Seminar 3 - Anticompetitive agreements Part 1 Flashcards
What is Article 101 TFEU?
A law that prohibits agreements, decisions, and concerted practices that prevent or distort competition within the EU.
What are the consequences of violating Article 101 TFEU?
Agreements violating Article 101(1) are automatically void, and parties may face fines or be sued for damages.
What does Article 101(3) TFEU provide?
Exemptions for agreements that improve production or distribution and provide benefits to consumers, as long as they don’t eliminate competition.
What is the UK equivalent of Article 101 TFEU?
The UK Competition Act 1998, Chapter 1 Prohibition.
What is meant by an ‘undertaking’ in competition law?
Any entity engaged in economic activity, irrespective of its legal form.
What is a ‘concerted practice’?
Coordination between firms to reduce competition without a formal agreement.
What is a cartel?
An agreement between competitors to fix prices, limit production, or divide markets.
What is the single economic unit doctrine?
Parent and subsidiary companies are considered a single entity for the purposes of Article 101 TFEU, meaning agreements between them may not fall under competition law.
What are the types of agreements prohibited by Article 101(1) TFEU?
Agreements that directly or indirectly fix prices, limit production, share markets, or apply dissimilar conditions to equivalent transactions.
What is the burden of proof for showing a breach of Article 101 TFEU?
The burden of proof is on the European Commission or national competition authorities to show a breach of Article 101(1).
What is a vertical agreement under Article 101 TFEU?
An agreement between companies at different levels of the supply chain (e.g., manufacturer and distributor).
What is a horizontal agreement under Article 101 TFEU?
An agreement between companies at the same level of the supply chain, such as two manufacturers or two retailers.
What is meant by ‘concerted practice’ under Article 101 TFEU?
A form of coordination between firms that knowingly substitutes practical cooperation for the risks of competition without reaching the stage of a formal agreement.
What is meant by ‘passive participation’ in anticompetitive agreements?
A party can be deemed part of an anticompetitive agreement if they attend a meeting where the agreement is discussed, even if they don’t actively participate.
What is a ‘hub and spoke’ arrangement in the context of concerted practices?
An arrangement where competitors share information through a non-competitor (the hub), which then passes information to other competitors (the spokes).
What happens if a public entity performs economic activity under Article 101 TFEU?
A public entity can be considered an undertaking and subject to competition rules if it engages in economic activities, even while performing public functions.
What is the significance of ‘decisions by associations of undertakings’ under Article 101 TFEU?
Decisions made by associations, such as trade bodies, can be caught under Article 101 if they affect competition, even if they are not formal agreements.
What is required for an agreement to have an appreciable effect on competition under Article 101 TFEU?
The agreement must impact trade between EU member states and must be capable of appreciably affecting competition.
What is a block exemption under Article 101(3) TFEU?
Certain types of agreements that would ordinarily breach Article 101(1) but are exempt under specific EU regulations because they provide benefits to the market
What is an example of a restriction by object under Article 101 TFEU?
A cartel engaging in price fixing or market sharing is considered a restriction by object, meaning it is inherently harmful to competition.
How does the leniency procedure work in uncovering cartels?
A member of a cartel can report the existence of the cartel to competition authorities and receive immunity or a reduction in fines under the leniency procedure.
What are the penalties for breaching Article 101 TFEU?
Breaches of Article 101 can result in agreements being voided, fines being imposed by authorities, and private lawsuits for damages.
What was the significance of Case 107/82 AEG-Telefunken v Commission?
It established that even tacit agreements, such as selective distribution policies enforcing resale price maintenance, can violate Article 101 TFEU.
What are ‘restrictions by object’ under Article 101 TFEU?
These are agreements that by their very nature restrict competition, such as price-fixing, limiting output, or market sharing, without needing to show actual harm to competition.
What is the significance of Case COMP/39437 – TV and Computer Monitor Tubes?
This case involved the European Commission imposing fines for price-fixing and market sharing in the production of cathode ray tubes, a violation of Article 101.
What is the single economic unit doctrine in competition law?
This principle holds that a parent and its subsidiary can be considered a single economic entity if the subsidiary lacks economic independence, and thus, agreements between them fall outside Article 101.
What is the importance of market share in assessing appreciable effects on trade under Article 101 TFEU?
Agreements between parties with a combined market share of less than 5% are generally not considered to have an appreciable effect on competition.
What are the consequences for trade associations that recommend anticompetitive practices?
Even non-binding recommendations from trade associations can be considered anticompetitive if they influence member behavior, violating Article 101.
What does ‘algorithmic pricing’ pose as a challenge to competition law?
Algorithmic pricing can potentially facilitate collusion, as companies may use algorithms to monitor and match competitors’ prices, raising concerns about tacit agreements.
What is the relevance of Case C-49/92 P Commission v Anic in anticompetitive agreements?
This case highlighted that merely attending a meeting where anticompetitive agreements are discussed can make a firm liable unless they explicitly distance themselves from the agreement.
