Competition Stories: January & February 2021

Welcome to the Competition Stories – a bimonthly exploration of recent courts and competition law agencies’ decisions. Authored by Makis Komninos, a renowned expert in the field, this new column aims to go through the latest and most important developments in competition law of the last two months. We call them “stories” because Makis has promised to include some anecdotes from time to time, and not just stay at the black letter. Enjoy!


2021 has started with a number of interesting developments in the procedural area, though nothing ground-breaking.

I. Court of Justice

  1. Kilpailu- ja kuluttajavirasto v Eltel (cartels)

First, we had some rulings on limitation periods in public enforcement.

In this preliminary reference from Finland, the question was about the starting point of limitation periods in bid-rigging cartels in the context of construction works. The referring court was unsure as to whether the competition infringement continues throughout the whole period in which contractual obligations are discharged or payments are made or only until the point at which the cartelist submitted a bid or entered into a contract for the execution of the works. Following AG Pitruzzella’s Opinion, the Court of Justice opts for the latter, more defendant-friendly, solution.

The Court starts from the premise that “the system of competition established by Articles 101 and 102 TFEU is concerned with the economic consequences of agreements, or of any comparable form of concertation or coordination, rather than with their legal form” (para. 30). In other words, competition law is a law of substance, not form. That’s a fundamental principle worth bearing in mind. Then, according to the Court, Article 101 TFEU applies and catches arrangements that produce their effects beyond the date on which the unlawful contacts formally come to an end. Thus, for example, a cartel infringement lasts throughout the whole period in which the unlawful prices are applied, even though the agreement has already formally ceased to be in force. However, from that point onwards, the Court’s interpretation of Article 101 TFEU becomes more restrictive: in the case of a bid-rigging arrangement, “the restrictive effects of the cartel on competition disappear, in principle, at the latest at the time when the essential characteristics of the contract, and in particular the overall price to be paid for the goods, works or services which are the subject of the contract, have been definitively determined, where appropriate, by the conclusion of a contract between the successful tenderer and the contracting authority, as it is at that moment that the latter is definitively deprived of the opportunity to obtain the goods, works or services in question under normal market conditions” (para. 35). In other words, the infringement ceases when a contract signed. As a result, in this case, the Finnish Competition and Consumer Authority’s application to the Market Court to impose a fine of EUR 35m goes down in flames, because of prescription (in Finland, the competition authority may decide on the existence of an infringement but only the Market Court can impose a fine). The Court was not impressed by the argument made by that authority and two governments that were intervening (Finland and Germany) that this would be detrimental to the effectiveness of Article 101 TFEU (paras 39-40). Effectiveness yes, but there is also a rule of law!

One point, which is very interesting for private enforcement, is the distinction made by the Court between the duration of the competition law infringement and harm in the civil law sense, which can be compensated through an action for damages. According to the Court, “the questions regarding the limitation period for such an action for damages, as well as of any action by the contracting authority to challenge the legality of the tender or to have the contract terminated, are legal questions distinct from those related to the date on which an infringement of the competition rules ended and the period during which a penalty for that infringement may be imposed before the limitation period expires.” Concretely, in this case, a fine may no longer be possible but there could be civil law consequences, if the other relevant conditions of Finnish law (including prescription) are present.

  1. Consiliul Concurenţei v Whiteland Import Export (limitation period)

Another case on limitation periods, preceded again by an Opinion by AG Pitruzzella. Only, this time, things went better for the Romanian Competition Council. The question was whether national provisions on limitation periods, particularly as regards the type of administrative actions which interrupt the limitation period, have to be adjusted in order to be consistent with the EU principle of effectiveness. In this case, the applicable Romanian competition law at the relevant time provided for a 5 year limitation period for the imposition of fines by the national authority. The limitation period could be interrupted by “any action taken by the competition authority for the purpose of a preliminary examination or investigation of an infringement”. The interpretation of that provision by the Court of Appeal was that, in the case at issue, the final action capable of interrupting the limitation period was the decision by the President of the Competition Council to initiate the investigation. Consequently, at the date of the final decision, the limitation period had elapsed with the result that the penalty imposed by that authority was invalid.

