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EXME 14 / 09.07
09 / 07 / 14
The European Commission has imposed fines totalling €427.7 million on the French pharmaceutical company Servier and five producers of generic medicines – namely, Niche/Unichem, Matrix (now part of Mylan), Teva, Krka and Lupin – for concluding a series of deals of deals all aimed at protecting Servier's bestselling blood pressure medicine, perindopril, from price competition by generics in the EU. Through a technology acquisition and a series of patent settlements with generic rivals, Servier implemented a strategy to exclude competitors and delay the entry of cheaper generic medicine to the detriment of public budgets and patients in breach of EU antitrust rules.
The European Commission has opened an in-depth investigation to verify whether exemptions from corporate tax granted under Dutch law to public companies, including port operators, are in line with EU state aid rules. The Commission has concerns that exempting certain companies merely because they are publicly owned may give them an advantage over their competitors. The opening of an in-depth investigation gives interested parties an opportunity to submit comments on the measures under assessment; it does not prejudge the outcome. Separately, the Commission is also gathering information on taxation of ports in other Member States. The Commission has informed France and Belgium of its concerns regarding the taxation of ports in these countries and has asked Germany to provide further information to ensure that there are no undue competitive advantages being granted to ports.
The European Commission has launched a public consultation on proposals to improve merger control at EU level outlined in a White Paper. The reform of the Merger Regulation in 2004 has made the EU’s merger control regime more efficient and predictable, preserving effective competition in the Single Market for the benefit of businesses and consumers. Nevertheless, the experience of the last ten years has also shown that there is scope for further improving some aspects of EU merger control. In its White Paper "Towards More Effective EU Merger Control" the Commission makes proposals that would allow it to better deal with non-controlling minority shareholdings which may affect competition, and that would make referral procedures simpler and faster. Comments can be submitted until 3 October 2014. In light of the comments received, the Commission may then put forward a legislative proposal to revise the EU Merger Regulation. See also MEMO/14/471 .
Commission approves restructuring aid for Adria Airways, AirBaltic and SAS
The European Commission has concluded that restructuring measures taken by Slovenia in favour of the national airline Adria Airways by Latvia in the context of the restructuring of the airline airBaltic were in line with EU state aid rules. The European Commission has also concluded that a Revolving Credit Facility that Denmark, Sweden and Norway granted to SAS in December 2012 was carried out on market terms and therefore did not constitute state aid within the meaning of EU rules.
Research partnerships between the EU, the private sector and Member States today presented their first calls for projects and partners under Horizon 2020, the EU's €80 billion research and innovation programme. Worth a total of €1.13 billion in public funding, which will be complemented by a comparable amount from the private partners, the first round of funding will go into projects that will improve people's lives as well as boost international competitiveness of Europe's industry. Topics include new treatments for diabetes and eye disease and a roll out of dozens of hydrogen-powered road vehicles and refuelling stations (see MEMO/14/468).
A total of €57 million of EU agricultural policy funds, unduly spent by Member States, is being claimed back by the European Commission today under the so-called clearance of accounts procedure. However, because some of these amounts have already been recovered from the Member States the financial impact of today's decision will be some €52 million. This money returns to the EU budget because of non-compliance with EU rules or inadequate control procedures on agricultural expenditure. Member States are responsible for paying out and checking expenditure under the Common Agricultural Policy (CAP), and the Commission is required to ensure that Member States have made correct use of the funds. Under this latest decision, funds will be recovered from 15 Member States: Belgium, the Czech Republic, Denmark, Germany, Spain, France, Italy, Latvia, Hungary, Poland, Portugal, Slovenia, Finland, Sweden and the UK. Within this global figure of €57 million, the most significant individual correction is €20.04 million charged to France for weaknesses related to the allocation of entitlements.
