COMMISSION STAFF WORKING DOCUMENT Accompanying the document REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS Report on Competition Policy 2016
Date: 2017-05-31
Institutions: Directorate-General for Competition, European Commission
Subjects: EU competition policy, State aid, competition law, electronic commerce, energy policy, innovation, restriction on competition, single market, telecommunications, waste recycling

EN 

   EN 

   EUROPEAN COMMISSION  Brussels, 31.5.2017  SWD(2017) 175 final   COMMISSION STAFF WORKING DOCUMENT Accompanying the document REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS  Report on Competition Policy 2016 {COM(2017) 285 final}  
 
 
TABLE OF CONTENTS 

I. 

LEGISLATION AND POLICY DEVELOPMENTS ................................................................................... 3 

Antitrust and cartels ............................................................................................................................ 3 

1. Guidance in antitrust and cartel proceedings ............................................................................. 3 

2. Significant judgments by the EU Courts in antitrust and cartels ................................................. 5 

3. The fight against cartels remains a top priority ........................................................................ 11 

4. Continuing close cooperation within the European Competition Network (ECN) and with 
national courts............................................................................................................................... 14 

Merger control .................................................................................................................................. 15 

1. Evaluation of selected procedural and jurisdictional aspects of EU mergers ........................... 16 

2. Recent enforcement trends ...................................................................................................... 17 

State aid control ................................................................................................................................ 19 

1. Uptake of the State Aid Modernisation .................................................................................... 19 

2. State Aid Modernisation continues ........................................................................................... 26 

3. Monitoring, recovery and cooperation with national courts .................................................... 29 

4. Significant judgments by EU Courts in the State aid area ......................................................... 31 

Developing the international dimension of EU competition policy .................................................. 34 

1. Bilateral relations ...................................................................................................................... 34 

2. Multilateral cooperation ........................................................................................................... 36 

II. 

SECTORAL OVERVIEW ................................................................................................................... 37 

1. Energy & environment ...................................................................................................................... 37 

2. Information and Communication Technologies (ICT) and media ..................................................... 43 

3. Financial services ............................................................................................................................... 50 

4. Taxation and State aid ....................................................................................................................... 55 

5.   Basic industries and manufacturing .............................................................................................. 58 

6. Agri-food industry ............................................................................................................................. 62 

7. Pharmaceutical and health services sector ....................................................................................... 65 

8. Transport and postal services ........................................................................................................... 69 

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I. 

LEGISLATION AND POLICY DEVELOPMENTS 

Competition policy helping make markets work more fairly  

The  EU  remains  the  largest  economic  and  trading  area  in  the  world,  with  more  than  half  a 
billion consumers and 20 million companies forming its strongest lever – the internal market. 
The on-going process of improving and expanding the functioning of the single market goes 
hand in hand with developing competition policy. In essence, competition policy ensures that 
companies can compete on equal terms all across Europe.  

But  competition  policy  also  has  another  dimension  –  the  social  side  –  as  referred  to  in  the 
State of the Union speech 20161. Enforcement of competition policy can contribute towards a 
fairer economy and promote markets so that businesses and consumers can get a fair share of 
the benefits of growth. Taken together, competition policy actions in the antitrust area, under 
the  merger  control  and  State  aid  control  can  make  a  real  difference  helping  make  markets 
work  more  fairly,  for  example,  they  stimulate  innovation,  prevent  abuses  from  dominant 
players,  contribute  towards  a  connected  Digital  Single  Market,  a  deeper  and  fairer  internal 
market,  an  integrated  and  climate-friendly  Energy  Union,  support  competition-friendly 
regulation and foster a global competition culture.  

Antitrust and cartels 

Articles 101, 102 and 106 TFEU  

According  to Article  101  TFEU,  anti-competitive  agreements  are  prohibited as  incompatible with  the  internal 
market.  Article  101  TFEU  prohibits  agreements  with  an  anti-competitive  object  or  effects  where  companies 
coordinate  their  behaviour  instead  of  competing  independently.  Even  if  a  horizontal  or  a  vertical  agreement 
could be viewed as restrictive (for example by combining the production of two competing companies) it might 
be allowed under Article 101(3) TFEU if it ultimately fosters competition (for example by promoting technical 
progress or by improving distribution).  

Article 102 TFEU prohibits abuse of a dominant position. It is not in itself illegal for an undertaking to be in a 
dominant position or to acquire such a position. Dominant undertakings, as any other undertaking in the market, 
are entitled to compete on the merits. However, Article 102 TFEU prohibits the abusive behaviour by dominant 
undertakings  which  prevents  new  entry  or  squeezes  competitors  out  of  the  market.  Such  practices  hamper 
competition and negatively affect incentives for innovation and growth, as well as consumer welfare.  

Finally, Article 106 TFEU prevents Member States from enacting or maintaining in force any measures contrary 
to  the  Treaty  rules  regarding  public  undertakings  and  undertakings  to  which  Member  States  grant  special  or 
exclusive rights (privileged undertakings). 

1. Guidance in antitrust and cartel proceedings 

In  2016,  in  order  to  further  increase  transparency  of  antitrust  proceedings  and  to  offer 
guidance to parties and practitioners, the Commission continued its work to facilitate access 
to  file.  It  also  developped  the  so  far  limited  practice  of  cooperation in  antitrust  proceedings 
and actively engaged in work on the interaction of competition policy, personal data and big 
data. 

The right to have access to the Commission's file is a central element of the rights of defence. 
The  preparation  of  non-confidential  versions  of  all  documents  on  file  for  the  purpose  of 
granting access implies a significant burden on parties, third parties and the Commission. One 

1 State of the Union speech 2016 available at http://ec.europa.eu/priorities/state-union-2016_en  

3 

 
 
                                                            
way  to  reduce  this  burden  for  all  involved  could  be  an  increased  use  of  the  so-called 
"voluntary confidentiality rings". In 2016, the Commission continued to develop its practice 
of  providing  access  to  file  through  voluntary  "negotiated  disclosure"  –  also  known  as 
"confidentiality  rings"  –  as  set  out  in  paragraph  96  of  the  Commission  Notice  on  Best 
Practices  for  the  Conduct  of  Proceedings  Concerning  Articles  101  and  102  TFEU2.  The 
Commission  used  confidentiality  rings  in  several  cases  in  2016,  which  allowed  for  more 
efficient  access  to  file  for  undertakings  subject  to  investigation,  third  parties  and  the 
Commission.  

Furthermore,  in  non-cartel  antitrust  cases  leading  to  a  prohibition  decision,  there  is  no 
structured  framework  (comparable  to  settlements  and  leniency  in  cartels)  to  reward 
cooperation by the parties. Although rewards for cooperation by means of fines reduction are 
possible  within  the  existing  legal  framework,  there  have  so  far  been  little  incentives  for  the 
parties  to  cooperate  in  non-cartel  antitrust  prohibition  decisions.  There  may  be  room, 
however,  for  the  Commission  to  reward  genuine  and  meaningful  cooperation  by  parties 
through  acknowledgment  of  the  infringement, disclosure  of  evidence and/or the  proposal  of 
remedies.  The  possible  level  of  fines  reduction  depends  on  the  extent  and  timing  of  the 
cooperation in the specific case and the resulting benefits in terms of efficient procedure and 
effective enforcement. The first example of such a cooperation in 2016 was the ARA case3. 

In  2016,  the  Commission  also  continued  to  actively  work  on  the  interaction  of  competition 
policy, personal data, and big data from both the antitrust angle and the merger control angle. 
The  Commissioner  set  out  some  key  issues  in  three  speeches,  including  on  the  competition 
concerns  and  benefits  of  data  sharing4.  The  interaction  of  competition  policy  and  data  was 
also  discussed  several  times  with  the  national  competition  authorities  in  the  European 
Competition Network. As noted in the press release accompanying the Microsoft / LinkedIn 
merger clearance decision5, "Privacy related concerns as such do not fall within the scope of 
EU competition law, but can be taken into account in the competition assessment to the extent 
that consumers see it as a significant factor of quality, and the merging parties compete with 
each other on this factor". In this instance, the Commission concluded that data privacy was 
an  important  parameter of  competition  between professional  social  networks  on the market, 
which  could  have  been  negatively  affected  by  the  transaction"6.  Finally,  the  Commission 
continues to actively monitor markets in this area, both from an antitrust perspective and from 
a merger control perspective. 

2 Commission notice on Best Practices for the Conduct of Proceedings Concerning Articles 101 and 102 TFEU, 
OJ C 308, 20.10.2011, p. 6, paragraph 96. 
3 For further details of the case see Section II.1 on Energy and Environment at p. 39.  
4 For further information see https://ec.europa.eu/commission/2014-2019/vestager/announcements/competition-
big-data-world_en;  
https://ec.europa.eu/commission/2014-2019/vestager/announcements/making-data-work-us_en and 
https://ec.europa.eu/commission/2014-2019/vestager/announcements/big-data-and-competition_en  
5 Case M.8124 Microsoft / LinkedIn, Commission decision of 6 December 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=2_M_8124  
6 For further information see IP/16/4284 of 6 December 2016 available at http://europa.eu/rapid/press-
release_IP-16-4284_en.htm  

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2. Significant judgments by the EU Courts in antitrust and cartels 

Article 101 TFEU 

Reverse payments in patent settlements 

In its judgments handed down on 8 September7 the General Court ruled for the first time on 
pay-for-delay  agreements  in  the  pharmaceutical  sector.  The  General  Court  basically  upheld 
the  Commission's  Lundbeck  decision.  It  considered  that  Lundbeck  and  the  generic 
undertakings concerned were  potential  competitors  at  the time the agreements at issue were 
concluded.  It  recalled  that,  in  order  to  establish  that  an  agreement  restricts  potential 
competition, it must be shown that, if the agreement had not been concluded, the competitors 
would  have  had  real  concrete  possibilities  of  entering  that  market.  The  General  Court 
considered  that  the  Commission  carried  out  a  careful  examination,  as  regards  each  of  the 
generic  undertakings  concerned,  of  the  real  concrete  possibilities  they  had  of  entering  the 
market, relying on objective evidence such as the investments already made, the steps taken in 
order to obtain a marketing authorisation and the supply contracts concluded with suppliers of 
active pharmaceutical ingredients.  

