Like many other merger control regimes, the EU merger control regulation (Regulation No. 139/2004, hereinafter “EUMR”) imposes certain obligations on parties to mergers and acquisitions that come under the jurisdiction of the European Commission. In particular, a transaction must be notified to the Commission prior to its implementation, and the parties must not implement the transaction until it has been cleared by the Commission. Failure to comply with the notification or the “standstill” obligations may result in a fine of up to 10% of the worldwide group turnover for each party. READ MORE
The famously “convoluted” language of the Foreign Trade Antitrust Improvements Act (“FTAIA”), 15 U.S.C. § 6a, is typically smoothed out and restated before application by courts. The actual statutory language must be honored, however, and occasionally fidelity to that language has led to the dismissal of claims on grounds that they seek an impermissibly extraterritorial application of the antitrust laws. A few illuminating examples appear in the recent Southern District of New York decision in Biocad, JSC v. F. Hoffmna-La Roche, Ltd.
Orrick Antitrust & Competition partner Alex Okuliar has co-authored an article in the European Competition Journal with Greg Sivinski, Assistant General Counsel in the Competition Law Group at Microsoft, and Lars Kjolbye, a partner at Latham & Watkins in Brussels, in which they propose a framework to determine the competitive significance of data. The framework first considers whether the parties own or control the relevant data. The second consideration is whether the relevant data is commercially available as a product or as an input for products of downstream competitors. The third consideration is whether the relevant data is proprietary to the owner’s or controller’s products or services and a competitively critical input. The last consideration is whether reasonably available substitutes for the relevant data exist or whether the data is unique.
The article can be accessed here.
As more internet users entrust their personal data to operators of websites, operators’ use of this “Big Data” has become a growing concern. As a result, government agencies around the world are grappling with whether and how to regulate “Big Data” in the context of social networking websites. This includes some competition authorities that are trying to expand their purview by using competition laws to regulate “Big Data” in the context of social media. The possibility that competition authorities around the world may try to become super regulators of “Big Data” should be of concern to all operators of social networking websites.
A case in point is the German competition authority (FCO), which in March 2016 initiated proceedings against one of the most popular social networking sites – Facebook – purportedly based on a concern that it may have infringed data protection rules. Since the case is the first of its kind in Europe, the outcome – which is expected before the end of the year – is awaited with great interest.
Orrick antitrust practice team attorneys Matthew G. Rose, Jay Jurata and Emily Luken recently published an article in the e-Competitions Bulletin August 2017 discussing the implications of the UK High Court of Justice ruling that enjoins Huawei from selling wireless telecommunications products in Britain due to Huawei’s failure to enter into a patent license for Unwired Planet’s worldwide portfolio of standard-essential patents (SEPs), even though Huawei was willing to enter into a license for Unwired Planet’s United Kingdom (UK) SEPs.
The article examines the potential competitive harms that would result from a regime in which licensees are required to take worldwide SEP licenses.
On 6 September 2017, the Court of Justice of the European Union (“CJEU”) handed down its long-awaited ruling in Intel v Commission (the “Ruling”). The Ruling, which sets aside the appealed judgment of the EU General Court and orders the case to be re-examined for failing to consider the effects of anticompetitive conduct on competition, has potentially broad implications for how the European Commission (“Commission”) conducts its analysis and reasons its decisions in ongoing and future EU antitrust investigations.
- The Ruling signals a return of “effects-based” analysis in EU antitrust cases and a move away from a “form-based” approach where certain conduct is deemed per se illegal.
- The Ruling not only clarifies how the General Court should assess appeals of Commission decisions, but is likely to have implications for how the Commission approaches its analysis and reasons its decisions in EU antitrust cases going forward. In particular, the burden of proving that specific conduct or practices have anticompetitive effects is placed firmly with the Commission.
- Intel’s victory may embolden other entities facing similar allegations to defend their corners more aggressively.
- This is not the end of the road. It cannot be ruled out that the General Court, when it re-examines the case and applies the appropriate analysis, comes to the same ultimate conclusions and upholds the Commission’s original fine.
Antitrust partner David Goldstein recently wrote an article for the Antitrust, UCL and Privacy section of the State Bar of California regarding the Second Circuit’s decision holding that Uber can enforce its internet-based arbitration agreement with its drivers. The decision, rendered in the context of a motion to compel arbitration of price-fixing claims, provides both general and specific guidance for web screen interfaces that may suffice for enforceable arbitration agreements.
The article can be accessed here.
A common question for companies contemplating mergers or acquisitions is how the Hart-Scott-Rodino process works and how long it takes for different kinds of transactions to be reviewed and cleared. The FTC posted a helpful article here today which provides practitioners with guidance regarding timing parameters under the HSR Act, including a helpful HSR timeline graph which can be accessed here.
Is a wind of change blowing through the European merger control enforcement landscape?
The response is yes, certainly.
Very recent cases or investigations launched by the European Commission alleging potential violations of merger control procedural rules by notifying parties have sent a clear signal to companies: you’d now better think twice before breaking the merger control procedural rules.
