Competition Law Highlights ' H1 2023

Published date01 September 2023
Subject Matterorporate/Commercial Law, Antitrust/Competition Law, M&A/Private Equity, Antitrust, EU Competition
Law FirmWiersholm
AuthorH'kon Cosma St'rdal, Karen Cecilie Gildberg, Ida Hestetun Dokken, Kristina Cavanna and Sigrid Ter'y Finnes

This newsletter gives an overview of highlights in the field of competition law from the first half of 2023, both in Norway and at the European level.

2023 has been an exciting year so far for the development of Norwegian competition law practice. With a record of two new Supreme court decisions, Wiersholm is pleased to have successfully represented our clients in both. In February the Supreme Court annulled the Norwegian Competition Authority ("NCA") and the Competition Appeal Tribunal's ("CAT") decision to block Schibsted's acquisition of Nettbil and in June the Supreme Court declared third party-financed class actions under the Dispute Act inadmissible. Noteworthy also is Oslo District Court's decision in one of the few follow-on actions for breach of EU/EEA competition law in Norway, where several international truck companies were acquitted from Posten Norge's 900 MNOK claim for compensation for alleged illegal price collusion. The decision is currently under appeal.

The first half of 2023 has otherwise been characterized by legislative work, with several proposals all of which widely expand the NCA's enforcement powers. The proposals equip the NCA with (i) a market investigation tool with extensive sanction options, both behavioral and structural, without establishing an infringement of competition law, (ii) the right to sanction individuals with civil administrative fines up to 43 MNOK for violations of the Norwegian Competition Act and to impose management quarantines and (iii) the right to appeal decisions from the CAT and bring legal actions before the Norwegians courts (which entered into force on 1 July 2023).

Legislative work has also been on the EU agenda. The Foreign Subsidies Regulation ("FSR") entered into force in January and is set to impact the landscape for M&A transactions by imposing a regulatory filing regime for certain transactions involving foreign subsidies from non-EU states, in which financial contributions from the EFTA countries are considered relevant for the calculation of financial contribution set out in the filing thresholds.

At the EU Commission level, a consultation on the adoption of new Guidelines on exclusionary abuses of dominance has been launched and revised guidance has been published providing clarification on enforcement priorities regarding Article 102 TFEU. Included below are also highlights of the Commission's adopted revised Horizontal Block Exemption Regulations and revised Horizontal Guidelines on the applicability of Article 101 TFEU. A welcome endorsement of the revised Horizontal Guidelines was announced by the NCA on 6 July. The NCA simultaneously issued their updated guidance on bidding consortia, seemingly in line with the Commission's revised Horizontal Guidelines.

In the Court of Justice's (the "Court") decision in Towercast, it was confirmed that a concentration without a community dimension may be subject to an ex-post control by national competition authorities and by national courts, due to the direct effect of the Article 102 TFEU prohibition of abuse of dominant position. In Super Bock Bebidas, the Court clarified circumstances under which a vertical agreement fixing minimum resale prices may constitute a restriction of competition by object under Article 101 TFEU, including guidance on the concept of an agreement under Article 101. In the much anticipated CK Telecoms decision, the Court of Justice has announced that the General Court erred in law and must rule once again on the lawfulness of the Commission's prohibition of the acquisition of Telefónica Europe (O2) by Hutchison 3G UK (CK Telecoms). Finally, the Commission has for the first time fined the target company (Grail) for gun-jumping in its decision against Illumina and Grail, while imposing the full 10 % of Illumina's turnover as a fine due to the knowingly and intentionally breach of the standstill obligation.

Noteworthy is also the announcement of EFTA Surveillance Authority's ("ESA") initiated investigation of Elkj'p for potential violations of Articles 53 and 54 of the EEA Agreement, and the Commission's Statement of Objections ("SO") to Google over alleged abusive practices in online advertising technology, where the Commission suggests that only divestment would sufficiently address its competition concerns.

Please find some selected highlights below.