The  General  Court  also  confirmed  that  the  Commission  was  entitled  to  conclude  that  the 
agreements  at  issue  constituted  a  restriction  of  competition  by  object.  The  General  Court 
found that in the agreements, a reverse payment was combined with an exclusion of generic 
competitors from the market or a limitation of the incentives to seek market entry. The reverse 
payments bought off competition. The General Court held there was uncertainty on patent law 
questions.  Replacing  that  uncertainty  in  relation  to  whether  or  not  the  generic  undertakings 
were infringing and to the validity of the applicants’ patents with the certainty that the generic 
undertakings  would  not  enter  the  market  during  the  term  of  the  agreements  at  issue 
constitutes,  as  such,  a  restriction  on  competition  by  object,  when  that  result  is  obtained 
through  a  reverse  payment.  The  General  Court  took  the  view  that  Lundbeck  did  not 
demonstrate that the restrictions set out in the agreements at issue were objectively necessary 
in  order  to  protect  its  intellectual  property  rights.  The  General  Court  also  confirmed  that 
generic  undertakings  were  exerting  competitive  pressure  on  Lundbeck.  That  competitive 
pressure was eliminated for the term of the agreements at issue, which constitutes, by itself, a 
restriction  of  competition  by  object.  In  conclusion,  the  General  Court  considered  the 
agreements  at  issue  were  comparable  to  market  exclusion  agreements.  The  General  Court 
made clear that the exclusion of competitors from the market constituted an extreme form of 
market sharing and of limitation of production. 

Infringements "by effects" in two-sided markets 

In  the  Groupement  des  Cartes  Bancaires8  (CB)  judgment  of  2016,  the  General  Court 
confirmed the Commission's finding that the fees adopted by CB had the effect of restricting 

7 Cases T-472/13H Lundbeck A/S and Lundbeck Ltd v Commission, EU:T:2016:449; T-460/13 Sun 
Pharmaceutical Industries Ltd, formerly Ranbaxy Laboratories Ltd and Ranbaxy (United Kingdom) Ltd v 
Commission, EU:T:2016:453; T-467/13 Arrow Group ApS and Arrow Generics Ltd v Commission, 
EU:T:2016:450; T-469/13 Generics (United Kingdom) Ltd v Commission, EU:T:2016:454; T-470/13 Merck 
KGaA v Commission, EU:T:2016:452; T-471/13,Xellia Pharmaceuticals ApS and Alpharma, LLC, formerly 
Zoetis Products LLC v Commission, EU:T:2016:460. 
8 Case T-491/07 RENV CB v Commission, judgment of the General Court of 30 June 2016, EU:T:2016:379. The 
case was sent back to the General Court for the examination of the Commission's effects analysis after the Court 
of Justice held in 2014 (in case C-67/13P Groupement des Cartes Bancaires (CB) v Commission, judgment of 
the Court of 11 September 2014) that the General Court erred in law when accepting that the measures 

5 

 
                                                            
competition in the French payment card issuing market, notably by discouraging the issuing 
of CB cards, increasing their price, preserving the revenues of the funding members of CB, 
and limiting technical development of the CB card system.  

The  judgment  of  the  General  Court  follows  the  case  law  of  the  Court  of  Justice  in  the 
MasterCard  judgment  of  2014  concerning  the  analysis  of  "by  effect"  infringements  in  two-
sided  markets.  In  particular,  concerning  the  implementation  of  Articles  101(1)  and  101(3) 
TFEU  in  two-sided  markets,  the  General  Court  stated  that  the  analysis  of  the  possible  anti-
competitive  effects  of  a  conduct  must  be  made  taking  into  consideration  the  legal  and 
economic  context  in  which  the  conduct  takes  place;  in  the  case  of  two-sided  markets,  this 
means  that  one  must  also  consider  the  interactions  between  the  two-sides  of  the  system. 
However,  the  balancing  test  of  pro  and  anti-competitive  effects  must  be  made  in  the 
framework  of  Article  101(3)  TFEU.  Concerning  the  analysis  of  anticompetitive  effects  in 
two-sided markets, the General Court also confirmed that one of the sides may be considered 
as  the  relevant  market  for  the  purposes  of  analysing  possible  anti-competitive  effects  of  a 
given  behaviour  and  that  the  fact  that  there  are  interactions  between  the  two-sides  is  an 
element of the context to be considered when analysing the effects. Concerning the analysis 
of  the  alternative  framework  of  assessment,  the  General  Court  confirmed  that  this  analysis 
must  be  made  within  the  same  market  in  which  the  Commission  has  identified 
anticompetitive effect. 

Reciprocal obligations not to compete 

In  its  Telefónica  and  Portugal  Telecom  judgments9  the  General  Court  confirmed  the 
Commission's  finding  that  the  clause  concluded  by  Telefónica  and  Portugal  Telecom  not  to 
compete with each other on the Iberian telecommunications markets, constituted a restriction 
of competition by object. The General Court confirmed that the Commission was not obliged 
to undertake a detailed analysis of the structure of the market concerned and of the potential 
competition between the companies on these markets before finding such an infringement. 

The General Court nevertheless required the Commission to recalculate the value of sales and 
therefore the amount of the fines, on the basis of the sales of Telefónica and Portugal Telecom 
directly  or  indirectly  linked  to  the  infringement.  In  order  to  determine  the  value  of  the 
companies’ sales to be taken into consideration for the calculation of the amount of the fines, 
the General Court asked the Commission to examine the arguments of Portugal Telecom and 
Telefónica in their replies to the statement of objections seeking to establish that there was no 
possibility of competition between them with regard to certain services.  

Restriction by object 

In its judgments in the Smart card chips case10 the General Court confirmed that an exchange 
of information on current and future prices as well as on capacities is in view of the market 
characteristics  capable  of  influencing  directly  the  commercial  strategy  of  competitors  and 
therefore an infringement by object. The same applies to the information to a competitor not 
to  compete  in  respect  of  a  product  at  a  certain  price  because  this  information  reduces  the 
uncertainty which should exist between competitors. 

introduced by CB were to be seen as restrictions of competition by object. The Court of Justice referred the case 
back to the General Court to determine whether the measures nonetheless had an anticompetitive effect. 
9 Cases T-216/13 Telefónica v Commission and T-208/13 Portugal Telecom v Commission, judgments of the 
General Court of 28 June 2016, EU:T:2016:369 and EU:T:2016:368. 
10 Cases T-758/14 Infineon v Commission and T-762/14 Philips v Commission, judgments of the General Court 
of 15 December 2016, EU:T:2016:737 and EU:T:2016:738. 

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Fines and inability to pay  

On 29 February, the General Court handed down six judgments11 in the Freight Forwarding 
case  confirming  in  nearly  all  respects  the  cartel  decision  adopted  against  that  international 
cartel  in  this  sector  of  services.  The  cartel  involved  15  undertakings,  with  each  of  them 
participating  in  at  least  one  of  four  distinct  cartels  in  the  sector  of  international  air  freight 
forwarding  services.  The  judgments  upheld  the  Commission's  fining  methodology  and  its 
application  of  the  2006  Fining  Guidelines.  In  particular,  the  General  Court  confirmed  that 
even if cartel participants agree only on a certain price component of the overall price paid by 
the  customers  (in  this  case  surcharges  imposed  on  customers),  this  does  not  prevent  the 
Commission from calculating the fine on the basis of the complete turnover generated by the 
sales of the final product or service containing this cartelised component.  

On 7 September, the Court of Justice handed down the last judgment12 against the UK based 
undertaking  Pilkington  in  the  Carglass  case.  The  Court  of  Justice  confirmed  that  the 
Commission was entitled, for the purpose of calculating the fine, to take into account the sales 
made during the infringement period on the basis of contracts concluded prior to that period. 
The  overall  plan  of  the  cartel  was  to  allocate  all  supplies  of  automotive  glass  between  the 
cartel participants, with respect to both existing supply contracts and new contracts. It follows 
that all the sales of car glass had to be regarded as coming within the scope of the cartel and 
could  be  taken  into  account  for  the  purposes  of  determining  the  fine,  including  those  made 
pursuant to contracts that pre-dated the infringement period. 

To  calculate  the  legal  maximum  of  10%  of  the  total  turnover  set  out  by  Article  23  of 
Regulation  1/2003,  the  Commission  took  the  average  exchange  rate  EUR/GBP  of  the  year 
preceding the adoption of the decision. The Court of Justice backed the choice made by the 
Commission  as  it  corresponded  to  the  period  relevant  for  the  calculation  of  the  legal 
maximum and as it best met the requirement of predictability. 

Finally,  the  Court  of  Justice  confirmed  the  General  Court's  findings  that  the  fact  that  the 
applicant's  activities  were  less  diversified  compared  with  the  other  groups  involved  in  the 
infringement  was  not  capable  of  justifying  a  reduction  of  the  fine.  Also,  the  possible 
difference  in  proportion  of  the  fine  in  relation  to  the  total  turnover  of  the  undertaking(s) 
concerned is not a sufficient justification for departing from the standard methodology as set 
out by the Fining Guidelines. 
In  a  judgment  of  20  January,  in  the  Power  Transformers  case13,  the  Court  of  Justice 
confirmed  the  application  of  point  18  of  the  2006  Fining  Guidelines,  which  provides  for  a 
method  of  attributing  value  of  sales  to  such  parties  which  had  due  to  a  market  sharing 
arrangement  no  sales  in  the  EEA.  The  Court  of Justice  stated  that  the  objective  of point  18 
was  to  reflect  in  the  most  appropriate  way  possible  the  weight  and  economic  power  of  the 
cartelists  in  order  to  ensure  that  the  fine  has  a  sufficient  deterrent  effect.  Therefore,  the 
Commission  was  right  not  to  limit  the  determination  of  the  market  shares  to  the  territories 
affected by the cartel, but to use the worldwide market shares to calculate each party's share in 
the value of sales generated in the EEA.  

