Antitrust Bites – Newsletter

2024 in numbers: An overview of fines imposed by the Italian Competition Authority

Based on the information available to date, it appears that in 2024 the Italian Competition Authority (ICA) imposed total fines of over EUR9.6 million on undertakings for violating competition law.

In only one case the ICA found a violation of the prohibition of agreements restricting competition. For this infringement it applied a sanction of over EUR3 million. In 2023, the investigations into anticompetitive agreements found infringements in three cases, with sanctions for a total of over EUR12.7 million.

One investigation found that an undertaking had failed to comply with a past decision of the ICA ascertaining the existence of an anticompetitive agreement. In this case, the Authority imposed a sanction of EUR140,044.

In three cases the ICA found violations of the prohibition of abuse of a dominant position and imposed sanctions for a total of over EUR6.4 million. In 2023 only one investigation found infringement of the prohibition of abuse of a dominant position and a sanction of over EUR15 million was imposed.

In two cases the ICA found violations of the obligation to notify a concentration between undertakings prior to its implementation. For these infringements the Authority imposed sanctions for a total of EUR32,857.

Regarding consumer protection, on the basis of the information available to date, it appears that the ICA imposed sanctions for a total of over EUR74.5 million (over EUR42 million in 2023). Of this sum, EUR20,000 was for failing to comply with previous ICA decisions, over EUR19.2 million for unfair contract clauses and over EUR55.3 million for unfair commercial practices and violating consumer rights.

Out of the 52 proceedings concluded by the ICA in 2024 (in 2023 there were 86 proceedings), 22 found unfair business-to-consumer commercial practices and/or the violation of consumer rights (32 in 2023), one was concluded with a finding of non-compliance with a past decision of the ICA (5 in 2023), 10 were concluded with a finding of unfair contract clauses and in one case the ICA found both unfair commercial practices and unfair contract clauses. In 17 investigations the undertakings' commitments were accepted. And, finally, one investigation ended with both commitments being accepted and with a finding of unfair commercial practices.

 

ICA proposes introduction of standstill obligation in merger control matters

In Bulletin No. 1/2025 of January 7, 2025, the ICA published the text of the report sent to the government containing reform proposals for the Annual Market and Competition Act 2024. One of the proposals was to introduce the standstill obligation in merger control matters into national law.

The standstill obligation is that parties to a transaction that has to be notified under the applicable merger control regime are prohibited from implementing it before having received the relevant authorization from the competent authority. Italy, to date, is the only EU jurisdiction that doesn't provide for this obligation in its merger control regulations (set forth in Articles 16 et seq. of Law 287/1990).

The only case of suspension contemplated in the field of merger control by Law 287/1990 (Art. 17) is optional and the ICA can (but doesn't have to) order it. The ICA can order it, as part of its examination of a merger, when it intends to initiate an in-depth investigation, opening the so-called Phase 2.

Conversely, at EU level, Regulation 139/2004 (EUMR) provides that a concentration intended for examination by the European Commission “shall not be implemented either before its notification or until it has been declared compatible with the common market” (Article 7 EUMR).

In the report, after noting that the Italian discipline in its current form is unique in the EU, the Authority points out that it would be appropriate to amend Article 17 of Law 287/1990 to introduce the standstill obligation in our jurisdiction. The Authority also stated that it should provide for effective sanctions in case of violation, taking into account the fact that a possible restoration of the situation before the implementation of the transaction could be complicated if not impossible.

According to the ICA, introducing a standstill obligation for companies won't lead to an increase in the burdens on companies in relation to the merger control regime, since most of the notified transactions are already subordinated to the Authority's authorization of the concentration. On the other hand, when the parties don't provide for such a clause, according to the ICA, recourse to temporary suspension measures pursuant to Article 17 of Law 287/1990 wouldn't be decisive in any case, since the Authority could only dispose of them at the start of Phase 2. There would therefore be a time lapse, namely until the (eventual) opening of Phase 2, during which the companies could still carry out the transaction in a legitimate manner.

As the ICA noted, the proposed amendment aims to harmonize the national legal framework with the EU regime, to ensure legal certainty for all economic operators, with particular regard to companies operating in several member states.

 

Amendments to the Regulation containing rules on investigation procedures under ICA jurisdiction

On January 23, 2025, the Decree of the President of the Republic No. 214 of November 2024 came into force. It contains amendments to the Decree of the President of the Republic No. 217 of 30 April 1998, regulating the investigation procedures under the ICA's jurisdiction. The changes introduced by the new Decree include:

1. Requests for information and exhibition of documents relevant to the investigation, addressed to representatives of undertakings, associations of undertakings or natural or legal persons who might have information relevant to the investigation, must now concisely indicate not only the sanctions, but also the penalty payments provided for in cases of refusal, omission or delay – without a justified reason – to provide what has been requested, including in cases where incomplete, misleading or untruthful information or documents are provided.
2. Documents pertaining to the relations between the ICA and EU institutions, and those pertaining to the relations between the ICA and the Competition Authorities of other member states, have been excluded from the possibility to exercise the right of access.
3. An express presumption of non-confidentiality of the information submitted, for which the right of access can be exercised, has been introduced. This presumption can be overturned only by submitting a specific request indicating the documents – or parts of them – to be excluded from access, specifying the reasons and providing a non-confidential version.
4. The Statement of Objection must be notified at least 45 days (instead of 30) before the end of the investigation period, and must now also mention the potential imposition of sanctions or remedies to bring the alleged infringement to an end. The deadlines for submitting written observations following receipt of the Statement of Objection have been changed (at least ten days before the end of the investigation, instead of five), as well as for submitting the request to exercise the right to be heard before the panel (within ten days of receipt of the Statement of Objection, instead of five).

