Ireland

Helen Kelly

Matheson Ormsby Prentice

Competition law in Ireland is consolidated in one main statute, the Competition Act 2002 as amended by the Competition (Amendment) Act 2006 (the Act).¹ Part 3 of the Act, which relates to merger control, came into force on 1 January 2003. The remainder of the Act came into force on 1 July 2002. In November 2007, the minister for enterprise, trade and employment (the minister) announced a public consultation on the operation and implementation of the Act. It is possible that this consultation will result in the minister bringing forward proposals for amendment of the Act, although no timetable for this process had been announced at the time of writing.

Merger control regime

Ireland’s merger control regime is governed by Part 3 of the Act. Sole responsibility for decisions on merger review lie with the Competition Authority (the Authority) except for media mergers where the minister also has a role.

Mergers

A merger or acquisition is deemed to occur in the following circumstances:
• two or more undertakings, previously independent of one another, merge;
• one or more individuals or other undertakings who or which control one or more undertakings acquire direct or indirect control of the whole or part of one or more other undertakings; or
• the result of an acquisition by one undertaking (the first undertaking) of the assets, including goodwill, (or a substantial part of the assets) of another undertaking (the second undertaking) is to place the first undertaking in a position to replace (or substantially to replace) the second undertaking in the business or, as appropriate, the part concerned of the business in which that undertaking was engaged immediately before the acquisition.

The Act also applies explicitly to full-function joint ventures (ie, those that perform, on an indefinite basis, all the functions of an autonomous economic entity).
The first two tests replicate the tests set out in the EC Merger Regulation (ECMR). ‘Control’ is defined in the Act in similar terms to the ECMR, namely the ability to exercise ‘decisive influence’ over the activities of an undertaking.

Thresholds

A merger must be notified to the Authority if:
• the worldwide turnover of each of at least two of the undertakings involved in the transaction is not less than €40 million;
• each of at least two of the undertakings involved in the transaction carries on business in any part of the island of Ireland (ie Ireland and Northern Ireland); and
• the turnover in the state (Ireland) of any one of the undertakings involved is not less than €40 million.

An undertaking is regarded as ‘carrying on business in any part of the island of Ireland’ if it has a physical presence in the island of Ireland and makes sales or supplies services to customers in the island of Ireland, or without having a physical presence in Ireland has made sales into the island of Ireland of at least €2 million in the most recent financial year. ‘Turnover in the state’ is defined by the Authority to comprise sales made or services supplied to customers within the state.

Media mergers

Media mergers are subject to special rules. As of 1 May 2007, a ‘media merger’ is a merger or acquisition in respect of which two or more of the undertakings involved carry on a media business in the state, or that one or more of the undertakings involved carries on a media business in the state and one or more of the undertakings involved carries on a media business elsewhere. Prior to this change, media mergers included all mergers in which one or more of the undertakings involved carried on a media business in the state and this required the notification of many mergers with only a very minimal impact, if any, on Ireland. The new definition of media merger will subject fewer mergers to the media merger provisions. ‘Media business’ is given a wide definition; it includes print media, broadcasting services (excluding internet) and the provision of a broadcast service platform. All media mergers must be notified to the Authority regardless of whether the turnover thresholds are exceeded.
The minister has the power to prohibit a media merger or to approve it subject to conditions based on public interest grounds. Public interest grounds include diversity of ownership, strength of the indigenous media and cross-ownership of different forms of the media.
In March 2008, the minister announced the establishment of an advisory group to review the current legislative framework relating to the public interest aspects of media mergers and to make recommendations as appropriate. The terms of reference of the Advisory Group are to review and consider the current levels of plurality and diversity in the media sector in Ireland; to examine and review the ‘public interest’ criteria as currently defined in the Act; to examine and consider how the application of these criteria should be given effect and by whom; to examine the role of the minister in assessing these criteria from a public interest perspective and the best mechanism to do so and to examine international best practice, including the applicability of models from other countries.

