and James Ashe-Taylor

        The European Commission (“EC”) has fined London-based ICAP, the world’s largest broker of interest-rate swaps, for facilitating bank cartels in the market for Yen-denominated interest rate derivatives.

        The EC already imposed heavy fines of 669 million euros on UBS, the Royal Bank of Scotland, Deutsche Bank, Citigroup and the British broker, RP Martin, in December 2013, after they admitted their involvement in several cartels that manipulated the Yen Libor benchmark.  The cartels involved traders’ discussions on Japanese Yen Libor submissions and exchange of commercially sensitive information on trading positions and future Japanese Yen Libor submissions.  As part of the same investigation, the EC opened proceedings against ICAP, which refused to admit guilt and did not join the financial institutions in paying fines to settle the case.

        The EC’s investigation concluded that ICAP facilitated six out of the seven Japanese Yen cartels, in particular by disseminating misleading information about expected Japanese Yen Libor rates, serving as a communications channel between traders and using its contacts at various banks in an attempt to influence their Yen Libor submissions.

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        Categories: Antitrust Enforcement, International Competition Issues

          January 7, 2015

          European Commission Announces Agreement To Cap Interchange Fees For Card-Based Payments

          A View from Constantine Cannon’s London Office

          By Yulia Tosheva and James Ashe-Taylor

          The European Commission has announced that the European Parliament and the European Council have reached a long-awaited political agreement on the Commission’s proposal for a Regulation on Interchange Fees for Card-based Payment Transactions.

          The Regulation will introduce maximum fees for four-party card schemes’ consumer debit and credit cards, prevent card schemes from forcing retailers to accept all types of cards regardless of their fees, and establish transparency rules for all transactions. The Commission has already ruled that interchange fees set by MasterCard are in violation of EU antitrust laws and, after a seven-year court battle, MasterCard lost its final appeal before the European Court of Justice in September 2014.

          Interchange fees represent about 70% of the approximately 13 billion euros a year retailers pay banks to handle payment card transactions. The Regulation is expected to have a profound impact on the card industry as a whole but its effect is likely to be particularly felt in markets such as Germany, where average credit card rates stand at 1.8%, and Poland, where average debit card charges are 1.6%.

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          Categories: Antitrust and Price Fixing, Antitrust Enforcement, Antitrust Legislation, Antitrust Litigation, International Competition Issues

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