Finally, the Decree introduced the use, common in practice, of certified electronic mail (or other certified electronic delivery services) among the methods of notification and communication of requests and hearings to/from the ICA.

 

The CJEU ruled on the topic of collective actions for damages for infringements of competition law

On January 28, 2025, the Court of Justice ruled on a reference for a preliminary ruling (case C-253/23) and stated a number of principles with regard to collective actions for damages for infringements of competition law.

The ruling stems from a collective action for damages brought by a firm licensed to operate as a “provider of legal services” under German law against a German Land, on the basis of compensation rights assigned to the plaintiff as a result of an infringement of Article 101 TFEU by the Land and by certain professionals (in the form of price-fixing).

Under German law, actions of individuals for collective damages or low-value damages concerning a large number of persons, may be grouped together through the “collection by group action”. This action may be brought by a provider of legal services licensed to pursue group recovery of the claims on behalf of the assignors.

In order to use this claim assignment mechanism, 32 undertakings had assigned to a provider of legal services their compensation rights resulting from an infringement of Article 101 TFEU by the German Land and other professionals between June 28, 2005, and June 30, 2019. The service provider then brought a group action for collection before a German court. The Land challenged the action stating that the service provider's license under German law would not allow it to pursue the collection of claims based on damages resulting from an alleged infringement of competition law.

During the collective proceedings, the referring court – noting that German law does not provide for any remedy equivalent to the group action for collection – made a request for a preliminary ruling on whether, under European law, persons harmed by an infringement of competition law may assign their rights to compensation to a provider of legal services in order for it to assert them collectively in an action for damages resulting from antitrust infringements.

Ruling on the questions referred by the German court, the CJEU stated that the interpretation of national legislation which has the effect of preventing persons harmed by an infringement of competition law from assigning their rights to compensation is contrary to EU law, if:

1. National law does not provide for any other possibility of grouping together the individual claims of those injured persons that would ensure the effectiveness of the exercise of those rights to compensation, and
2. The bringing of an individual action for damages is, having regard to all the circumstances of the case, impossible or excessively difficult for those persons, with the result that they are deprived of their right to effective judicial protection.

 

Exclusive Distribution Agreements: Advocate General Medina rules on the “Parallel Imposition” Requirement

On January 9, 2025, Advocate General Medina issued an opinion in case C-581/23, concerning a preliminary ruling request on the interpretation of certain provisions of the former EU regulation on exclusive distribution agreements (Regulation EU 330/2010, replaced by Regulation EU 2022/720). And, specifically, it concerned the condition known as the “parallel imposition” requirement, which entails a supplier restricting the active sales of the purchaser to territories or customer groups exclusively assigned to another purchaser or reserved for the supplier. If this condition is met, it allows a restriction on active sales to benefit from a block exemption, avoiding the application of Art. 101, paragraph 1, TFEU.

The main proceeding concerned a dispute between the exclusive distributor of a type of cheese in Belgium and several companies operating in the supermarket sector in Belgium and the Netherlands. According to the exclusive distributor, these companies, aware of the existence of the exclusive distribution agreement between it and the supplier, directly or indirectly infringed its exclusivity rights under that agreement through their activities.

The companies in the supermarket sector, on the other hand, argued that the exclusive distributor and the supplier had attempted to impose on them a prohibition on active sales which they considered contrary to Article 101 TFEU. They claimed the exclusive distribution agreement didn't impose an obligation to protect the exclusive distributor from the active sales of other purchasers and didn't meet the strict conditions set out under competition law to justify a resale ban.

For the purpose of deciding the dispute, the referring court submitted two preliminary questions to the Court of Justice of the EU, asking the Court to clarify:

• if the mere finding that non-beneficiary buyers of the exclusivity regime don't engage in active sales is sufficient to establish the existence of an agreement between that supplier and those other buyers concerning the active sales ban;
• what is the relevant point in time at which the acquiescence by the other buyers has to take place to apply the parallel imposition condition. In particular, the referring court asks whether it is sufficient for the supplier to show that its other buyers accepted the active sales ban only if and when those buyers show an intention actively to sell into the exclusive territory.

The Advocate General first noted that Article 4(b)(i) of Regulation EU 330/2010 includes the parallel imposition condition, even though it's not expressly mentioned. Then, the AG ruled negatively on the first preliminary question. The AG held that, to demonstrate the existence of an agreement prohibiting active sales to other non-exclusive purchasers of the supplier, it's necessary to show that the supplier explicitly invited these other purchasers to behave in a clearly defined manner in the market, and that the purchasers, at least tacitly, expressed their intention to comply with such a prohibition, which must be evidenced on the basis of consistent coincidences or indicia. According to Advocate General Medina, the mere observation of the absence of active sales by non-exclusive buyers is insufficient to prove the existence of an agreement between those purchasers and the supplier.

Regarding the second preliminary question, the Advocate General stated that, when a supplier has assigned a territory exclusively to a specific purchaser, the supplier must prove that the parallel imposition requirement is met with respect to all its other purchasers in the EEA during the entire period for which it claims the benefit of the block exemption provided for in Regulation No 330/2010.