ANTITRUST ALERT
ANTITRUST ALERT
A Global Resource for Compliance Officers & Legal Advisors
ANTITRUST ALERT
A Global Resource for Compliance Officers & Legal Advisors
Consumer Protection/Privacy
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Annual European Competition Review 2019

by | Feb 3, 2020 | , , , , , , , , , ,

McDermott’s Annual European Competition Review summarizes key developments in European competition rules. During the previous year, several new regulations, notices and guidelines were issued by the European Commission. There were also many interesting cases decided by the General Court and the Court of Justice of the European Union. All these new rules and judicial decisions may be relevant for your company and your day-to-day practice.

In our super-connected age, we can be inundated by information from numerous sources and it is difficult to select what is really relevant to one’s business. The purpose of this review is to help general counsel and their teams to be aware of the essential updates.

This review was prepared by the Firm’s European Competition Team in Brussels and Paris. Throughout 2019 they have monitored legal developments and drafted the summary reports.

Access the full report.



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FTC Hearing on Broadband

by | Apr 25, 2019 | ,

The tenth of the FTC’s Hearings on Competition and Consumer Protection in the 21st Century focused on competition and consumer protection issues in US broadband markets. The panelists addressed developments in US broadband markets, technology, and law since the FTC staff’s 2007 Broadband Connectivity Competition Policy report and the FTC staff’s 1996 Competition Policy in the New High-Tech, Global Marketplace report.

Four panels of industry experts broadly discussed: (i) how the FTC should identify and evaluate advertising claims by internet service providers (ISPs) with respect to delivery speed; (ii) how broadband networks and markets have evolved since the 2007 Broadband Report; and (iii) how the FTC should identify and evaluate anticompetitive conduct in the broadband industry.

Read the full article.

Originally published by Competition Policy International, April 2019.



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THE LATEST: EU Commission Fines Facebook EUR 110 million for Providing Incorrect or Misleading Information

by | May 19, 2017 | , ,

The Commission’s EUR 110 million fine on Facebook for breach of its procedural obligations under the EU merger control rules underscores the need to submit full, accurate and reliable information during the Commission’s merger control review process. An intentional or negligent failure to do so will lead to draconian fines—even where the provision of incorrect or misleading information does not have an impact on the ultimate outcome of the Commission’s decision.

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Unfair Commercial Practices: The European Court of Justice Specifies Criteria for Comparative Advertising

by | Feb 21, 2017 | ,

On 8 February 2017, the European Court of Justice (ECJ) handed down a judgment on a reference for a preliminary ruling stating that comparative advertising can be misleading if consumers are not provided with information on the different format or size of shops where the products are sold. In particular, according to the ECJ, consumers shall be informed of all the relevant elements regarding the comparison, including whether it is “made between prices charged in shops having larger sizes or formats in the advertiser’s retail chain and those displayed in shops having smaller sizes or formats in competitors’ retail chains”.

On 2 October 2013, ITM Alimentaire International SASU (ITM) sued Carrefour for damages alleging that the television advertising campaign launched by the company, consisting in a comparison between products charged in its shops and in competitors’ shops, was misleading. On 31 December 2014, the Commercial Court of Paris awarded damages to ITM and granted an injunction prohibiting the dissemination of the advertising. Carrefour appealed the judgment to the Court of Appeal of Paris, which made a reference for a preliminary ruling to the ECJ, asking whether:

  1. a comparison of the price of goods sold by retail outlets is permitted only if the goods are sold in shops having the same format or of the same size;
  2. the fact that the shops whose prices are compared are of different sizes and formats can be considered as a material information that must be brought to the knowledge of the consumer; and
  3. If so, to what degree and/or via what medium that information must be disseminated to the consumer.

The ECJ found that in price comparative advertisements consumers shall be “informed clearly and in the advertisement itself that the comparison was made between the prices charged in shops in the advertiser’s retail chain having larger sizes or formats and those indicated in the shops of competing retail chains having smaller sizes or formats”.

Gabriele Giunta contributed to this blog post.



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Higher Mitigation of Fines Due to Prompt Implementation of Measures Addressing Authority’s Concerns in Unfair Commercial Practices Investigations

by | Feb 15, 2017 | ,

In a decision published on 10 February 2017, imposing Samsung Electronics Italia S.p.A. (“Samsung”) fines totaling € 3.1 million for alleged aggressive unfair commercial practices, the Italian Competition Authority (the “Authority”) confirmed that the prompt implementation of measures aimed at addressing its concerns regarding alleged unfair commercial practices leads to a higher mitigation of the fine.