Fisheries: Commission proposes higher catches for anchovy in the Bay of Biscay
The European Commission today proposed to increase the fishing opportunities of anchovy in the Bay of Biscay by 18% to allow catches of 20,100 tonnes for the period 1 July 2014 - 30 June 2015. This total allowable catch (TAC) is based on recent scientific advice confirming that the stock is in a good shape and above safe biological limits. Commissioner for Maritime Affairs and Fisheries, Maria Damanaki, stated: “Anchovy is a good example that it pays off to manage fisheries with a long-term approach and to involve the fishermen to achieve this. Since the anchovy fishery had to be totally closed between 2005 and 2009 to save it from collapse, it is a relief that the stock has recovered over the last four years and that French and Spanish fishermen can go back to fishing more of it after a very tough period”. Spain and France are the only EU Member States involved in this fishery. The proposed catch limit is in line with the principles set out in the multi-annual anchovy stock management plan tabled in 2009 . Since 2010, when the fishery was re-opened, the Commission has consistently applied this plan which has led to a recovery of the anchovy biomass well above safe biological limits. For this year's TAC, the estimated spawning stock size of about 66,158 tonnes must be formally confirmed by the relevant scientific bodies. In the case that the final figures change, the Commission's proposal will be updated accordingly.
Energy: Conference on “Security of gas supply: the role of gas development in the Mediterranean region” in Malta
A conference on “Security of gas supply: the role of gas development in the Mediterranean region” will be held on Thursday 10th and Friday 11th July 2014 in Malta, organised by the European Commission, the Government of Malta and the Republic of Cyprus. EU, North African and Middle Eastern Energy Ministers, and key stakeholders in the energy field are invited to chart the way forward on how gas developments in the Mediterranean can enhance security of supply. The conference can be followed live through a live stream provided by the organisers. A joint press conference is scheduled on 11 July at 13:00 h with Günther H. Oettinger, Vice-President of the European Commission responsible for Energy, Konrad Mizzi, Minister for Energy and Health of Malta and George Lakkotrypis, Minister for Energy, Commerce, Industry and Tourism of the Republic of Cyprus. This event will be recorded and available on Europe by Satellite EbS. For further information, program and accreditation provisions please consult the conference website .
Mergers: Commission clears acquisition of controlling stake by PAI Partners in Labeyrie Fine Foods
The European Commission has approved under the EU Merger Regulation the acquisition joint control over the French company Labeyrie Fine Foods by the French private equity company PAI Partners and the farming cooperative Lur Berri. Labeyrie Fine Foods is currently jointly controlled by Lur Berri and another financial investor. The Commission concluded that the proposed acquisition would not raise competition concerns, in particular because the activities of the portfolio companies of PAI Partners do not overlap significantly with the activities of Labeyrie Fine Foods. The transaction was examined under the normal merger review procedure. More information is available on the Commission's competition website, in the public case register under the case number M.7281 .
Mergers: Commission clears acquisition of Euro Media Group by PAI partners
The European Commission has approved under the EU Merger Regulation the acquisition of Euro Media Group of France, by PAI partners of France. Euro Media Group provides complete custom-made solutions for the production and delivery of all media content. PAI partners is one of the largest private equity funds in Europe. The Commission found that the proposed acquisition does not give rise to any horizontal or vertical overlap between the parties. The Commission therefore concluded that the proposed transaction would not raise competition concerns. The transaction was examined under the simplified merger review procedure. More information is available on the Commission's competition website, in the public case register under the case number M.7301
Mergers: Commission clears acquisition of Mauser by CD&R Fund IX in packaging sector
The European Commission has granted clearance under the EU Merger Regulation to the proposed acquisition of Mauser Holding GmbH of Germany by CD&R Fund IX of the US. Mauser is mainly active in the production and sale of rigid industrial packaging products. CD&R Fund IX is a private equity fund. The Commission concluded that the proposed transaction would not raise competition concerns, in particular because the parties' activities do not overlap. The operation was examined under the simplified merger review procedure. More information is available on the Commission's competition website in the public case register under the case number M.7287 .
