In survey conducted by Global Competition Review last year, Italy’s antitust authority received high praise for its overall performance. Sebastian O’Meara asked Italian lawyers for their current assessment

Tom Blass reports from Amsterdam on the IBA 2000 Conference’s session on the Criminalisation of Antitrust, where the audience was treated to some scary stuff about custodial sentences

Among those applauding Joel Klein’s call for a global initiative to ease multi-jurisdictional merger review at the recent conference in Brussels (see report, page 8) was the chairman of the IBA Section on Business Law, Bill Rowley of Toronto’s McMillan Binch. After the conference he told GCR why

Michal S Gal of the New York University School of Law suggests some basic principles that should drive policy towards intellectual property-based monopoly power in smaller jurisdictions

Samantha Mobley and Maitena Arakistain of Baker & McKenzie, London explain why corporations proposing to blow the whistle on fellow cartel members need to take an international approach

The Autorità Garante, Italy’s antitrust authority, has established a no-nonsense reputation following its recent crackdown on anti-competitive behaviour. Sebastian O’Meara found out from the Authority’s director why the time was right to shake Italian industry out of its cocoon

Cynthia Grant of the Canadian Competition Bureau reports on how a ‘benchmarking’ project on best practices in merger control was structured to include the experience of foreign agencies

Georgia-Pacific, a forest products company from the US is proposing an US$11 billion merger with Fort James, a paper company.

The two largest fibre-optic component producers, JDS Uniphase and SDL, have entered into a US$41 billion merger agreement.

Daimler Chrysler is set to sell Adtranz, its rail unit, to Bombardier in a deal that will be worth slightly more than US$1 billion dollars.

Ashton Mining Ltd is considering two multi-million dollar acquisition proposals by rival mine industry giants.

In April 2000 PepsiCo filed a complaint with the Mexican Federal Competition Commission accusing Coca-Cola of abusing its dominant position in Mexico.

AOL and Time Warner’s US$127 billion planned merger has faced serious regulatory scrutiny in the US and the EC. In the United States regulatory issues focused on the future of broad-band internet access in a number of American cities. Conditions are therefore likely to focus on the provision of open access to the merged companies’ share of the cable market. Press reports predict that AOL and Time Warner are ready to make all necessary concessions and that the deal is therefore likely to go ahead.

The German utility group, RWE, plans to acquire Thames Water of the UK in a US$6.21 billion deal.

The tendency of the Commission seems to be to apply a broad interpretation of the ‘effects’ question. How its policy will develop in the future remains to be seen.

Dante Marcelo Ramos
Allende & Brea
Buenos Aires

An important reform of Belgian competition law entered into force in October 1999. The main aims of the law as far as mergers are concerned were to improve legal certainty by focusing on transactions with close links to Belgium and, more generally, to meet the needs of industry. After almost a year of application, most of those aims seem to have been achieved. However, although the institutional aspects of the reform made a good start in January, some new hurdles have recently appeared and Belgium still needs to improve its institutional structures to ensure an effective competition policy.

Florence Melchior and Sophie Ayrault
Freshfields Bruckhaus Deringer
Brussels

The Canadian Competition Tribunal has released a landmark merger decision in which it allows efficiencies to save an otherwise anti-competitive merger.

In another development, new regulations have been added to the Competition Act to govern Canada’s sole remaining national air carrier.

John F Clifford and Jeffrey P Roode
McMillan Binch
Toronto

In the parliamentary debate on the new merger control legislation, the right-wing parties were quick to bring up the subject of market definition in the Danish Competition Act, which it would appear is not fully consistent with the market definition criteria under the EU competition rules.

Jan-Erik Svensson
Gorrissen Federspiel Kierkegaard
Copenhagen

Under the tight timetable of the ECMR, the Commission has limited time to carry out its own investigations and must necessarily base its assessment largely on the information provided by the parties in their notification and by third parties in their responses to the Commission’s questionnaire. To provide false or misleading information or refuse to supply information seriously undermines the merger control process. The Commission has therefore shown its determination to impose very substantial fines even against third parties who do not provide the information requested by the Commission in the course of a merger control proceeding. The Commission has also indicated that it may make a proposal to the Council for an increase in the amounts of the fines levied in such cases.

Thomas Wessely
Freshfields Bruckhaus Deringer
Brussels

The French Supreme Court has relaxed the regime applicable to the granting of protective measures under French competition law. In addition, the Court seems to have moved towards assimilating the test applicable to protective measures under competition law and under the French Civil Procedure.

Angélique De Brousse
Freshfields Bruckhaus Deringer
Paris

This first decision of the FCO under the new prohibition on sales below cost shows the determination of the FCO to fight unfair sales practices by undertakings with market power. It will use its new powers prior to the finalisation of its notice on the interpretation of the new ban on sales below cost price which was announced a few weeks ago.