According to the Authority, Samsung would have: (i) provided consumers with incomplete and misleading information on the terms and conditions of the promotions; and (ii) forced consumers to provide their consent to the processing of their personal data for marketing purposes, as a condition to obtain the premiums related to the purchase of the product. In setting the amount of the fine, the Authority took into account the measures implemented by Samsung before and after the beginning of the proceeding. Indeed, in relation to the second allegation, the Authority considered the importance of the measures implemented before the opening of the proceeding and granted a significant reduction of the fine (25%). In relation to the first conduct, the Authority granted a lower reduction of the fine (15%), given that the measures aimed at addressing its concerns were adopted only after the opening of the investigation.

On 4 May 2016, the Authority opened the investigation following several complaints received from consumers and consumers’ associations. In particular, Samsung would have used claims aimed at promoting prize-giving events without providing consumers with all relevant information and using a font style, which would have been too small or difficult to read. The Authority also considered that the access to promotions’ rules in each point of sales or through the website was not sufficient in order to overcome this lack of information. Furthermore, as mentioned above, according to the Authority, Samsung would have forced consumers to provide their consent to the processing of personal data for purposes other than the ones necessary for obtaining the premium. During the proceeding, Samsung voluntarily submitted and implemented measures aimed at improving consumers’ awareness on the terms and conditions of the promotions. These measures included simplification of consumers’ involvement in prize-giving events, verification of consumers’ satisfaction, improvement of systems aimed at monitoring whether employees would effectively provide all the relevant information to consumers, streamline procedures for obtaining the premium, a more efficient handling of consumers’ complaints. Furthermore, Samsung also submitted that it had implemented other measures aimed at addressing the concerns related to the provision of the customers’ consent for the processing of their personal data. The Authority fined Samsung of € 3.1 million for alleged unfair commercial practices consisting of aggressive and misleading promotions related to the purchase of smartphone, smart TV and other Samsung’s products. However, in the calculation of the fine, the Authority acknowledged the relevance of the above mentioned measures granting a significant reduction of the applicable fine.

Gabriele Giunta (Trainee) contributed to this blog post.



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Finally Implemented! The Italian Council of Ministers Approves a Legislative Decree Implementing the EU Antitrust Damages Directive

by | Jan 17, 2017 | , ,

On 14 January 2017, the Italian Council of Ministers approved the Legislative Decree implementing Directive 2014/104/EU on certain rules governing actions for damages under national law for infringements of the competition law provisions of the Member States and of the European Union (the “Directive”). The final version of the Legislative Decree has not been published yet on the Official Journal. However, the key points emerging from it include:

  1. A strengthened mechanism of evidence disclosure in actions for damages related to alleged infringements of competition rules. In fact, the judge will have the power to request the defendant or a third party, including the Italian Competition Authority (the “Authority”), to disclose relevant evidence which lies in their control.
  2. The extent to which Italian courts will be able to rely on decisions of the Italian Competition Authority or other national competition authorities. For instance, an infringement of competition law ascertained by a decision of the Italian Competition Authority (or appeal judgment), which is not subject to further means of appeal, will be deemed to be indisputably established for the purposes of an action for damages brought before the national courts under Article 101 or 102 TFEU or under national competition law.
  3. The rules applicable to limitation periods for bringing actions for damages, as well as how Italian courts shall assess the joint and several liabilities of companies which are found to have infringed competition rules, and how they shall quantify the harm suffered as a consequence of the alleged infringements.
  4. The business sections of the courts of Milan, Rome and Naples, identified as the only competent courts for such actions for damages, including class actions.

According to the established Italian case-law, in case of actions for damages regarding alleged violations of competition rules, the judge shall use all available investigation means in order to address the obstacles faced by the claimant to access the relevant evidence in antitrust cases, and therefore apply broadly the rules on the disclosure of evidence and information requests (Corte Suprema di Cassazione, judgment no. 11564 of 4 June 2015).

On 26 November 2014, the European Parliament and the Council of the European Union adopted the Directive, which entered into force 26 December 2014, setting 27 December 2016, as the deadline for its transposition at national level. On 27 October 2016, the Italian Council of Ministers approved an initial proposal for a Legislative Decree implementing the Directive and sent it to the relevant commissions of the Italian Parliament for their mandatory (non-binding) opinions. The Legislative Decree was therefore finally approved in the Council of Ministers’ meeting of 14 January 2017. Although it is difficult to predict the likely impact of the Legislative Decree, it will definitely provide a more certain legislative framework for companies and consumers interested in claiming damages on the basis of alleged antitrust infringements.