The referring court (the Romanian High Court) noted in its reference that there were two conflicting lines of national case law on the interpretation of this provision. The more restrictive approach (followed by the Court of Appeal) was resulting in a solution different from the one adopted by the EU legislator, Article 25(3) of Regulation No 1/2003, according to which the limitation period is interrupted by any type of investigative measures and not just by the initiation of proceedings. However, Article 25(3) was not applicable here, because that provision “does not lay down limitation rules relating to the national competition authorities’ powers to impose penalties” and regulates only the proceedings before the European Commission (para. 39).

So the question arose whether the Romanian restrictive interpretation infringed the EU principles of effectiveness and of sincere co-operation (Article 4(3) TEU). The Court of Justice, in a classical, almost didactic manner starts from the premise of national procedural autonomy and then proceeds to explain how the EU principle of effectiveness imposes limitations on that autonomy (paras 44-46). Unreasonable national time limits may thus be considered incompatible with EU law. The Court also reminds that competition cases generally require “a complex factual and economic analysis”, which means that they necessarily take time (I am sure this is music to the ears of competition officials who usually quote such statements from Luxembourg to their own courts 🙂).

So the Court’s response is that a “strict interpretation of the national legislation, totally prohibiting the limitation period from being interrupted by action taken subsequently in the course of the investigation, appears likely to compromise the effective application of the rules of EU competition law by national competition authorities, in that that interpretation could present a systemic risk that acts constituting infringements of that law may go unpunished” (para. 56). Although the national court has the final word, the Court of Justice left no doubt that such a “systemic risk” was here present.

  1. Printeos (fines)

Lawyers representing companies in competition cases sometimes are faced with a pleasant problem: if an infringement decision imposing a fine is partially or wholly annulled and the fine has to be reimbursed by the Commission, the question of the repayment of the capital with interest arises.

In this case, the Commission had imposed a fine which was annulled by the General Court. The Commission reimbursed the fine but did not include any interest, because it had invested the amount but no interest accrued. Printeos then brought a successful action for damages against the Commission and the General Court ordered the payment of default interest (i) for the period the fine was in the Commission’s hands, at the ECB refinancing rate plus 2 percentage points, and (ii) for the period starting from the date of delivery of its judgment, at the ECB refinancing rate plus 3.5 percentage points.

The Commission appealed, because, among other things, Printeos had initially asked for “compensatory interest” in its action for damages, though it later re-branded it as “default interest”, pursuant to a question from the Court. The Commission considered that the General Court decided ultra petita. That argument was easily rejected by the Court of Justice, which dismissed the Commission’s appeal in its entirety. According to the Court of Justice, the General Court had “merely applied the legal characterisation which seemed to it to be appropriate to the facts alleged by Printeos, in accordance with the principle iura novit curia” (para. 54). The Court of Justice also held that secondary legislation, which provides that the Commission invests the provisionally paid fines in financial assets to ensure their security and liquidity, must be interpreted in accordance with Article 266 TFEU on the Commission’s duty to comply with judgments of the Court. Thus, if the interest yielded is lower than that of the default interest payable or if there is no interest yielded, the return on the capital invested having been negative, in order to comply with its obligation under Article 266 TFEU, the Commission is required to pay to the party concerned the difference between the amount of interest yielded and the amount of default interest.

In addition, the Court of Justice allowed a cross-appeal by Printeos and found that in view of the particular circumstances of the case, the Commission should pay Printeos compound interest at the ECB refinancing rate plus 3.5 percentage points, from the date in which it introduced its action for damages to the General Court, rather than from the date of the delivery of the General Court’s judgment.

The moral of the story is that repayment of annulled fines can lead to quite generous amounts these days of negative interest rates. There are a few pending cases involving billions of euros in fines. DG Budget may be losing its sleep…

  1. Slovak Telekom (investigation)

That was another very interesting judgment on procedure and competence. The case was about two partially parallel investigations against Slovak Telekom, by the Commission and the Slovak competition authority, on matters that were quite similar. Both investigations focussed on one Member State, Slovakia, and on certain pricing practices of Slovak Telekom. The judgment has two parts. One is on the interpretation of Article 11(6) of Regulation No 1/2003 and the second part is on double jeopardy (principle of non bis in idem).