11 Cases T-251/12 EGL and Others v Commission; T-254/12 Kühne + Nagel International and Others v 
Commission; T-265/12 Schenker Ltd v Commission; T-264/12 UTi Worldwide Inc. and Others v Commission; T-
267/12 Deutsche Bahn AG and Others v Commission; and T-270/12 Panalpina World Transport (Holding) Ltd 
and Others v Commission, judgments of the General Court of 29 February 2016, EU:T:2016:114, 
EU:T:2016:113, EU:T:2016:111, EU:T:2016:112, EU:T:2016:110 and EU:T:2016:109. 
12 Case C-101/15P Pilkington et al. v Commission, judgment of the Court of 7 September 2016, EU:C:2016:631.  
13 Case C-373/14P Toshiba Corporation v Commission, judgment of the Court of 20 January 2016, EU: C: 
2015:427.  

7 

 
                                                            
In  a  judgment  of  14  July,  in  the  Marine  Hoses  case14,  the  General  Court  confirmed  the 
increase  in  the  fine  imposed  by  the  Commission  for  the  aggravating  circumstance  of  cartel 
leadership and found that the 'coordination' of the cartel has been managed by two cartelists, 
upholding the Commission's assumption that there can be two leaders operating at the same 
time. 

In a further judgment in the Pre-stressing Steel case of 2 June15, the General Court dismissed 
a number of appeals lodged by a Spanish group of companies, including the appeals against 
the  rejection  of  the  pre-decision  and  post-decision  "inability  to  pay"  (ITP)  requests.  In  its 
judgment, the General Court confirmed that, when assessing the undertaking's ability to pay 
the fine, the financial situation of the shareholders could be taken into account even if these 
shareholders were not liable for the infringement. Moreover, the General Court considered as 
inadmissible  appeals  against  the  rejection  of  the  post-decision  ITP  requests  because  those 
requests  did  not  demonstrate  that  the  financial  situation  of  these  companies  had  changed 
significantly  since  the  Commission  decision  of  30  June  2010  which  rejected  the  initial  ITP 
requests.  A  number  of  judgments  and  orders16  of  the  Court  of  Justice  in  the  Pre-stressing 
Steel case rejected the parties' appeals and thereby confirmed the Commission decision.  

Application of 2006 Leniency Notice 

In judgments17 in the Freight Forwarding case the General Court confirmed the scope of the 
immunity decision. The General Court did not consider it too broad although it has covered 
all  surcharges  covered  in  the  Commission  decision,  some  of  which  were  not  explicitly 
mentioned  by  the  immunity  applicant  in  its  application.  The  General  Court  found  that 
pursuant  to  2006  Leniency  Notice,  it  is  not  required  that  the  materials  submitted  by  the 
immunity applicant constitute evidence pertaining specifically to the infringements identified 
by  the  Commission  in  its  final  decision.  Instead,  it  is  sufficient  that  the  materials  provided 
enable  the  Commission  to  carry  out  a  targeted  inspection  in  connection  with  a  behaviour 
which covers the infringement(s) that the Commission finds to exist in its final decision. 

A preliminary ruling18 by the Court of Justice on 2 January provided some clarifications about 
the  legal  status  of  summary  application  before  national  competition  authorities.  The  model 
leniency  programme  of  the  European  Competition  Network  (ECN)  foresees  that  companies 
which make a leniency application with the Commission can make simplified applications to 
national competition authorities (called "summary application") to secure their leniency rank 
with the national competition authorities as well, in case the Commission will not deal with 
the case. The Court of Justice found that the ECN model leniency programme was not binding 
on  the  national  competition  authorities  and  stated  that  there  was  no  legal  link  between  an 
immunity application submitted to the Commission and the summary application submitted to 

14 Case T-146/09 RENV Parker Hannifin Manufacturing and Parker-Hannifin v Commission, judgment of the 
General Court of 14 July 2016, EU: T: 2016: 411.  
15 Cases T-426/10 to 429/10 and T-438/12 to 441/12 Global Steel Wire, Moreda-Riviere Trefilerías SA and 
Others v Commission, judgment of the General Court of 2 June 2016, EU: T: 2016:335.  
16 Cases C-490/15 P Ori Martin v Commission and C-505/15 P Siderurgica Latina Martin SpA (SLM) v 
Commission, judgment of the Court of 14 September 2016, EU:C:2016:678; C-510/15 P Fapricela v 
Commission, order of the Court of 7 July 2016, EU:C:2016:547; C-514/15 P Hit Groep BV v Commission, order 
of the Court of 7 July 2016, EU:C:2016:57; C-519/15 P Trafilerie Meridonali v Commission, judgment of the 
Court of 14 September 2016, EU:C:2016:682; C-523/15 P Westfälische Drahtindustrie and Others v 
Commission, order of the Court of 7 July 2016, EU:C:2016:541. 
17 Cases T-265/12 Schenker Ltd. v Commission and T-267/12 Deutsche Bahn AG and Others v Commission, 
judgments of the General Court of 29 February 2016, EU: T: 2016:111 and EU: T: 2016:110.  
18 Case C-428/14 DHL Express (Italy) and DHL Global Forwarding (Italy) SpA v Autorita Garante della 
Cocorrenza e del mercato, judgment of the Court of 20 January 2016, EU:C:2016:587.  

8 

 
                                                            
a  national  competition  authority.  Therefore,  the  national  competition  authority  was  not 
obliged to  interpret  the summary  application in  the  light  of the  application  submitted  to  the 
Commission.  Further,  the effective application of Article 101 TFEU  did  not  preclude that  a 
national leniency programme allows the acceptance of a summary application submitted by an 
undertaking  which  had  not  submitted  an  application  for  full  immunity  before  the 
Commission.  

Level of reasoning 

On  13  December,  the  General  Court  annulled  the  fine  imposed  on  one  of  the  parties  in  the 
Envelopes19  settlement  case  after  having  found  that  the  recitals  concerning  discretionary 
reductions  granted  in  view  of  inter  alia  the  parties'  mono-product  character  were  not 
sufficiently  reasoned  to  allow  the  parties  and  the  court  to  verify  the  respect  of  the  equal 
treatment  principle.  The  General  Court  underlined  that  the  duty  to  state  reasons  must  be 
complied with all the more rigorously when the Commission uses its discretion to depart from 
its Fining Guidelines. Although this was the first review by the General Court of a settlement 
decision, the level of reasoning in the concerned recitals fully mirrored the reasoning used in 
other decisions where such mono-product reductions have been granted, including decisions 
adopted  under  the  normal  procedure.  The  annulment  was  therefore  not  due  to  a  more 
streamlined reasoning of a settlement decision.  

Use of evidence 

In  its  judgment  of  8  September  in  the  Shrimps20  case,  the  General  Court  confirmed  that 
wiretaps found during an inspection are admissible as evidence in cartel cases, irrespective of 
whether  those  wiretaps  were  made  legally  or  not.  What  counts  is  that  the  Commission  has 
obtained  the  wiretaps  lawfully  and  that  the  parties  had  received  all  opportunities  to  defend 
themselves  against  the  gathering  and  usage  of  this  information.  As  in  the  case  of  any  other 
type  of  document,  once  admissible,  the  wiretaps  can  be  used  as  evidence  if  their  content  is 
credible.  The  General  Court  underlined  in  this  respect  that  the  Commission's  case  was  not 
built exclusively on the wiretaps, but was also supported and corroborated by other evidence. 

In the Smart card chips case, the authenticity of a series of e-mails written at the time of the 
infringement was questioned by a party. In its judgment of 15 December 201621 the General 
Court underlined that the only relevant criterion of assessing the probative value of evidence 
is  its  credibility.  When  making  this  assessment,  the  General  Court  accepted  the  assessment 
made  by  the  Commission,  which  consisted  in  the  first  place  in  an  examination  of  the 
credibility of the Leniency applicant having submitted such documents and, secondly in the 
examination  of  the  individual  contested  documents.  In  this  respect,  the  Court  noted  that  no 
expert  report  by  the  parties  concluded  that  the  e-mail  was  not  authentic  and  that  its  content 
was confirmed by a body of evidence resulting also from other documents or statements.  

19 Case T-95/15 Printeos and Others v Commission, judgment of the General Court of 13 December 
2016,:EU:T:2016:722. 
20 Case T-54/14 Goldfish BV and Others v Commission, judgment of the General Court of 8 September 2016, 
EU:T:2016:455. 
21 Case T-758/14 Infineon v Commission, judgment of the General Court of 15 December 2016, EU:T:2016:737. 

9 

 
                                                            
Article 106 TFEU  

Definition of abusive practice 

On 30 June, the Court of Justice in its order22 in Slovenská pošta rejected an application for 
annulment  brought  against  a  judgment23  of  the  General  Court  concerning  the  application  of 
Article 106(1) TFEU in conjunction with Article 102 TFEU.  

The Court of Justice dismissed all the pleas of the applicants. Most importantly the Court of 
Justice confirmed  that an abusive practice contrary  to Article 106(1) TFEU existed where  a 
Member State granted to an undertaking an exclusive right to carry on certain activities and 
creates  a  situation  in  which  that  undertaking  was  manifestly  not  in  a  position  to  satisfy  the 
demand prevailing on the market for activities of that kind. In this context the Court of Justice 
held  that  the  case-law  covered  all  cases  of  manifest  inability  to  satisfy  demand  for  certain 
activities, and not only those where the inability was "structural". 

