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EU & Antitrust – A Review of 2013

1. Two Phase II Merger Control Investigations

In 2013, there were two Phase II merger control investigations, the first in-depth reviews since 2011, both of which involved trade buyers.  In April 2013, following a full investigation, the Competition Authority (the “Authority“) unconditionally cleared Intersnack International B.V.’s acquisition of KP Snacks from United Biscuits (UK) Limited.

The second Phase II case involved the acquisition by Uniphar plc. of Cahill May Roberts Limited, the Irish pharmaceutical distribution and wholesaling subsidiary of Celesio.  This was also cleared unconditionally in April 2013 following an in-depth review.  In both cases the Authority had been concerned about the levels of market concentration post-merger, but ultimately found its concerns to be unfounded.

2. Increase in Enforcement Activity

It is widely acknowledged that the Authority has struggled with a shortage of resources over the last number of years.  In 2013, however, significant additional resources were sanctioned and we are seeing an increase in enforcement activity by the Authority.  At the end of 2012, following a year-long investigation into pricing practices of Brazil Body Sports (“BBS“), the exclusive distributors of the FitFlop brand in Ireland, BBS entered into commitments not to restrict retailers from determining their own pricing policy.  These commitments were made an order of the High Court, which took effect on 2 February 2013.  This was the first time that such commitments could be made an order of the court (made possible under an amendment to the Competition Act in 2012).

Later in the year, the Authority succeeded in extracting High Court undertakings from the Irish Medical Organisation (“IMO“) to suspend a decision by the IMO’s GP Committee to withdraw certain services to patients in protest to proposed cuts to GP fees under the General Medical Scheme.  The Authority had viewed this as an attempt to fix GP fees, in breach of Irish and EU competition law, and initiated enforcement proceedings.

Finally, in the summer of 2013, the Authority carried out high profile dawn raids of a number of flooring contractors that were suspected of engaging in bid rigging.

3. Legislative Changes in the Pipeline

A number of significant institutional and legislative changes were expected to take effect during the course of 2013.  In 2008, the Government announced plans to amalgamate the Authority and the National Consumer Agency as part of the rationalisation of State agencies.  Legislation to effect the amalgamation was to be published in 2013, but has not yet materialised.

Reform to the Irish media merger regime was also expected in 2013 following a public consultation in 2008 and the publication in 2009 of a report by the Tánaiste and Minister at the time, Mary Coughlan.  That report set out a number of far reaching recommendations, including the introduction of a new notification system, under which the Minister would be notified of media mergers, independently of any merger control process before the Authority or the European Commission.

The legislation dealing with both of these significant institutional changes are now expected to come within the Consumer and Competition Bill, which is currently scheduled to be published no later than Spring 2014.

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