On June 16, 2020, the Commission launched four formal investigations into Apple’s business practices. Three of the investigations seem to follow the same theory of harm and zero in on contract terms that Apple imposes on developers wishing to distribute apps through the App Store on Apple devices, and whether Apple has been using those terms to disadvantage app developers that compete against Apple’s own apps.[1]
The Commission Publishes Its Decision to Fine Qualcomm for Abuse of Dominant Position
On June 8, 2020, the Commission published its decision to fine U.S. based chipset producer Qualcomm a total of €997 million for abusing its dominant position by offering payments to Apple under the condition that Apple purchases from Qualcomm all LTE chipsets for iPhones and iPads.[1] This is the first time the Commission issued a decision on exclusivity payments since the Court of Justice’s ground-breaking Intel judgment in 2017.[2] Qualcomm’s appeal against the decision is pending before the General Court.[3]
Advocate General Kokott Opines on Pharma Reverse-payment Settlement (Lundbeck)
On June 4, 2020, AG Kokott advised the Court of Justice to confirm the General Court’s judgment upholding the Commission’s decision of June 19, 2013 (“the Opinion”). The aforementioned decision imposed fines of €146 million on Lundbeck and five other generic drug manufacturers (“generics”) for patent settlement agreements that prevented the sale of rival versions of Lundbeck’s antidepressant drug citalopram.[1]
The Commission Launches Consultations on New Market Investigation Tool and Digital Platforms Regulation
On June 2, 2020, the Commission published two inception impact assessments[1] and two public consultations which address two new policy initiatives: (1) a new market investigation tool (“new competition tool”);[2] and (2) a regulatory instrument that would ex ante govern large online platforms that act as gatekeepers with significant network effects in the European Union’s internal market.[3]
The Commission Launches its Public Consultation on the Review of the Vertical Block Exemption Regulation and Publishes a Roadmap for its Future Review of the Motor Vehicle Block Exemption Regulation
On June 2, 2020, the Commission published two inception impact assessments[1] and two public consultations which address two new policy initiatives: (1) a new market investigation tool (“new competition tool”);[2] and (2) a regulatory instrument that would ex ante govern large online platforms that act as gatekeepers with significant network effects in the European Union’s internal market.[3] These initiatives are part of the Commission’s wider efforts to modernize EU competition law in an era of digitalization. Stakeholders are invited to submit their comments up until September 8, 2020[4] and the impact assessments are expected to be submitted to the Regulatory Scrutiny Board of the Commission and be finalized in the fourth quarter of 2020.
Implications of the Three/O2 Judgment for EU Merger Control
On May 28, 2020 the General Court overturned Commissioner Vestager’s first prohibition decision, blocking a 4-to-3 merger in the UK
The Commission Waives Merger Commitments in Takeda/Shire and Nidec/Whirlpool
The Commission’s Notice on remedies states that waivers “will very rarely be relevant for divestiture commitments” and since divestiture commitments are required to be implemented in a short time after the decision, it is “very unlikely” that sufficient changes in market circumstances will have occurred for the Commission to accept any modifications of the commitments.[1] In May 2020, the Commission waived commitments given to secure merger control approval in two cases.
The Commission Publishes Support Studies for the Evaluation of the Vertical Block Exemption Regulation
Following the Commission’s roadmap and launch of the public consultation process,[1] on May 26, 2020, the Commission published the final report[2] with support studies for the evaluation of the Vertical Block Exemption Regulation (the “VBER”).[3] The report is part of the Commission’s evaluation of the VBER, which is set to expire on May 31, 2022.
FCJ Provides Useful Guidance on Umbrella Damages and the Passing on Defense in Cartels Follow-on Damages Cases
On May 19, 2020, the Federal Court of Justice (“FCJ”) overturned a judgment of the Munich Court of Appeal in one of the numerous cartel follow-on damages actions brought against members of the so-called Rail Cartel (“Schienenkartell”), this time by the Munich Transportation Authority.[1] The FCJ once more confirmed its decisional practice in the case of quota and customer protection cartels, according to which there can be no prima facie evidence that damages were incurred and/or whether individual purchase orders were affected by the cartel.[2] The decision had to be reversed, for the Munich Court of Appeal had based its decision on such prima facie evidence. Of particular interest is the FCJ’s reasoning on two other issues:
Advocate General Pitruzzella’s Opinion in Groupe Canal+: A Trailer for the First Annulment of Commitments by the Court of Justice?
On May 7, 2020, Advocate General (“AG”) Pitruzzella delivered his opinion on Canal+’s appeal against a 2016 Commission commitment decision in the context of its investigation into the cross-border provision of pay-TV services.[1] AG Pitruzzella concluded that by accepting Paramount’s commitments, the Commission breached the principle of proportionality because they ignored contractual rights of third parties. Should the Court of Justice (the “CJEU”) follow this opinion, the case may lead to the first annulment by the EU’s highest court of a Commission commitment decision since the adoption of Regulation No. 1/2003.