Brussels Brief - December 14, 2007

December 14, 2007

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KEY DEVELOPMENTS

 

Competition:  CFI Increases Fine for BASF in Choline Chloride Cartel Case

Yannis Virvilis

The Court of First Instance (CFI) has revised the fines imposed by the European Commission on BASF and UCB in the framework of the choline chloride cartel case.  The Commission had found that the companies in question had participated in cartel arrangements both globally and in Europe and that all of those activities constituted a single and continuous infringement.  However, the CFI ruled that, for a number of reasons, the global and European infringements constituted separate infringements and that the companies involved should not be fined for their participation in the global cartel, since that infringement was time-barred.  Subsequently, the CFI recalculated the fines imposed on the companies, increasing the fine to BASF by EUR 54,000 (from EUR 34.97 million to EUR 35.02 million), and reducing the fine imposed on UCB from EUR 10.38 million to just EUR 1.87 million.

 

Mergers:  Commission Opens Second Phase in Arjowiggins—M-real Zanders’ Reflex Mill Deal

Patricia Armesto

The European Commission has opened an in-depth second phase investigation into the proposed acquisition of M-real Zanders’ Reflex Mill, a German company, by the French company Arjowiggins.  Both companies produce carbonless paper and other speciality premium fine paper.  The Commission’s initial market investigation has indicated that the proposed merger would raise serious doubts with regard to competition in the carbonless paper market.  In a post-merger scenario, Arjowiggins’ market share would account for more than half of the European carbonless paper market.  The Commission is concerned that this situation might enable Arjowiggins to impose less favourable supply conditions or prices on its customers in the absence of sufficient alternative suppliers.  The final decision is expected to be taken in April 2008.

 

Internal Market:  New EU Rules Crack Down on Misleading and Aggressive Sales Practices

Mélanie Bruneau

The Directive on Unfair Commercial Practices (UCP), adopted in May 2005, came into force on 12 December 2007.  Misleading and aggressive practices are the two main categories of unfair commercial practices defined in the new Directive.  It includes bait advertising, fake free offers, direct appeals to children via television and the internet, pyramid schemes, prize winning, advertorials and false curative health claims used against consumers.  These restrictions are part of an extensive blacklist of schemes which are banned by the UCP Directive, targeting a dozen of the most abusive practices.  To date, 14 EU Member States have implemented the Directive.  The Commission has launched proceedings against Member States that have not yet implemented any rules in their national legal systems.

 

State Aid:  Commission Concludes Investigation into Aid to Tieliikelaitos

Juan Gutiérrez

At the end of 2000, the Finnish Government decided to transform the "in-house" activity of the former Road Service of Finland into a State Enterprise, through the creation of Tieliikelaitos, now Destia, and to open it gradually to free competition.  An aid package was designed to address the financial burden resulting from overstaffing and the generous employment conditions that Tieliikelaitos had inherited from the pre-liberalisation period.  The European Commission has decided not to raise objections to the aid, which will be provided on a transitional basis to facilitate Tieliikelaitos' adaptation to its new competitive environment.  The Commission has also set the deadline of 1 March 2008 for Finland to put an end to a number of privileges that Tieliikelaitos enjoyed, namely the non-application of normal bankruptcy and corporate income tax legislation.

 

Media:  Italy Warned for Breach of EU TV Advertising Rules

Elena Kostadinova

The European Commission has sent a letter of formal notice to Italy for its failure to implement correctly the Television without Frontiers Directive.  The Directive provides for a limit of 12 minutes of advertising per hour, and a minimum of 20 minutes continuous programming between advertising breaks.  However, Italian legislation does not apply this hourly limit with regard to teleshopping spots, resulting in more advertising than permitted under the Directive.  In addition, according to Italian legislation, self-promotion of broadcasters does not constitute advertising, which leads to undue interruption of programmes and longer advertising breaks.  According to the Commission, Italy has also failed to adopt effective, proportionate and dissuasive penalties for non-compliance with the advertising rules.  The Italian Government has two months to respond to the concerns expressed by the Commission.

