On December 27, 2019, the FCO published a summary of its activities in 2019.[1] In 2019, the FCO imposed fines in cartel proceedings totaling approximately €848 million in five cartel proceedings, examined around 1,400 notified mergers, conducted numerous abuse of dominance proceedings (including against Facebook and Amazon), and received 104 applications for review in public procurement cases.
Cartel Prosecution
The FCO’s president, Andreas Mundt, stressed that, as before, cartel prosecution remains a key area of focus to protect competition and consumers. With fines imposed in cartel proceedings of approximately €848 million in 2019 and thus more than double as high as in 2018,[2] 2019 was the second most successful year for the FCO in more than ten years.[3] The extraordinary level of fines imposed in 2019 is mainly driven by a fine totaling €646 million imposed just recently on steelmakers for fixing the price of steel plates over a 14-year period.[4]
While in contrast to 2018, the overall number of concluded cartel proceedings slightly increased from four in 2018 to five in 2019, 2019 confirms the overall decrease in the number of cases in which the FCO received leniency applications from a peak of more than 40 in 2013 to only 16 in 2019.
Merger Control
Merger control also remained a key area for the FCO in 2019. In 2019, the FCO received around 1,400 notifications, and thus slightly more than in 2018.
Number of Merger Notifications
In 2019, four mergers were prohibited and in an additional five cases, the merging parties withdrew their projects in Phase II proceedings.[5] Hence, the FCO’s latest prohibition of Loomis AB’s acquisition of Ziemann Sicherheit Holding GmbH[6] draws the line under what has been a year stamped by prohibition decisions and withdrawals of filings in the FCO’s merger practice.[7] It remains to be seen whether the FCO will maintain this course also in 2020.
To enable the FCO to focus on the cases that really matter to consumers and on Phase II cases which require an enormous amount of time and effort, the Draft Proposal for the 10th Amendment to the ARC increases the second domestic turnover threshold for notifiable mergers from €5 million to €10 million and intends to reduce thereby the number of notifications by approximately 20%.[8]
Digital Economy
Andreas Mundt emphasized the FCO’s continued goal to maintain an open market by preventing big tech companies and platforms from abusing dominant positions.
On February 6, 2019, the FCO concluded its proceedings against Facebook and found that Facebook’s data collection practices amounted to an exploitative abuse of its dominant position. It thus ordered Facebook to change its data collection practices.[9]
On July 17, 2019, the FCO terminated its probe into Amazon, after Amazon had committed to making several changes to its (worldwide) business terms towards sellers on its market places.[10]
In addition, the FCO published a joint study with the French Competition Authority on “Algorithms and Competition”.[11]
The FCO’s continued focus on digital economy will also be reflected in the 10th Amendment to the ARC as new rules on abuse control, in particular for digital platforms, will be implemented.[12]
Consumer Protection
In the area of consumer protection, the FCO concluded its first sector inquiry into comparison websites in April 2019[13] and intends to conclude two additional sector inquiries in 2020, namely one into the use of consumer data by smart TVs (launched already in December 2017)[14] and another one into the authenticity and validity of user reviews on online platforms (launched in May 2019)[15].
Public Procurement
Finally, with respect to public procurement, the FCO will continue working towards the establishment of the so-called Federal Competition Register for Public Procurement, which is intended to enable contracting authorities to check whether a company has previously committed relevant violations of commercial law. The Federal Competition Register for Public Procurement is intended to be operational by the end of 2020.
[1] FCO Press Release, December 27, 2019, available in English here. For the FCO’s 2018 Annual Report, see German Competition Law Newsletter May – June 2019, p. 1 et seq., available in English here.
[2] In 2018, fines of approximately €376 million were imposed.
[3] In 2014, the FCO’s most successful year in terms of fines imposed in cartel proceedings, the FCO had imposed fines totaling €1.1 billion.
[4] For more details, see our article on the FCO’s decision to fine steel manufacturers for price fixing in this newsletter; see also FCO Press Release, December 12, 2019, available in English here.
[5] In comparison, in 2018, none of the 1,383 notified mergers were prohibited, 99% of the notified transactions were cleared in Phase I, eight mergers were cleared after an in-depth review in Phase II and three projects were withdrawn due to competitive concerns expressed by the FCO; see also German Competition Law Newsletter May – June 2019, p. 1 et seq., available in English here.
[6] For more details, see our article on the FCO decision to block the 3-to-2 merger of cash handling service providers in this newsletter.
[7] See also the FCO’s prohibition decisions Miba/Zollern (B5-29/18; see also German Competition Law Newsletter January – February 2019, p. 6, available in English here), Heidelberger Druckmaschinen/MBO (B5-185/18; see also German Competition Law Newsletter May – June 2019, p. 6 et seq., available in English here), and Remondis/DSD (B4-21/19; see also German Competition Law Newsletter July – August 2019, p. 6, available in English here).
[8] For more details on the Draft Proposal for the 10th Amendment to the ARC, see our article in this newsletter.
[9] Case B6-22/15. See German Competition Law Newsletter January – February 2019, p. 1 et seq., available in English here. On August 26, 2019, the DCA, in an interim decision, suspended the FCO’s decision against Facebook (see German Competition Law Newsletter July – August 2019, p. 1 et seq., available in English here). The FCO appealed the DCA’s decision. The case is now pending before the Federal Court of Justice and a decision is expected for 2020.
[10] Case B2-88/18. See German Competition Law Newsletter July – August 2019, p. 3 et seq., available here.
[11] FCO Press Release, November 6, 2019, available in English here. The complete study is available in English here.
[12] For more details on the Draft Proposal for the 10th Amendment to the ARC, see our article in this newsletter.
[13] FCO Press Release, April 11, 2019, available in English here. See also German Competition Law Newsletter March – April 2019, p. 1 et seq., available here.
[14] FCO Press Release, December 13, 2017, available in English here.
[15] FCO Press Release, May 23, 2019, available in English here.