Brussels Brief - December 5, 2008
December 5, 2008
Full Printable Version in PDF Format
(Adobe Acrobat Reader required, available for free download here)
KEY DEVELOPMENTS
Competition: Commission Publishes Guidance on Article 82 Enforcement Priorities
Leigh Smith
On
The economic and effects-based approach set out in the guidance reflects Commission practice in recent Article 82 cases, such as those against Microsoft and Wanadoo. However, it is the first time the business community and national competition law authorities have been given detailed guidance as to the Commission’s preferred approach.
The guidance applies to scenarios involving a single dominant undertaking. It applies to all forms of exclusionary conduct covered by Article 82, such as exclusive dealing, tying and bundling, refusal to supply and predatory pricing. The Commission intends to fully apply the guidance to future Article 82 cases.
Chemicals: New Global Labelling Rules
Andrea Hamilton
EU Member States have approved a regulation that will align EU legislation on classification and the labelling of substances and mixtures with the United Nations Globally Harmonised System. The new regulation will replace existing rules in this area, namely Directives 67/548/EEC and 1999/45/EC and is intended to promote consistent labels and descriptions, particularly in reference to hazards, of chemicals worldwide. It is also expected to complement the REACH regulation on the registration, evaluation authorisation and restriction of chemicals.
Regulators hope that the use of internationally agreed classification criteria and labelling will facilitate trade and contribute to global efforts towards human and environmental health and safety. After the new regulation enters into force, according to the new rules the deadline for substances classification will be
Pharmaceuticals – Competition: Preliminary Report on Pharmaceutical Sector Inquiry
Laura Zadunayski
On 28 November 2008, the European Commission issued its preliminary report on the competition inquiry into the pharmaceutical sector. According to the preliminary findings there is evidence that originator companies (companies developing and selling new medicines) have engaged in practices with the objective of delaying or blocking market entry of competing medicines from other originator companies and, in particular, from generic companies (companies that sell medicines once the patents have expired).
The preliminary report highlights a number of “delaying” tactics adopted by the originators which restrict competition:
· Originator companies filed so called “patent clusters” (a large number of EU-wide patents for a single medicine.
· Another practice was litigation against the generic companies. The Commission found that the generics won over 60 per cent of these cases but, even where the generics had been successful, the litigation could lead to a substantial delay in the marketing of the generic product.
· Originator companies concluded settlement agreements with generics, many of which contained restrictive agreements such as “reverse payment settlement” clauses whereby market entry was restricted in return for the generics receiving payment.
· Originator companies practised defensive patent strategies to fence off competition from other originator companies.
· Originator companies participated in national authorisation procedures for generics often with the result that approval of the generic is delayed (on average by four months).
The Commission considered that these practices, and others, were detrimental to competition and led to higher costs for consumers and health authorities as the entry of generics on the market usually led to a large reduction in prices.
The report underlines a significant number of comments from stakeholders on the regulatory framework. In particular, both generic companies and originator companies called for a single Community Patent and the creation of a unified and specialised patent judiciary in Europe, with the aim of decreasing the number of contradictory final judgments in litigation cases as well as the total direct costs associated with patent litigation.
Before reaching its final conclusions, the Commission invites all stakeholders to submit their views and observations on the preliminary findings by 31 January 2009. The final report will take into account comments received during the public consultation and is expected to be published in spring 2009.
Energy: Commission Adopts Revised Proposal on Nuclear Safety
Vasilios Bousis
The European Commission has adopted a revised proposal for a Directive setting up a Community framework for nuclear safety. The new Directive responds to EU citizens' concerns for Europe-wide binding safety legislation for the operation of nuclear power plants. It defines basic obligations and general principles for the safety of nuclear installations in the European Union whilst enhancing the role of national regulatory bodies.
The proposal, which replaces and updates the one tabled in September 2004, is based on the obligations of the Convention on Nuclear Safety (CNS) and the International Atomic Energy Agency (IAEA) on Safety Fundamentals. The High Level Group on Nuclear Safety and Waste Management (ENSREG) will become the main point of co-operation between regulators and will contribute to the continuous improvement of nuclear safety requirements, especially with respect to new reactors.
The proposal’s scope of application is the design, construction, maintenance, operation and decommissioning of nuclear installations, for which consideration of safety is required under the legislative and regulatory framework of the
Finance – VAT: Commission Presents Action Plan to Better Combat VAT Fraud
Jacques Pieters
The European Commission has released a communication announcing a short term action plan to combat VAT fraud. The main target is so-called “missing trader fraud”. This is where a person subject to VAT makes an intra-community acquisition on which no VAT is charged and subsequently supplies the goods domestically, charges VAT and then disappears without paying the tax authorities the charged VAT.
The Commission’s action plan consists of: (i) amendments to the VAT Directive to tighten the conditions under which VAT exemptions will apply and to extend the liability for the VAT payment to other parties involved in the transaction, and (ii) a number of measures that should increase the information exchange between Member State authorities (through the Eurofisc network) or their ability to recover VAT due from residents of another Member State.
Energy: Establishment of Service Stations – Commission Closes Proceedings Against
Anteo Picello
In June 2007 the European Commission formally requested Italy to amend its rules on the establishment of service stations, which previously imposed: (i) compliance with regional market programming, (ii) compulsory minimum size and additional “non-oil” commercial activities, (iii) minimum distances between installations, (iv) constraints regarding opening hours, and (v) analytical self-certification accompanied by a report by a sworn expert entered on the Italian register. The Commission’s request took the form of a Reasoned Opinion, based on Article 226 of the EC Treaty.
The legal framework involved both national and regional law. Italian national authorities promised legislative initiatives, but as nothing had been done by February 2008, the Commission decided to bring
NEXT WEEK’S EVENTS
Monday 8 December –
COUNCIL MEETINGS
General Affairs and External Relations Council (8 – 9 December 2008)
Transport, Telecommunications and Energy Council (8 – 9 December 2008)
European Council (11 – 12 December 2008)
COURT OF JUSTICE
Judgments
Common Customs Tariff
Joined Cases C-362/07, C-363/07 Kip
Company law
C-380/06 Commission v
Competition
C-52/07 Kanal 5 and TV 4
Environment and consumers
C-387/07 MI.VER and Antonelli
Free movement of goods
C-524/07 Commission v
Law governing the institutions
C-121/07 Commission v
Police and judicial cooperation in criminal matters
C-297/07 Bourquain
State aid
C-295/07 P Commission v Département du Loiret
Taxation
C-285/07 A.T.
C-371/07 Danfoss and AstraZeneca
Opinions
Approximation of laws
C-460/07 Puffer
Taxation
C-572/07 RLRE Tellmer Property
COURT OF FIRST INSTANCE
Judgments
Agriculture
T-339/06 Greece v Commission
Intellectual property
T-136/07 Colgate-Palmolive v OHMI - CMS Hasche Sigle (VISIBLE WHITE)
T-290/07 MIP Metro v OHMI - Metronia (METRONIA)