The Court first interprets Article 11(6) in a teleological way and explains that its aim is to ensure consistency of enforcement, while also protecting undertakings from parallel investigations. Then, it goes on to explain that a national competition authority is relieved of its competence only if the Commission opens an investigation on the same facts, undertakings and conduct, in the same product and geographic markets. This is something that we always knew. Indeed, the ECN Notice mentions that in para. 51. In the case at hand, however, the opening of the Commission’s investigation did not relieve the Slovak competition authority of its competence, because the two investigations focussed on different product markets. The Commission’s investigation was focussed on the market for wholesale broadband access services, such as the provision of wholesale access to the unbundled local loop, whereas the Slovak authority’s investigation concerned the wholesale and retail markets for telephone services and low-speed (dial-up) internet access services. Therefore, Article 11(6) could not lead to the exclusion of the Slovak competition authority’s competence.

As far as non bis in idem is concerned, the Court of Justice follows faithfully the test established in Toshiba and reiterates that the “idem” condition is subject to a “threefold sub-condition that the facts must be the same, the offender the same and the legal interest protected the same” (para. 43). Since the two investigations were focussed on different markets, there was no “idem”, therefore, no violation of the non bis in idem principle.

  1. Other judgments

A couple of other judgments that I have not referred to in detail are Qualcomm and Goldman Sachs. I do not think they change anything. In Qualcomm, the dispute concerned a request for information that the Commission had addressed to Qualcomm following the Statement of Objections in the predation case. Qualcomm decided to challenge the Commission’s decision to request information, alleging the violation of a number of EU general principles and implying bias on the part of the Commission. Predictably, the General Court dismissed the appeal and the Court of Justice agreed. In Goldman Sachs, the Court of Justice upheld a General Court judgment which had established liability for Goldman Sachs because it held all voting rights associated with its subsidiary’s shares and was, therefore, able to determine the subsidiary’s strategy. The Court thought that this position is not dissimilar to the situation where a parent holds the capital of the subsidiary.

II. Commission

On the Commission front, it’s worth noting the Decision against Valve and five publishers of PC video games for geo-blocking practices which were considered anti-competitive, in that they restricted parallel trade within EU Member States by preventing customers from buying cheaper games available outside of the customer’s location or country of residence (geo-blocking).

Another development was the publication of the Broadcom commitments Decision. The Commission managed to impose some pretty far-reaching obligations: at worldwide level, Broadcom cannot offer rebates and condition them on the customer purchasing more than 50% of its requirements from it. At EU level, the number is 0%, i.e. there will be no conditional rebates at all! The text of the decision gives some context about this rather extreme remedy. It seems that the purchase threshold of 50% was considered too high because the markets in question were characterised by large-scale, periodic tenders, which meant that the 50% threshold would effectively lead to OEMs or service providers relying on Broadcom for much more than 50% of their requirements. This would be for two reasons: In the first place, in order to secure advantages conditional on reaching that threshold, OEMs may tend to submit Broadcom-based bids in much more than 50% of all tenders in which they participate. In the second place, while OEMs and service providers could have an incentive to dual-source components, practice showed that if one supplier provides 50% of a certain component, this may lead the OEM to de facto single source (para. 95). So we had a very special case, that’s why the number was brought down to zero.

The Commission also accepted commitments from Aspen and closed its long-standing excessive pricing investigation concerning six off-patent cancer medicines. The prices had increased, often by several hundred percent, although there was no obvious justification and the medicines have been off-patent for 50 years. The commitments are very prescriptive and regulatory in nature, something that the Commission could not probably do in an infringement decision. First, Aspen will reduce its prices for the medicines by 73%, which is on average below the prices of 2012, before Aspen’s price increases started. Second, the reduced prices will be the maximum that can be charged for ten years. Third, Aspen guarantees the supply of the medicines for the next five years, and, for an additional five-year period, will either continue to supply or make its marketing authorisation available to other suppliers.

Finally, there has been a lot of noise about the Epic Games complaint against Apple. It is unclear how the Commission will approach this. I doubt that the Commission has consulted with the complainant prior to the submission of the formal complaint. If an informal consultation had taken place, there would have been no need for noise and statements. Anyway, I think this case could be the time of truth for the Commission. Apple follows a full vertical integration model. I just don’t see how the Commission could bring a case unless it considers the App Store an “essential facility”, and we know how much the Commission frets this “epithet”…


Citation: Makis Komninos, Competition Stories: January & February 2021, CONCURRENTIALISTE (March 3, 2021)

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