Report from the Commission to the Council and the European Parliament on the application of the agreements between the European Communities and the Government of the United States of America and the Government of Canada regarding the application of their competition laws 1 January 2001 to 31 December 2001
Date: 2002-09-17
Institutions: European Commission
Subjects: Canada, United States, competition law, competition policy, control of restrictive practices, economic cooperation, international agreement, report

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 17.09.2002
COM(2002) 505 final

REPORT FROM THE COMMISSION
TO THE COUNCIL AND THE EUROPEAN PARLIAMENT

on the application of the agreements
between the European Communities
and the Government of the United States of America
and the Government of Canada
regarding the application of their competition laws

1 January 2001 to 31 December 2001

1.

UNITED STATES

1.1.

Introduction

On 23.09.1991 the Commission concluded an Agreement with the Government of the United
States of America regarding the application of
(the “1991
Agreement”),
the aim of which is to promote co-operation between the competition
authorities. By a joint decision of the Council and the Commission on 10.04.19952 the
Agreement was approved and declared applicable from the date it was signed by the
Commission.

their competition laws1

On 04.06.1998 another agreement, which strengthens the positive comity provisions of the
1991 Agreement, entered into force3 (the "1998 Agreement"), after having been approved by
a joint decision of the Council and the Commission of 29.05.1998.

On 08.10.1996 the Commission adopted the first report on the application of the 1991
Agreement for the period of 10.04.1995 to 30.06.19964. The second report completes the
1996 calendar year, covering the period of 01.07.1996 to 31.12.19965. The third report covers
the whole calendar year 19976, the fourth the year 19987, the fifth the year 19998 and the sixth
the year 20009. The current report concerns the calendar year from the 01.01.2001 to
31.12.2001. This report should be read in conjunction with the first report which sets out in
detail the benefits, but also the limitations of this kind of co-operation.

In summary, the 1991 Agreement provides for:

- notification of cases being handled by the competition authorities of one Party, to the extent
that these cases concern the important interests of the other Party (Article II), and exchange of
information on general matters relating to the implementation of the competition rules
(Article III);

- co-operation and co-ordination of the actions of both Parties' competition authorities
(Article IV);

- a "traditional comity" procedure by virtue of which each Party undertakes to take into
account the important interests of the other Party when it takes measures to enforce its
competition rules (Article VI);

1

2

3

4

5

6

7

8

9

Agreement between the Government of the United States of America and the Commission of the
European Communities regarding the application of their competition laws (OJ L 95, 27.4.1995, pp. 47
and 50)
See OJ L 95, 27.4.1995, pp.45 and 46.
Agreement between the European Communities and the Government of the United States of America
on the application of positive comity principles in the enforcement of their competition laws, OJ L 173,
18.6.1998, pp. 26–31.
Com(96) 479 final, see XXVIth Report on Competition Policy, pp. 299-311.
Com(97) 346 final, see XXVIth Report on Competition Policy, pp. 312-318.
Com(98) 510 final, see XXVIIth Report on Competition Policy, pp. 317-327.
Com(1999) 439 final, see XXVIIIth Report on Competition Policy, pp. 313-328.
Com(2000) 618 final, see XXIXth Report on Competition Policy, pp. 319-332.
Com(2002)45 final, see XXXth Report on Competition Policy, pp. 291-307.

2

- a "positive comity" procedure by virtue of which either Party can invite the other Party to
take, on the basis of the latter's legislation, appropriate measures regarding anti-competitive
behaviour implemented on its territory and which affects the important
interests of the
requesting Party (Article V).

In addition, the 1991 Agreement makes it clear that none of its provisions may be interpreted
in a manner which is inconsistent with legislation in force in the European Union and the
United States of America (Article IX). In particular, the competition authorities remain bound
by their internal rules regarding the protection of the confidentiality of information gathered
by them during their respective investigations (Article VIII).

The 1998 Agreement clarifies both the mechanics of the positive comity co-operation
instrument, and the circumstances in which it can be availed of. In particular, it describes the
conditions under which the requesting Party should normally suspend its own enforcement
actions and make a referral.

