On June 23, 2021, the German Federal Cartel Office (“FCO”) published its Annual Report 2020/2021 as well as its biennial Activity Report 2019/2020. Andreas Mundt, the President of the FCO, pointed out that the FCO’s enforcement activities continue to focus on the digital economy and consumer protection—especially with the help of the FCO’s new enforcement tools created by the recently introduced 10th Amendment of the German Act Against Restraints of Competition (“ARC”). The reports also provides various enforcement statistics that show that the FCO continues to be a highly active competition law enforcer in the EU.
The FCO stressed the accelerating impact of the COVID-19 pandemic on digitalization and its goal to ensure open markets by investigating large tech companies and platforms and their potential to abuse their dominant positions.
- In 2019, the FCO investigated Facebook’s data processing practices and considered data protection law in its abuse of dominance analysis for the first time. This complex judicial proceeding is still ongoing and German courts have recently referred questions to the Court of Justice of the European Union (“CJEU”) for guidance on how data protection law relates to antitrust law.
- On December 10, 2020, the FCO initiated proceedings against Facebook to examine whether requiring users of its Oculus virtual reality glasses to also have a Facebook account constitutes an abuse of a dominant position. The FCO extended the scope of its investigation in January 2021 and is now examining whether Facebook has paramount cross-market significance (“PCMS”) and whether linking the services needs to be assessed on this basis.
- In the judicial proceedings following the proposed merger between CTS Eventim/Four Artists, the German Federal Court of Justice (“FCJ”) confirmed the FCO’s prohibition decision and emphasized the autonomous interpretation of German merger control law, which does not require the authority to establish a significant impediment to effective competition as long as the merger will strengthen a dominant position.
In addition, the FCO supported the Federal Ministry for Economic Affairs and Energy to prepare the coming into force of the 10th Amendment to the ARC in January 2021 and actively participates in discussions on the Digital Markets Act at a European level.
The FCO also continued its sector inquiry into online advertising, focusing on the technological developments and their impact on the market structure and market opportunities of the various players concerned.
In August 2019, the FCO established the new unit “Digital Economy” to support decision divisions on issues relating to multi-sided markets, intermediate power, algorithms used by companies, and access to data relevant for competition.
In 2019/2020, the FCO concluded three sector inquiries into potential consumer protection issues and has launched one new inquiry:
- In April 2019, the final report of the sector inquiry into price comparison websites concluded that several comparison websites infringed consumer rights by providing misleading or incomplete information.
- In July 2020, in its final report of the sector inquiry “smart TVs”, the FCO found transparency and data protection gaps in manufacturers’ data protection regulations.
- In October 2020, the sector inquiry into the authenticity and validity of user reviews on online platforms showed that a relevant part of user reviews are manipulated and not easy to detect by consumers.
- In November 2020, the FCO launched a sector inquiry into messenger services, which allow data exchange and communications on mobile devices via Internet. The FCO examines whether the services adequately protect consumer data privacy and expects insights on how to increase interoperability of messenger services.
The FCO has also published a series of papers on “Competition and Consumer Protection in the Digital Economy”, highlighting threats to consumers and possible measures to protect them.
In 2020, the FCO imposed fines of approx. € 349.4 million on a total of 19 companies or trade associations as well as 24 individuals. Despite the COVID-19 pandemic and the fact that no dawn raids could be carried out in the first half of 2020, the amount of fines imposed by the FCO was higher only in 2003, 2007, 2014 (with the exceptionally high amount of € 1.117 million), 2018 and 2019. The highest fine in 2020 amounted to approx. € 174 million and was imposed on aluminum forging companies and individuals responsible for sharing information on their pricing factors in Germany. In 2020, the FCO received 13 leniency applications in 11 cases, and conducted dawn raids in three cases, inspecting 17 business premises.
