Two-minute Recap of Competition Law Matters Around the Globe – August 2023

EC initiates investigations into acquisitions under Article 22 of the EC Merger Regulation

The European Commission (“EC”) is investigating two proposed acquisitions under Article 22 of the EC Merger Regulation (“ECMR”), which accepts referrals for transactions that fall below national and EU notification thresholds. In the first case, the EC has raised competition concerns in the vehicle-to-everything (“V2X”) semiconductor market in its review of Qualcomm’s proposed acquisition of Israeli chipmaker Autotalks. The deal was taken to the review stage following the requests of 15 national competition authorities. The EC found that the transaction could have an impact on V2X technology, which is essential for improving road safety, traffic management and emissions reduction. In the second case, the EC has opened an investigation following requests from Denmark, Finland and Sweden into the proposed acquisition of Nasdaq Power by the European Energy Exchange, marking its third investigation within the scope of Article 22 of the ECMR after Illuma’s acquisition of GRAIL and Autotalks/Qualcomm. The proposed acquisition brings together the only companies facilitating exchange-based trading and clearing of Nordic power contracts, which is crucial for stable energy prices and competitive markets.

Microsoft separates Teams from Office in EU

Microsoft will unbundle its Teams product from Office 365 in the EEA and Switzerland starting 1 October. The move is intended to address concerns that Microsoft's bundling of Teams with Office software is stifling competition. Microsoft has also promised to improve interoperability with rival platforms like Zoom and Slack, allowing third-party apps to use Office functionality. This development follows an investigation launched by the EC after complaints from Slack and alfaview about Microsoft's anti-competitive practices.

CMA releases the final version of horizontal agreement guidelines

The UK’s competition watchdog, the CMA, has published its final guidelines on horizontal agreements, which differ from EC practice on certain types of information exchanges. The CMA identifies certain exchanges of publicly available information as potential breaches, in contrast to EC rules. The guidelines emphasise that the competitive sensitivity of publicly available information depends on its reliability and cost of acquisition. In particular, UK antitrust rules may apply to agreements entered into outside the UK if they restrict competition within the UK, but these guidelines do not introduce a qualified effects test for such agreements. In addition, the CMA decided not to include guidance on sustainability agreements and indicated plans for separate guidance in the future.

Ukraine adopts comprehensive competition law revision for post-war era

Ukraine’s parliament has approved amendments to the country's competition law, bringing it closer to EU standards. The updated law will empower the antitrust authority to effectively protect competition, especially during the post-war reconstruction period. Key changes include a five-year statute of limitations for investigations of anticompetitive conduct, enhanced procedural rights for defendants, and formalisation of the leniency program. The amendments introduce joint and several liability for the subsidiaries of parent companies, expedited evidence gathering, and the direct imposition of fines for violations. The revision of the law also targets merger control thresholds and encourages cooperation while improving the efficiency of Ukraine's competitive environment.

Microsoft adopts divestiture remedy for the Activision deal after the CMA’s block

Microsoft's USD 69 billion acquisition of Activision has taken an unexpected twist,  as Microsoft has now revamped its proposal after the UK's Competition and Markets Authority (“CMA”) upheld its initial decision to block the merger. Microsoft has introduced a novel structure for the deal involving divestiture of cloud streaming rights for Activision's games to Ubisoft, a French video game developer that for over 15 years operates outside the European Economic Area (“EEA”). Microsoft will not be allowed to exclusively release Activision Blizzard games on its Xbox Cloud Gaming service or control licensing terms for rival services. The situation may affect the ongoing appeal of the initial decision to block the deal and potentially trigger EU re-notification.

Hungary probes Booking.com for abuse of dominance 

The Hungarian Competition Authority is conducting an accelerated sector inquiry in relation to Booking.com, investigating potential abuse of dominance by delaying payments to hosts and property owners. The investigation follows allegations of significant outstanding payments to users of its listing services.

Georgia and Brazil impose fines for price-fixing in fuel sector

The competition authorities in Georgia and Brazil have fined major gasoline and diesel suppliers for engaging in price-fixing practices. The Administrative Council for Economic Defense in Brazil imposed fines totalling more than EUR 10 million on five companies for price-fixing in the fuel market. In addition to the significant fines, the directors also received non-monetary sanctions, including a five-year ban from holding senior positions in the sector to deter future cartel behaviour. In Georgia, Lukoil and four other major gasoline and diesel suppliers faced fines totalling EUR 1.4 million for similar conduct. The investigation revealed that the undertakings colluded to maintain high retail fuel prices from March to August last year, and that despite different import costs, they maintained identical retail fuel prices. The agency ordered procedural improvements, including accurate fuel metering systems at gas stations along with the fines.

Conditional approval for Australian banks' anti-fraud collaboration

The Australian Competition and Consumer Commission has granted conditional interim approval for Australia's major banks to work together to develop an industry standard to combat fraud, following concerns that such conduct could constitute a cartel or concerted practice. This decision came after Australian consumers lost an estimated EUR 1.8 billion last year because of fraud in banking transactions.

Swiss landfill company faces fine for abuse of dominance

The Competition Commission of Switzerland has fined a landfill company approximately EUR 1 million for exploiting its market dominance in the local waste disposal market by providing lower rates exclusively to its shareholders and denying services to non-shareholders.