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Archive for October 2021

IEB Postgraduate Competition Law Course (25th edition)

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Diez cosas que no sabías sobre Madrid - Datos interesantes y curiosidades  sobre la capital: Go Guides

2022 will mark the 25th edition (!) of the EU and Spanish competition law course founded by Luis Ortiz Blanco. This is a course that is particularly dear to us: I took it as a student back in 2005, and have co-directed it for the past few years; Pablo is also actively involved as lecturer and module coordinator.

The course (taught partly in Spanish and partly in English) will run from January to March 2022 in a hybrid format (attendees can participate either in person or online). Lectures take place in the afternoon (16h to 20h CET) to help make it compatible with other professional or academic activities.

As always, it will feature a great line-up of international lecturers (70 in the past edition) that include Judges from EU and national courts, officials from the European Commission, the Spanish CNMC and other national competition authorities, as well as top-notch academics, in-house lawyers and practitioners. Students are tipically officials from competition authorities, in-house lawyers as well as lawyers/economists in private practice. The course is designed to cater to all levels.

All relevant information (program, coordinators, cost, sponsors, and list of lecturers in the past edition of the course) is available here:

IEB COMPETITION LAW COURSE 2022

In addition to registering for the full course, it is also possible to register for the 1-day seminars that will be fully taught in English. The seminars in this 25th edition will be the following:

Seminar 1- Recent Developments in EU Competition Law (4 February 2022). Coordinators: Fernando Castillo de la Torre and Eric Gippini-Fournier

Seminar 2 – Competition Law in Hi-Tech Markets (25 February 2022). Coordinators: Nicholas Banasevic and Alfonso Lamadrid

Seminar 3 – Sport and Competition Law (18 March 2022). Coordinator: Marcos Araujo

Seminar 4 – Private enforcement of the competition rules (25 March 2022). Coordinator: Mercedes Pedraz

Special Seminar – Celebrating 25 years of the Course (1 April 2022).

If you want to know more, please drop us a line at competencia@ieb.es

Written by Alfonso Lamadrid

15 October 2021 at 10:42 am

Posted in Uncategorized

Of undertakings, legal entities and groups of companies. The CJEU’s judgment in Sumal (C-882/19)

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(Guest post by Marcos Araujo Boyd)

On 6 October 2021, the Grand Chamber of the CJEU issued its much-awaited decision in respect of the legal entities against which follow-on claims may be made (link here)

This decision that will be remembered for reasons way beyond the liability of subsidiaries in a follow-on cartel claim. As suggested by the appointment of a Grand Chamber, the Court soon realised that it would have to reconsider a particularly convoluted area of EU competition law:  the theory of the undertaking or economic unit and its relationship with legal persons and groups of companies. The answer provided may be ranked alongside Hydrotherm, Viho, Dansk Rørindustri , Confederación Española de Estaciones de Servicio , Akzo Nobel or Skanska in its importance on the construction of the undertaking as a legal concept in EU competition law.

The discussion follows the order of the arguments in the judgment starting from its paragraph 31, after having dealt with procedural and admissibility issues. For a fuller discussion on the context of the judgment, the reader is invited to check my previous guest post on AG Pitruzzella’s Opinion.

The opening statements: On Giant’s Shoulders (paras 32 to 37)

After rephrasing the three initial questions as whether a victim may indifferently sue a parent company sanctioned by the Commission or an affiliate provided both entities constitute an economic unit, paragraphs 32 to 37 of the judgment recall the jurisprudence of the Court on private enforcement. The arguments feature Skanska prominently, stressing that the determination of the liable entity is a matter of EU law only, and abundantly noting the link between public and private enforcement.

While there is little new in this section, these references usefully reveal the reluctance of the Court to heed to the temptation of facilitating private claims under the principle of effectiveness or, as suggested in para 52 of AG Pitruzzella’s Opinion, by admitting that national courts affirm it without that being required by EU law. Rather, the Court builds its arguments on private enforcement over the strong shoulders of public enforcement, dismissing by implication potential divergences between the two tools. That perspective enables it to rely on its rich public enforcement case-law in the sections that follow.

The Centrality of the Notion of Undertaking (paras 38 to 44)

Following the discussion on public and private enforcement, the Court moves on to a second constitutional stepping stone, constituted by the notion of undertaking. Quoting earlier jurisprudence, the Court depicts it as ‘an autonomous concept of EU law’ that designates ‘the perpetrator of an infringement (…), who is liable to be punished’ and ‘the entity on which the Commission may impose a fine’, contrasting it with other concepts such as companies or legal persons, and observes that this notion is employed both in primary and secondary legislation, especially the Damages Directive 2014/104. It then recalls the jurisprudence on the notion of undertaking by recalling Imperial Chemical Industries, Confederación Española de Estaciones de Servicio, the 2009 and 2017 Akzo Nobel judgments and Knauf Gips before moving on to the application of the principle of personal responsibility to the undertaking and not to legal entities, an apparent oxymoron that has, not without some reaction from various AGs, featured prominently in EU competition law since ETI. That recollection ends with a surprising, yet reiterated, principle of EU competition law used in public enforcement since at least Siemens Österreich whereby the joint and several liability amongst the entities of a single economic unit applies ipso iure or automatically, no decision to that effect being actually needed, an argument that resonates differently in the context of private enforcement than when discussing a case where the separate entities have been identified in a decision following a procedure. That is, in any event, inevitable given the logic of parallelism between public and private enforcement already noted.