Decision-making process

Mergers that come within the scope of the Act must be notified to the Authority within one month of the conclusion of the agreement or the making of a public bid. The Authority will not accept a notification in advance of a binding agreement although it will enter into pre-notification discussions prior to the conclusion of a binding agreement if there is a bona fide intention of proceeding with a transaction.
The Act provides for a two-phase assessment procedure for mergers. Phase I allows the Authority to reach a determination within one month of notification that the result of the merger or acquisition will not be to substantially lessen competition in markets for goods or services in Ireland. The one-month deadline may be extended to 45 days where the parties have submitted proposals to ameliorate the effect on competition of the proposed merger. The Authority may make a formal or informal request for further information to be provided. A formal request ‘stops the clock’ and the one-month period recommences on receipt of the information requested. An informal request does not stop the clock. For the first two years of operation of the merger control regime, formal requests were unusual. However, in the past few years, the Authority has made a number of formal requests. The Authority has even issued a number of witness summonses compelling the provision of information in a merger context from merging parties, competitors and customers.
A Phase II investigation may be initiated if there are significant competition concerns so that the Authority can undertake a more detailed examination of the market. The Authority has four months from the date of notification to determine whether the merger should be cleared, blocked or take effect subject to conditions.

SLC test

The substantive test for review is whether a merger would substantially lessen competition in the state (the SLC test). The Authority defines the relevant product and geographic markets and then assesses the market concentration by applying the Herfindahl-Hirschman Index of Concentration (the HHI Test). In deciding whether the merger will result in a substantial lessening of competition, the Authority considers the market structure, the likely effect of the merger on the behaviour of the merged entity, the reaction of competitors and customers, barriers to entry and countervailing buyer power. The ‘failing firm’ defence is only likely to be accepted in very exceptional circumstances.

Failure to notify and early implementation

Ireland’s merger notification regime is mandatory. The obligation to notify is on all of the undertakings involved in a transaction (this does not include the vendor), although in practice most notifications are submitted jointly. Failure to notify a transaction within the one month time limit is a criminal offence. In Radio 2000/Newstalk 106² the Authority found that the parties had failed to notify within the time limit, and so had breached the Act. However, the Authority did not find sufficient evidence that any officer of the companies involved had knowingly and wilfully permitted the breach, so no criminal penalty was sought.
The Act provides that a notifiable merger which is put into effect prior to clearance from the Authority is void. The point was considered in detail in Radio 2000/Newstalk 106 in which Radio 2000 acquired operational control of the target radio station before the transaction had been approved by the Authority. The Authority concluded that the relevant section of the Act is designed to protect the Authority’s right of review and is not intended to render a merger or acquisition void indefinitely. The effect is that a transaction which has been implemented prior to clearance remains void until such time as the Authority issues a decision approving the transaction. To date, the Authority has not taken legal action against any party to a merger where a transaction has been put into effect prior to clearance. In practice, notifying parties may seek to avoid censure for breach of the Act by suspending or carving out implementation of the Irish part of a transaction, for example by the use of hold-separate undertakings. For example, in Aviva/CGU/Gresham (M/05/013), the Authority cleared a transaction in the insurance sector that was put into effect prior to the submission of a notification to the Authority. In its clearance determination the Authority noted that: ‘The agreement between the parties explicitly provided that the agreement would not be put into effect in Ireland unless and until clearance was obtained from the Competition Authority under the Competition Act.’ The determination also noted the provisions of the Act that prohibit completion prior to clearance but did not expressly censure the parties.

Voluntary notifications

The Act provides for a voluntary merger notification system so that a merger that falls below the threshold levels may be voluntarily notified to the Authority. Clearance by the Authority protects the merger from subsequent challenge by third parties under sections 4 and 5 of the Act (which mirror articles 81 and 82 of the EC Treaty). Mergers notified voluntarily are subject to the same procedural rules as mandatory notifications. In 2003, the Authority published a notice dealing with voluntary notifications to give guidance on its policy in relation to the review of non-notifiable mergers that might raise competition issues. However, since 1 January 2003 there have only been two voluntary notifications, although the Authority has initiated investigations into a small number of non-notifiable mergers.³

Appeals

A notifying party may appeal to the High Court within one month of being informed of the Authority’s decision to prohibit a merger or to approve it subject to conditions. The Act provides no right of appeal against a decision to clear a merger. No appeals have been made since the Act came into force.