1.2.

EU/US cooperation during 2001

During 2001, the Commission continued its close cooperation with the Antitrust Division of
the US Department of Justice (DoJ) and the US Federal Trade Commission (FTC) in an ever
greater number of cases. Indeed, contact between Commission officials and their counterparts
at the two US agencies is showing a marked increase in frequency. These contacts range from
detailed case-related discussions to more general, sometimes theoretical, competition policy-
related matters. Case related contacts usually take the form of regular telephone calls, e-mails,
exchanges of documents, and other contacts between the case teams. High-level meetings and
contacts also occur with reasonable frequency. The cooperation continues to be of
considerable mutual benefit to both sides, in terms of enhancing the respective enforcement
inconsistencies between those enforcement
activity, avoiding unnecessary conflicts or
activities, and in terms of better understanding each other's competition policy regimes.

1.2.1. Merger cases

The trend towards the globalisation of markets continued apace during the year, as most
vividly illustrated by the record number and scale of transnational mergers: the year 2001 saw
a continued large number of transactions notified to both the Commission and the US antitrust
agencies. With regard to the investigation of these proposed mergers, staff-level contacts
between DG Competition’s Merger Task Force, on the one hand, and the US DoJ and FTC,
on the other, take place virtually on a daily basis. Cooperation is most effective where the
parties involved agree to permit the EU and US authorities to share the information they
provide by means of a waiver. This now frequently occurs.

to undertakings. Likewise,

In the Metso/Svedala case, which concerned rockcrushing equipment, the Commission and
the FTC fully and intensely cooperated not only with respect to the substantive assessment of
the case but also to the suitability of the remedies. The operation was finally approved by both
authorities subject
in the Nestle/Ralston Purina case, which
concerned pet food, the Commission and the FTC closely cooperated during the negotiations
of remedies. In the CVC/Lenzing case the Commission and the FTC remained in close and
mutually beneficial contact all along the procedure by sharing information, and by discussing
and developing consistent analysis of the main substantive issues. After the Commission had
prohibited the operation, the FTC closed its file. In the GE/Honeywell case the operation was
finally approved by the DoJ and prohibited by the Commission. Although the Commission
reached a divergent outcome from that of the US DoJ, this did not result from a lack of

3

transatlantic cooperation. Indeed, cooperation between the Commission and the DoJ was very
intense and started early in the process, that is well ahead of the actual notification of the
transaction to the Commission.

1.2.2. Non-merger cases

During the course of the year, there has been a notable increased level of contact between the
Commission and the US antitrust agencies in non-merger cases, in particular in cartel cases.
About eleven cartel investigations that both the Commission and the US DoJ had been
investigating were discussed between the two agencies. Most contacts were established via
telephone and e-mail. In certain cases visits took place. In the Fine Art Auction Houses case
cooperation between the agencies was productive. It lead, amongst others, to a coordinated
timing of the investigatory steps of both agencies. This had to do, amongst others, with the
criminal investigation and trial before the District Court of the Southern District of New
York, against former Sotheby’s chairman Taubman. Also, one company involved provided a
waiver, which permitted the two agencies to exchange views regarding confidential evidence.
The Commission’s investigation had not yet been concluded at the end of 2001. Also in other
cases the DoJ and the Commission were able to coordinate there investigations e.g. the timing
of surprise inspections at the companies concerned.

1.3.

Administrative Arrangements on Attendance (AAA)

The Commission adopted on March 31, 1999 a text setting forth administrative arrangements
between the competition authorities of the European Communities and of the United States
concerning reciprocal attendance at certain stages of the procedures in individual cases
involving the application of their respective competition rules10. These arrangements were
concluded in the framework of the agreements between the European Communities and the
government of the United States concerning enforcement of their competition rules, and in
particular the provisions regarding co-ordination of enforcement activities. In May of 2001,
representatives from the US DoJ attended the oral hearing in the GE/Honeywell case.

1.4.

