Brussels Brief - December 15, 2006
December 15, 2006
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KEY DEVELOPMENTS
Internal Market: Parliament Paves the Way for REACH Adoption
Elena Kostadinova
The European Parliament has approved amendments to the Council’s common position on the Regulation concerning the Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH). The main amendments aim to guarantee that tests on vertebrate animals will be performed only if absolutely necessary and that industry is stimulated to develop and use substitutes to dangerous substances. The undertakings which must register an existing phase-in substance will be obliged to participate in a substance information exchange forum whether they benefit or not from a transitional period. This requirement should limit the number of studies performed for the purpose of registration of a substance. It is expected that REACH will be approved by the EU Council on 18 December 2006, in which case it will enter into force on 1 June 2007.
Competition: Commission Adopts New Leniency Notice
Yannis Virvilis
The European Commission has adopted a new Leniency Notice for companies providing it with information on a cartel. The new Notice mainly clarifies some of the features contained in the old Notice, adopted in 2002. These clarifications relate to the nature and amount of information that a leniency applicant should provide to the Commission to benefit from immunity or reduction of fines. A new notion introduced is the so-called “marker system”, whereby a leniency application can be submitted on the basis of limited information. The applicant can then be granted time allowing him to gather all necessary information. Finally, the Commission lays out a procedure protecting corporate statements given by leniency applicants from discovery in civil damage proceedings.
State Aid: New De Minimis Regulation
Alexandra Rogers
As part of the State Aid Action Plan, the European Commission has adopted a new de minimis regulation which provides that certain subsidies are exempted from the requirement to obtain advance clearance from the Commission. Under the new regulation, which enters into force on 1 January 2007, grants of aid of up to EUR 200,000 over any period of three years will not be considered to constitute State aid and will therefore be exempted from any notification obligation. Loan guarantees will also be exempted where the guaranteed part of the loan does not exceed EUR 1.5 million. By raising the de minimis threshold from the current EUR 100,000 the Commission aims to concentrate its efforts on the most serious distortions of competition. A lower ceiling of EUR 100,000 will be effective as regards road transport, a sector which has not previously been covered by the de minimis principle. Forms of aid for which the aid amount cannot be accurately calculated in advance will be excluded from the scope of the regulation.
Competition: Commission Investigation into TFT/LCD Industry
Michal Cieplinski
The European Commission has sent formal requests for information to a number of thin film transistor/liquid crystal display (TFT/LCD) producers. The purpose of this investigation is to ascertain whether there is evidence of a cartel agreement and related practices concerning price fixing for these products which could be an infringement of Article 81 of the EC Treaty. The Commission is particularly looking into alleged production limiting agreements in 2002 and 2003 to counter the staggering price declines on the TFT/LCD market. Similar probes were recently launched in South Korea, Japan and the United States. A number of producers of TFT/LCD screens, announced that they had received requests for information from the regulatory bodies of various countries.
Internal Market: Commission Pursues Member States for Failure to Liberalise Energy Market
Andrea Hamilton
The European Commission has taken the second step in infringement proceedings against 16 Member States for failing to open their national energy markets, as required by EU law. According to the 2003 Directives on the opening of gas and electricity markets, Member States must liberalise their energy markets in order to establish an internal EU-wide market. The Commission sent initial warnings to the 16 Member States in April 2006, alleging that they had not transposed the 2003 Directives into national legislation. After reviewing each Member State’s response to the initial warning, the Commission concluded that the Member States still had not taken sufficient action to implement the 2003 Directives. As a result, the Commission sent reasoned opinions to the targeted Member States, commencing the second step of the infringement proceedings. These Member States have two months to respond to the reasoned opinions, and they may ultimately face court action.
Competition: Commission Inspections in the German Electricity Sector
Geert Dierickx and Elena Kostadinova
European Commission officials accompanied by their German counterparts have carried out unannounced inspections (“dawn raids”) at the premises of some electricity companies in Germany. The Commission said there were reasons to believe these companies may have kept electricity prices artificially high, for example by lowering the output of certain power plants. The companies are also suspected of trying to freeze out new rivals by delaying the construction of new transmission infrastructure. According to the Commission, the inspections were not carried out as part of the energy sector competition inquiry. These unannounced inspections follow a series of similar dawn raids on energy companies in Austria, Belgium, France, Germany and Italy in May 2006.
Environment: Commission to Take Action Over Missing National Allocation Plans
James Arneill
The European Commission has announced that it will send final written warnings to Austria, Denmark, Hungary and Italy, specifying that they will face court action unless they rapidly submit their national allocation plans (NAPs) for the second trading period of the EU Emissions Trading Scheme from 2008 to 2012. The NAPs had been due by 30 June 2006. A first written warning was issued by the Commission in October. France, which had withdrawn its NAP, will face similar action unless it sends a replacement plan forthwith. The Commission is also taking infringement action against seven Member States for failing to provide complete reports on their progress in limiting or cutting greenhouses gas emissions, as required by a 2004 Commission Decision on monitoring emissions which implements the Kyoto Protocol.
Mergers: Second Phase Probe into Universal’s Take Over of BMG's Music Publishing Business
Mélanie Bruneau
The European Commission has opened an in-depth (“second phase”) investigation into the proposed acquisition of the music publishing business of Germany’s Bertelsmann Music Group (BMG) by Universal, a US subsidiary of the French company Vivendi. Universal is a prominent company in the music recording and music publishing business. Having completed its preliminary review, the Commission considers that the acquisition might significantly impede competition in the already concentrated music publishing market. The Commission will now investigate further whether the transaction would be likely to have a negative impact on fees for publishing rights or on the conditions for song writers in the European Economic Area or in individual Member States. In assessing the effects of the merger, the Commission will take into account the role and position of collecting societies. The Commission now has 90 working days (until 27 April 2007) to take a final decision.
Monday 18 December – Friday 22 December 2006
COUNCIL MEETINGS
Environment Council (18 December 2006)
Agriculture and Fisheries Council (19 – 21 December 2006)
COURT OF JUSTICE
No cases next week
COURT OF FIRST INSTANCE
No cases next week