Overall, the 2020 enforcement statistics confirm tendencies from earlier years:
- The overall number of concluded cartel proceedings decreased from a peak of 17 in 2012 to only five in
- The number of cases in which the FCO received leniency applications has continued to significantly decrease since 2016. The FCO is concerned that the unforeseeable scope of civil liability will continue to have a negative impact on the attractiveness of leniency programs, which currently represent a significant contribution to uncovering antitrust
- As in previous years, the FCO registered numerous actions for damages following completed cartel proceedings (so-called “follow-on” damages actions), including in the following sectors: sugar, trucks, rails, bathroom fittings, electronic cash, chipboard, detergents, picture tubes, packaging, cement, steel blasting abrasives, wallpaper, gas-insulated sound systems, drugstore articles, flour (mill cartel), confectionery, sausages, beer, and spark plugs. According to the FCO’s Activity Report 2019/2020, around 370 new private damages action have been initiated. Compared to the previous report, the number of newly brought private damages actions has substantially decreased, mainly due to the fact that the wave of Truck Cartel-related lawsuits is diminishing (despite their declining total number, follow-on actions related to the Truck Cartel still accounted for more than 80% of all follow-on actions registered in the reporting period).
In 2020, the FCO received 1,236 merger notifications. This is a decrease of 13.7%, which is probably due to the COVID-19 pandemic. The increase in the relevant turnover thresholds for merger filings under the 10th Amendment to the ARC will reduce the number of filings even further going forward.
In the reporting period 2019/2020 the FCO has been “intervening” in more cases than in the years before almost reaching the numbers of 2009/2010. This refers to cases in which either no notification or a modified notification was made due to competition concerns raised by the FCO during pre-notification, the notification was pulled during the initial review period (Phase I) or the in-depth review period (Phase II), clearance was only granted subject to conditions or the merger was blocked.
As in previous years, the FCO cleared approx. 99% of the notified transactions in Phase I (i.e., within one month). The FCO concluded nine Phase II proceedings after an in-depth review. Of these nine transactions, the FCO cleared four unconditionally and three subject to conditions (remedies). While the FCO did not issue a single prohibition decision in 2020, in the other two Phase II proceedings, the parties withdrew their notifications after the FCO had expressed serious competitive concerns.
The FCO will continue to focus on the digital economy and put their new toolbox from the 10th Amendment of the ARC into action. In particular, the FCO:
- Can prohibit certain conduct, g., self- preferencing, exclusionary conduct that hinders access to a market, non-transparency, or impediment of interoperability if it had determined a company to have PCMS. After proceedings to determine Google’s, Amazon’s and Facebook’s PCMS have already been launched earlier this year, Apple is now the last major digital company of the GAFA to be investigated by the FCO under the new rules.
- Can establish dominance based on access to data in traditional markets that are not multi- sided as well as on the role as an intermediary that provides access to inputs or
- Can order a company to notify any acquisitions after conducting a sector inquiry, and if there are indications that future concentrations may restrict competition in the sector, and acquirer and target fulfil certain turnover
Can impose interim measures if they are required to protect competition or to avert an immediate and serious impairment of another company.
 For more details, see our article in this newsletter.
 For more details, see our article in this newsletter.
 Trucks (Case AT.39824), European Commission (“EC”) decision of September 27, 2017, a case summary is available in English here. For private follow-on damages actions also see our French Competition Law Newsletter November 2019, p. 5 et seq., available here, as well as our UK Competition Law Newsletter May 2019, p. 4 et seq., available here, February – March 2020, p. 7, available here, April – May 2020, p. 5 et seq., available here, June – July 2020, p. 6, available here, and November 2020, p. 5, available here, and our Alert Memorandum of December 7, 2020, available here.
 Carglass/ATU-Glasgeschäft (B4-60/20), FCO decision of December 17, 2020, a press release is available in English here; Allianz/ControlExpert (B9-49/20), FCO decision of October 20, 2020, a press release is available in English here; Zentralklinikum Flensburg (B3-33/20), FCO decision of July 30, 2020, a press release is available in English here; CRRC/Vossloh Locomotives (B4-114/19), FCO decision of April 27, 2020, available in English here.
 Vue/Greater Union (B6-80/18), FCO decision of February 28, 2020, a press release is available in English here; XXXLutz/Roller (B1-195/19), FCO decision of November 26, 2020, a cases summary is available in English here; Kaufland/Real (B2-83/20), FCO decision of December 22, 2020, a press release is available in English here.
 Edgewell/Harry’s (B5-149/19), FCO’s Press Release, March 6, 2020, available in English here; RWZ/Raiwa, FCO’s Press Release, June 18, 2018, available in English here. The parties withdrew their notification on December 28, 2020, after the FCO had initiated a second phase proceeding. On April 21, 2021, the FCO cleared the acquisition after further changes, see FCO’s Press Release, April 21, 2021, available in English here.
 For further information, please see our other article in this newsletter.