As  regards  the  establishment  of  facts  by  the  Commission  and  the  General  Court  and  the 
probative value of evidence the Court of Justice held that there is no rule or principle of EU 
law  that  precluded  the  Commission  or  the  General  Court  from  relying  on  a  single  piece  of 
evidence  in  order  to  establish  the  relevant  facts.  The  Court  of  Justice  also  held  that  the 
assessment  of  the  probative  value  of  the  evidence  concerned  and  the  question  whether  it 
definitely  attested  to  the  existence  of  the  fact  alleged  formed  part  of  the  assessment  of  the 
evidence  and  of  the  facts  which  fell,  in  principle,  outside  the  jurisdiction  of  the  Court  of 
Justice, except where the evidence has been distorted. 

State measures with an anticompetitive consequence 

Also  in  relation  to  Article  106  TFEU,  by  judgments  of  15  December,  the  General  Court 
upheld the Commission's decisions of 2008 and 2009 in the Greek Lignite case24 following a 
referral  by  the  Court  of  Justice25.  The  General  Court  confirmed  that  Greece  had  infringed 
Article  106  TFEU  in  conjunction  with  Article  102  TFEU  by  granting  the  Greek  energy 
incumbent PPC/DEI privileged access to lignite and thereby maintained or reinforced PPC's 
dominant position on the wholesale electricity market in Greece. These judgments therefore 
confirm  that  the  Commission  is  entitled  to  tackle  Member  States'  interventions  when  they 
might lead to companies distorting competition.  

Proportionality of commitments  

In  the  Morningstar  judgment26  the  General  Court  upheld  the  Commission´s  commitments 
decision in the Reuters Instrument Codes case27 which intended to address the concerns that 
Thomson  Reuters had  abused  its dominant  position in the market for consolidated real-time 
datafeeds.  

22 Case C-293/15 P Slovenská pošta a.s. v Commission, order of the Court of 30 June 2016, EU:C:2016:511.  
23 Case T-556/08 Slovenská pošta a.s. v Commission, judgment of the General Court of 25 March 2015, 
EU:T:2015:189. 
24 Case AT.38700 Greek Lignite. For further information see 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=1_38700  
25 Cases T-169/08 RENV and T-421/09 RENV - Dimosia Epicheirisi Ilektrismou AE (DEI) v Commission, 
judgments of the General Court of 15 December 2016,:EU:T:2016:733 and EU:T:2016:748.  
26 Case T-76/14 Morningstar Inc. v Commission, judgment of the General Court of 15 September 2016, 
EU:T:2016:481. 
27 Case AT.39654 Reuters Instrument Codes, Commission decision of 20 December 2012 available at 
http://ec.europa.eu/competition/elojade/isef/index.cfm?fuseaction=dsp_result  

10 

 
                                                            
The  General  Court  dismissed  the  application  by  Morningstar,  a  competitor  of  Thomson 
Reuters, as unfounded and confirmed that the review of the lawfulness of a decision making 
commitments binding must be assessed in the light of the Commission’s concerns and not on 
the  basis  of  the  demands  put  forward  by  competitors.  The  General  Court  found  that  the 
Commission is not obliged to show that the commitments accepted were the most favourable 
to competition (compared to other alternatives). Moreover, the General Court found that the 
appropriateness of commitments is a prospective assessment and it is not possible to refute the 
adequacy of commitments because of lack of actual effect on the market. Of importance was 
rather  whether  at  the  point  in  time  at  which  the  Commission  adopted  its  decision,  the 
commitments  were  in  themselves  sufficient  to  remove  the  previously  identified  competition 
concerns. 

Procedural issues 

In  a  series  of  judgments  in  the  Cement  case28,  the  Court  of  Justice  ruled  on  the  appeals 
brought by four cement producers against the judgments by the General Court concerning the 
Commission's  request  for  information  decisions  adopted  pursuant  to  Article  18(3)  of 
Regulation 1/2003.  

The Court of Justice annulled the Commission decisions and held that the General Court erred 
in law in finding that the decisions were adequately reasoned. The Court of Justice recalled 
that the requirement to state reasons must be assessed in light of all the circumstances of the 
case.  In  the  case  at  hand,  the  Court  of  Justice  found  that  the  statement  of  reasons  was  not 
sufficient considering that the decisions were adopted at a time when the Commission already 
had  information  that  would  have  allowed  it  to  present  more  precisely  the  suspicions  of 
infringement weighing on the companies involved. 

3. The fight against cartels remains a top priority 

Cartels are secret agreements between sellers or buyers of the same product or service. They 
are  made  with  the  objective  of  fixing  prices,  limiting  output  or  allocating  clients  and 
suppliers. Cartels harm the consumers at all levels of the value chain and the economy as a 
whole.  Cartelists  charge  inflated  prices,  limit  the  choice  of  the  consumers  and  block 
innovation.  Only  undistorted  competition  guarantees  that  scarce  resources  are  used  in  the 
most  efficient  way.  The  Commission's  action  to  stop  hard  core  cartels  prevents  companies 
from  continuing  to  profit  from  illegal  overcharges  and  thereby  contributes  to  fair  and 
balanced business relationships. The significant sanctions imposed by the Commission deter 
companies from entering into cartels or from remaining in cartels, sending a clear signal that 
operating a cartel will ultimately not pay off.  

The Commission's strong enforcement record against hard core cartels continued in 2016. As 
in  preceding  years,  the  Commission  adopted  cartel  decisions  in  important  sectors  for 
innovation  and  investment,  such  as  the  financial  markets  and  the  automotive  industry.  The 
settlement procedure remains an efficient tool regularly used by the Commission in its fight 
against cartels. Settlement can also apply to sanction large cartels covering important products 
as shown by the trucks settlement decision.  

28 Cases C-247/14P Heidelberg Cement v Commission; C-248/14P Schwenk Zement v Commission; C-267/14P 
Buzzi Unicem v Commission and C-268/14P Italmobiliare v Commission, judgments of the Court of 10 March 
2016, EU:C:2016:149, EU:C:2016:150, EU:C:2016:151 and EU:C:2016:152. 

11 

 
                                                            
The Trucks case 

On  19  July,  the  Commission  imposed  a  total  fine  of  EUR  2.93  billion  on  five  European  truck  producers  for 
coordinating the gross pricing of heavy and medium trucks in the EEA between 1997 and 2011. DAF, Daimler, 
Iveco,  MAN,  Volvo/Renault  had  admitted  their  involvement  in  the  cartel,  which  allowed  the  Commission  to 
settle  the  case  with  them.  MAN  benefited  from  immunity  under  the  Commission's  2006  Leniency  Notice  for 
revealing the existence of the cartel to the Commission. Volvo/Renault, Daimler and Iveco benefitted from fine 
reductions.  Since  all  five  undertakings  agreed  to  settle  the  case  with  the  Commission,  their  fines  were  further 
reduced by 10%. A sixth undertaking chose not to settle the case and the proceedings continue against it under 
the normal procedure.  

The cartel concerned the sales of new trucks weighing between 6 and 16 tonnes ("medium trucks") and trucks 
weighing more than 16 tonnes ("heavy trucks") both as rigid trucks as well as tractor trucks. The case does not 
concern aftersales, other services and warranties for trucks, the sale of used trucks or any other goods or services. 
The parties colluded on pricing and gross price increases in the EEA for trucks and on the timing and the passing 
on of costs for the introduction of emission technologies for medium and heavy trucks required by EURO 3 to 6 
standards.  The  addressees'  headquarters  were  directly involved  in  the  discussion of prices,  price  increases  and 
the  introduction  of  new  emission  standards  until  2004.  From  at  least  August  2002  onwards,  discussions  took 
place  via  German  subsidiaries  which,  to  varying  degrees,  reported  to  their  Headquarters.  The  exchange  was 
operated both on a multilateral and on a bilateral level. The infringement lasted from 17 January 1997 until 18 
January 2011. 

The  Commission  adopted  two  further  settlement  decisions  against  all  participants  in  the 
cartels on 27 January concerning Alternators and Starters29 and on 12 December concerning 
Rechargeable Batteries30. This brings the total number of settlement decisions adopted since 
2010 to 22 and during the same period, around 57% of the total amount of the fines imposed 
by the Commission was via settlement decisions. 

The Commission also completed its investigation in three "hybrid" cases. In "hybrid" cases, 
decisions are adopted both under the ordinary and under the settlement procedure in the same 
case. In these cases, all but a limited number of parties (generally one) were willing to settle 
and  the  Commission  decided  to  adopt  a  settlement  decision  for  the  ones  willing  to  settle 
which represented a large majority. For the parties which did not wish to follow the settlement 
route, the Commission subsequently adopted the decision under the normal procedure.  

On 6 April, the Commission fined Riberebro EUR 5.19 million for participating in the canned 
Mushrooms cartel31. The Commission fined three other producers of canned mushrooms for 
their  participation  in  the  same  cartel  by  its  settlement  decision  of  25  June  2014.  These 
companies  had  admitted  their  involvement  in  the  collusive  arrangements  in  the  mushrooms 
sector,  which  allowed  the  Commission  to  settle  the  case  with  them.  Riberebro  chose  not  to 
settle the case and proceedings continued against it under the normal procedure.  

On 25 May, the Commission completed its investigation in the Steel Abrasives cartel case by 
adopting  an  ordinary  decision  against  Pometon  S.p.A  and  imposing  a  fine  of  EUR  6.2 
million32.  In  April  2014,  the  Commission  imposed  fines  on  four  producers  that  decided  to 
settle the case with the Commission. 