Recent cases

To date, the Authority has blocked two mergers. These were transactions in the information technology business recovery sector, IBM/Schlumberger (M/04/032), and the market for the manufacture and provision of insulation materials, Kingspan/Xtratherm (M/06/039). The Authority has made a number of conditional determinations including Scottish Radio Holdings/FM 104 (M/03/33), Grafton/Heiton (M/04/051), eircom/Meteor (M/05/50), UGC (Chorus)/NTL (M/05/024), Premier Foods/RHM (M/06/98), Communicorp/Scottish Radio Holdings (M/07/040).
The IBM/Schlumberger transaction covered Schlumberger’s business continuity operations in the United States, Switzerland, Spain, France and the UK, as well as Ireland. The Authority defined the relevant market as the supply of business recovery hotsite services in Ireland. (The purpose of business recovery services is to ensure that in the event of a sudden disruption to a business’ systems or premises (or both), it will be able to continue to run its critical functions.) The parties’ combined market share (based on revenue) was between 75 and 95 per cent. The Authority acknowledged that shares in bidding markets and in IT markets can change relatively quickly. Therefore, it emphasised that in reaching its decision it did not rely strongly on market share data but rather examined competitive effects directly. In its examination of actual effects on competition, the Authority found that the parties benefited from a high level of vertical integration. Other operators providing business recovery solutions, or indeed customers with in-house provision, would not have the same degree of upstream inputs to allow them to compete effectively with the parties, and may even be dependent upon the parties for such inputs. The Authority also considered that the merging parties were each other’s closest competitors. Again the Authority placed considerable emphasis on concerns raised by the merging parties’ customers who, in many cases, considered IBM and Schlumberger to be the only viable service providers in the market. The Authority’s blocking of this transaction demonstrates its tenacity and rigour in reviewing transactions, even those approved by competition bodies in other member states and where the size of the market is fairly low, less than €20 million.
In October 2006, the Authority blocked the proposed acquisition of Leonort Group (Xtratherm) by Kingspan Group plc on the grounds that the transaction would substantially lessen competition in the manufacture and provision of insulation materials in the state. The Authority defined the relevant market as for the manufacture and supply of polyurethane (PU) and polyisocyanurate (PIR) in the state. This was a narrower definition than that argued for by the undertakings, which was the market for PU/PIR and other insulation products in Ireland and the UK. The merger would have created a market participant with a market share of 80 per cent. In its assessment of the competitive effects of the merger, the Authority emphasised the fact that in the PU/PIR market, supply had significantly exceeded demand and industry excess capacity represented a barrier to further entry. The Authority also found that imports did not appear to be a competitive constraint in the Irish PU/PIR market. Furthermore, it was considered likely that if the merged entity were to raise prices, its main competitor Quinn Therm would accommodate this price rise.
The joint bid by Carlsberg and Heineken for the Scottish & Newcastle (S&N) group was approved by the European Commission on 3 April 2008, with the exception of the proposed acquisition of Beamish & Crawford plc, S&N’s business in Ireland, by Heineken. The merger has been referred by the European Commission to the Authority for the purpose of an investigation into its effect on competition in Irish beer markets. This resulted from an article 9(2) application by the Authority in February 2008. This is the first time that a merger notified to the European Commission has been referred to the Authority or that the latter has requested it. Section 18(13) of the Act provides that a referral by the European Commission constitutes a notification for the purposes of the Act. It has been argued that the integration of Beamish & Crawford into Heineken would create a duopoly in the Irish market between Diageo and Heineken by merging Beamish’s 9 per cent market share with Heineken’s 21 per cent. The remaining 70 per cent is held by Diageo. Article 9 of the Merger Regulation authorises a referral to a national competition authority by the European Commission where a concentration in the market threatens to significantly affect competition. The initial Phase I enquiry by the Authority commenced in April 2008 and this was elevated to a full (Phase II) enquiry on 1 August 2008.

