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Relaxing whilst doing Competition Law is not an Oxymoron

Archive for May 5th, 2010

Bottom-Up Cross Fertilization

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Apologies for the mysterious title of this post. It deliberately borrows to the jargon which political scientists use to look bright, and impress their colleagues.

Here’s the explanation. The Commission’s released today its drafts on horizontal cooperation agreements, which are intended to replace the Block Exemption Regulation on joint R&D, the Block Exemption Regulation on Specialisation Agreements and last, but not least, the Guidelines on Horizontal Cooperation Agreements. Pursuant to the Commission’s press release, the primary innovations of the Guidelines are:

  • The inclusion of a chapter on the assessment of information exchange between companies;
  • Guidance on standard terms in the chapter on standardisation;
  • Clarification of the application of the competition rules to agreements between joint ventures and their parent

Now, what stroke me in going through the text is that the Guidelines abundantly recycle examples taken from the case-law of national competition authorities.

Read this:

Luxury hotels in the capital of country A, which is a tight and stable oligopoly operating in a non complex and concentrated market, directly exchange individual information about current occupancy rates and revenues. In this case, from the information exchanged the parties can directly deduce their actual current prices.

Looks familiar? Now read this:

The four companies owning all the petrol stations in country A exchange current gasoline prices over the telephone. They claim that this information exchange cannot have restrictive effects on competition because the information is public as it is displayed on large display panels at every petrol station.

Both those examples refer to cases dealt with the French competition authority in previous years. Those draft Guidelines are thus the proof that Regulation 1/2003 has triggered bottom-up, cross fertilization dynamics. More simply, the decisional practice of NCAs helps shaping the content of EU competition law.

(Image possibly subject to copyright. Source here)

Written by Nicolas Petit

5 May 2010 at 12:25 am