EU/US Mergers Working Group

there were extensive tri-partite (Commission/DoJ/FTC) discussions,

The work of the joint EU/US Mergers Working Group has continued. During the course of
including a
2001,
number of tele/video-conferences. At the occasion of the bilateral meeting of 24 September
2001 it was decided to expand and to intensify the activities of the working group.

1.5.

High-level contacts

There were numerous high-level bilateral contacts between the Commission and the relevant
US authorities during the course of 2001: Commissioner Monti paid a visit to Washington in
March, and used the occasion to meet inter alia with key members of the Administration. On
the 24 September Commissioner Mario Monti met in Washington the newly appointed heads
of the US antitrust agencies, Assistant Attorney General Charles James of the Antitrust
Division of the DoJ and Chairman Timothy Muris of the FTC for the annual bilateral EU/US
meeting. The meeting coincided with the 10th anniversary of the EU-US bilateral agreement
on competition policy. Meetings also took place during the course of the year between the
Commission and other US agencies, e.g., the US Department of Transportation (which has
some responsibility for the management of competition policy issues ).

10

Bulletin EU 3-1999, Competition (18/43); 1999 Report COM(2000) 618 final, p. 5.

4

1.6.

Statistical information

a)

Number of cases notified by the Commission and by the US authorities

There was a total of 84 formal notifications made by the Commission during the period
between 1 January 2001 and 31 December 2001. The cases are divided into merger and non-
merger cases and are listed in Annex 1.

The Commission received a total of 37 formal notifications from the US authorities during the
same period. A list of these cases is found in Annex 2, again broken down into merger and
non-merger cases.

Merger cases made up the majority of all notifications in both directions. There were 71
merger notifications made by the Commission and 25 by the US authorities.

The figures given represent the number of cases in which one (or more) notifications took
place and not the total number of individual notifications. Under Article II of the Agreement,
notifications may be made at various stages of the procedure and so more than one
notification may be made concerning the same case.

b)

Notifications by the Commission to Member States

The text of the interpretative letter sent by the European Communities to the US as well as the
Statement on Transparency made by the Commission to the Council on 10 April 1995,
provides that the Commission, after notice to the US Competition authorities, will inform the
Member State or Member States, whose interests are affected, of the notifications sent to it by
the US antitrust authorities. Thus, when notifications are received from the US authorities,
they are forwarded immediately to the relevant sections in DG Competition and at the same
time copies are sent to the Member States, if any, whose interests are affected. Equally, at the
same time that DG Competition makes notifications to the US authorities, copies are sent to
the Member State(s) whose interests are affected.

1.7.

Conclusions

2001 witnessed a further intensification of EU/US cooperation in all areas of competition law
enforcement. 2001 saw a record number of merger transactions notified both to the
Commission and the US authorities.. The increase of cooperation in 2001 with respect to the
combating of global cartels is noteworthy, also the authorities on the two sides of the Atlantic
are taking increasingly convergent approaches to the identification and implementation of
remedies, and to post-merger remedy compliance monitoring. The Commission, DoJ and FTC
also continued to maintain an ongoing dialogue on general competition policy/enforcement
issues of common concern.

5

2.

CANADA

2.1.

Introduction

The EU/Canada Competition Co-operation Agreement11 is designed to facilitate cooperation
between the European Communities and Canada with respect to the enforcement of their
respective competition rules. The agreement was signed at the EU/Canada Summit in Bonn
on 17 June 1999 and entered into force at signature.

The Agreement provides for, among other things: (i) reciprocal notification of enforcement
activities by either competition authority, where such activities may affect the important
interests of the other party; (ii) one competition authority rendering assistance to the
competition authority of the other party in its enforcement activities; (iii) coordination by the
two authorities of their enforcement activities; (iv) requests by a party that the competition
authority of the other party take enforcement action (positive comity); (v) one party to take
into account the important interests of the other party in the course of its enforcement
activities (traditional comity); and (vi) the exchange of information between the parties,
subject
information. The report on
cooperation between 17 June 1999 and 31 December 2000 was published together with the
sixth report on cooperation with the United States.12 The current report concerns the calendar
year from 1 January 2001 to 31 December 2001.

to applicable domestic laws to protect confidential

2.2.