Anti-competitive arrangements: sections 4 and 5

Section 4 of the Act is modelled on article 81 of the EC Treaty and prohibits all agreements between undertakings, decisions by associations of undertakings and concerted practices which have as their object or effect the prevention, restriction or distortion of competition in trade in any goods or services in the state or in any part of the state.
Breach of section 4 or article 81 of the EC Treaty is a criminal offence in Irish law. Any commission of hard-core offences such as price fixing, market sharing or output limitations could result in a maximum sentence of five years’ imprisonment. Undertakings found guilty of hard-core offences and other less serious competition law infringements may be fined up to the higher of €4 million or 10 per cent of annual turnover. There is no longer an imprisonment term for non-hard-core section 4 of the Act/article 81 of the EC Treaty infringements. The Act also empowers the Authority to bring civil proceedings for breaches of section 4/article 81.
A system of self-assessment, so that undertakings must determine whether their agreements come within the scope of section 4(1), has been in place since 1 July 2002. This is in line with the approach of the European Commission pursuant to Regulation 1/2003. The Authority gives guidance on the self-assessment process by way of notices and may also issue a declaration in respect of specified categories of agreement, decisions or concerted practices which comply with the efficiency criteria in section 4(5). The effect of such a declaration is to automatically exempt agreements, decisions or concerted practices within the category from the prohibition in section 4(1) (similar to the European Commission’s power to issue block exemptions).
There are currently three declarations in force: the Declaration in Respect of Agreements between Suppliers and Resellers (the Verticals Declaration);⁴ the Motor Fuels Declaration;⁵ and the Cylinder Liquefied Petroleum Gas (LPG) Declaration.⁶ The Verticals Declaration came into force on 1 January 2004 and is due to expire on 31 May 2010. It broadly aligns Irish law with EC Law as set out in Commission Regulation 2⁷90/99 and the accompanying guidelines. It introduces a 30 per cent ceiling on market shares in vertical agreements between firms in the Irish market and a 15 per cent market share threshold for agreements not generally caught by competition law. On 1 July 2008, the Motor Fuels Declaration was renewed, with minor changes, until 30 June 2010. This is part of the Authority’s broader scheduled review of the rules governing vertical agreements. The Authority indicated that after this date exclusive purchasing agreements between suppliers and resellers will no longer be treated separately to such agreements generally.
No other Declarations are currently in force under Part 2 of the Act. In May 2005, the Authority initiated a consultation process and is considering whether to issue a specific declaration in respect of the bulk LPG market.⁸ This consultation is ongoing.

Immunity and leniency

The Authority has a cartel immunity programme in conjunction with the director of public prosecutions (DPP). It is stricter than the European Commission’s immunity programme. It provides for immunity from prosecution for criminal offences under the Act for the first applicant to come forward to the Authority with sufficient evidence to warrant a referral of a completed file to the DPP.
The Authority will recommend to the DPP that immunity be granted on condition, inter alia, that:
• it has agreed to take all steps to terminate its participation in the illegal activity;
• it does not alert other participants to the illegal activity;
• it can show that it has neither coerced any other party to participate in the illegal activity or acted as the instigator; and
• it provides timely cooperation throughout the investigation and subsequent prosecution.

It is understood that a number of requests for immunity have been accepted.

Section 5

Section 5 of the Act is modelled on article 82 of the EC Treaty and prohibits any abuse by one or more undertakings of a dominant position in trade for any goods or services in the state or in a substantial part of the state. Infringement of section 5/article 82 of the EC Treaty no longer carries an imprisonment term but financial penalties remain, with maximum fines of up to the higher of €4 million or 10 per cent of annual turnover. The Act also empowers the Authority to bring civil proceedings for breaches of section 5 of article 81 of the EC Treaty.

Proceedings

The past 12 months have seen the Authority actively exercising its enforcement powers under the Act. Court proceedings, both civil and criminal, have been initiated and a number of matters came to trial in 2007 and 2008.

