Antitrust in focus - March 2023

Published Date
Mar 2, 2023
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This newsletter is a summary of the antitrust developments we think are most interesting to your business. Philip Mansfield, partner and co-head of Allen & Overy's global antitrust group, is our editor this month. He has selected:

Our report finds that authorities worldwide are continuing to vigorously enforce antitrust laws 

Global antitrust enforcement looks more unpredictable in 2023. We can expect new legislation and policies, authorities employing creative approaches to their investigatory powers and further developments in the private damages litigation arena.

As a result, regular appraisal of antitrust risk exposure is a clear business imperative.

Our latest Global antitrust enforcement report explores the shifts in the global enforcement landscape.

We analyse data on antitrust enforcement activity in 2022 from 30 jurisdictions and identify the key developments and themes shaping authorities’ activities. We examine cartels and non-cartel conduct, including vertical and restrictive price maintenance arrangements and abuse of dominance as well as fine levels.

In particular, we identify the sectors and types of conduct facing continuing regulatory scrutiny and highlight issues posing particular risks.

Notable topics include enforcement in the digital sector, a growing focus on labour markets and the interplay between antitrust law and sustainability initiatives.

Take a look at the full report here.

We are already seeing evidence of vigorous antitrust enforcement in 2023. 

The Japan Fair Trade Commission (JFTC), for example, has imposed fines totalling JPY101 billion (EUR705 million) on electricity companies for a cartel that involved agreements to mutually restrict business activities in each other’s supply areas. This marks the highest fine ever issued by the JFTC in a single case.

European Commission plans abuse of dominance guidelines focusing on exclusionary abuses 

The European Commission (EC) has announced an initiative to adopt guidelines on exclusionary abuses of dominance. 

An “exclusionary” abuse broadly refers to conduct by a dominant undertaking which is capable of preventing rivals from entering or remaining active in a given market. Examples include predatory pricing, refusal to deal, tying and bundling and loyalty rebates.

The new guidelines are intended to reflect “significant developments” in EU courts’ case law, the EC’s enforcement experience and market developments such as concentration in various industries and the growing importance of digital markets and services.

To date, the only EC guidance in this area has taken the form of a 2008 communication outlining the EC’s enforcement priorities for exclusionary abuses. Since then, the EC’s economic analysis has evolved with a focus on the potential effects of alleged abusive conduct, and EU courts have confirmed the effects-based approach to abuse of dominance.

The new guidelines will replace the 2008 guidance. In the meantime, the EC has amended and withdrawn specific parts of the 2008 guidance, setting out some important clarifications (in a communication and its annex) on its approach to determining which exclusionary conduct cases to pursue. 

Three clarifications are particularly notable:

  • In some circumstances, eg in markets characterised by network effects or other high barriers to entry, the EC may investigate price-based practices by a dominant company that are capable of foreclosing competitors that are not (yet) as efficient as the dominant company.
  • The price-cost “as efficient competitor” test is only one of a number of methods for assessing whether conduct is capable of producing exclusionary effects. However, if the test is carried out, its results should be assessed together with all other relevant circumstances and quantitative and/or qualitative evidence.
  • The EC may investigate cases where a dominant firm imposes unfair access conditions to a particular input (so-called “constructive refusal to supply”), even if there is no evidence that such input is indispensable. 


A March 2023 EC policy brief provides further background on these changes.

Across the EU, many antitrust authorities are robustly enforcing abuse of dominance rules. Our Global antitrust enforcement report also notes how private unilateral conduct claims are potentially on the rise. In fostering harmonised enforcement of the EU legal provisions by the EC, national antitrust authorities and national courts, the new guidance will therefore provide businesses with welcome legal certainty. 

However, there remains a notable omission in the EC’s plans and revisions: its approach to exploitative abuses. In contrast to exclusionary practices which target rivals, exploitative conduct directly harms customers. The main example is excessive pricing, where a dominant undertaking charges customers prices that are far in excess of its costs and comparable products. 

Exclusionary practices are typically considered the most harmful type of abuse and are more frequently enforced. However, enforcement against excessive pricing is a reality, particularly but not exclusively in the pharmaceutical industry. As we have previously commented, these cases may well be investigated by several antitrust authorities within the EU, despite involving the same product. EC guidance would be beneficial to ensure consistency of approach. 

The EC is currently seeking feedback on its initiative. It expects to publish a draft of the guidelines for consultation by mid-2024 and to adopt them in 2025. We will keep you informed of developments.