The consequence of the above is clear: upward and downward liability are placed on equal footing, both resulting from the very nature of the undertaking as defined in EU law, and not as a result of control or agency theory. But thar is not the end. Keep reading.

Undertakings within Groups of Companies? (paras 45-50)

After reaching the above conclusion, the Court moves on to a correction required by the problem identified already by AG Pitruzzella: the link that should exist between the legal entity against which the claim is made and the undertaking that is initially liable. It will be recalled that the AG had proposed to require an involvement by the subsidiary on the specific economic activity under consideration, for example, by selling the goods object of the cartel (see para 57 of the Opinion).

Quoting the AG’s Opinion, the Court follows its logic with a significant twist. Taking conglomerate groups as an example, the Court argues that groups of companies may contain various ‘economic units’ (or undertakings, although the judgment avoids that term in this context). This would be the case where the groups are active in ‘several economic fields having no connection between them’. It even notes that, in those conglomerate groups, ‘the same parent company may be part of several economic units made up (…) of itself and of different combinations of subsidiaries all belonging to the same group of companies’, thereby affirming that a group of companies, all linked by control, may actually contain several separate ‘economic units’.

This logic is used to solve the absurdity that a subsidiary ‘could be held liable for infringements committed in the context of activities entirely unconnected to its own activity and in which they were in no way involved, even indirectly’ (para 47). However, its impact is far reaching beyond the matter at hand, changing the notion of undertaking as hitherto regarded by supplementing the presence of ‘control’ with ‘sharing an economic field’. Wow.

It is difficult to overestimate the relevance of this logic. From now on, groups of companies may, at least where their activities substantially differ, be understood to integrate various economic units or undertakings. Worldwide turnovers used in the calculation of sanctions may need to be determined separately for each economic entity. One can not help but to note the divergence this represents with the notion of undertaking as used in the EUMR, where conglomerate groups would remain to be a single ‘undertaking’. It might even be wondered if Article 101 could apply to agreements between separate ‘economic units’ of a conglomerate group, a door that might have appeared to have been closed in Ecoservice not that long ago.

Other questions to be clarified in future cases will look at what standards may be used to tell an activity from another. Sumal has been cautious in presenting this in the context of conglomerate groups where the legal entities act in ‘several economic fields having no connection between them’, That said, it will be interesting to follow what intensity of ‘connection’ is relevant for these purposes.

That said, the answer given by the Court adequately resolves the problem of inverse or downward liability in a consistent way which is firmly anchored on the notion of undertaking. It also provides a hook to resolve the inconsistency resulting from Recital 22 of the Merger Regulation, which appeared to recognise the existence of separate undertakings within public conglomerates, an option arguably unavailable for private ones.

What About Rights of Defence? (paras 51 to 67)

Read the rest of this entry »

Written by Alfonso Lamadrid

7 October 2021 at 3:39 pm

Posted in Uncategorized

The mardis du droit de la concurrence at ULB are back: 2021-2022 programme

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The mardis du droit de la concurrence at the ULB’s Institut d’études européennes need no introduction: led by Denis Waelbroeck and Jean-Francois Bellis, they continue to be a classic, and a must, of the Brussels scene. The programme for the new academic year can be downloaded here.

The series will be closed by the President of the Court of Justice, Koen Lenaerts, on 17 May; and includes the traditional overview of the case law on cartels by Fernando Castillo de la Torre (Principal Legal Advisor and Head of the Competition Team at the Commission’s Legal Service).

I am honoured (and very much grateful to Denis and Jean-Francois) to be joining the impressive line-up of speakers to discuss the recent developments on sports and competition law (on 16 November — I hope to see many of you there).

The topic is dear to my heart (you may remember my post on the General Court’s ISU judgment earlier this year) and the invitation could not be more timely (SuperLeague and all). I hope to be able to share a paper ahead of my presentation via the blog.

The full programme is the following:

26 October 2021: Competition Law and Digital Markets: challenges ahead, by Frederic Jenny (ESSEC and OECD)

16 November 2021: Sports and Competition Law: Recent Developments, by yours truly

14 December 2021: The Review of the Vertical Block Exemption Regulaiton, by Andrzej Kmiecik (Van Bael & Bellis)

11 January 2022: Recent developments in EU Merger Control, by Guillaume Loriot (DG Comp, European Commission)

8 February 2022: La jurisprudence récente en matière de cartels, by Fernando Castillo (Legal Service, European Commission)

8 March 2022: Recent developments on abuse of dominance, by Nicholas Banasevic (who, after a stellar career as a top official at DG Comp, is transitioning into pastures new)

26 April 2022: Recent developments in State aid policy, by Karl Soukup (DG Comp, European Commission)

17 May 2022: The Court of Justice and Competition Law, by Koen Lenaerts (President, Court of Justice)

Written by Pablo Ibanez Colomo

5 October 2021 at 10:30 am

Posted in Uncategorized