Criminal proceedings

In 2003, the Authority achieved its first successful conviction on summary indictment under the Act when the District Court imposed a fine of €14,000 on six farmers who attempted to block the unloading of a ship of its cargo of grain in Drogheda Port.⁹ The convictions were appealed but three of the convictions were upheld and the Probation Act applied.
Following its investigation into allegations of price fixing of home heating oil products in the west of Ireland, the Authority recommended that the DPP prosecute on indictment the undertakings and individuals involved. In April 2004, proceedings on indictment were initiated against 24 defendants.¹⁰ This case represents the first jury trial for a criminal competition offence in Europe. In February and March 2006, the DPP secured criminal convictions against a number of the defendants found guilty of price fixing. One defendant was fined and given a six-month custodial sentence, suspended for 12 months, for aiding and abetting In price fixing. To date, 17 other cartel participants have been found guilty of various charges relating to price fixing or aiding and abetting price fixing activities. The largest fines imposed in the trial to date are €12,500 on a company and €15,000 on an individual with total fines to date of €72,500. Proceedings remain ongoing, with the trial of the last defendant to take place during 2008.
In 2006, the DPP successfully brought a number of charges against an individual for aiding and abetting the Irish Ford Dealers’ Association and its members in implementing an agreement aimed at preventing, restricting or distorting competition in the motor trade so as to directly or indirectly fix the selling price of cars. In January 2007, an individual charged with aiding and abetting members of the Irish Ford Dealers’ Association in distorting competition in the motor trade by fixing the selling prices of cars between 1998 and 2003, was fined €30,000 and given a one-year sentence, suspended for five years. During the course of 2007 and 2008 the DPP brought charges against a number of Citroën dealerships and individual officers and directors of those dealerships, for membership of a price-fixing cartel covering Citroën vehicles. Proceedings in the Citroën price-fixing cartel case are ongoing.
In 2005, the DPP also secured a conviction against a managing director of an undertaking for failure to appear before the Authority, following receipt of a witness summons, during the Authority’s investigation into the bulk and cylinder liquefied petroleum gas (LPG) markets.¹¹ He subsequently complied with the order and the court imposed a probationary sentence.

Civil proceedings

On 8 May 2007, in a significant judgment for Irish competition law, the Supreme Court overturned the 2004 finding of the High Court that the Irish League of Credit Unions (ILCU) – the organisation representing the majority of credit unions in Ireland – had abused its dominant position in the distinct product markets of credit union representation and savings protection by tying access to its Savings Protection Scheme (SPS) to the purchase of representation services. The court found that the Authority had not produced sufficient evidence to the effect that SPS was in a distinct product market, and that therefore the tying theory failed. The court also rejected a subsidiary argument made by the Authority that the actions of the ILCU in refusing to supply SPS to disaffiliated credit unions constituted an abusive refusal to supply. This was the first time that the Supreme Court has had to adjudicate on substantive competition law issues.
The Authority unsuccessfully challenged a rationalisation scheme (BIDS) in the cattle slaughtering industry¹² on the grounds that the scheme breached article 81 of the EC Treaty, as it believed it would result in anti-competitive effects including increased beef prices to customers. Although the BIDS scheme aimed at reducing overall capacity in the industry, the High Court in its judgment in July 2006 accepted that the scheme would result in cost savings for the industry, as it was experiencing overcapacity. The High Court found that the Authority had failed to demonstrate a restriction of competition including that BIDS would result in a significant increase in the price of beef or a reduction in beef output. This case was appealed to the Supreme Court, which in March 2007 made an article 234 reference to the ECJ to clarify whether or not the agreement among beef processors to reduce capacity is ‘to be regarded as having as its object, as distinct from effect, the prevention, restriction or distortion of competition within the common market and therefore, incompatible with article 81(1) of the Treaty establishing the European Community?’ The article 234 reference was made to the ECJ in April 2008 and the Advocate General is expected to deliver her opinion on 4 September 2008.
On 25 May 2007, the Authority agreed settlement terms with the Irish Medical Organisation (IMO) in relation to High Court proceedings initiated by the Authority. In February 2005 the Authority investigated allegations of price fixing by IMO concerning provision of Private Medical Attendants’ Reports to life assurance companies. Following an investigation, the Authority brought an action against IMO claiming IMO’s conduct was a breach of section 4. The proceedings were settled with IMO agreeing to refrain from interfering in dealings between GP’s and life assurance companies or to engage in coordinated behaviour in breach of competition law regarding these services.