Mergers: Commission approves acquisition of joint control over Nets Holding by Advent International and Bain Capital
The European Commission has cleared under the EU Merger Regulation the acquisition of joint control over Nets Holding of Denmark by Advent International and Bain Capital both of the US. Nets Holding provides payments, cards and information services, mainly in Scandinavia (Denmark, Estonia, Finland, Norway and Sweden. Bain Capital and Advent International are both private equity investors, which already jointly control WorldPay a UK based payment services provider. The proposed transaction creates overlaps between the activities of Nets and WorldPay on the market for merchant acquiring and acquirer processing services in Scandinavia, the UK and Ireland. The Commission has found that the proposed transaction would not raise competition concerns because the overlaps are minimal and WorldPay and Nets have a different geographic focus and do not compete closely. The operation was examined under the normal merger review procedure. More information is available on the Commission's competition website, in the public case register under the case number M.7241 .
Mergers: Commission clears acquisition of joint control over Visma by HgCapital, KKR and Cinven
The European Commission has approved under the EU Merger Regulation the acquisition of joint control over Visma AS of Norway by HgCapital of the UK, KKR& Co. L.P. of the United States and Cinven Limited of Guernsey. Visma was previously already jointly controlled by HgCapital and KKR. HgCapital, KKR and Cinven are private equity funds. Visma develops software solutions and provides IT services. The activities of Visma and Host Europe, one of Cinven's portfolio companies, overlap for web-hosting in Norway, Sweden and the Netherlands. Moreover, in Norway, Visma provides IT services to another portfolio company of Cinven. The Commission concluded that the proposed transaction would not raise competition concerns in the markets for web-hosting solutions and IT services, because of the limited overlaps brought about by the transaction and the existence of numerous alternative strong players. The transaction was examined under the simplified merger review procedure. More information is available on the Commission's competition website, in the public case register under the case number M.7280 .
Mergers: Commission clears acquisition of joint control over Haier Biomedical and Laboratory Product by Carlyle and the Haier Group
The European Commission has granted clearance under the EU Merger Regulation to the proposed acquisition of joint control over Haier Biomedical and Laboratory Product ('HBML') of China by Carlyle of the US and the Haier Group of China. HBML is currently solely controlled by the Haier Group. It manufactures laboratory equipment, in particular medical freezers, medical refrigerators/deep freezers and biomedical safety hoods. Carlyle is a global asset manager. The Haier Group is a manufacturer and supplier of consumer electronics and home appliances. The Commission concluded that the proposed transaction would not raise competition concerns, in particular because HBML has only negligible activities within the European Economic Area (EEA) and the parties' activities do not overlap. The operation was examined under the simplified merger review procedure. More information is available on the Commission's competition website in the public case register under the case number M.7294 .
The European Commission has found the restructuring plan of the Greek Alpha Bank, including the acquisition and integration of Emporiki Bank, to be in line with EU state aid rules. The measures already implemented and those envisaged in the future will enable the bank to return to viability, while limiting the distortions of competition brought about by the state funding. Commission Vice-President in charge of competition policy Joaquín Almunia said: "Alpha Bank's restructuring will make a significant contribution to reinforcing the viability of the Greek banking sector, to the benefit of the Greek economy."
The European Commission has found a series of reductions and exemptions from a Danish tax on non-nominative advertising material delivered to households, to be in line with EU state aid rules. The Commission found that while some of these measures contain state aid, it is compatible with EU rules as it furthers EU environmental and cultural goals without unduly distorting competition in the Single Market.
The European Commission has adopted decisions on the compatibility with EU state aid rules of four distinct projects by Germany, Hungary and Spain to grant regional aid in favour of the car manufacturers Volkswagen, BMW and Ford, in order to attract major investment projects. The Commission has authorised a German aid measure worth €43.67 million to Volkswagen/Porsche in Leipzig because it furthers regional development without unduly distorting competition in the Single Market, in line with EU guidelines. For BMW, also based in Leipzig, the Commission has found that only part of the planned aid was necessary to carry out the project and has therefore authorised €17 million out of the €45 million planned by Germany. The Commission has opened an in-depth investigation to assess the compatibility of aid by Hungary to Volkswagen/AUDI in Győr, because it has concerns that, in view of the strong market position of the beneficiary and the difficult market situation, the aid could harm competition. Finally, the Commission has closed a formal investigation into regional aid for Ford in Spain, after Spain reduced the aid from €24.4 million to €11.2 million, a level which does not require Commission approval.