Gabriele Giunta contributed to this post. 



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Unfair Commercial Practices – The Italian Competition Authority and The Italian Communication Authority Sign a Memorandum of Understanding

by | Jan 17, 2017 | , ,

On 13 January 2017, the Italian Competition Authority (AGCM) and the Italian Communication Authority (AGCOM) signed a memorandum of understanding concerning several aspects of their cooperation in the application of consumers’ protection rules. Under the memorandum of understanding, in the case of consumers’ protection matters, which potentially involve both authorities, there will be coordinated actions, even during the preliminary investigation phase. Furthermore, AGCM will inform AGCOM on cases concerning the violations of rules enforced by AGCOM, which will do the same in case of hypothesis of unfair commercial practices in the electronic communications sector. The authorities agreed also to set up a standing working group in order to promote the debate on consumer protection issues. Finally, the agreement provides rules on the exchange of information between the authorities on investigations.

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Misleading Terms & Conditions and Unfair Contract Terms: The Italian Competition Authority Opens Two Investigations against WhatsApp Inc.

by | Nov 1, 2016 | ,

On 28 October 2016, the Italian Competition Authority (the “Authority”) opened two investigations against WhatsApp Inc. for alleged unfair commercial practices. The first investigation by the Authority alleges that WhatsApp Inc. would have forced users to subscribe to new terms and conditions, in particular, a clause on the sharing of data with Facebook, by making users believe that, otherwise, they would have not be able to use the service. On another other side, the Authority opened a second investigation regarding other alleged unfair commercial practices. According to the Authority, WhatsApp Inc. would have included in its “Terms of Use” unfair contracts terms, including the exercise of the right of withdrawal granted exclusively to the company, the limitation on liability in favor of the company and the identification of the competent court for disputes resolution (currently only US Courts). Finally, the Authority also opened a consultation on these alleged unfair contract terms.

These investigations emerged after the Italian Data Protection Authority, on 27 September 2016, opened an investigation on WhatsApp’s new privacy policy and the data flow from WhatsApp Inc. to Facebook. In particular, the Italian Data Protection Authority asked WhatsApp Inc. to clarify certain aspects regarding the communication of data to Facebook, such as the typology of data communicated, the modality for the acquisition of consent for the communication and the measures adopted to ensure the compliance with data protection laws.

Gabriele Giunta contributed to this blog post.



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UK CMA Imposes Behavioural Commitments akin to a Structural Divestment: The Sci-fi Magazines Case

by | Oct 21, 2016 | ,

Divestments often constitute the most appropriate remedy to resolve antitrust concerns in the context of merger control. However, behavioural commitments may also have the same commercial effects as a divestment. This was illustrated in a merger control case handled by the United Kingdom Competition Market Authority (the ‘CMA’) in the specialist magazines sector. Another feature of this case pertains to the market definition found by the CMA in this case.   (more…)



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Activation of Premium Services, The Italian Competition Authority Fines Telepass for Unfair Commercial Practices

by | Oct 21, 2016 | ,

On 20 October 2016, the Italian Competition Authority (the “Authority”) fined Telepass of EUR 200,000 for alleged unfair commercial practices. According to the Authority, Telepass would have activated a premium service (premium option extra) to consumers, who activated the simple premium option, without their consent. In particular, Telepass would have adopted a mechanism based on the tacit consent of the consumers, giving them an opt-out option, which consisted in the exercise of the right of withdrawal within 60 days.

The main feature of this decision is the application by the Authority of Article 65 of the Italian Consumers Code. This provision was introduced with Legislative Decree no. 21/2014, implementing Directive 2011/83/EU on consumer rights. According to Article 65, “before the consumer is bound by the contract or offer, the trader shall seek the express consent of the consumer to any extra payment in addition to the remuneration agreed upon for the trader’s main contractual obligation. If the trader has not obtained the consumer’s express consent but has inferred it by using default options which the consumer is required to reject in order to avoid the additional payment, the consumer shall be entitled to reimbursement of this payment”. The aim of this provision is to ban the use of the opt-out mechanism in favor of the use of the opt-in mechanism. Therefore, the Authority fined Telepass and prohibited the continuation of the alleged conduct.

Gabriele Giunta contributed to this blog post.



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