ECJ confirms that below-threshold mergers can be assessed under EU abuse of dominance rules 

The European Court of Justice (ECJ) has held that transactions not meeting EU or national merger control thresholds, and which have not been referred to the European Commission (EC) under Article 22, can be assessed by Member State antitrust authorities under EU rules on abuse of dominance.

The ruling stems from a complaint by broadcaster Towercast to the French competition authority (FCA). Towercast alleged that the acquisition by TDF Infrastructure of Itas amounted to an abuse of dominance by TDF on the markets for digital terrestrial television.

The deal did not trigger a review under EU or French merger control rules, and was not referred to the EC. After the FCA’s decision-making body considered that no abuse was committed, Towercast appealed to the Paris Court of Appeal, which asked the ECJ to rule on whether national antitrust authorities can apply abuse of dominance rules to below-threshold transactions.

The ECJ’s affirmative answer is significant. It means that merging parties, despite concluding that EU antitrust authorities do not have jurisdiction to review their transaction under merger control rules, cannot rule out the possibility that the deal will face an antitrust assessment.

This risk remains even after the deal completes.

As discussed in our recent Global trends in merger control enforcement report, merging parties must now consider the EC’s revised Article 22 policy, which encourages Member States to refer transactions (including completed deals) to it for review even where EU and national merger control thresholds are not met. Parties must also navigate evolving rules in several Member States that enable national authorities to review deals falling below their own filing thresholds.

The ECJ’s ruling therefore subjects merging parties to yet another layer of post-closing uncertainty.

However, the judgment does set some limitations on the application of abuse of dominance rules to transactions:

  • The rules can clearly only apply where the acquisition involves a company holding a dominant position. This will take many below-threshold transactions out of scope.
  • National authorities must show that, by making the acquisition, the dominant purchaser has substantially impeded competition on the market on which it is dominant. It is not enough for the national authority to merely find that the dominant company’s position has been strengthened. This may prove a difficult bar for authorities to meet.


The ruling will no doubt prompt a significant uptick in abuse complaints against dominant companies engaging in acquisitions that are not caught by merger control rules.

And it has already prompted the Belgian antitrust authority to open an own initiative abuse of dominance investigation into Proximus’s takeover of rival broadband provider edpnet, which did not meet the country’s merger control thresholds (see our alert for further information). The extent to which other national authorities will pursue these complaints, however, remains to be seen.

If any such case results in a finding of abuse, all eyes will be on the nature of any sanction imposed. In her opinion on the Towercast case, Advocate General Kokott stated that the imposition of fines would be a more appropriate sanction than blocking or unwinding the deal. Notably, the ECJ does not make a similar statement. This suggests that, depending on national procedural rules, prohibition could be a possibility.

The position of the EC is also left open. The ECJ’s ruling considers only national antitrust authorities and does not rule on whether the EC itself can apply EU abuse of dominance rules to below-threshold deals. Given its continuing desire to ensure that potentially anti-competitive transactions (and in particular “killer acquisitions”) do not escape scrutiny, the EC may take an expansive approach to the judgment.

U.S. DOJ continues to target interlocking directorates 

The U.S. Department of Justice (DOJ) has announced that five directors resigned from four corporate boards and one company declined to exercise board appointment rights in response to its enforcement efforts under Section 8 of the Clayton Act.

Section 8 prohibits directors and officers from serving simultaneously on the boards of competitors, subject to limited exceptions. There is some question as to the scope of coverage of the prohibition, and the DOJ is increasingly pushing for a broader interpretation. The DOJ’s concern is that competitors sharing officers or directors creates the opportunity to exchange competitively sensitive information and facilitate anti-competitive coordination.

This latest development follows seven resignations last year, which the DOJ billed as “the first in a broader review of potentially unlawful interlocking directorates”. The DOJ now claims to have notched up the unwinding or prevention of interlocks relating to at least 13 directors from ten boards.

The companies concerned – none of which admit liability – operate in a wide variety of industries including audit and compliance services, market information platforms, corporate education services, APM software, insurance, vehicle components and air freight.

They also include investment firms.

The announcement reflects the continuing focus of the DOJ on interlocking directorates across the entire U.S. economy. In particular, it is clear that appointments of independent directors to company boards by investment and private equity firms are under close examination notwithstanding the lack of such enforcement historically. We consider this renewed DOJ focus, as well as scrutiny of PE-funded deals more generally, in our Global trends in merger control enforcement report.