The European Commission has found the support measures granted by Latvia to AS Reverta (formerly AS Parex banka) and AS Citadele banka to be in line with EU state aid rules and has therefore closed its in-depth investigation. Based on the additional information provided by Latvia, the Commission concluded, in particular, that the measures were necessary to preserve the stability of the Latvian banking system and for an orderly resolution of Reverta.
In the context of its State Aid Modernisation (SAM) initiative, the European Commission has revised its rules for assessing Member States' support measures to rescue and restructure companies in difficulty. The new guidelines aim to ensure that public funding is channelled where it is needed most and that investors in failing firms carry their fair share of the costs of restructuring, rather than leaving the burden to taxpayers. The rules adopted apply only to non-financial firms in difficulty; a separate set of rules is in place for banks and other financial institutions (see most recently IP/13/672). The new guidelines will enter into force on 1 August 2014 (see also MEMO/14/473).
The European Commission has opened an in-depth investigation to examine whether a €25 million capital injection by SEA SpA, the publicly owned manager of the Italian airport Milan, in favour of its new ground-handling subsidiary Airport Handling was in line with EU state aid rules. The opening of an in-depth investigation gives interested third parties the opportunity to comment. It does not prejudge the outcome of the investigation.
The European Commission has closed its antitrust investigation into generic pharmaceutical companies in France. The investigation focused on suspected coordination between generic pharmaceutical companies when negotiating an initial price with the French pricing authority before launching a new generic product. In its sector inquiry report on the distribution of medicinal products in France of December 2013, the French competition authority referred to the possibility that the current French regulatory framework would allow for such pricing coordination between generic competitors (see report here). It also suggested that the French pricing authority and the French competition authority would closely work together in case such anomalies were detected.
The European Commission has adopted a Communication identifying areas for action to enhance the enforcement of EU antitrust rules by national competition authorities (NCAs). Since 2004, both the Commission and NCAs have the power to fully enforce the EU’s antitrust rules. Based on ten years of experience, the Commission aims to further strengthen the position and tools of the NCAs. The Communication adopted today sets out priority areas where further progress is necessary. The Commission will then assess which policy initiatives should be taken to best achieve these goals.
Senior management appointments
The Commission has decided to make three new senior management appointments. First, Mr Gerassimos THOMAS has been appointed Deputy Director-General in the Energy Directorate-General, with special responsibility for co-ordination of nuclear energy issues. Mr Thomas, a Greek national, is currently Finance Director in the Directorate-General for Economic and Financial Affairs, responsible for the borrowing and lending activities of the European Union, the treasury and asset management of the European Commission and the co-ordination of all financial instrument support schemes involving the EU budget. He is also a member of the EIB and European Investment Fund Board of Directors. Previous roles in his 24-year Commission career include Head of Cabinet of Commissioner Joaquín Almunia (2006-9). He studied economics, business administration and international relations in Athens, London and Brussels. This decision takes effect on 16 September 2014. The second appointment concerns Mr Brian HOLMES, who becomes a Principal Adviser in the Education and Culture Directorate-General, in order to be seconded as Director to the Education, Audiovisual and Culture Executive Agency in Brussels. Mr Holmes, who is British, helped set up the agency in 2006, and is already its acting Director. He is a Chartered Engineer and has an MBA from a Paris business school and a PhD on technology-enhanced learning from the University of Lancaster. This decision takes effect on 1 August 2014. Finally, Mr Kęsţutis SADAUSKAS has been appointed Director 'Green Economy' in the Environment Directorate-General. Mr Sadauskas is Lithuanian, and currently serves as Head of Cabinet of Commissioner Algirdas Šemeta. He previously headed the Commission Representation in Vilnius, and before joining the Commission worked in the Lithuanian Ministry of Foreign Affairs where, among other things, he was responsible for EU accession negotiations. He has a Masters degree in International Relations and a Masters degree in Geography from the University of Vilnius. The date of effect of this decision will be determined later.