Cooperation

An increasing number of cases is being examined by the competition authorities on both sides
resulting in increased and enhanced cooperation. Contacts between the Commission and the
Canadian Competition Bureau have been frequent and fruitful. Discussions have concerned
both case related issues, and more general policy issues. Case related contacts usually take the
form of telephone calls, e-mails, exchanges of documents, and other contacts between the
case teams. Case related contacts comprised all areas of competition law enforcement. Merger
cases included GE/Honeywell and Nestle/Ralston Purina and Bayer Aventis. There was a
notable increase in cooperation in cartel cases, about eight cartel investigations that both the
Commission and the Canadian Competition Bureau were dealing with were discussed
between the two authorities.

Policy related issues were discussed at the occasion of visits and through video conferences.
Two bilateral meetings, as foreseen in the Cooperation Agreement, took place in February
2001 in Brussels and September 2001 in Ottawa at which the heads of the respective
competition authorities participated. In addition,
the merger and cartel units from the
respective authorities met to discuss issues specific to their areas of enforcement.

11

12

Agreement between the European Communities and the Government of Canada regarding the
application of the competition laws OJ L 175, 10.7.1999, p. 50
Com(2001)45 final, see XXXth Report on Competition Policy, pp. 291-307.

6

2.3.

Statistical information

a)

Number of cases notified by the Commission and by the Canadian Competition
Bureau

There was a total of 8 formal notifications made by the Commission during the period
between 1 January 2001 and 31 December 2001 (Annex 3). The Commission received 10
formal notifications from the Canadian Competition Bureau (CCB) in 2001 (Annex 4).

b)

Notifications by the Commission to Member States

As foreseen in the agreement, the Commission has informed the Member State or Member
States, whose interests are affected, of the notifications sent to it by the Canadian Competition
Bureau. Thus, when notifications are received from the Competition Bureau,
they are
forwarded immediately to the relevant sections in DG Competition and at the same time
copies are sent to the Member States, if any, whose interests are affected. Equally, at the same
time that DG Competition makes notifications to the Competition Bureau, copies are sent to
the Member State(s) whose interests are affected.

2.4.

Conclusion

The Agreement has lead to a closer relationship between the Commission and the Canadian
Competition Bureau, as well as to a greater understanding of each other’s competition policy.
An increasing number of cases are being examined by both competition authorities, and there
is consequently a growing recognition of the importance, on the one hand, of avoiding
conflicting decisions and, on the other, of coordinating enforcement activities to the extent
that this is considered mutually beneficial by both parties. The increase of cooperation in
2001 with respect to the combating of global cartels is also noteworthy. The Commission and
the Canadian Competition Bureau also continued to maintain an ongoing dialogue on general
competition policy/enforcement issues of common concern.

7

ANNEX 113

Notification by the European Commission to the US Authorities

01.01.2001 –31.12.2001

Merger cases:

01

02

03

04

05

06

07

08

09

10

11

12

13

14

15

16

17

18

19

20

Case n° COMP/ M.2291

VNU/ACNielsen

Case n° COMP/ M.2256

Philips/Agilent

Case n° COMP/ M.2211

Universal Studio Networks/NTL/Studio Channel

Case n° COMP/ M.2271

Cargill/Agribrands

Case n° COMP/ M.2306

Berkshire Hathaway/Johns Manville

Case n° COMP/ M.2312

Abbott/BASF

Case n° COMP/ M.2324

Sanmina Corp.