29 Case AT.40028 Alternators and Starters, Commission decision of 27 January 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=1_40028 For further information see 
IP/16/173 of 27 January 2016 available at http://europa.eu/rapid/press-release_IP-16-173_en.htm  
30 Case AT.39904 Rechargeable Batteries. For further information see IP/16/4356 of 12 December 2016 
available at http://europa.eu/rapid/press-release_IP-16-4356_en.htm  
31 Case AT.39965 Mushroom. For further information see IP/16/1261 of 6 April 2016 available at 
http://europa.eu/rapid/press-release_IP-16-1261_en.htm  
32 Case AT.39792 Steel abrasives, Commission decision of 25 May 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=1_39792  

12 

 
                                                            
The EIRD case33 

On 7 December, the Commission fined Crédit Agricole, HSBC and JPMorgan Chase a total of EUR 485 million 
for participating in a cartel in Euro Interest Rate Derivatives (EIRD). These three banks chose not to settle this 
cartel case with the Commission, unlike Barclays, Deutsche Bank, RBS and Société Générale, with whom the 
Commission  reached  a  settlement  concerning  the  same  cartel  in  December 2013.  Since  then,  the  investigation 
has continued under the Commission's standard cartel procedure. 

Interest rate derivatives are financial products such as forward rate agreements, interest rate swaps or interest rate 
options, which are used by companies to manage the risk of interest rate fluctuations or for speculation. They 
derive  their  value  from  the  level  of  a  benchmark  interest  rate,  such  as  the  Euro  Interbank  Offered  Rate 
(EURIBOR)  and/or  the  Euro  Over-Night  Index  Average  (EONIA)  for  euro  interest  rate  derivatives.  The 
EURIBOR  benchmark  interest  rate  is  meant  to  reflect  the  cost  of  interbank  lending  in  euros  and  is  based  on 
individual quotes submitted daily by a panel of banks to a calculation agent. 

The Commission's investigation found that there was a cartel in place between September 2005 and May 2008, 
involving  a  total  of  seven  banks  over  varying  time  periods.  It  covered  the  whole  European  Economic  Area 
(EEA).  The  participating  traders  of  the  banks  were  in  regular  contact  through  corporate  chat-rooms  or  instant 
messaging services. The traders' aim was to distort the normal course of pricing components for euro interest rate 
derivatives.  They  did  this  by  telling  each  other  their  desired  or  intended  EURIBOR  submissions  and  by 
exchanging sensitive information on their trading positions or on their trading or pricing strategies. This means 
that the seven banks colluded instead of competing with each other on the euro derivatives market. This market 
is very important not only to banks but also to many companies in the Single Market, which use euro interest 
rate derivatives to hedge their financing risk.  

This decision marks  the  end  of  several  investigations the  Commission carried out into  cartels  set up by  major 
international banks to manipulate the trading of derivatives. Over the past three years, the Commission has taken 
six decisions on cartels imposing fines of just above EUR 2 billion. In addition to this case, cartels concerning 
derivatives linked to the Japanese Yen and the Swiss Franc were also sanctioned. The common goal of all these 
decisions  is  to  make  sure  that  financial  markets  are  competitive  to  the  benefit  of  European  consumers  and 
businesses.  By  their  adoption,  a  clear  message  was  sent  that  banks,  like  all  companies,  have  to  respect  EU 
competition rules. 

Ordinary  procedures  remain  significant  because  not  all  investigations  may  be  eligible  for 
settlement  discussions.  Relevant  factors  include  the  number  of  parties,  the  proportion  of 
leniency  applicants  in  relation  to  the  total  number  of  parties,  the  degree  of  contestation, 
conflicting  positions  between  the  parties  and  the  existence  of  novel  features  or  aggravating 
circumstances  in  the  investigated  practices.  When  the  right  circumstances  are  not  met,  the 
Commission will apply the ordinary procedure.  

The  Commission  remains  committed  to  pursuing  all  cartels  across  all  sectors  where  it  has 
sufficient  evidence  of  an  infringement  detected  through  its  leniency  programme  or  its  ex 
officio action (more information on the cartel decisions is available in the sectoral overview).  

The Commission's cartel enforcement record remains strong and effective, with six decisions, 
fines  totalling  approximately  EUR  3.73  billion  and  solid  work  for  enforcement  in  future 
years. 

33 Case AT.39914 EIRD. For further information see IP/16/4304 of 7 December 2016 available at 
http://europa.eu/rapid/press-release_IP-16-4304_en.htm  

13 

 
                                                            
Case name 

Adoption 
date 

Fine 
EUR 

imposed 

Undertakings 
concerned  

Prohibition 
Procedure 

Rechargeable batteries 

12/12/2016 

165 841 000 

Euro Interest Rate 
Derivatives (EIRD) 

07/12/2016 

484 456 000 

Trucks 

19/07/2016 

2 926 499 000 

Steel abrasives 

25/05/2016 

6 197 000 

Canned mushrooms 

06/04/2016 

5 194 000 

Alternators and Starters  27/01/2016 

137 789 000 

3 

3 

5 

1 

1 

3 

*normal procedure part of a hybrid case with a settlement decision in:  
December 2013(*), April 2014(**) and June 2014(***). 

Antitrust and cartel output:  

Settlement 

Hybrid* 

Settlement 

Hybrid** 

Hybrid*** 

Settlement 

14 

14 
1 

13 

14 
1 
1 

11 

8 

2 

4 

7 

1 

4 

1 

7 

4 

1 
1 

6 

5 

1 

5 

6 

1 

8 

3 

1 
1 

2 

1 

11 

1 

5 

1 

4 

1
2 
3 

1 
1 

4 

3 

16 

8 

2 

2 

4 

1
0 

3 

3 

3 

1 

8 

2 

1 

2 

1 

2 

Cartel Other*

Cartel Prohibition (Settlement)

Cartel Prohibition (Hybrid)

Cartel Prohibition (Normal)

Antitrust Other**

Antitrust Commitment

Antitrust Prohibition

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

* Rejection of complaint   ** Rejection of complaint, procedural infringement, penalty payment 

4. Continuing close cooperation within the European Competition Network (ECN) 
and with national courts  

The national competition authorities (NCAs) play a key role in applying the EU competition 
rules alongside the Commission. Action by NCAs accounts for 85% of public enforcement of 
the EU antitrust rules. This is a significant contribution to make sure that markets work well 
and fairly for the benefit of consumers and businesses and to drive economic growth.  

However, there is room for improvement. NCAs often lack the means and instruments they 
need to be truly effective enforcers. If NCAs cannot realise their full potential, this weakens 
one of the main facets of the single market namely, ensuring that competition is not distorted 
in Europe. 

14 

 
 
The  2014  Commission  Communication  on  Ten  Years  of  Regulation  1/200334  identified  a 
number  of  areas  of  action  to  make  enforcement  by  the  NCAs  more  effective.  In  particular, 
action should be taken to guarantee that NCAs: (i) have the right tools to detect and sanction 
violations  of  the  EU  antitrust  rules;  (ii)  have  effective  leniency  programmes  that  encourage 
companies to come forward, possibly in several jurisdictions, with evidence of illegal cartels; 
and  (iii)  have  adequate  resources  and  are  sufficiently  independent  when  enforcing  EU 
competition law. 

Support for empowering NCAs to become more effective enforcers 

Building  on  the  Communication  on  Ten  Years  of  Regulation  1/2003,  the  Commission  launched  a  public 
consultation  in  November  2015  on  empowering  the  NCAs  to  be  more  effective  enforcers35.  The  public 
consultation  ended  on  12  February  2016.  181  replies  were  submitted  by  a  wide  variety  of  stakeholders. 
Approximately  75%  of  stakeholders  consider  that  the  effectiveness  of  the  NCAs  could  be  improved  and  80% 
thought that action should be taken to ensure that NCAs have the means and instruments they need.  

A  Public  Hearing  was  co-organised  with  the  European  Parliament  on  19  April  2016  to  gather  further  views. 
There was overall support for empowering NCAs to be more effective enforcers. The Commission is working 
towards an EU legislative initiative to address this, with the aim of adopting a proposal in the first half of 201736. 

Cooperation with national courts 

In  addition  to  its  cooperation  with  NCAs  in  the  context  of  the  ECN,  the  Commission  also 
continued its cooperation with national courts (NCs)  under Article 15 of Regulation 1/2003. 
The  Commission  helps  NCAs  to  enforce  the  EU  competition  rules  in  an  effective  and 
coherent manner by providing case-related information or an opinion on matters of substance 
or by intervening as amicus curiae in proceedings pending before the NCs. 

The  Commission  publishes  its  opinions  and  amicus  curiae  observations  on  its  website 
(http://ec.europa.eu/competition/court/overview_en.html) as soon as it receives approval from 
the courts concerned. 

Merger control 

EU merger control  

The  purpose  of  EU  merger  control  is  to  ensure  that  market  structures  remain  competitive  while  facilitating 
smooth  restructuring  of  the  industry.  This  applies  not  only  to  EU-based  companies,  but  also  to  any  company 
active  on  the  EU  markets.  Industry  restructuring  is  an  important  way  of  fostering  efficient  allocation  of 
production  assets.  However,  there  are  also  situations  where  industry  consolidation  can  give  rise  to  harmful 
effects  on  competition,  taking  into  account  the  merging  companies'  degree  of  market  power  and  other  market 
features.  EU  merger  control  ensures  that  changes  in  the  market  structure  which  lead  to  harmful  effects  on 
competition do not occur.  

The substantive test for assessing mergers under the current legal framework seeks to obtain 
fairer results by protecting  all aspects  of competition, including innovation.  As a result, EU 
merger control protects market structures, in which companies compete not only on price, but 

34 Communication from the Commission of 9 July 2014, Ten Years Of Antitrust Enforcement Under Regulation 
1/2003: Achievements And Future Perspectives, COM/2014/0453 available at http://ec.europa.eu/competition/ 
antitrust/legislation/antitrust_enforcement_10_years_en.pdf 
35 For further information see IP/15/5998 of 4 November 2015 available at http://europa.eu/rapid/press-
release_IP-15-5998_en.htm  
36 Commission Work Programme 2017 Annex 1: New Initiatives, p.3 item 6 under Implementation of the Single 
Market Strategy available at http://ec.europa.eu/atwork/pdf/cwp_2017_annex_i_en.pdf  

15 

 
 
                                                            
also  on  innovation  in  order  to  attract  customers.  The  Commission's  enforcement  practice  in 
recent  years,  for  example,  in  the  pharmaceutical37  and  energy38  sectors,  shows  that  it 
considers innovation and investments as important aspects of competition. The Commission 
will  continue  to  assess  the  effects  on  innovation  in  the  ongoing  investigation  in  the  agro-
chemical sector concerning the proposed merger between Dow and DuPont39, among others.  