Chinese Anti-Monopoly Law regulations provide some further guidance 

The Chinese antitrust authority – the State Administration for Market Regulation (SAMR) – has published final versions of four regulations that supplement substantial changes to China’s Anti-Monopoly Law (AML) which came into force last year. These important amendments impacted the merger control and anti-competitive behavioural rules and gave SAMR greater enforcement powers (see our alert for further information).

The revised regulations on behavioural rules, for example, adapt the antitrust provisions to the online platform economy, provide clarifications regarding hub-and-spoke arrangements and add a safe harbour for certain categories of vertical agreements. 

In relation to merger control, the regulation clarifies, for instance, the application of the newly introduced stop-the-clock mechanism, the procedure for reviewing below-threshold transactions and rules on imposing fines. 

These latest regulations will become effective on 15 April this year. Watch out for our alert describing the changes in detail. 

Also see our February edition of Antitrust in focus for other recent developments in antitrust enforcement in China as well as expected amendments to the antitrust rules.

European Commission allows consolidation in Belgium telecoms market, subject to infrastructure access commitments 

Following an in-depth investigation, the European Commission (EC) has conditionally approved Orange’s acquisition of VOO and Brutélé. Orange is Belgium’s second-largest mobile network operator and a provider of retail fixed telecoms services using third party networks, while the latter are together the second-largest providers of fixed and mobile telecoms services in Brussels and Wallonia.

The EC had three categories of concern.

First, that the transaction would reduce the number of operators from three to two in areas covered by the targets’ own fixed networks, eliminating Orange as an “innovative and significant competitive constraint”.

Second, that the deal would reduce competition in a number of markets where the parties are close competitors, namely the retail supply of: (i) fixed internet access; (ii) audio-visual services; and (iii) multiple-play bundles.

Finally, the EC considered that the merger would increase the likelihood of coordination between the remaining operators on the affected retail markets.

In the specific circumstances of the case, the EC has accepted behavioural remedies to address these horizontal concerns.

Orange has committed to provide telecom operator Telenet with access to: (i) Voo and Brutélé’s existing fixed network infrastructure in the Walloon region and parts of Brussels; and (ii) Orange’s future fibre-to-the-Premises network, which it expects to roll out “in the coming years”.

The commitments will be in place for at least ten years, and will be monitored by a trustee appointed by Orange.

The identity of the beneficiary of the remedy has clearly been vital to the EC’s decision. The EC notes that Telenet is “one of the leading telecom operators in the North of Belgium” and “a reputable player with a proven track record”. It sees the commitments as effectively replacing Orange with Telenet as the “access seeker” on the relevant VOO and Brutélé networks.

More generally, the need for investment in telecoms infrastructure across Europe – including the rollout of 5G – continues to fuel calls for consolidation among mobile network operators. However, while the EC is generally more open to cross-border telecoms consolidation, EC officials have noted that mergers in the sector, and in particular in-country consolidation, should be closely scrutinised. The EC insists that it assesses transactions on a case-by-case basis and that there is no “magic” number of mobile operators in a national market, but has traditionally prohibited or imposed extensive conditions on four-to-three mergers.

All eyes will now be on the EC’s in-depth review of the proposed Orange-MásMóvil transaction, a potential four-to-three merger in Spain. The EC’s phase 1 investigation, completed in early April, found that the transaction would reduce the number of network operators in the country, thereby eliminating an innovative and significant rival. The EC also expressed concern that Orange and MásMóvil would have the ability and incentive to restrict access of virtual operators to wholesale mobile network and wholesale fixed network access services. We will update you on the EC’s phase 2 assessment.

UK adds to growing list of antitrust enforcers drafting sustainability guidance

Over the last year, antitrust authorities, particularly in Europe, have been setting out their positions on how businesses can legitimately cooperate on green and sustainability projects.

The UK Competition and Markets Authority (CMA) has been one of the latest to do so, issuing for consultation draft guidance in late February 2023.

The CMA’s draft guidance is a useful starting point for businesses looking to collaborate on environmental sustainability issues. It includes a number of concrete examples and guidelines on how to assess the compatibility of these types of collaboration with UK antitrust rules.

Notably, and in contrast to the European Commission’s proposed position, the CMA proposes a more permissive approach to “climate change agreements”. The CMA considers that climate change presents a “special category of threat” and parties should therefore be allowed to justify such cooperation based on a wider range of benefits flowing from the arrangements to UK consumers in general.

However, gaps and grey areas remain, particularly in relation to how certain benefits should be described and quantified. This will likely make the CMA’s offer of bespoke informal advice to companies – which brings with it a level of protection against CMA fines – an attractive route for some collaborations.

