Real Estate & Construction

CMA Activity

In 2019, the CMA devoted considerable resources to preparing for the UK’s exit from the EU. It carried out a consultation and published guidance on the functions of the CMA after a ‘no deal’ exit from the EU. In anticipation of its increased workload, it recruited additional staff at all seniority levels and completed its move to new premises in Canary Wharf. It also increased its focus on digital markets and took a less permissive approach to gun-jumping and failures to provide full responses to formal requests for information.

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.

On December 13, 2019 the Commission published an anonymized summary of the contributions submitted by NCAs during the Commission’s ongoing evaluation of the Vertical Block Exemption Regulation (“VBER”) and the accompanying Guidelines on Vertical Restraints (“Guidelines”), which will lapse in 2022.[1] The Commission received 20 contributions from NCAs across the EEA.[2]

On November 29, 2019, the Council of State partially annulled[1] a judgment delivered by the TAR Lazio in 2018[2], which had upheld the ICA’s decision to impose on Holcim Italia S.p.A. (“Holcim”) a fine amounting to €2, 381,252 for participating in a price-fixing cartel concerning the Italian cement market.[3]

On November 6, 2019, the Commission published a public consultation seeking input on the amendment of the Horizontal Block Exemption Regulations (“Horizontal BERs”), which are set to expire on December 31, 2022, and of the Horizontal Guidelines.[1] Interested parties were given until February 12, 2020 to comment on the reform of these important instruments. The consultation is part of a wider Commission evaluation to determine whether the rules should be updated to better reflect the current economy and provide clearer guidance.

On November 6, 2019, the FCO and the French Competition Authority (“ADLC”) presented a joint study on “Algorithms and Competition.”[1] The study focuses on algorithms used for dynamic price setting and their potential effects on competition, particularly in the form of collusion, and contains important insights for companies utilizing third- party algorithms.

On October 10, 2019, the Working Group on Competition Law held its annual meeting in Bonn. The FCO and more than 120 competition law experts discussed revisions to the European Vertical Block Exemption Regulation (“VBER”)[1] in light of the digital transformation of the economy.[2] In preparation for this meeting, the FCO had published a comprehensive background paper,[3] setting out the need for adaption and possible adjustments to the VBER to address online distribution and other challenges posed by the digital transformation of the economy.

On October 9, 2019, the FCO unconditionally cleared Rewe-Zentralfinanz eG’s (“Rewe”) acquisition of wholesaler Lekkerland AG & Co. KG (“Lekkerland”).[1] Rewe is mainly active as a food retailer, but also as a food wholesaler, supplying fresh and convenience food to Aral AG’s gas station shops. Lekkerland is a German wholesaler for food and tobacco products whose principal clients are gas station shops, convenience stores and kiosks.

There is a global trend of increasingly burdensome demands by competition authorities conducting merger review for the submission of merging parties’ internal documents, and the CMA is no exception. In recent months the CMA has also taken greater steps to enforce such requests, in particular by fining companies for failing to comply with formal requests for documents under Section 109 of the Enterprise Act 2002 (“Section 109 Notices”).