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Belgium: Practical difficulties for Competition Authority

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The number of merger decisions that have been published, and therefore that have formally been taken, has dramatically decreased over the years. To give some indication, there were 42 published decisions in 1994 and only 19 in 1997. According to reliable sources, 18 mergers were ‘informally’ cleared in 1996 and 37 in 1997.

Hungary: Logical inconsistency in Competition Act

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There is currently no legislative history or legal commentary available to explain why the 'independence' requirement was not built into the merger control provisions in a uniform manner. The Competition Office has applied the law to the letter without regard to the resulting logical inconsistency. In this writer’s view, however, the apparent distinction drawn by the Competition Act between the second form of business concentration (acquisition of control) and the first and third forms (mergers and formation of a joint venture) is not compelling.

United Kingdom: Flux in the electricity sector

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The MMC’s PacifiCorp report and the decision by Margaret Beckett not to refer Texas’s bid for Eastern to the MMC has clarified that foreign bids for RECs are not expected to raise regulatory concerns. This would not necessarily be the case in deals involving increased vertical integration in the industry, or common ownership of two or more RECs.

New Zealand: Reforms in electricity industry

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The problems identified in the Government discussion document on the reform package are certainly not unique to the electricity industry. A similar package of reforms may well be initiated in the gas industry, while the Commerce Commission has been active in obtaining settlements from various regional councils involved in the provision of water and wastewater services, such that maintenance and connection services are to be separated.

Spain: Changes to Draft Competition Bill

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The draft bill on competition law is being revisited by the government. It appears that the government is backtracking on its initial proposals. The new proposals, which would maintain the TDC’s current independent status, are more in line with the trend at EU level to reinforce the independence of the competition authorities.

Franchising:Australia proposes mandatory franchising code

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The process surrounding the promulgation of the draft Code also is troubling: the original public comment period was only two weeks. Nevertheless, the International Franchise Association and other interested parties submitted critical comments, and the Ministry has now agreed to redraft the proposed Code. However, the revision will not be published for additional comments and is likely to be enacted into law later this year.

Australia: ACCC changes tack

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National Foods Limited appears to have convinced the ACCC to provide clearance to its proposed acquisition of Pauls Limited without the need for it to make its usual market enquiries. In accepting a courtenforceable divestiture undertaking from National Foods to address its competition concerns, the ACCC relied on its understanding of the dairy industry. It will be interesting to see whether this case will pave the way for other proposed mergers to proceed with a similar level of cooperation from the ACCC.

United States: FTC resolves Intel concerns

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The FTC settlement in the Intel/Digital matter continues the US antitrust enforcement agencies’ activist stance in the area of intellectual property rights. The agencies will closely examine the transfer of such rights between significant competitors, particularly where the transfer results from an out-of-court resolution of intellectual property litigation. As a result, parties should structure such arrangements so as to ensure that they do not unreasonably restrict opportunities and incentives for product and technological innovation.

Italy: Autorita turns spotlight on pharmaceuticals

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Parallel behaviour on prices can be very lucrative in this sector where, because of the essential nature of pharmaceuticals, demand is very stable. More often than not, demand is determined by the doctor who prescribes the medicine rather than by the consumer. The problem of proving parallel conduct has always been a topical issue in competition law. In the absence of hard evidence pointing to contact between undertakings, it is likely that the Authority will rely on the Dyestuff case, in which the ECJ stated that price increases which are very similar in timing and rate of price change cannot be explained by independent market forces.

Brussels tackles broadcasting

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EU Competition Commissioner Karel van Miert has had two important broadcasting cases on his agenda that are seen as critical to the future of digital television in Europe: British Interactive Broadcasting, a joint venture of British Sky Broadcasting and British Telecom in home shopping and banking, and in Germany the proposed digital TV alliance between erstwhile rivals Kirch Gruppe and Bertelsmann AG alongside Deutsche Telekom, whose cable network is to carry the service.