Market studies and advocacy

The Advocacy Division of the Authority monitors and analyses competition policy in the state. The Authority was vehemently opposed to the Groceries Order, which prevented below-cost selling of a range of grocery goods and imposed a series of obligations and prohibitions on suppliers and retailers in the grocery trade. The Authority issued various reports and a formal submission on the anti-competitive effects of the Grocery Order, culminating in the introduction of The Competition (Amendment) Act 2006, which repealed the Groceries Order in March 2006. This introduced three new sub sections into the Act that prohibit certain conduct on the part of grocery goods undertakings. As a result of this amendment, there is no longer a sector-specific prohibition on the sale of groceries at less than their net invoice price. Below-cost selling on the part of dominant grocery goods undertakings will now be dealt with in the grocery sector, as it is in the economy at large, by means of the prohibition on predatory pricing under section 5 of the Act. Following the repeal of the Groceries Order, the Authority was asked to review and monitor the grocery sector in the aftermath of this legislative change. In response the Authority initiated the Grocery Monitor Project and on 9 April 2008 published the first two reports of this project. A third report is expected later this year.
The Authority continues to have a strong advocacy role. It has made submissions to the Alcohol Advisory Group on the Intoxicating Liquor Bill 2008, which is set to overhaul the current liquor licensing system, and has also made a number of formal submissions on the structure of the electricity market.
The Authority has carried out substantive market studies to ascertain the extent of any potential or actual restrictions on competition, including: studies on a number of professions: medical practitioners, dentists, veterinary surgeons, optometrists, solicitors, barristers, and architects (a report has been provided on engineers); non-investment banking in the state; and non-life insurance in the state.
The Authority published its report on non-investment banking in the state in September 2005 and identified a number of anti-competitive problems in various sectors, including personal current accounts. The Authority’s report highlighted a lack of aggressive competition for customers between the banks in Ireland and made a number of recommendations to mitigate the anti-competitive problems identified. A study into the non-life insurance market in Ireland with particular reference to motor insurance, employers’ liability and public liability insurance carried out in conjunction with the Department of Enterprise, Trade and Employment was completed in March 2005 and some recommendations were made.
In February 2007, the Authority published a report on competition in the private health insurance market, in which it examined the impact of the principle of inter-generational solidarity on competition on that market. It made 16 recommendations for promoting competition in the private health insurance sector in Ireland.
The Authority has published final reports and recommendations on the optometry, architectural, legal (solicitors and barristers) and dental professions. A report on the veterinary profession was published in June 2008 and a report on the medical profession is expected later this year.

Regulated sectors

There are five sectoral regulatory authorities and one consumer regulator in Ireland:
• the Commission for Aviation Regulation (CAR);
• the Commission for Energy Regulation (CER);
• the Commission for Communications Regulation (ComReg);
• the Broadcasting Commission of Ireland (BCI);
• the Irish Financial Services Regulatory Authority (IFSRA); and
• the Office of the Director of Consumer Affairs (ODCA).

The Authority has entered into a cooperation agreement with each of CER, ComReg, CAR, BCI and the ODCA and in 2005 entered into a cooperation agreement with the Health Insurance Authority, the regulatory body for private health insurance in Ireland. The purpose of the agreements is to facilitate cooperation, avoid duplication and ensure consistency between the actions of the Authority and the bodies concerned. Each agreement provides for the exchange of information between the parties, forbearance to act where one party is already considering a particular issue and consultation prior to a determination of an issue of interest to both parties. In June 2008, the Authority and ComReg enhanced their cooperation agreement aiming to facilitate the performance of their concurrent competition powers.

Challenge posed by modernisation

The long-awaited modernisation of EC competition law and the coming into force of Regulation 1/2003 poses significant challenges for Irish competition law.

Forum shopping

Ireland, unlike many other EU member states (apart from the UK) has criminal sanctions for breaches of competition law and while it is thought possible that Ireland could be seen as an attractive location for complainants given the potential for forum shopping, no significant cases have yet been launched. If it were to happen it would undoubtedly place considerable strains on the Authority’s ability to cope (as it already has a heavy caseload), and place pressure on the already overburdened court system.