COMPETITION LAW IN NORWAY

Norwegian laws and regulation

The Norwegian Competition Authority may now appeal decisions (excluding merger decisions) from the National Competition Appeals Tribunal ("CAT") and bring actions before the Norwegian courts

In March, a proposal to provide the NCA with formal rights of action against decisions from the CAT (excluding decisions to prohibit mergers) was issued. Decisions from the CAT have previously only been brought before national courts by the private undertaking concerned.

The proposal has now been adopted. As of 1 July 2023, the NCA may themselves bring actions concerning the enforcement of the Norwegian Competition Act Section 10, 11 and 12 third and fifth paragraph, regulations issued pursuant to Section 14 and Article 53 and 54 of the EEA Agreement in before national courts according to Section 39 of the Norwegian Competition Act.

More information about the proposal can be found in our newsletter from April here and on the government's website here.

The Norwegian Ministry of Trade, Industry and Fisheries launched a public consultation for a market investigation tool and an independent inquiry for individual civil sanctions for infringements of competition law

On 31 March, the Norwegian Ministry of Trade, Industry and Fisheries (the "Ministry") launched a public consultation for a new market investigation tool that allows the NCA to initiate investigations and impose behavioral and/or structural remedies on market participants without requiring the NCA to provide evidence of an infringement in the market. The new proposed tool will provide the NCA with wide discretionary powers to investigate markets as long as there are circumstances implying that competition in the relevant market is or may be in danger of being restricted.

If the NCA proves that there are issues present in the market that significantly restrict or are capable of significantly restricting competition in the market, the NCA may impose remedies and/or temporary measures on the market players. Such remedies or measures will likely most often materialize in the form of behavioral measures, e.g., access to important input, services etc. Where behavioral measures are not considered sufficient, the NCA will have the competence to impose structural remedies on the undertakings active in the relevant market.

Companies who are unwilling to accept and incorporate the remedial measures imposed on them by the NCA will risk sanctions, including administrative fines of up to 10 % of the company group's turnover.

The Ministry has in its consultation asked for feedback on whether it is considered necessary to limit the appeal bodies competence to review appeals of decisions adopted under the market investigation tool regime. Noteworthy, although unsurprisingly, the NCA has (in its consultation response published on 29 June) indicated that the review by the appeal body should be limited to a legality test rather than a full review.

Along with the proposal for a new market investigation tool, the Ministry published an expert report inquiring whether the NCA should have powers to sanction individuals with fines for infringements of competition law and other measures including quarantine periods for company management. In the expert report, it is recommended that the current authority to impose criminal fines and prison sentences on individuals is replaced with the authority to impose individual civil sanctions for infringements of Section 10 in the Norwegian Competition Law, including administrative fines and management quarantine.

The report proposes to cap the civil administrative fines for infringement of Section 10 at 43 MNOK, and other infringements at 9 MNOK. It is also proposed to enable the NCA to impose management quarantine of up to five years in certain cases. The proposal will cover both intentional and negligent infringements and will be applicable in general for all employees, not limited to people holding management positions.

In its reply to the public consultation published on 29 June, the NCA proposed that it should also be granted powers to impose administrative fines and enabled to sanction conduct in violation of Section 11 concerning the abuse of a dominant position, Section 16 and 16a regarding decisions about concentrations and minority acquisitions and regulations adopted in accordance with Section 14 of the Norwegian Competition Act.

The NCA also expressed skepticism concerning the wide scope of application envisaged for management quarantine e.g. for the duty to provide correct information, and proposed that the authority impose a management quarantine limited to violation of Section 10 and 11 in the Norwegian Competition Act.

More detailed information about the proposals and implications for market players can be found in our April newsletter here. The public consultation can be found on the government's website here and the NCA's reply here.

The Norwegian Competition Authority published updated guidance on bidding consortia

On 6 July 2023, the NCA publicly announced that they are endorsing the EU Commission's Revised Horizontal Guidelines (see below). The NCA has also updated their guidance on bidding consortia, seemingly in line with the Commissions' Revised Horizontal Guidelines.

According to the NCA, actual or potential competitors cannot, as a main rule, submit a joint bid. Undertakings are considered actual or potential competitors if they could each participate individually in the tender procedure. This starting point and main rule is somewhat nuanced in the NCA's updated guidance on what constitutes a...

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