Case n° COMP/ M.2208

Chevron/Texaco

Case n° COMP/ M.2302

Heinz/CSM

Case n° COMP/ M.2292

AEA Investors/DLJMB Funding III/BF Goodrich

Case n° COMP/ M.2220

General Electric/Honeywell

Case n° COMP/ M.2330

Cargill/Banks

Case n° COMP/ M.1976

Shell/Halliburton/Welldynamics

Case n° COMP/ M.2079

Raytheon/Thales

Case n° COMP/ M.2227

Goldman Sachs/Messer Griesheim

Case n° COMP/ M.2308

Northrop Grumman/Litton Industries

Case n° COMP/ M.2275

PepsiCo/Quaker

Case n° COMP/ M.2365

Schlumberger/Sema

Case n° COMP/ M.2355

Dow Chemicals/Enichem Polyurethanes

Case n° COMP/ M.2350

Campbell/ECBB (Unilever)

13

Due to confidentiality requirements or to protect the secrecy of ongoing investigations, this list names
only those investigations or cases which have been made public

8

21

22

23

24

25

26

27

28

29

30

31

32

33

34

35

36

37

38

39

40

41

42

43

44

45

46

47

Case n° COMP/ M.2231

Huntsmann International/Albright & Wilson

Case n° COMP/ M.2375

PAI + UGI/Elf Antargaz

Case n° COMP/ M.2328

Shell/Beacon/3i/Twister

Case n° COMP/ M.2222

UGC/Liberty Media

Case n° COMP/ M.2394

SCI Systems/Nokia Networks

Case n° COMP/ M.2435

Electronic Data Systems Corp/Systematics AG

Case n° COMP/ M.2424

TYCO/CIT

Case n° COMP/ M.2405

Dow Chemical Company/Ascot plc

Case n° COMP/ M.2359

International Fuel Cells/SOPC (Shell)

Case n° COMP/ M.2466

Sodexho/Abela(II)

Case n° COMP/ M.2190

LSG/OFSI

Case n° COMP/ M.2421

Continental/Temic

Case n° COMP/ M.2460

IBM/Informix

Case n° COMP/ M.2415

Interpublic/True North

Case n° COMP/ M.2449

Goldman Sachs/SJPC/SCP

Case n° COMP/ M.2461

OM Group/DMC

Case n° COMP/ M.2439

Hitachi/STMicroelectronics/SuperH/JV

Case n° COMP/ M.2489

Borg Warner/Hitachi

Case n° COMP/ M.2337

Nestlé/Ralston Purina

Case n° COMP/ M.2480

Thomson/Carlton/JV

Case n° COMP/ M.2531

SARA LEE / EARTHGRAINS

Case n° COMP/ M.2534

SCI Systems/Nokia Networks

Case n° COMP/ M.2517

Bristol-Myers Squibb/Du Pont

Case n° COMP/ M.2509

Dow/Reichhold/JV

Case n° COMP/ M.2575

LIBERTY MUTUAL/GRUPO RSA ESPANA

Case n° COMP/ M.2510

Cendant / Galileo

Case n° COMP/ M.2510

Re-Notification - Cendant / Galileo

9

48

49

50

51

52

53

54

55

56

57

58

59

60

61

62

63

64

65

66

67

68

69

70

71

Case n° COMP/ M.2571

Johnson Controls/Sagem

Case n° COMP/ M.2549

SANMINA/SIC SYSTEMS

Case n° COMP/ M.2560

(USA)
APAX Europe V – A.L.P. Delaware
Mannesmann Plastics Machinery AG, Krauss-Maffei
Corp., Van Dorn Demag Corp., Krauss-Maffei
France, Netstal Maschinen AG

