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Competition: Commission Sends Statement of Objections to MasterCard
The European Commission has sent a supplementary Statement of Objections (SO) to MasterCard. In the new SO, the Commission takes the view that MasterCard restricts competition between member banks by pre-determining a minimum price retailers must pay for accepting MasterCard and Maestro branded payment cards. MasterCard will be given access to the file and the opportunity to make its views known in an oral hearing, before the Commission decides whether it has indeed violated EU Competition rules. The Commission could prohibit MasterCard’s interbank “interchange” fees if the efficiencies of these fees do not sufficiently outweigh the restrictive effects of the minimum fee charged to retailers.
Environment: Action Taken Against Italy for Violations of Environmental Law
The European Commission has announced that it has taken legal action against Italy for several breaches of EU health and environmental law. In two cases related to waste management, the Commission has referred Italy to the European Court of Justice (ECJ) for (i) failing to conform Italian legislation to the EU Landfill Directive, 1999/31/EC, and (ii) Italy’s definition of “waste”, which is more restrictive than the EU definition contained in the EU Waste Framework Directive, 75/442/EEC (as amended). In a third waste management case, the Commission sent Italy a final warning for failing to comply with an ECJ ruling that found the state of several landfills in the Puglia region inconsistent with the EU Waste Framework Directive. Finally, the Commission has sent Italy a final warning for failing to determine whether an environmental impact assessment (EIA) is necessary in connection with a road project near Milan, as required by the EU EIA Directive 85/337/EEC (as amended).
Mergers: easyJet Challenge to Air France/KLM Deal Rejected
The Court of First Instance (CFI) has dismissed an appeal by easyJet against a decision of the European Commission to approve the merger between Air France and KLM, subject to compliance with certain undertakings. The CFI found that the Commission was right in defining that each point-to-point route is a separate market. The CFI further considered that easyJet had not presented sufficient evidence to show that the Commission had committed manifest errors in its assessment of the impact of the merger, taking into account the undertakings given by Air France and KLM.
Competition: CFI Upholds Fine in Dutch Industrial Gases Cartel
The Court of First Instance (CFI) has dismissed the appeal lodged by the Dutch company NV Hoek Loos against the Commission decision in the Dutch industrial gases cartel case. In 2002, the Commission fined seven producers of industrial and medical gases a total of EUR 25.72 million for participating in collusive arrangements. NV Hoek Loos was fined EUR 12.6 million. In its appeal, the company asked the CFI to annul or reduce the fine imposed. The CFI held that the fine imposed upon NV Hoek Loos was neither disproportionate nor discriminatory. Furthermore, the CFI confirmed that, when calculating fines, it is not discriminatory for the Commission to apply the ten per cent upper limit on the worldwide turnover of a participant in a cartel before the application of a reduction pursuant to the Leniency Notice.
Trade: Commission Approves Terms for New EU-Russia Agreement
The European Commission has agreed negotiating directives for a new EU-Russia Agreement, which will replace the current EU-Russia Partnership and Cooperation Agreement. The Commission is proposing an agreement that will cover all areas of cooperation, known as the four Common Spaces: (i) economic, including the energy dialogue; (ii) freedom security and justice; (iii) external security; and (iv) research, education and culture. The European Council has to agree on the negotiating directives before the Commission proceeds with the negotiations. The Commission is relying on support from the Finnish Presidency and expects the Council’s agreement before the end of 2006. It will propose to move towards a free trade agreement once Russia accedes to the World Trade Organisation.
Taxation: Infringement Procedures Against Poland and Finland Regarding Car Registration Rules.
The European Commission has decided to send Poland and Finland formal requests to amend their car registration tax rules. In Poland, the way registration tax is calculated results in heavier taxation of second-hand cars imported from other Member States. Such legislation fails to conform with the EC Treaty, which provides that a Member State may not impose higher internal taxation on other Member States’ products than on similar domestic products. In the case of Finland, both the amount of registration tax levied on second-hand cars imported from other Member States and the way in which registration tax is levied on leased cars are considered not to be in conformity with the prohibition on imposing higher taxation on foreign products, and with the freedom to provide services. If no satisfactory responses are received from Poland and Finland, the Commission may bring the cases before the European Court of Justice.