Our alert takes you through the CMA’s draft guidance and highlights divergences in international approaches in this fast-moving area.

Even more recently, the Japan Fair Trade Commission (JFTC) has finalised its guidelines on sustainability activities of businesses. Interestingly, the guidelines not only cover cooperation/joint activities between businesses, but also unilateral conduct. They also include guidance on mergers.

The guidelines set out a framework for analysis of activities that pose no concerns under the Japanese antitrust rules, those that have solely anti-competitive effects, and those that have both anti- and pro-competitive effects, where a full assessment is needed. 

Like the CMA, the JFTC gives illustrative examples, promising to update and refine these and the guidelines more generally. The JFTC also has a similar process enabling businesses to consult it, either in writing or orally, to discuss whether particular activities may pose antitrust concerns under the Japanese rules.

EU relaxes state aid rules to support green transition 

In line with the EC’s Green Deal Industrial Plan, the European Commission (EC) has adopted a new Temporary Crisis and Transition Framework aimed at encouraging measures that will support the transition to a net-zero economy.

The new Framework amends and prolongs in part the Temporary Crisis Framework adopted in March 2022 in the context of Russia’s invasion of Ukraine, which already includes specific provisions on simplified support for renewable energy, decarbonisation technologies and energy efficiency measures.

The new Framework provides some important changes that the EC believes will further facilitate the green transition:

  • It prolongs the support measures available to EU Member States, eg schemes for accelerating the rollout of renewable energy and energy storage, until 31 December 2025.
  • It amends the scope of these measures, making schemes easier to design and more effective by simplifying the conditions for the granting of aid, expanding the scope of the support and providing for higher aid ceilings and simplified aid calculations.
  • It introduces new measures, also applicable until 31 December 2025, which enable investment support for the manufacturing of strategic equipment, including batteries, solar panels, wind turbines and heat-pumps.

The new measures have been seen as a response to the U.S. Inflation Reduction Act (IRA), which provides for USD369 billion support – primarily in the form of tax incentives – designed to enhance clean technology investments in the U.S. In particular, the IRA has created a concern that investments may be diverted away from Europe.

The new Framework seeks to address this concern. In “exceptional cases”, where diversion of investments is a real risk, Member States can provide either “matching aid”, ie the amount of support the beneficiary could receive for an equivalent investment in the alternative location, or the amount needed to incentivise the company to locate the investment in the EEA (the “funding gap”), whichever is lowest. This support will be subject to a number of safeguards, including requirements relating to the location of the project and the production technology used. The aid also must not trigger relocation of investments between Member States. 

At the same time, the EC has endorsed a targeted amendment to the General Block Exemption Regulation (GBER) to further facilitate the EU's green and digital transitions.

The GBER exempts certain categories of state aid from the requirement of prior notification and approval by the EC. The proposed amendment significantly increases notification thresholds for environmental aid as well as for research, development and innovation. It also seeks to exempt aid measures set up by EU Member States concerning the regulation of energy prices such as electricity, gas, and heat produced from natural gas or electricity.

In other state aid news, the EC continues to focus on tax planning measures. Executive Vice-President Margrethe Vestager notes in a recent speech that the EC has conducted an in-depth inquiry into tax ruling practices in all Member States from 2014-2018. In addition to the EC’s work on ongoing state aid cases in this area, she expects this inquiry will lead to new investigations in certain countries “in the not-so-distant future”.

About your editor

Philip Mansfield is global co-head of our antitrust team. He has over 25 years of experience representing clients on a wide range of strategic matters before major antitrust agencies around the world, including the UK Competition and Markets Authority, the European Commission (EC) and national agencies in EU Member States, and the U.S. 

Philip regularly secures clearance for clients on complex mergers and joint venture arrangements, in particular in the high-tech and financial services sector, and has twice won, with his team, Global Competition Review Matter of the Year award for merger-related cases. He also has an extensive cartel and behavioural practice, including acting on the first EC settlement case and the first ever antitrust enforcement case brought by the UK Financial Conduct Authority. Philip is a regular speaker at the signature IBA/ABA cartel conference, and led the team winning Global Competition Review Behavioural Matter of the Year for work on the EC’s credit default swaps investigation.

Philip represents clients in cartel-related litigation, advising on defences to follow-on damages actions before the courts, and has an established track record of successfully raising and defending behavioural complaints regarding issues such as interoperability, bundling and patent pools before the EC and the UK courts.

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