The National Markets and Competition Commission confirms application of the de minimis rule to vertical price-fixing agreements
The National Markets and Competition Commission (“CNMC”) confirms that the fixing of resale prices, while a restriction by object, is not necessarily contrary to competition rules as long as it does not significantly affect competition.
This case relates to a complaint lodged by a retail lamp seller against a lamp distributor which had terminated the agreement for failure to respect the sales prices it had fixed. The CNMC stated that, despite the significance of the conduct, it was nevertheless necessary to take into account the market characteristics and the parties’ position in order to determine whether the practice appreciably affected market competition.
The CNMC decided that there were no barriers to entry in the specific market, that there were numerous actors in the market and that the seller’s market share in the Spanish domestic lighting sector was not significant. The CNMC therefore concluded that, in this case, the vertical price-fixing did not violate competition rules.
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The former National Competition Commission issues fines of more than EUR 43 million on the Port Authority of Valencia and associations and companies operating in the container transport sector
The National Competition Commission (“CNC”) imposes liability on several transport and shipping undertakings, the Regional Department of Infrastructure and Transport of the Autonomous Region of Valencia, the Port Authority of Valencia and operators for anticompetitive practices involving price-fixing agreements on road transport and other price elements, such as stoppage indemnities or repercussions in connection with increases in fuel prices and the consumer price index.
As regards the liability of the Regional Department of Infrastructure and Transport of the Autonomous Region of Valencia, the CNC considered, in contradiction to the most recent case law of the Spanish National Court (Audiencia Nacional) (see the judgment of 16 July 2013), that the authorities need not act as an economic operator in order for their conduct to fall under the authority of the CNC given that the relevant factor is the capacity of the authorities’ conduct that generated or aggravated the restrictive effects of the collusive conduct in which it participated.
The CNC also stated that controlling the authorities’ conduct cannot be limited to challenging acts before the contentious-administrative courts, especially in this case in which the conduct of the authority did not result in a challengeable act.
Nevertheless, the CNC concluded that it was not appropriate to fine the Regional Department given that the goal justifying the sanctioning power, deterrence, would not be achieved precisely because the intention of the authorities was to satisfy the general interest. Moreover, the sanction would cause a decrease in the public treasury and, consequently, this reduction would ultimately affect all citizens.
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The National Markets and Competition Commission declares that REPSOL, CEPSA and BP infringed obligations established in prior sanction proceedings
The companies were found to have breached the obligations established under the Resolution of 30 July 2009 declaring the existence of the infringement involving the fixing of retail prices of motor vehicle fuels with independent undertakings. The infringement consisted of failing to adjust specific clauses of the agreement.
REPSOL, CEPSA and BP were found to have not removed clauses from their fuel distribution agreements that: (i) fixed the acquisition/transfer price of the fuel to the maximum or recommended price of the service station or nearby competitors; and (ii) established commissions and mark-ups calculated to levels similar to those in the area. The Spanish National Markets and Competition Commission (the “CNMC”) also held that the entities had not established a continuous and non-discriminatory system in service stations for access to shared discounts corresponding to customer loyalty cards, thereby contravening the mandate under the resolution.
In its resolution, the CNMC refers to regulatory amendments in the hydrocarbon sector, including the obligation to adapt contracts regarding dealer-owned dealer-operated service stations before 28 July 2014 as suggested by the CNMC. The same modifications were excluded in the agreements with the service stations owned by the dealer but managed by a third party. Despite the entities’ arguments suggesting that the modifications rendered meaningless the CNMC’s mandate to remove the clauses, the CNMC held that the modifications do not exempt the operators from compliance with both domestic and European competition rules. Therefore, the CNMC held that the clauses should have been removed regardless of regulatory amendments.
The CNMC’s resolution, which was adopted by the Council in plenary session given that it pertained to a regulated sector, received a dissenting vote according to which the regulatory modifications should have caused the Council to declare the investigated conduct as exempt by law.
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The National Markets and Competition Commission fines AENA and several car rental companies operating at Spanish airports EUR 3 million for the exchange of information
The National Markets and Competition Commission (“CNMC”) fined AENA for sending monthly reports to car rental companies regarding invoicing in previous months, the number of contracts and the conditions that the car rental companies offered at some Spanish airports. The CNMC considered that the exchange of information allowed car rental companies to determine competitors’ market shares and number of contracts on an individual basis, as well as their economic progress, eliminating uncertainty in the market.
Among the car rental companies considered responsible for the infraction, the CNMC decided not to fine those previously fined in case S/0380/11, Coches de Alquiler for participating in a price-fixing agreement, in application of the non bis in idem principle due to the identical nature of the acts in both cases. As such, the CNMC only fined the car rental companies that were not fined in connection with case S/0380/11.