Case n° COMP/ M.2526

GE Insurance Holdings/National Mutual Life

Case n° COMP/ M.2559

USG/Deutsche Perlite

Case n° COMP/ M.2505

Tyco / CR Bard

Case n° COMP/ M.2584

Tyco/Sensormatic

Case n° COMP/ M.2566

Shell-Cinergy / EDA / EPA / JV

Case n° COMP/ M.2507

Xchange/BAE Systems/Procur

Case n° COMP/ M.2572

Time UK Publishing Holdings Ltd/IPC Group Ltd

Case n° COMP/ M.2648

KPNQWEST / GLOBAL TELESYSTEMS

Case n° COMP/ M.2276

The Coca-Cola Company/Nestlé/JV

Case n° COMP/ M.2562

Bertelsmann/France Loisirs

Case n° COMP/ M.2651

AT&T/Concert

Case n° COMP/ M.2667

Utilicorp/DB Australia/Midlands Electricity/JV

Case n° COMP/ M.2643

Blackstone / CDPQ / DeTeKS BW

Case n° COMP/ M.2652

Blackstone / CDPQ / DeTeKS NRW

Case n° COMP/ M.2656

Cinven / Klöckner

Case n° COMP/ M.2613

ALCOA / BHP / BILLITON / JV

Case n° COMP/ M.2502

CARGILL / CERESTAR

Case n° COMP/ M.2627

Otto Versand / Sabre / Travelocity JV

Case n° COMP/ M.2642

BT/Concert

Case n° COMP/ M.2637

NUTRICIA/BAXTER/2.HSC

Case n° COMP/ M.2666

Berkshire Hathaway/Fruit of the loom

10

Non_merger cases

01

02

03

04

05

06

07

08

09

10

11

12

13

request for information

request for information

request for information

request for information

Case n° COMP/ 38.102

PO/NSI-VeriSign Registry

Case n° COMP/ 38.064/F

Covisint

request for information

request for information

Case n° COMP/ 37.926

Sun Microsystems/ETSI

Case n° COMP/ 36.213/F2 GEAE+P&W

request for information

*

*

*

*

*

*

11

ANNEX 2

Notification by the US Authorities to the European Commission

01.01.2001 –31.12.2001

Merger cases:

01

02

03

04

05

06

07

08

09

10

11

12

13

14

15

Philips/Agilent

Svedala/Metso

Quaker Oats/PepsiCo

Baker Holding/Lhoist

GlaxoSmithKline

Eastern Lime Holding/Blue Circle Ind

Ralston Purina/Nestlé

Svedala/Metso

France Telecom/Equant

Chevron/Texaco

General Electric/Honeywell

Phillips/Marconi

Cargill/Cerester

Seagram/Pernod/Diageo

Stoess/Leiner Davis Gelatin

16 Weston/Unilever

17

18

19

20

21

National Dairy Holdings/Marigold

3D Systems Corporation

National Dairy Holdings/Crowley Foods, Inc.

Blue Circle Industries/Lafarge

Reuters Group/Bridge

12

22

23

24

25

Acordis/Lenzing/CVC European Eq. Partners II

DGF STOESS

Dow Chemical Company/Rechhold

Acordis/Lenzing/CVC European Eq. Partners II

Non merger cases14

01

02

03

04

05

06

07

08

09

10

11

12

Delta Airlines/Air France

Anchor (carbon cathode block)

*

USAid waterworks projects (Criminal Fine)

*

(Monochloacetic) Akzo Nobel

Powder River Basin Coal

*

*

*

*

*

14

Due to confidentiality requirements or to protect the secrecy of ongoing investigations, this list names
only those investigations or cases which have been made public

13

ANNEX 315

Notification by the European Commission to the Canadian Authorities

01.01.2001 –31.12.2001

01

02

03

04

05

06

07

08

09

Case n° COMP/ M.2268

Pernod Ricard/Diageo/Seagram Spirits

Case n° COMP/ M.2279

Nortel/Mundinteractivos/Broad Media

request for information

Case n° COMP/ M.2493

Norske Skog/Abitibi/Papco

Case n° COMP/ M.2518

GfE/SHELL HYDROGEN/HQC

Case n° COMP/ *

*

request for information

Case n° COMP/ M.2643

Blackstone / CDPQ / DeTeKS BW

Case n° COMP/ M.2652

Blackstone / CDPQ / DeTeKS NRW

15

Due to confidentiality requirements or to protect the secrecy of ongoing investigations, this list names
only those investigations or cases which have been made public

14

ANNEX 4

Notification by the Canadian Authorities to the European Commission

01.01.2001 –31.12.2001

01

02

03

04

05

06

07

08

09

Graphite & Carbon Products

Supply and Service of Post-tensionning Systems to
the Hibernia Platform

Graphite & Carbon Products

General Electric/Honeywell

Bulk vitamins and Related Products

Carbon & Graphite Products

Carbon & Graphite Products

Bulk vitamins and Related Products

*

15