Term
| In order to infringe article 101(1), must inter-state trade actually be affected? |
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Definition
| No, things which have the potential to affect trade will also = infringement of 101(1) |
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Term
| Societe Technique Miniere (STM) v Maschinenbau - LAYING OUT THE TEST FOR |
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Definition
It must be possible to foresee with a sufficient degree of probability, that the agreement in question may have an influence, direct or indirect, actual or potential, on the pattern of trade between Member States
STM tried to have a contracted they were party to voided under Art101(1) |
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Term
| According to the STM test, what are the different ways in which an activity can be seen to have affected trade? |
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Definition
a) actually
b) potentially
c) directly
d) indirectly |
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Term
| Consten SARL v Grundig-Verkaufs |
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Definition
| If there is an increase/decrease in trade, as a direct consequence of undertaking's actions, then the undertaking will be deemed to have affected trade between member states |
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Term
| Pronuptia de paris v Pronuptia de paris |
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Definition
| Franchise agreement = something which may be deemed to be something which may affect trade between member states |
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Term
| Vereniging van Cementhandelaren v Commission |
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Definition
| A trade association = something which may be deemed to be something which may affect trade between member states |
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Term
| The term 'trade' has been given a wide meaning... give some example of what it covers |
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Definition
| The production and distribution of goods, including agricultural produce, and the services sector, including areas such as banking, insurance and maritime transport |
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Term
| Examples of agreements which have been found to have an effect on interstate trade |
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Definition
a) Contracts which prohibit distributors from selling goods other than in their own national market
b) agreements whereby producers agree to protect each other's national markets
c) small agreements which may have a massive cumulative effect (BRASSERIE DE HAECHT)
d) Consten |
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Term
| Brasserie de Haecht SA v Wilkin-Janssen |
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Definition
CUMULATIVE EFFECT
+ CJ STATED THAT AGREEMENTS HAVE TO BE CONSIDERED W.IN CONTEXT OF THEIR MARKET
If the cumulative effect of a number of similar agreements to the agreement that has been made, would affect the market, then the agreement in itself will be prohibited.
A Belgium brewery and a Belgium pub made an exclusivity agreement, and although it was a minor agreement, the Commission held that the cumulative effect of a number of such arguments would have closed off the market |
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Term
| Since the Brasserie de Haecht case, what important piece of legislation has been issued by the Commission w.r.t. agreements of minor importance?? |
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Definition
| Notice on Agreements of Minor Importance |
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Term
| Notice on Agreements of Minor Importance |
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Definition
| Under this notice, an agreement between parties who have less than a 10-15% hare of the market would be considered de minimis and would not infringe Article 101(1) |
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Term
| W.r.t to the size of the effect on trade, what must it be?? |
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Definition
| Any actual or potential effect on trade must be appreciable and must not be de minimis or insignificant (discussed as a defence later on) |
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Term
| Does article 101(1) apply to horizontal agreements |
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Definition
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Term
| Does article 101(2) apply to vertical agreements? |
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Definition
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Term
| What are horizontal agreements? |
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Definition
| Agreements between two or more undertakings at the same level of trade or industry |
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Term
| What are vertical agreements? |
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Definition
| Agreements between two or more undertakingsa at different levels of the process in trade or industry |
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Term
From the wording of Art 101(1), it is clear that the terms 'object' and 'effect' are
a)cumulative
b) alternatives?? |
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Definition
| b)alternatives - confirmed in STM |
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Term
| STM on the words 'object' and 'effect' in Article 101(1) |
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Definition
The two words are to be read disjunctively -
Only if it is not clear that the object of an agreement is to harm competition, is it necessary to consider whether it might have the effect of doing so.
Clearly, if the object of an agreement is to harm competition, it is assumed that this will also be its effect |
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Term
| Is the test for establishing the 'object' of an agreement objective or subjective? |
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Definition
| Ob jective - they Commission / NCA will look at the apparent purpose, within the economic context in which it is to operate |
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Term
| Where it is found that the object of an agreement was to restrict trade, does the Commission / NCA also have to show that it would in fact have affected trade? |
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Definition
| NO - Object is sufficient |
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Term
| List of horizontal agreements that may have as their object the restriction of competition... |
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Definition
a) agreements to fix prices
b) agreements to share markets
c) agreements to limit production output
d) agreements to limit sales
e) agreements to exchange price information |
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Term
| List of vertical agreements which may have as their object the restriction of competition... |
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Definition
a) agreements to fix minimum resale prices
b) agreements to impose bans on parallel imports or passive selling |
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Term
| What would a ban on parallel imports do?? |
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Definition
| operates to prevent a distributor in one MS from buying a product from anyone other than the authorised dealer |
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Term
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Definition
| Passive selling occurs where there is no active marketing campaigh or other promotional measures underttaken by a seller - the buyer seeks out the seller rather than the other way round |
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Term
| Under what circumstances would the Commission / NCA have to try to establish what the 'effect' of an agreement is? |
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Definition
| Where it cannot be established that the 'object' of the agreement is anti-competition, the Commission / NCA would than have to establish that the effect will be anti-competition, in order to establish a breach under Article 101(1) |
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Term
| In order to establish what an 'effect' might be, what is it necessary to investigate? |
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Definition
Thoroughly investigate the 'agreement' itself.
Thoroughly investigate that market in which the agreement is to operate. |
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Term
| European Night Services v Commission |
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Definition
MUST CONSIDER THE SOCIAL/ECONOMIC/LEGAL CLIMATE
MUST ALSO TAKE ACCOUNT OF POTENTIAL FOR NEW COMPETITORE TO PENETRATE THE MARKET
4 rail operaters established a company to operate overnight rail services through the channel tunnel from UK to Europe. Commission stated that this = 101(1) breach.
COURT HELD - outlined way in which the 'effect' of undertaking's agreement should be assessed...
a) account should be taken of the actual conditions in which it functions
b) in particular, the economic context in which the undertakings operate
c)examination of conditions of competition must also take account of potential competition, in order to ascretain whether, in the light of the structure of the market and the economic and legal context in which it functions, there is a real possibility for competition amongst current undertakings, and the potential for new undertakings / new competitors to penetrate the market |
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Term
| In assessing the 'effect' of undertaking's agreement, the Commission / NCA will... |
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Definition
1) Define the product / service
2) Define the market for the product / service
3) Define the geographical market
They will then
a)consider the effect of the undertaking's agreement in the economic environment in which it is intended to operate
b) and consider any future impact (so far as it can be gauged) |
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Term
| The 'black list' - 101(1)(a) - limits price fixing, but what type of indirect price fixing is allowed? |
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Definition
| Recommended prices, so long as they are only recommended and not enforced in any way |
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Term
| The 'black list' - 101(1)(a) - prohibits the fixing of any trading conditions. What does this have to do with exports/imports? |
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Definition
| Effectively, prohibiting the fixing of trading conditions = prohibits export bans and bans on parallel imports. |
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Term
| The 'black list' - 101(1)(c) - prohibits agreements between undertakings which share market or sources of supply. What does this mean? |
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Definition
| As the undertakings should be competiors, it prohibits them from making agreements to share resources, therefore stopping collusion and promoting competition |
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Term
| What will be a key indication that an agreement prevents / restricts / distorts competition? |
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Definition
| If the pattern of competition in the relevant market differs from what it would have been had there been no agreement / decision / practice. |
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Term
| Article 101(1) declares that an agreement is prohibited if it has as its object/effect the 'prevention, restriction or distortion of competition'. Is it necessary to show that all three P,R&D exist? |
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Definition
| NO - it is sufficient if only one of them is found. The principal one is restriction of competition. |
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