Brussels Brief - May 8, 2009
May 8, 2009
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Key Developments
Competition: The CFI Reduces Fines Imposed on the Nintendo Group
Matthew Kopetski
Between 1995 and 1996, the European Commission launched two separate investigations into the distribution of Nintendo’s video game cartridges and consoles. The first investigation commenced after the Commission published the preliminary findings of its inquiry into the video game sector. The second was launched in response to a complaint that Nintendo was hindering the parallel trade of its products and was operating a resale price maintenance policy.
At the conclusion of these investigations, the Commission fined Nintendo EUR 149 million for its participation in a “complex of agreements and concerted practices” in the market for video game cartridges and consoles that had the object and effect of restricting parallel imports. Nintendo appealed this decision to the Court of First Instance (CFI), seeking to annul or reduce the fine.
The Commission’s fining guidelines allow it to reduce a fine if a company cooperates with its investigation to a greater extent than that required by law. Nintendo argued that it was entitled to receive a reduction greater than the 25 per cent of the fine granted by the Commission because its cooperation came earlier and was more extensive than that provided by another company, John Menzies Distributors, which was granted a 40 per cent reduction. The Court concluded that the documents in its possession did not show that Nintendo’s cooperation came at an earlier stage in the procedure than the cooperation given by John Menzies Distributors. It did, however, find that much of the information given to the Commission by Nintendo was of equal value to that provided by that company. The Court concluded that the cooperation given by Nintendo was comparable with John Menzies Distributors’ and Nintendo was therefore entitled to receive the same 40 per cent reduction of its fine.
Antitrust: Report on Functioning of Antitrust Regulation 1/2003
Teresa Arnoni
The European Commission has adopted a report on the first five years of application of Regulation 1/2003 on the modernisation of the enforcement of EC antitrust rules. The report follows a fact finding phase to obtain input from stakeholders and a public consultation with businesses, law firms and academia.
According to the report, the abandonment of individual exemptions under Article 81(3) of the EC Treaty has eliminated unnecessary bureaucracy and allowed the Commission to focus its resources on serious violations, such as cartels. The report finds also that the introduction of the European Network of Competition Authorities has contributed to increasing coherent application of EC antitrust rules and has proved to be a successful model of cooperation amongst the national authorities and the Commission.
The report recommends improvements in certain aspects of the Commission's investigations and procedures, notably in relation to voluntary interviews and the imposition of periodic penalty payments. The report also highlights the fact that Regulation 1/2003 does not formally regulate or harmonise the procedures of national competition authorities when they apply EC antitrust rules. Many Member States have, however, voluntarily aligned their rules of procedure with those of the EC.
State Aid: Danish Export Credit Insurance Scheme Approved
Jacques Pieters
Many export firms are suffering under the current credit crisis and the increasing difficulty of insuring the export-credit risk on the private market is only adding to their problems. To mitigate this situation, the Danish State export-credit agency, Eksport Kredit Fonden (EKF) has set up a credit insurance scheme, which provides export-credit reinsurance to the front line private insurers, allowing them to provide (better) credit insurance coverage to the export companies.
The European Commission has now declared this scheme compliant with the EU State aid rules on the basis of the following considerations: (i) the premiums charged by EKF reflect the private market rate; (ii) the premiums are set at a level that ensures that exporters will revert back to the private market once sufficient cover has become available; and (iii) the measure is limited in time and is, for the moment, only approved until 31 December 2010.
Consumer Rights: Commission Wants Consumers to Surf the Web Without Borders
Mary Dineen
A recent Eurobarometer survey found that, although 48.5 per cent of EU households have a broadband internet connection, a lack of confidence holds many consumers back from online transactions. Only 12 per cent of those surveyed believe that transactions over the internet are completely safe, with 42 per cent not having any confidence in these transactions at all. In the European Union, 65 per cent of internet users say they do not know where to get information and advice about cross-border shopping.
A new online tool giving practical advice on the “digital rights” consumers have under EU law has been launched by the European Commission. The “eYouGuide” covers a broad range of online consumer issues, ranging from data protection information to security for online payments. A “Digital Agenda”, identifying eight priority areas for possible EU action, was also announced. These are in response to a call by the Parliament in 2007 for the Commission to implement a comprehensive and coordinated strategy for increasing consumer confidence in the digital environment as a whole. The aim of these measures is to address the low levels of cross border e-commerce trading in Europe and to bridge the gap in e-commerce between Europe and the United States and Asia. It is hoped that making consumers aware of their rights will increase confidence in the e-commerce market and ultimately boost growth.
Internal Market: European Parliament Votes to Ban Trade in Seal Products—WTO Action Threatened
Andrea Hamilton
The European Parliament has voted to approve an EU Regulation that would ban trading in products derived from seals, including their skins, meat, oil, blubber and organs. The proposed Regulation aims to eliminate trade in products derived from commercial seal hunts, but would exempt subsistence seal hunting by Inuit and other indigenous communities.
The proposed Regulation was overwhelmingly approved in the Parliament and must now be approved by Member States. Several Member States, however, have reportedly already signalled support for the measure and the ban is expected to take effect next year.
Major exporting countries of seal products have voiced opposition to the ban, most notably Canada and Norway. Canada is the world’s largest exporter of seal products. It has reportedly threatened to initiate a case against the European Union at the World Trade Organisation (WTO) over the proposed Regulation, unless Canada is exempted from the bans. Norway has likewise made apparent threats to take the European Union to the WTO over the proposed Regulation.
NEXT WEEK’S EVENTS
Monday 11 May – Friday 15 May 2009
COUNCIL MEETINGS
Education, Youth and Culture Council (EYC) (11 – 12 May 2009)
COURT OF JUSTICE
Judgments
Agriculture
C-34/08 Azienda Agricola Disarò Antonio and Others
Area of Freedom, Security and Justice
C-180/06 Ilsinger
C-322/08 Commission v Sweden
C-266/08 Commission v Spain
Free movement of goods
C-161/08 Internationaal Verhuis- en Transportbedrijf Jan de Lely
Opinions
Commercial policy
C-141/08 P Foshan Shunde Yongjian Housewares & Hardware v Council
Environment and consumers
C-40/08 Asturcom Telecomunicaciones
Freedom to provide services
C-199/08 Eschig
Industrial Policy
C-192/08 TeliaSonera Finland
Intellectual property
C-202/08 P, C-208/08 P American Clothing Associates v Office for Harmonisation in the InternalMarket
Social policy
C-116/08 Meerts
State aid
C-89/08 P Commission v Ireland and Others
COURT OF FIRST INSTANCE
Judgments
Intellectual property
T-410/07 Jurado Hermanos v OHMI (JURADO)
T-136/08 Aurelia finance v OHMI (AURELIA)
T-183/08 Schuhpark Fascies v OHMI - Leder & Schuh (jello SCHUHPARK)
T-165/06 Fiorucci v OHMI - Edwin (ELIO FIORUCCI)