By  protecting  all  these  aspects  of  competition,  EU  merger  control  contributes  to  the 
achievement  of  fairer  market  structures  and  a  level  playing  field.  Those  transactions  which 
may  bring  unfair  results  by  distorting  the  parameters  for  competition  are  subject  to  close 
scrutiny  by  the  Commission,  which  is  committed  to  protect  consumers  by  requesting  the 
necessary  commitments  or,  if  necessary,  by  prohibiting  the  transaction.  For  example,  the 
merger between Hutchison and O240, which was ultimately blocked to protect British mobile 
consumers and prevent unfair results. 

In  order  to  ensure  such  fairness,  EU  merger  control  also  takes  into  account  efficiencies 
brought  about  by  mergers  which  bring  positive  effects  on  innovation  and  other  aspects, 
provided they are verifiable, merger-specific and likely to be passed on to consumers.  

As  highlighted  in  previous  reports  on  competition  policy,  the  Commission  continuously 
evaluates the substantive and procedural rules that make up the legal framework in force for 
merger control. In this context, the Commission regularly assesses concerns and suggestions 
for further improvement voiced by industry representatives and other stakeholders, evaluates 
the need for reform and policy changes in specific areas which give rise to new debates and 
checks that its policies and enforcement practices do not unduly create red-tape for companies 
and  thereby  hamper  innovation  and  investment.  If  necessary,  policy  changes  are  proposed 
(see point 1 below).  

1. Evaluation of selected procedural and jurisdictional aspects of EU mergers 

In  2016,  the  Commission  launched  a  public  consultation  in  the  context  of  an  ongoing 
evaluation  of  selected  procedural  and  jurisdictional  aspects  of  EU  merger  control.  This 
ongoing  evaluation  builds  notably  upon  the  results  of  the  2014  public  consultation  on  the 
White Paper "Towards more effective EU merger control". 

The White Paper "Towards more effective EU merger control" 

In the White Paper "Towards more effective EU merger control" adopted in July 201441, the 
Commission made some concrete proposals to improve the Merger Regulation in a few areas. 
Those  mainly  concerned  the  possible  extension  of  the  EU  Merger  Regulation  to  minority 
shareholdings, the streamlining of the referral system and additional simplification.  

The  feedback  received  on  the  topics  of  referrals  and  further  simplification  was  broadly 
supportive of the Commission's proposals. On the other hand, respondents to the 2014 public 

37 Case M.7275 Novartis / GlaxoSmithKline oncology business available at 
http://ec.europa.eu/competition/elojade/isef/index.cfm?fuseaction=dsp_result  
38 Case M.7477 Halliburton / Baker Hughes available at 
http://ec.europa.eu/competition/elojade/isef/index.cfm?fuseaction=dsp_result  
39 Case M.7932 Dow / DuPont available at 
http://ec.europa.eu/competition/elojade/isef/index.cfm?fuseaction=dsp_result  
40 M.7612 Hutchison 3G UK / Telefonica UK, Commission decision of 11 May 2016. For further information see 
IP/16/1704 available at http://europa.eu/rapid/press-release_IP-16-1704_en.htm  
41 White Paper Towards more effective EU merger control, COM(2014) 449 final available at 
http://ec.europa.eu/competition/consultations/2014_merger_control/mergers_white_paper_en.pdf  

16 

 
                                                            
consultation on the White Paper generally expressed doubts about the proportionality of the 
White Paper's proposals as regards minority shareholdings, in view notably of the perceived 
limited scope of the problem identified.  

Following  this  public  consultation,  the  Commission  commissioned  a  study  to  obtain 
additional information on the topic of minority shareholdings from the point of view of both 
competition and corporate law and practice in different jurisdictions. The results of this study 
were published on DG Competition's website in October42. 

Evaluation of procedural and jurisdictional aspects of EU merger control 

Meanwhile,  a  debate  has  emerged  on  the  effectiveness  of  the  turnover-based  jurisdictional 
thresholds  in  EU  merger  control  when  it  comes  to  some  high-valued  transactions  involving 
target companies with limited or no turnover, which may have significant competitive effects 
in the EEA but fall outside the scope of application of the EU Merger Regulation. This debate 
concerned in particular the digital economy, where Facebook's acquisition of WhatsApp has 
been  a  catalyst  for  this  discussion.  However,  this  concern  may  also  be  relevant  in  other 
sectors, such as pharmaceuticals. 

Against  this  background,  the  ongoing  evaluation  of  selected  procedural  and  jurisdictional 
aspects  of  EU  merger  control,  launched  in  2016,  focusses  on  whether  the  current  purely 
turnover-based  thresholds  of  the  Merger  Regulation  allow  capturing  all  transactions  which 
can  potentially  have  an  impact  on  the  internal  market  and,  if  not,  on  the  possibility  to 
introduce  complementary  jurisdictional  thresholds,  based  for  instance  on  the  transaction 
value.  

In  addition,  the  evaluation  seeks  to  explore  the  potential  for  further  simplification  of  EU 
merger  control,  going  beyond  the  suggestions  made  in  the  White  Paper.  Moreover,  the 
evaluation covers a possible streamlining of the referral system, building on the proposals put 
forward in the 2014 White Paper. Finally, a number of technical aspects of merger procedures 
will also be reviewed. 

The public consultation closed in January 2017. The outcome of the planned evaluation will 
inform the type of follow-up and, in particular, any decision concerning possible subsequent 
proposals for legislative changes.  

2. Recent enforcement trends 

The  substantial  growth  in  merger  activity  in  2015  and  2016  is  reflected  in  the  significant 
increase in the number of merger notifications received by the Commission. The number of 
notified  mergers  in  particular  in  2016,  increased  significantly  compared  with  the  previous 
seven years: overall, 362 transactions were notified in 2016, whereas the average number of 
notifications received in the period 2009-2015 was 291 per year43. Among these notifications, 
the  Commission  has  received  29  reasoned  pre-notification  submissions  by  the  notifying 
parties  to  request  the  referral  of  a  case  from  the  Commission  to  a  Member  State  or  from  a 
Member  State  to  the  Commission.  In  eight  cases,  the  Commission  opened  in-depth 
investigations (second phase). These cases concerned various industry sectors, including agro-

42 See, the Report Support study for impact assessment concerning the review of Merger Regulation regarding 
minority shareholdings, prepared by Spark Legal Network and Queen Mary University of London, 2016 
available at http://ec.europa.eu/competition/publications/reports/KD0416839ENN.pdf 
43 The total number of notifications received in 2016 is 9% higher than in 2015 and 19% higher than in 2014.  

17 

 
                                                            
chemicals, telecoms, railway equipment systems, provision of oil exploration services, space 
and satellites, cement and construction materials, financial services and car components. 

In  2016,  the  Commission  took  355  final  decisions  in  merger  cases44.  The  number  of  27 
interventions in 2016 was significantly higher compared with the average of the last six years, 
which  amounted  to  around  16  interventions  per  year45.  In  2016,  19  mergers  were  cleared 
subject  to  commitments  in  first  phase  and  six  in  the  second  phase.  In  one  case,  the  parties 
abandoned  a  transaction  during  the  in-depth  investigation46.  Moreover,  the  Commission 
adopted a prohibition decision in one case47.  

The  adoption  of  the  simplification  package  in  December  2013  has  been  followed  by  a 
significant  increase  in  the  number  of  cases  reviewed  under  the  simplified  procedure:  the 
number of cases dealt with under the simplified procedure increased by 10%: from 59% over 
the period 2004-2013 to around 69% of all notified transactions in 2016. 

The  Commission  has  also  looked  at  its  methodology  in  defining  geographic  markets  and  in 
taking  into  account  competitive pressure from imports in  its assessment of  mergers. Market 
definition  is  a  tool  to  identify  effective  alternative  sources  of  supply  for  customers  of  the 
merging  companies,  and  to  calculate  market  shares  as  a  meaningful  starting  point  for  an 
analysis  of  competitive  forces.  It  is  only  the  initial  step  of  its  analysis,  however.  In  its 
competitive assessment, apart from examining, inter alia, barriers to entry and expansion of 
rivals  and  the  expected  price  increase  caused  by  the  transaction,  the  Commission  also 
considers the competitive pressure of imports.  

The  Commission  held  discussions  with  the  EU  national  competition  authorities,  the  United 
States  antitrust  agencies  and  legal  and  economic  experts.  It  also  asked  two  leading 
competition  economists  to  evaluate  the  Commission’s  approach  to  geographic  market 
definition on the basis of a sample of recent merger decisions. The study48 largely supported 
the Commission's approach to geographic market definition and did not recommend that the 
Commission revise its basic methodology in this matter. It concluded that the Commission’s 
approach was very much in line with that of all leading competition agencies in the EU and 
world-wide,  with  internationally  recognised  standards  and  with  academic  literature  on  the 
topic. 