 

ECJ:  Trade Union Policies Must Not Prevent Freedom of Establishment

Kate DaSilva

In the case of the International Transport Workers’ Federation and the Finnish Seamen’s Union v. Viking Line ABP and Oü Viking Line Eesti, the European Court of Justice (ECJ) has held that conditions laid down by trade unions for the registration of shipping vessels must not form an obstacle to freedom of establishment.  The ECJ further held that trade unions’ right to participate in collective negotiations can be withheld in situations where workers will consequently benefit from higher levels of social protection. 

 

Air Transport:  EU and Ukraine Negotiate Common Aviation Area Agreement

Andrea Hamilton

The European Commission has announced that it is negotiating a Common Aviation Area agreement with Ukraine, which would open the European Union’s single aviation market to its eastern neighbour.  These negotiations follow the completion of similar agreements between the EU and two other neighbours—the Western Balkans and Morocco.  The Commission considers an agreement with Ukraine to be a priority, in part because of the substantial aviation links and increasing air traffic between the EU and Ukraine.  In addition to opening markets, the agreement is expected to further integrate Ukraine into the EU’s aviation framework by requiring Ukraine to harmonise its legislation with European standards.  Overall, the Commission views an agreement with Ukraine as a important step toward the creation of a Common Aviation Area between the EU and its neighbours.

 

Customs:  EU Parliament and Council Adopt Pan-European Electronic Customs System

Geert Dierickx

The European Parliament and Council of Ministers have adopted a plan to implement a pan-European electronic customs system, which has been welcomed by the European Commission.  The electronic customs system will allow the Commission, customs administrations and other EU border agencies to exchange information electronically, thereby becoming paper-free.  This electronic tool will facilitate the movement and control of goods, and increase the competitiveness of European trade by reducing compliance and administrative costs.  By 2011, economic operators will be able to lodge electronically all the information required by customs legislation for EU cross-border movement of goods.

 

NEXT WEEK’S EVENTS

Monday 17 December – Friday 21 December 2007

 

COUNCIL MEETINGS

Agriculture and Fisheries Council (17 – 20 December 2007)

Environment Council (20 December 2007)

 

COURT OF JUSTICE

Judgments

Approximation of laws

C-284/07 Commission v Portugal

 

Area of Freedom, Security and Justice

C-77/05 United Kingdom v Council

C-137/05 United Kingdom v Council

 

Company law

C-357/06 Frigerio Luigi & C.

C-481/06 Commission v Greece

 

Competition

C-202/06 P Cementbouw Handel & Industrie v Commission

 

Customs union

C-62/06 Z.F. Zefeser

 

Environment and consumers

C-186/06 Commission v Spain

C-194/05 Commission v Italy

C-195/05 Commission v Italy

C-263/05 Commission v Italy

C-85/07 Commission v Italy

 

Freedom of establishment

C-257/07 Commission v Sweden

 

Freedom to provide services

C-532/03 Commission v Ireland

C-220/06 Asociación Profesional de Empresas de Reparto y Manipulado de Correspondencia

C-281/06 Jundt

 

Free movement of capital

C-101/05 A

C-436/06 Grønfeldt and Grønfeldt

 

Law governing the institutions

C-64/05 P Sweden v Commission and Others

 

Principles of Community law

C-341/05 Laval un Partneri

 

Social security for migrant workers

Joined Cases C-396/05, C-419/05, C-450/05 Habelt

 

Taxation

C-368/06 Cedilac

C-314/06 Société Pipeline Méditerranée and Rhône

 

COURT OF FIRST INSTANCE

Judicial vacation of the Court of First Instance from 17 December 2007 to 6 January 2008 inclusive.

 

 

McDermott Will & Emery

McDermott Will and Emery