Finally, the CNMC fined AENA EUR 901,518 because its collaboration was considered indispensable to achieve the collusive practice.
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The National Markets and Competition Commission fines Correos for abuse of its dominant position
The National Markets and Competition Commission (“CNMC”) fined Sociedad Estatal de Correos y Telégrafos, S.A. (“Correos”) more than EUR 8 million for abuse of its dominant position through a margin squeeze.
The Council of the CNMC considered proven that Correos obstructed potential competitors from competing in the large consumer postal service sector, excluding them from the market. Correos provided its large customers significantly greater discounts than it did to alternative providers of post services, despite the latter having contracted similar postal services of a sufficient volume to be considered as large customers. Although the other providers were technically granted access, the conditions impeded competition with Correos, the dominant provider.
The CNMC emphasised that Correos benefits from an irreplaceable postal network due to its coverage and network, created by virtue of special and exclusive rights. In particular, Correos is responsible for managing global postal services in Spain under a government-backed monopoly based on Law 43/2010 for a period of 15 years as from 1 January 2011.
The resolution was adopted by the Council of the CNMC in a plenary session because the conduct affected a market subject to regulatory supervision.
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The National Court holds that activities of the public authorities of Andalusia connected with the exercise of the powers of a public authority fall outside of the scope of competition rules
The Spanish National Court corrected the position of the Spanish Competition authority in its ruling of 16 July 2013 and confirmed that public authorities may only be considered as having infringed competition rules if they act as an undertaking, and not when carrying out activities connected with the exercise of the powers as a public authority.
The case involved a fine imposed on several sherry producers in Jerez and the Department of Agriculture and Fisheries of Andalusia for alleged concerted practices involving the fixing of grape and must prices between April 1991 and, at least, March 2009. The allegations against the Government of Andalusia involved its participation in the preparation of the Jerez Strategic Plan, fixing the prices of grapes and must, assuming the presidency of the Strategic Plan Monitoring Committee and attending all its meetings, as well as acting as the guarantor of its correct implementation. Despite acknowledgment that the Government of Andalusia could not be considered an undertaking, the Spanish Competition Authority considered that its conduct breached competition rules given that it had the capacity to drive, generate or aggravate the restrictive effects of the anticompetitive conduct in which it participated.
The National Court corrected the position of the Spanish Competition Authority and held that since the Government of Andalusia did not intervene as an undertaking but rather in the exercise of the powers of a public authority, its conduct was not subject to sanction. The fact that the actions exceeded the powers granted to the Government of Andalusia was irrelevant.
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The National Court annuls the fine imposed on a trade association representative for statements on price increases
In a ruling dated 15 October 2013, the National Court held that statements made by the representative of an undertaking who did not intend for them to be considered a recommendation or advice to the sector to follow them did not constitute a collective recommendation.
The matter related to a fine imposed on the president of a hotel company who was also a trade association representative for an alleged collective recommendation on hotel prices in Spain. The representative had made comments at Spain’s International Tourism Fair (FITUR) in connection with the need to increase Spanish hotel prices in 2011, subsequently quantifying the increase in an interview. The National Court held that, although the individual was also the representative of a trade association, the statements were nevertheless made in his capacity as president of the company in which he was employed. Similarly, the National Court determined that the statements were not made as a recommendation or as advice to the sector as a whole to follow them.
The National Court held that the following must be proved to consider a collective recommendation contrary to article 1 of the Spanish Competition Act (Law 15/2007): (i) there must be intentional simultaneous acts by two or more undertakings; (ii) the recommendation must be intended to align actions; and (iii) the conduct must have sufficient capacity to influence the market.
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The National Court confirms the existence of limits on the duty to cooperate with the National Markets and Competition Commission
On 26 December 2013 the National Court upheld the appeal against the decision of the Spanish National Markets and Competition Commission (“CNMC”) that imposed a fine on Oracle for an alleged infringement of its duty to cooperate with the competition authority in the context of antitrust proceedings relating to restrictive practices.
The CNMC requested that Oracle submit specific data that it did not possess (information on sales of its database licences with a breakdown by platform). The breakdown lacked commercial relevance for Oracle given that its clients are granted perpetual licences and can therefore transfer licences among their hardware systems as many times as they wish, without having to inform Oracle about the type of hardware on which the software is used.
Oracle had to take significant efforts to obtain information from third parties that would allow them to respond to the competition authority’s request. The National Court held that the requested information was beyond Oracle’s scope of control and that the request thus exceeded the limits established in article 39 of the Spanish Competition Act (Law 15/2007), stating that legal and natural persons are only obliged to provide data in their possession.
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The National Markets and Competition Commission confirms application of the de minimis rule to vertical price-fixing agreements