44 For the purposes of this report, decisions based on Articles 6(1)(a), 6(1)b, 6(1)b in combination with 6(2), 
8(1), 8(2) and 8(3) of the Merger Regulation are considered as final decisions. 
45 Commission interventions in merger cases include prohibition decisions and mergers cleared subject to 
commitments, as well as withdrawals during second phase in-depth investigation. 
46 Case M.7477 Halliburton / Baker Hughes, Statement by Commissioner Vestager on announcement by 
Halliburton and Hughes to withdraw from proposed merger of 2 May 2016 available at 
http://europa.eu/rapid/press-release_STATEMENT-16-1642_en.htm 
47 Case M.7612 Hutchison 3G UK / Telefonica UK, Commission decision of 11 May 2016. For further 
information see IP/16/1704 available at http://europa.eu/rapid/press-release_IP-16-1704_en.htm 
48 Amelia Fletcher and Bruce Lyons, Geographic Market Definition in European Commission Merger Control, A 
Study for DG Competition, January 2016 available at 
http://ec.europa.eu/competition/publications/reports/study_gmd.pdf 

18 

 
                                                            
Merger decisions: 

398 
25 

5 

348 
21 

4 

130 

112 

343 

27 

9 

117 

311 
8 

4 

108 

270 
16 

1 

110 

243 
18 

82 

300 

18 

2 

73 

272  26
17 
15 

1 

2 

83 

86 

238 

211 

190 

143 

143 

191 

171 

166 

207 

222 

245 

355 

27 

1 

Interventions*

320 

22 

75 

1 

82 

2nd Phase Clearance without
remedies

1st Phase Clearance
(Non-simplified Procedure)

1st Phase Clearance
(Simplified Procedure)

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

* Interventions in merger cases include prohibition decisions and mergers cleared subject to remedies, as 
well as withdrawals in Phase II; Prohibition decisions: one in 2007, 2011, 2012 and 2016 and two in 2013.  
Source: Directorate-General for Competition 

State aid control 

State aid control is an integral part of EU competition policy and a necessary  safeguard to preserve effective 
competition and free trade in the single market. 

The Treaty establishes the principle that State aid which distorts or threatens to distort competition is prohibited 
in so far as it affects trade between Member States (Article 107(1) TFEU). However, State aid, which contributes 
to well-defined objectives of common interest without unduly distorting competition between undertakings and 
trade  between  Member  States,  may  be  considered  compatible  with  the  internal  market  (under  Article  107(3) 
TFEU).  

The objectives of the Commission's control of State aid are to ensure that aid is growth-enhancing, efficient and 
effective, and better targeted in times of budgetary constraints that aid does not restrict competition but addresses 
market  failures  for  the  benefit  of  society  as  a  whole.  In  addition  to  this,  the  Commission  acts  to  prevent  and 
recover State aid which is incompatible with the Single market. 

1. Uptake of the State Aid Modernisation  

One  of  the  cornerstones  of  the  State  Aid  Modernisation  reform  is  the  new  General  Block 
Exemption  Regulation  (GBER)49,  which  simplifies  aid  granting  procedures  for  Member 
States  by  authorising  without  prior  notification  a  wide  range  of  measures  fulfilling  EU 
objectives  in  the  common  interest.  For  the  aid  categories  covered  by  the  GBER,  only  cases 
with  the  biggest  potential  to  distort  competition  in  the  single  market  will  still  face  ex  ante 
assessment (notification). As a result of the reform, a significantly larger  number of smaller 

49 Commission Regulation (EU) No 651/2014 of 17 June 2014 declaring certain categories of aid compatible 
with the internal market in application of Articles 107 and 108 of the Treaty on the Functioning of the European 
Union (TFEU), OJ L 187, 26.6.2014, p.1. 

19 

 
 
 
                                                            
and  unproblematic  measures  are  exempted  from  prior  notification,  notably  aid  granted  to 
tackle local needs.  

Member  States  have  already  made  extensive  use  of  the  possibilities  offered  by  the 
comprehensive modernisation of State aid rules. Notably, a surge in aid excluded from prior 
Commission  scrutiny  indicates  an  important  reduction  of  red  tape.  Based  on  the  State  Aid 
Scoreboard50,  more  than  96%  of  new  measures,  for  which  expenditure  was  reported  for  the 
first  time  in  2015,  were  covered  by  the  GBER,  which  entails  an  increase  of  about  24 
percentage  points  compared  to  2013.  Three  quarters  of  all  measures  for  which  expenditure 
was  reported  (i.e.  not  only  new  measures),  took  the  form  of  block  exempted  measures  in 
2015.  On  average,  total  spending  on  GBER  measures  in  the  EU  represented  about  40%  of 
total expenditure in 2015, i.e. an increase of about 5 percentage points compared to 2014.  

On top of a broadening of categories already covered by the previous GBER, the new rules of 
the State Aid Modernisation reform introduced new categories of aid into the GBER, namely 
aid  to  innovation  clusters  and  aid  to  process  and  organisational  innovation,  aid  schemes  to 
make good the damage caused by natural disasters, social aid for transport residents of remote 
regions, aid for broadband infrastructure, aid for culture and heritage conservation, including 
aid  schemes  for  audio-visual  works,  aid  for  sport  and  multifunctional  recreational 
infrastructures, as well as investment aid for local infrastructure. 

50 The 2016 State Aid Scoreboard comprises aid expenditure made by Member States before 31 December 2015 
and which falls under the scope of Article 107(1) TFEU. The data is based on the annual reporting by Member 
States pursuant to Article 6(1) of Commission Regulation (EC) 794/2004 available at 
http://ec.europa.eu/competition/state_aid/scoreboard/index_en.html  

20 

 
 
                                                            
To a large extent, the reported increase in expenditure on GBER measures did already reflect 
the impact of the new Regulation in 2015. That year, total GBER spending for aid to culture 
and  heritage  conservation  almost  tripled,  while  it  doubled  for  broadband  and  local 
infrastructure  and  significant  increases  were  also  recorded  for  aid  to  compensate  damages 
caused by natural disasters (+53%), for training aid (+41%), for environmental protection and 
energy savings (+35%), for employment aid (+32%) and for SMEs (+19%). 

State aid enforcement (Commission decisions, monitoring and Member States' Evaluation Plans) 2007-2016 

Partnership with Member States 

To facilitate the implementation of SAM, the Commission supports Member States in various 
ways and has started a closer cooperation with them.  

Collaboration  with  Member  States  takes  multiple  forms.  The  Working  Group  on  SAM 
implementation (SAM WG) is a forum for Member States to exchange best practices on their 
systems  for  State  aid  control,  creating  an  effective  network  for  the  informal  discussion  of 
State  aid  issues  among  Member  States  and  with  the  Commission.  Other  dedicated  working 
groups or workshops have dealt with specific aspects of SAM implementation, in particular 

21 

 
 
 
the new requirements for transparency and evaluation or the implementation of the energy and 
environment  guidelines.  Once  a  year,  the  SAM  WG  reports  to  a  High  Level  Forum  (HLF) 
which in turn provides guidance on the future work of the Partnership.  

The SAM WG met three times in 2016, under a United Kingdom Chair, and addressed several 
policy and compliance issues related to SAM implementation. It reported on its conclusions 
and recommendations to the HLF held on 3 June 2016, in Brussels. On this occasion it was 
agreed to further strengthen the partnership.  

In 2016, the Commission also launched Bilateral Partnerships with certain Member States in 
order  to  address  existing  compliance  problems  and  challenges  in  these  Member  States.  The 
Bilateral  Partnerships  aim  to  build  a  structured  bilateral  dialogue  between  the  Commission 
and  the  Member  State concerned  to  allow  identifying  and  addressing  the  obstacles  that  still 
hinder compliance with the State aid rules. In 2016, the Commission has agreed on practical 
work programmes on State aid with Italy, Bulgaria and Romania and work is on-going with a 
view  to  deepening  cooperation  with  other  Member  States  that  could,  in  time,  also  lead  to 
structured Bilateral Partnerships with these Member States. 

Transparency 

The new transparency provisions of SAM are in force since 1 July 2016 and require Member 
States  to  publish  information  about  the  beneficiaries  of  aid  awards  above  EUR  500 00051. 
Member States have six months starting from the date of granting to provide the required aid 
awards' data, which is longer for awards in the form of fiscal aid. The Commission services 
facilitated  compliance  with  this  requirement  by  developing,  in  cooperation  with  Member 
States, the Transparency Award Module (TAM) – a new informatics tool for submission and 
publication of data required under the transparency provisions. The TAM is operational since 
1 July and the submitted data is automatically available online52.  

In  addition,  since  February,  the  annual  expenditure  figures  at  scheme  level  as  reported  by 
Member  States  are  published  in  the  online  case  register  of  DG  Competition53,  hence 
increasing overall transparency of State aid.  

Finally, a Eurobarometer Survey about citizens' perceptions of transparency and awareness of 
State  aid54  was  carried  out  in  June.  Some  27 818  EU  citizens  were  asked  about  their 
awareness of State aid and the perceived ease of finding relevant information, as well as about 
their attitudes towards transparency of State aid. The results show that in all Member States, 
citizens  do  not  feel  well-informed  about  State  aid  and  consider  it  difficult  to  find  relevant 
information.  Over  80%  of  respondents  consider  that  EU  citizens  should  have  full  access  to 
information  about  State  aid.  In  addition,  the  majority  of  Europeans  consider  transparency 
beneficial for public accountability and the good management of public funds, and as relevant 
for companies as for citizens.  

51 For further information see the Competition Policy Brief 4/2016 available at 
http://ec.europa.eu/competition/publications/cpb/2016/2016_004_en.pdf  
52 For further information see the Transparency Award Module (TAM) available at 
https://webgate.ec.europa.eu/competition/transparency/public/search/chooseLanguage  
53 The Commission's State aid case search tool open to the general public available at 
http://ec.europa.eu/competition/elojade/isef/  
54 For further information see the Special Eurobarometer 448 on the European Union Open Data Portal available 
at https://data.europa.eu/euodp/en/data/dataset/S2135_85_3_448_ENG  

22 

 
                                                            
Evaluation 

Evaluation of aid schemes is a new requirement introduced by SAM. The aim is to gather the 
necessary  evidence  to  better  identify  impacts,  both  positive  and  negative,  of  the  aid  and 
inform future policy-making by Member States and the Commission.  