It is even truer when one considers that this may well be a trend throughout Europe. These cases have echoed back to recent similar cases, pending or closed, at the member state level (the Altice case in France, the CEE Holding Group limited/ Olympic International Holdings Limited case in Hungary, the AB Kauno Grudai / AB Vievio Paukstynas case in Lithuania, and a very recent bakery case in Slovakia). READ MORE
In the first post in this series, we introduced the concept of joint ventures (“JVs”), outlined why antitrust law applies to their formation and operation, identified the major antitrust issues raised by JVs, and discussed why you should care about these issues. In the second installment, we unpacked some of the major antitrust issues surrounding the threshold question of whether or not a JV is a legitimate collaboration. This third post in the series discusses ancillary restraints—what they are and how they are analyzed. READ MORE
On June 6, 2017, a committee within Japan’s Fair Trade Commission published a report on competition policy and big data. The report is based on a concern that dominance of big data by certain major technology companies could impede competition and innovation, and addresses how Japan’s Antitrust Act (Act) could be applied in this context.
A main focus of the report is how certain cases of “collection of data” and “use of data” could trigger antitrust issues. READ MORE
Germany’s Federal Cartel Office (FCO) has published two documents summarizing its activities for the public: a more detailed “Activities Report” for the years 2015 and 2016 and the high-level “Annual Report 2016.” These documents confirm that the FCO continues to be a highly active operator in the area of competition law enforcement in Europe.
Antitrust partner Alex Okuliar and associate Elena Kamenir published a column on Competition Policy International about recent commentary by the global enforcement community on pricing algorithms, the legal precedent supporting the US antitrust agencies’ views, and the possible antitrust implications for businesses. To view the column, please visit here.
Shelley Zhang, an Orrick partner based in Beijing, recently published in Competition Law360 an article discussing the first year of the China State Council’s fair competition review system, which is designed to foster the development of competitive markets throughout China. A link to the article appears here.
On June 19, 2017, the U.S. Supreme Court decided Bristol-Myers Squibb Co. v. Superior Court of California, a multi-plaintiff State product liability case in which the Court rejected a loose standard for personal jurisdiction for claims brought by out-of-State plaintiffs. Though questions as to its impact remain, BMS surely will signal the end to multi-State plaintiffs’ efforts to centralize claims in the State court of their choosing. Even beyond this, the decision has potentially significant implications for State class actions and perhaps even federal antitrust cases.
On April 13, 2017 in Janssen Cilag S.A.S v. France, the European Court of Human Rights (the “Court”) confirmed the validity of search and seizure operations carried out by the French Competition Authority at Janssen Cilag’s company premises. In keeping with its findings in Vinci Construction and GTM Génie Civile et Services v. France,  the Court considered that the broad and indiscriminate seizure by the FCA amounted to interference with the rights guaranteed by Article 8 of the European Convention of Human Rights (the “Convention”), but that the interference was while pursuing a legitimate aim and therefore “in accordance with the law.”
On May 31, 2017, the FTC filed an administrative complaint alleging that the Louisiana Real Estate Appraisers Board (“Board”), a state agency controlled by real estate appraisers, violated Section 5 of the FTC Act by fixing real estate appraisal fees paid by appraisal management companies (“AMCs”). AMCs act as agents for lenders in arranging real estate appraisals and are licensed and regulated by the Board. The FTC alleges that the Board required AMCs to pay appraisal fees that are equal to or exceed the median fees identified in survey reports commissioned and published by the Board. This action represents the FTC’s first enforcement action against a state agency since its victory in North Carolina State Board of Dental Examiners v. FTC, 135 S.Ct. 1101 (2015). An administrative trial is scheduled to begin on January 30, 2018.
On Tuesday June 20, Orrick partner Jay Jurata will be giving a presentation to the DC Chapter of the Licensing Executives Society about the challenges and opportunities raised by recent developments regarding standards-essential patents. Over the past four years, numerous court decisions and regulatory actions around the globe have provided some insight inthttp://blogs.orrick.com/antitrust/?p=1086&preview=trueo the meaning of voluntary commitments to license patents on “fair, reasonable and non-discriminatory” terms. Yet many questions remain unresolved, and Jay will discuss areas of emerging consensus, open issues, and what that means for both licensors and potential licensees of standard-essential patents.
You can register at http://www.lesusacanada.org/event/201706WDC. Hope to see you there!
Legendary antitrust practitioner Larry Popofsky recently passed away. His longtime colleague and close friend, Steve Bomse, published a personal remembrance and tribute to Larry and his epic and transformative victory in the GTE Sylvania case in Competition Law360. A link to the article appears here.
Merger notification obligations are changing in Germany and Austria, as new alternative jurisdictional thresholds based on the “transaction value” are being introduced into the respective national regimes, previously solely based on turnover thresholds.
In Germany, the introduction of a new set of alternative thresholds was approved by both chambers of Parliament and will enter into force upon the (imminent) signature by the Federal President.
Even though the new thresholds are being introduced with a view to better control acquisitions of Internet startups, they apply regardless of the economic sector to any high-valued acquisition of undertakings that have a “significant” presence in Germany. READ MORE