Mergers: Second Phase Conditional Clearance of Inco/Falconbridge Merger
The European Commission has cleared the proposed acquisition of Falconbridge by Inco subject to conditions. Inco and Falconbridge are both Canadian mining companies active in the mining, processing, refining and sale of nickel, cobalt and other metals. The Commission’s investigation indicated that the new entity would have been able to increase prices on certain nickel and cobalt markets in the European Economic Area (EEA) in the absence of any significant competitive constraint. With a view to removing the Commission’s concerns, the merging parties have committed to divest Falconbridge’s sole nickel refinery and related assets, and have proposed to sell these assets to LionOre, an international mining company which is also active in nickel mining. The Commission has concluded that subject to full compliance with these commitments, the proposed transaction, as modified, would not significantly impede effective competition in the EEA.
Internal Market: Commission to Refer Germany to ECJ over Pension-Savings Grant
Contact Philip Bentley QC
The European Commission has decided to refer Germany to the European Court of Justice (ECJ) over legislation concerning the Pension-Savings Grant, Riester-Rente. Under German Riester-Rente legislation, a grant is paid to pension institutions to encourage individuals to make their own capital-based provision for retirement and to complement their social security pensions. In the Commission’s opinion, three elements of the Riester-Rente are contrary to EU Treaty provisions on the free movement of workers and persons: (i) to qualify for the grant the individual has to be fully liable to tax in Germany; (ii) the individual can use grant-aided capital to purchase a dwelling only if it is situated in Germany; and (iii) the grant must be repaid if the individual ceases to be fully liable to tax in Germany. The decision to refer Germany to the ECJ follows a reasoned opinion issued by the Commission on 19 December 2005.
Social: Late Implementation of Directives – ECJ Ruling
Philip Bentley QC
The European Court of Justice (ECJ) has ruled again in relation to Member States’ late implementation of directives. This case arose out of the illegality of certain Greek legislation which had the effect of denying the protection instituted by Directive 1999/70/EC for persons employed under successive fixed-term contracts. The ECJ ruled that, from the date that a directive enters into force (usually the date of publication), national courts must refrain from interpreting domestic law in a manner which might seriously compromise attainment of the directive’s objectives after the deadline for transposition into national legislation had expired. Furthermore, if a Member State does not respect that deadline, its national courts must then interpret national law, as far as is possible, with a view to achieving the results sought by the directive. This development is additional to, and does not affect, the long-established doctrine of “direct effect” of certain provisions in directives.
NEXT WEEK’S EVENTS
Monday 10 July – Friday 14 July 2006
Economic and Financial Affairs Council (ECOFIN) (11 and 14 July 2006)
COURT OF JUSTICE
C-313/04 Franz Egenberger
Approximation of laws
Area of Freedom, Security and Justice
C-103/05 Reisch Montage
Common Customs Tariff
C-14/05 Anagram International
C-205/03 P FENIN v Commission
C-74/04 P Commission v Volkswagen
Joined Cases C-295/04, C-296/04, C-297/04, C-298/04 Manfredi
Convention on jurisdiction
C-539/03 Roche Nederland and Others
Environment and consumers
C-191/05 Commission v Portugal
Freedom of establishment
C-434/04 Ahokainen and Leppik
C-221/05 Sam Mc Cauley Chemists and Sadja
C-61/05 Commission v Portugal
Law governing the institutions
C-432/04 Commission v Cresson
C-13/05 Chacón Navas
C-89/05 United Utilities
C-45/05 Maatschap Schonewille-Prins
C-278/05 Robins and Others
Freedom of movement for persons
Free movement of goods
C-434/04 Ahokainen and Leppik
Social security for migrant workers
C-265/05 Perez Naranjo
COURT OF FIRST INSTANCE
T-413/03 Shandong Reipu Biochemicals v Council
Common foreign and security policy
T-253/02 Ayadi v Council
T-49/04 Hassan v Council and Commission
T-323/03 La Baronia de Turis v OHMI - Baron Philippe de Rothschild (LA BARONNIE)
T-252/04 Caviar Anzali v OHMI - Novomarket (Asetra)
T-247/03 Torres v OHMI - Bodegas Muga (Torre Muga)
T-277/04 Vitakraft-Werke Wührmann v OHMI - Johnson's Veterinary Products (VITACOAT)
T-97/05 Rossi v OHMI - Marcorossi (MARCOROSSI)
T-225/04 Italy v Commission