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European Union
Competition
In two recent judgments the European Court of Justice upheld the fines imposed by the European Commission on ArcelorMittal Luxembourg SA and ThyssenKrupp Nirosta. In the decisions, which go against the advocate general's opinion, the court dealt with the application of the European Coal and Steel Community Treaty after its expiry and with the working of limitation periods for competition law infringements.
The European Commission's plans for a directive on private antitrust damages actions suffered a setback when the commission was forced to postpone the initiative. The leaked June 2009 draft gives an indication of its views on issues such as representative actions and the opt-out implications. However, it remains to be seen what new proposals will be made once the new commissioners are in office.
The European Commission has imposed a fine of €20 million on a company which infringed its obligation to file a transaction prior to implementation, despite no competition concerns having been raised by the transaction. Given the recent tendency of competition authorities to impose ever-increasing fines for procedural breaches, companies should be careful when examining their filing duties under EU regulations.
It has recently become known that the European Commission is to propose a directive on rules governing damages actions for infringements of Articles 81 and 82 of the EC Treaty. The proposed directive seeks to promote private antitrust actions and would require EU member states to introduce various new measures into their national laws.
The European Commission recently published legislation updating its position on merger remedies, outlining the circumstances in which remedies other than divestiture might be acceptable and the steps that need to be taken by undertakings wishing to utilize these alternatives.
The European Court of First Instance has upheld the first-ever fine imposed on a third party for alleged cartel activity. The court stated that a consultancy firm will be liable for an infringement of Article 81(1) of the EC Treaty "where it contributes actively and intentionally to a cartel" operating in a different market from the consultancy firm.
Germany
Competition
Overview
Including: Amendments to the Act against Restraints of Competition; New Regime on Horizontal and Vertical Restraints; Abuse of Dominant Position; Merger Control; Extended Powers of Competition Authorities; Increased Fines; Private Enforcement.
It is crucial that a trading enterprise can decide independently whether to adopt a manufacturer's recommended sales price. If a manufacturer does more than just give a single, unilateral non-binding price recommendation, this can raise suspicions about price fixing and lead to an assumption that price restrictions are intended
Court increases fines on appeal by up to 85%
The Dusseldorf Higher Regional Court recently ruled on the liquefied gas cartel members' appeal against a Federal Cartel Office (FCO) fine decision. The court found new evidence which allowed it to reach a different conclusion from the FCO when evaluating both the duration and gravity of the infringement. As a result, the court not only confirmed the fines but increased them for most appellants.
The Federal Supreme Court recently confirmed a judgment of the Berlin Court of Appeal concerning a telephone call on which a supplier was found to have exerted illicit pressure towards its retailer in order to enforce prohibited resale price maintenance. The appeal court construed the circumstances in a way that the retailer could only interpret the call as the supplier's attempt to exert unlawful pressure in order to influence retail prices.
The Constitutional Court recently ruled that the obligation to pay interest on fines imposed by a competition authority does not breach the Constitution. The court does not consider it contrary to the principle of equality that interest must be paid on cartel fines only. The risk that interest must be paid if an appeal against a fine is withdrawn should be taken into account when deciding whether to bring an appeal.
The Federal Cartel Office recently prohibited the continuation of a joint venture which it had cleared in 1996. The decision demonstrates that merger control clearance provides little legal certainty in Germany in cases where competitors intend to create a joint venture, at least if the joint venture operates on the same market as one or more of its parent entities.
The Federal Parliament recently passed the Eighth Amendment to the Act against Restraints of Competition with the aim of further modernising the conditions for competition. The revision introduces a new test for the assessment of mergers - the significant impediment to effective competition test - which facilitates a more flexible review of cases.
White Collar Crime
In 2012 a Federal Court of Justice decision fuelled debate about the scope and effectiveness of German anti-corruption legislation in the healthcare sector. Nearly one year on, there are signs that stricter rules could come into force in the near future. Thus, both pharmaceutical companies and medical professionals are well advised to keep a close eye on legal developments in this area.
The latest revisions of the Anti-money Laundering Act have extended the scope of anti-money laundering duties to cover issuers of electronic money ('e-money') and e-money agents, as well as entities or persons distributing or redeeming e-money. The amendments restrict pre-paid card-based transactions and thus may have severe effects on the pre-paid market.
According to the Code of Criminal Procedure, witnesses must appear before the court on the date of their appearance. They are required to testify unless an exception is permitted under statute. However, it is questionable whether, and to what extent, witnesses are obliged to prepare for their appearance in court.
The Federal Court of Justice has ruled that it is not a criminal offence for German doctors who have their own practice and are authorised to treat patients insured with a statutory healthcare fund to accept favours or gifts from pharmaceutical companies in return for prescribing particular drugs and medication. The ruling shows that, in this respect, there is a loophole in German anti-corruption legislation.
It can happen to any employer: certain employees turn out to be black sheep and their conduct, which may even be criminal, causes the company considerable economic loss. In such cases, the employer may not only dismiss the employee, but may also consider whether it can successfully claim damages and whether it would be helpful to file a criminal complaint with the Public Prosecutor's Office.
The Federal Tax Court has asked the European Court of Justice for a preliminary ruling on whether a company whose owners and employees may have rendered themselves liable to prosecution by procuring a contract duplicitously can claim for input-tax relief for their defence costs under German law.
