Competition Law And Policy 4th Quarter 2018

1. COURTS

   Aptoide wins court battle against Google

   Aptoide, a Portuguese startup that owns an independent application store for Android smartphones, won a legal action against Google, claiming that the North American company was identifying the application as being potentially malicious.

   The decision came as a result of a legal action started after Aptoide noticed that the Google Play Store had wrongly warned its users, both at a national and international level, that the app would pose a threat to their equipment and that it should be immediately uninstalled, leaving the application automatically unavailable without their consent. The company warned Google, but without success, which is why it decided to proceed with an injunction application before the District Court of Évora.

   In a decision that has an impact on more than 80 countries, the court decided in favour of Aptoide, ordering Google to cease its conduct immediately.

   Aptoide stated that it expects Google to comply with the injunction ruling. The startup will require the tech company to pay compensation for losses, including the loss of 2.2 million users in 60 days.

   The startup was one of the companies that filed a complaint in the Android case, which led the European Commission in July 2018 to impose a historic fine of €4.34 billion on Google for alleged illegal practices involving Android mobile devices.

2. COMPETITION AUTHORITY

   Portuguese Competition Authority publishes definitive version of Issues Paper on technological innovation and competition in the financial sector

   On 3 October 2018, the Portuguese Competition Authority (PCA) published the definitive version of the Issues Paper "Technological Innovation and Competition in the Financial Sector in Portugal".

   The Issues Paper was approved following the public consultation process of the paper's draft version, published in April 2018. The PCA received input from 11 entities, including regulators, associations, market players and law firms.

   In the preliminary version of the Issues Paper, the PCA identified barriers to entry of new firms based on innovative technologies applied to the financial sector - known as FinTech - in Portugal. These barriers relate principally to the regulatory framework and the risk of market foreclosure of FinTech entrants by incumbent banks.

   The PCA analysed the responses and weighed them in drafting the Issues Paper's final version. The public consultation confirmed many of the conclusions of the analysis carried out.

   The PCA reiterates the need to keep up with the challenges posed by innovation through an adequate and proportional regulatory framework. The PCA considers the implementation of the Second Payment Services Directive (PSD2) to be essential and urgent and warns of the risks underlying the implementation of the Directive and of the Regulatory Technical Standards (RTS).

   For a summary of the main conclusions and recommendations of the PCA's analysis, see the summary sheet that was published together with the Issues Paper.

   Portuguese Competition Authority carries out dawn raids at food retail sector association

   On 8 October 2018, the Portuguese Competition Authority (PCA) confirmed that it carried out dawn raids at the premises of an association of the retail food sector, following suspicions of a concerted practice of price fixing, which in its view may substantiate anticompetitive conduct.

   In the context of this investigation, the dawn raids were carried out in the district of Oporto, by PCA case handlers in cooperation with the Department of Criminal Investigation and Police officers.

   The PCA ordered the infringement proceedings to be subject to secrecy because the interest behind the investigation would not be duly safeguarded should the proceedings be made public.

   Portuguese Competition Authority carries out dawn raids at two advertising company associations

   On 10 October 2018, the Portuguese Competition Authority (PCA) confirmed that it carried out dawn raids at the premises of two associations of advertising companies, following suspicions of concerted practices in procurement procedures launched by advertisers.

   In the context of this investigation, the searches were carried out in two locations in the district of Lisbon, by PCA case handlers in cooperation with the Department of Criminal Investigation and Police officers.

   The PCA ordered the infringement proceedings to be subject to secrecy because the interest behind the investigation would not be duly safeguarded should the proceedings be made public. In its press release, the PCA stated that the inspections are not related to the procurement procedure for outdoor advertising for Lisbon.

   Portuguese Competition Authority publishes Annual Report on Competition Policy for 2017

   On 17 October 2018, the Portuguese Competition Authority (PCA) published the Annual Report on Competition Policy for 2017, a year marked by the reinforcement of investigative activity, resulting in significant results in two of the indicators in this area: the number of proceedings opened and the dawn raids carried out.

   In this context, raids were carried out in 16 proceedings at 35 premises of 44 entities across Portugal, in particular in the areas of driving education, tourist river transport, modern distribution, insurance and railway maintenance. This was a historic annual maximum.

   Within the general framework of the investigation of anticompetitive practices, the PCA concluded seven cases, issuing seven final decisions. According to the PCA, the ability to detect restrictive practices at its own initiative should be noted, since 85% of the investigations opened corresponded to ex officio procedures.

   The total amount of fines imposed was €38.8 million, in particular for breach of competition law regarding restrictive practices and a non-notified merger.

   As regards judicial review of decisions, the courts applied or confirmed a total of €4.9 million in fines. Most of the court decisions were in favour of the PCA. In the PCA's view, the high judicial success rates confirm increasingly effective control by the Authority.

   With respect to merger control, the PCA adopted more than 50 decisions, with special focus on manufacturing industries, wholesale and retail trade, vehicle repair, transport and storage, insurance and financial activities.

   During the year 2017, the PCA prepared a number of studies and opinions, which reflect its monitoring of markets and its interaction with sector regulators. Among these, it is worth stressing the economic studies with recommendations in the energy area and, more specifically, the AdC Impact 2020 Project (in collaboration with the OECD), which aims to support a more efficient and effective intervention of public entities in various sectors of activity of strategic importance to the Portuguese economy.

   The PCA also carried out several initiatives to raise awareness of its activities, promoting dialogue and interaction between its stakeholders on...