internal market and competition law Flashcards
direct discrimination
If a national rule directly contains less favourable treatment of nationals of other MS.
indirect discrimination
formally, a provision is not linked to nationality, but to a criterion which, as a result, places domestic goods, persons, etc. in a better position than those from other MS.
restriction
= Dassonville formula
National rules that impede or effectively pose an obstacle to exercise freedom of movement, so that it becomes less attractive. There’s no element of discrimination, all nationals are affected, but it has a negative effect on market opportunities of foreigners.
country-of-origin principle
goods are allowed to circulate in the same form, shape and composition that is lawful in the country of origin.
Dassonville-formula
All measures enacted by MS which are capable of hindering, directly or indirectly, actually or potentially, intra-Union trade are to be considered as measures having an effect equivalent to quantitative restrictions.
Keck-exemptions
expressly excludes completely neutral selling arrangements (rules governing the conditions of sale or marketing of product), provided that they are
(1) not discriminatory and
(2) have no negative effect on the market access of foreign goods,
eg. fair-trading law.
(1) principle of universality: indistinctly applicable measure
(2) principle of neutrality: affects domestic and products from other MS in the same manner, in law and in fact.
derogations
Discrimination does not apply to certain public service positions that requires the worker to exercise imperium and a special allegiance to the state. eg. judge, police force, military
definition of a good
products which can be valued in money and which are capable, as such, of forming the subject of commercial transactions
definition of a worker
a person performs genuine and effective economic activity for and under the direction of another person in return for remuneration (Lawrie Blum)
definition of a service
a person performs a task in return for remuneration NOT under the direction of another person and WITHOUT a permanent establishment
definition of an establishment
a person performs a task in return for remuneration NOT under the direction of another person and with a permanent establishment on a stable and continuous basis
definition of capital
The transfer of value in the form of real and monetary capital, which regularly represents an investment at the same time:
- real capital (company shares, real estate)
- monetary capital (loans, credits, securities)
- capital transactions of personal nature (gifts, inheritance)
definition of payment
= flows of funds that are related to an
agreed underlying transaction.
three aspects of market definition
(1) Product Market: Products or services that are substitutable from the consumer’s perspective based on characteristics, prices, and intended use.
(2) Geographical Market: The geographical area where competition conditions are sufficiently homogeneous and distinguishable from other areas.
(3) Temporal Market
FRAMEWORK FOR SOLVING CASES (!)
(1) No special rules
(2) Scope
(3) Addressees
(4) Discriminations or restrictions
(5) Derogations
(6) Justification
(1) special rules
- Art. 110 TFEU: fiscal barriers to trade
- Art. 38 TFEU: agricultural products
- Art. 346 TFEU: trade in arms
- Fully harmonised secondary legislation
(2) scope
a) Material: What is a good, worker, establishment, service, capital, payment?
b) Personal: Who has rights under the internal market freedoms?
c) Territorial: cross-border situation
d) Temporal: if a measure is adopted by the MS
before accession to the EU
(3) addresses
- host state
- home state (Art. 35, similar for other freedoms)
- generally not for private actors but exceptions!
(1) Non-state actors exercising regulatory competence
conferred by public authorities
(2) Non-state actors attributable to the state, e.g. financed, created, staffed
(3) Failure to protect the internal market rights against
private acts (Schmidberger)
provisions where professional bodies are addressees
Free movement of workers
Freedom of establishment
Freedom of services
application of fundamental freedoms between private parties
Only recognized in the context of free movement of workers (Angonese)
(6) justifications
a) Grounds
i. Treaty-based justifications: e.g. public policy, public security
ii. Overriding grounds in the public interest (Cassis de Dijon)
b) Proportionality test
c) Fundamental rights: any justification must be appraised in light of EU fundamental rights, but balancing interests is mandatory!
Cassis de Dijon justification conditions
(1) No direct discrimination
(2) No purely economic measure
(3) Non-exhaustive list of reasons of mandatory requirement:
e.g. protection of the environment, consumer protection, fundamental rights
proportionality requirements
(1) Suitability: measure must be suitable to
achieve the goal
(2) Necessity: measure must not go beyond
what is necessary to achieve the goal
(3) Appropriateness: no excessive impact on
the market freedoms, balancing competing
interests
conditions of a cartel (Art. 101 TFEU)
(1) Undertaking / Association of undertakings
(2) Collusion: agreement, concerted practices, decisions
(3) Having as its object or effect the restriction of competition
(4) Effect on trade between MS
(5) Appreciability
(1) undertaking
Every entity engaged in an economic activity, regardless of the legal status of the entity and the way in which it is financed (Höfner)
(2) agreement
existence of a concurrence of wills between at least two parties, the form in which it is manifested being unimportant so long as it constitutes the faithful expression of the parties’ intention. Bindingness not required (‘gentlemen’s agreement’) and it has market conduct as the object.
(2) concentrated practices
A form of coordination between undertakings without a properly conducted agreement.
(3) restriction of competition
any restriction of the individual economic freedom of action of an undertaking on the market (independence)
(5) appreciability (de minimis)
Collusive behaviour of minor importance of both restriction and effect on trade.
(< 10 % horizontal
< 15 % vertical)
exemption conditions for cartels
(1) Improve the production or distribution of goods
or promote technical or economic progress
(2) Ensure that consumers receive a fair share of
the resulting benefits
(3) Only contain necessary restrictions
(4) Must not substantially eliminate competition
conditions of an abuse of market position (Art. 102 TFEU)
(1) Undertaking
(2) Dominant Position
(3) Abuse
(4) Effect on trade between MS
exploitative abuse
gains monopoly benefits at the expense of consumers
eg. tying and bundling
exclusionary abuse (foreclosure)
actually or potentially, foreclose the market to existing or new competitors having an adverse impact on consumer welfare
conditions for state aid (Art. 107)
(1) Beneficiary is an undertaking
(2) State origin
(3) Advantage
(4) Selectivity
(5) Distortion of competition and aid affects trade between MS
Demand-side substitutability
The SSNIP test (“Small but Significant Non-transitory Increase in Price”) assesses whether consumers would switch to alternative products in response to a small price increase (typically 5-10%).
Supply-side substitutability
Whether suppliers can easily switch production to offer competing products.