Information exchange

There are also real concerns about the possible exchange of information between national competition authorities (NCAs) of other member states and Ireland and the transfer to Ireland of a case from a member state without a criminal regime and the consequent impact on the rights of the undertakings and individuals concerned, and the ability to mount an effective prosecution. Article 12 of Regulation 1/2003 provides that information exchanged cannot be used by the receiving authority to impose custodial sanctions. Therefore, Ireland cannot expect to be a recipient of incriminating evidence from other NCAs or the European Commission, if it wishes to proceed against such undertakings or individuals on a criminal basis leading to imprisonment.

Amicus curiae

Article 15 of Regulation 1/2003 enables NCAs or the European Commission to intervene as amicus curiae in national proceedings. No such intervention has occurred to date. However, the High Court was called on to consider an application by the Authority to act as amicus curiae in a private action between two suppliers of liquid petroleum gas in which the defendant alleged a violation of the Act by way of counterclaim in 2004. Proceedings in the case have been stayed by agreement of the parties so it was not necessary for the court to rule on the Authority’s application.

NCA designation

The decision by the government to designate the Authority and the High Court as an NCA for the purposes of Regulation 1/2003 has left a number of questions unaddressed. The extent of the High Court’s obligations under article 11 of Regulation 1/2003 are far from clear. Whether the obligation imposed on NCAs by article 11(4) of Regulation 1/2003 to notify the European Commission prior to the adoption of a decision requiring that an infringement be brought to an end could possibly apply in the case of a criminal prosecution before a jury has yet to be resolved.

***

2008 should prove to be significant for the development of competition law in Ireland. A number of enforcement actions await court hearing and the BIDS ECJ reference should progress, casting some light on the proper approach in article 81(1) cases. Although merger activity is generally down in 2008, there are a number of significant Phase II decisions pending that could lead to possible blockings by the Authority.

Notes

1 Prior to the enactment of the Act, Irish competition legislation was comprised of two key sets of legislation: (i) the Competition Act, 1991 (as amended by the Competition (Amendment) Act, 1996) which established the Competition Authority and governed anti-competitive agreements and abuse of dominance, and (ii) the Mergers and Take-overs (Control) Acts, 1978–1996 which provided for a regime for merger control.
2 Competition Authority Press Release, 18 March 2004
3 Notification No. M/03/012 Smurfit Ireland/Lithographic Universal Limited and Notification No. M/05/004 IBM/Equitant.
4 Notice in respect of the review of the review of non-notifiable mergers and acquisitions, Competition Authority Decision No.N/03/001, 30 September 2003.
5 Declaration in Respect of Vertical Agreements and Concerted Practices Competition Authority Decision No. D/03/001, 5 December 2003. The Authority also adopted a notice in respect of Vertical Agreements and Concerted Practices (Decision No. N/03/002) to provide guidance on the application of the Verticals Decision.
6 Motor Fuels Category Licence [now Declaration], Competition Authority Decision No. 25, 1 July 1993. The Motor Fuels Declaration expired on 30 June 2008, but has been renewed until 30 June 2010
7 FH D/05/001.
8 This Consultation process concluded in September 2005 and it is envisaged that the Authority will decide before the end of 2007 whether or not to proceed with the Declaration in the bulk LPG market.
9 The only previous successful criminal prosecution in Ireland for anti-competitive offences was a IR£1,000 (e1,250) fine imposed on Estuary Oil in October 2000 for price fixing (under the predecessor to the Act).
10 The Director of Public Prosecutions v Michael Flanagan, Con Muldoon, Muldoon Oil, James Kearney, All Star Oil, Kevin Hester, Corrib Oil, Mor Oil, Alan Kearney, Sweeney Oil, Gort Oil, Pat Hegarty, Cloonan Oil, Ruby Oil, Matt Geraghty Oil, Declan Geraghty, Fenmac Oil & Transport, Michael McMahon, Tom Connolly, Eugene Dalton Snr., JP Lambe, Sean Hester, Hi-Way Oil, Kevin Cunniffe.
11 The Competition Authority v Mr Pat Morgan (Tru Gas) 22 December 2005, District Court, Ryan J.
12 The Competition Authority v Beef Industry Development Society (BIDS) – Mr Justice Liam McKechnie, High Court, 27 July 2006.

An extract from The European Antitrust Review 2009