However, the FCO prohibition order is still subject to appeal and may yet be challenged.

August-Carel Maske
Freshfields Bruckhaus Deringer
Cologne

Competition law will be tested by the practical application of fair market principles to the fast-developing area of domain registration, which, because of its central role in ebusiness, may be one of the hottest competition issues over coming years.

Iván Bartal
Oppenheim and Partners/ Freshfields Bruckhaus Deringer
Budapest

That the Authority is taking a much harder line than previously has been remarked by numerous observers. On the one hand this new approach is to be welcomed, given that strategic economic sectors in Italy (such as public utilities) are characterised by a relative lack of competition, mainly as a consequence of restrictive regulation.

On the other hand many commentators believe that the more draconian approach of the Authority appears to have adversely affected the right of defence in antitrust cases.

In particular, they have claimed that the Authority, in various recent decisions, has been less rigorous than in the past in its analysis of the evidence used to prosecute anticompetitive behaviour, giving rise to a de facto shifting of the burden of proof. Indeed, in a number of recent cases the Authority’s decisions have been reviewed by the Administrative Court for lack of evidence.

Might it be, as some have suggested, that the recent growth of the Authority’s workload means that it is unable to apply the same rigorous internal control of each proceeding as it has in the past? Whether this apparent shortcoming will be resolved by the recent internal reorganisation of the Authority remains to be seen.

Luciano Vasques
Freshfields Bruckhaus Deringer
Rome

The new Dutch Postal Act provides for a further liberalisation of the postal market than is required in the relevant EU directive. Under the new Postal Act, the exclusive rights granted to the national postal operator for the distribution of mail will be limited to letters weighing up to and including 100 grammes and at a maximum rate of three times the public tariff for the single item. The Dutch government intends to fully liberalise the national postal market by 2003, unless insufficient progress has been made in neighbouring countries.

Pepijn van Ginneken
Allen & Overy
Amsterdam

The reform adopted by the government introduces substantial amendments to the existing domestic merger control regime. These amendments have brought Spanish merger control laws more in line with EU rules and the laws of other EU Member States. However, there are a number of issues which will need to be clarified by future implementing legislation. These include the introduction of a coherent legal regime for concentrations carried out by means of a public takeover bid (particularly in cases of competing bids), the enactment of guidelines on certain issues such as calculation of turnover and the definition of undertakings concerned, and even the introduction of a short-form notification for transactions which do not raise significant competition issues (eg where there is no overlap between the parties to the concentration, as well as in other circumstances). The procedure for agreeing remedies during the firststage investigation (terminación convencional) also needs to be developed by implementing legislation.

Álvaro Iza
Freshfields Bruckhaus Deringer
Madrid

Direct sanctions are at present unknown in Swiss antitrust law. However, it appears that this is about to change with the coming revision of the Federal Competition Act. The first draft of the bill was made public a few weeks ago. In addition to direct sanctions, the bill contains a number of new features including a modification of the composition of the ComCo and the abolition of special thresholds for media sectors in the context of merger control. The introduction of direct sanctions can be largely seen as a response to the vitamin cartel brought to light by the US antitrust authorities, which has created a great deal of frustration within ComCo as well as among many Swiss politicians.

Manuel Bianchi
Lenz & Staehelin
Geneva

The Act, which completed its progress through Parliament hours before the summer recess, was a very different one to the Bill first introduced to the House of Commons in January 2000. Initially the government had intended the Bill to cover regulation in the water and telecommunications sectors as well as electricity and gas - hence the name ‘Utilities Bill’, which now seems such a misnomer. At the beginning of March, the Department of Trade and Industry (DTI) announced that the telecommunications and water provisions would be removed from the Bill. To a large extent this was due to lobbying by the telecoms industry, which favoured sector-specific legislation. Allegedly, territorial disputes between various government departments also played a role. Since then, the Department of Environment, Transport and the Regions has issued a consultation paper on competition in the water industry to supplement the Competition Act, and the DTI has been canvassing views on reform of communications legislation. It is unlikely that either of these initiatives will be translated into legislation before the next general election. By then the Utilities Act may have proved its worth.

Renella Reumerman
Freshfields Bruckhaus Deringer
London

The decision underscores the need for painstaking scrutiny (and review by legal counsel) of the terminology to be used on the website and in marketing materials and public filings. The ruling also emphasises the need for careful consideration (from both a business and legal perspective) as to how to offer to involve franchisees in alternative distribution arrangements without the offer subsequently being construed as an acknowledgment of the franchisees’ rights.

Philip F Zeidman and Steven B Feirman
Piper Marbury Rudnick & Wolfe LLP
Washington DC