Since 1 July 2014, evaluation is required for large GBER schemes in certain aid categories55 
as  well  as  for  a  selection  of  notified  schemes  under  the  new  generation  of  State  aid 
guidelines56.  

By  the  end  of  2016,  the  Commission  had  approved  evaluation  plans  covering  28  State  aid 
schemes  submitted  by  12  Member  States57,  most  of  these  decisions  concerned  either  large 
regional  or  R&D&I  aid  schemes  under  the  GBER  or  notified  broadband  schemes.  These 
schemes account, in total, for about EUR 36 billion of annual State aid budget. 

The Commission services have accompanied the implementation of this new requirement by 
publishing  policy  briefs58  and  by  organising  dedicated  workshops  with  Member  States' 
representatives and evaluation experts59.  

Aid for research, development and innovation 

While one of the headline targets of the Europe 2020 Strategy60 is for R&D&I investments in 
the  EU  to  reach  3%  of  EU  GDP,  R&D  spending  in  the  EU  has  been  lagging  behind  major 
global competitors, mainly due to lower levels of private investment.  

The  State  aid  rules  for R&D&I  help  to  ensure that  public  funding  goes  to  research  projects 
that  would  not  have  happened  otherwise  due  to  market  failures,  i.e.  projects  that  truly  go 
beyond the state of the art and which bring innovative products and services to the market and 
ultimately  to  consumers.  The  rules,  using  flexible  and  simple  criteria  for  assessing  the 
compatibility  of  State  aid,  facilitate  the  implementation  of  support  for  R&D  projects  by 
Member States.  

In 2016, the Commission ensured that aid schemes and individual measures notified under the 
R&D&I  rules  were  well  targeted  to  projects  enabling  ground-breaking  research  and 
innovation activities. Its State aid control activities covered a variety of sectors including the 
automotive, aeronautic, railways and microelectronic sectors. 

In  one  case61,  following  an  in-depth  investigation  into  a  Spanish  plan  to  finance  the  full 
investment  costs  for  the  construction  of  a  test  centre  for  high-speed  trains,  the  Commission 

55 Schemes with an average annual State aid budget above EUR 150 million in the fields of regional aid, aid for 
SMEs and access to finance, aid for research and development and innovation, energy and environmental aid and 
aid for broadband infrastructures. 
56 Evaluation might apply to notified aid schemes with large budgets, containing novel characteristics or when 
significant market, technology or regulatory changes are foreseen.  
57 The Czech Republic, Germany, Spain, France, Hungary, Italy, Lithuania, Austria, Poland, Portugal, Finland 
and the United Kingdom.  
58 For further information see the Competition Policy Briefs 7/2014 available at 
http://ec.europa.eu/competition/publications/cpb/2014/007_en.pdf and 3/2016 available at 
http://ec.europa.eu/competition/publications/cpb/2016/2016_003_en.pdf 
59 The most recent workshop was organised with the BRUEGEL think tank on 30 May 2016 available at 
http://bruegel.org/events/state-aid-evaluation-two-years-of-implementation.  
60 Communication of 3 March 2010 from the Commission, Europe 2020 A Strategy For Smart, Sustainable And 
Inclusive Growth, COM(2010) 2020 final available at http://eur-lex.europa.eu/legal-content/EN/TXT/?qid= 
1427303331326&uri=CELEX:52010DC2020  

23 

 
                                                            
concluded that the project was not in line with EU State aid rules because it did not meet a 
genuine  objective  of  common  interest  due  to  the  absence  of  market  demand  for  the  type  of 
R&D&I services to be provided by the test centre. This conclusion was underpinned by the 
fact  that,  despite  the  public  funding  allocated  to  this  project,  no  private  investor  showed  an 
interest  in  participating  in  the  funding  and  that  the  project  was  expected  to  generate  losses 
throughout its entire period of operation.  

In  another  case62,  the  Commission  found  that  public  support  granted  by  Lithuania  to  two 
Science and Technology Parks acting as innovation intermediaries and supporting innovation 
efforts by SMEs incubated within their facilities did not constitute State aid at the level of the 
parks, while accepting the Member State's commitments to maintain the support passed on by 
the parks to the incubated SMEs in line with the de minimis aid rules.  

Aid to risk finance  

SMEs  across  the  EU  remain  heavily  dependent  on  traditional  bank  lending,  which  is  still 
limited by banks' refinancing capacity, risk appetite and capital adequacy. The financial crisis 
has exacerbated the problem with approximately one third of SMEs being unable to receive 
the necessary finance in recent years. Given the pivotal importance of SMEs and midcaps for 
the  whole  EU  economy,  the  situation  has  a  significant  negative  impact  on  growth  and  job 
creation. The new rules aim to offer better incentives for private sector investors - including 
institutional ones – to increase their funding activities in the critical area of SME and midcaps 
financing.  The  rules  also  mirror  other  EU  initiatives  designed  to  promote  wider  use  of 
financial  instruments  in  the  context  of  new  support  programmes  such  as  Horizon  2020  or 
COSME (the Programme for the Competitiveness of Enterprise and SMEs)63. 

The current Risk Finance Guidelines64 and the corresponding parts of the GBER, provide the 
framework  for  seamless  support  for  new  ventures  from  their  creation  to  their  development 
into  global  players.  The  aim  is  to  help  new  ventures  to  get  past  the  critical  stages  where 
private financing is either unavailable or not available in the necessary amount or form. 

Aid measures encouraging investment and innovation 

In 2016, under the new Risk Finance Guidelines, the Commission dealt with several notified schemes aimed at 
encouraging investment in innovative SMEs and midcaps. In particular, it approved one scheme in Italy granting 
fiscal  incentives  for  investments  in  innovative  start-ups,  a  German  scheme  providing  grants  for  risk  capital 
investments  as  well  as  the  evaluation  plan  presented  by  France  in  connection  with  a  risk  finance  scheme 
providing  for  fiscal  advantages  to  physical  persons  investing  in  early  stage  SMEs.  In  all  these  cases,  the 
Commission took the view that the measures at issue covered a real gap in the market, and worked together with 
the  Member  States  on  solutions  to  limit  the  impact  on  competition  in  the  single  market.  In  particular,  the 
Commission considered that the risks inherent to the activities of these young firms and innovative companies 
(i.e. products/technologies not yet proven to be economically viable) and the lack of financial guarantees limited 
their capacity to access funding and that the aid was necessary to stimulate investment that would not have been 
provided by the market unprompted. 

61 Case SA.37185 (2015/C) Aid to ADIF, Commission decision of 25 July 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_37185  
62 Case SA.41540 (2015/N) Aid to public legal persons – science and technology parks (STPs), Commission 
decision of 29 September 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_41540  
63 For an overview on the EU programme for the Competitiveness of Enterprises and Small and Medium-sized 
Enterprises available at http://ec.europa.eu/enterprise/initiatives/cosme/index_en.htm  
64 Communication from the Commission, Guidelines on State aid to promote risk finance investments, OJ C 19, 
22.1.2014, p. 4 available at http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:52014XC0122(04)  

24 

 
                                                                                                                                                                                          
Moreover, the Commission cooperated with a number of Member States with a view to enabling them to adjust 
certain  envisaged  risk  finance  measures  and  bring  them  in  line  with  the  new  GBER.  This  way,  aid  measures 
could  be  granted  without  having  to  be  notified  to  the  Commission,  speeding  up  public  support  to  innovative 
SMEs. 

Regional aid  

Regional aid is an important instrument in the EU's toolbox to promote greater economic and 
social cohesion. The 2014-2020 regional aid framework has been in place since July 2014. 

The GBER has extended the range of regional aid measures, enabling Member States to put in 
place  aid  schemes  and  individual  aid  measures  without  having  to  notify  them  to  the 
Commission.  Examples  of  these  are  ad  hoc  regional  investment  aid  measures  below  the 
notification  thresholds,  transport  aid  schemes  and  operating  aid  schemes  for  outermost 
regions.  In  2016  the  Commission  continued  advising  Member  States'  authorities  on  how  to 
interpret  and  implement  the  regional  aid  provisions  of  GBER,  thus  helping  them  to  make  a 
success of the reforms introduced under SAM. 

Regional aid measures  

In  2016,  the  Commission  adopted  decisions  both  under  the  former  and  under  the  current 
regional aid rules.  

It  endorsed  two  regional  aid  measures  to  support  large  investment  projects  under  the 
Guidelines on National Regional Aid for 2007-2013: the Commission authorised the aid for 
Euroglas  Polska65  in  the  preliminary  examination  phase  and  approved  the  aid  for  AUDI 
Hungaria  Motor  Ltd66  after  having  carried  out  an  in-depth  assessment  in  the  formal 
investigation phase.  

The  Commission  also  adopted  several  decisions  on  regional  aid  measures  under  the  new 
provisions, on investment aid schemes67, on evaluation plans for exempted large regional aid 
schemes68,  and  on  individual  regional  aid  measures.  In  particular,  it  took  two  decisions 
authorising individual regional aid: one for an investment relating to new process innovation 
by Hamburger-Rieger in a "c" region in Germany (paper production)69 and one for a regional 
investment by STM in an "a" region in Southern Italy (electronics)70. In addition it initiated a 
formal  investigation  into  a  notified  regional  aid  in  support  of  an  investment  involving  a 
process  innovation  by  REHAU  in  a  "c"  region  in  Germany.  Since  Germany  withdrew  this 

65 Case SA.36510 Poland - LIP - Euroglas Polska Sp. z o.o., Commission decision of 29 March 2016 available 
at http://ec.europa.eu/competition/elojade/isef/index.cfm?fuseaction=dsp_result  
66 Case SA.36754-2014/C (ex 2014/NN and 2013/N) which Hungary has partly implemented and is planning to 
implement in favour of AUDI Hungaria Motor Ltd, Commission decision of 1 February 2016, OJ L 310, 
17.11.2016, p. 24. 
67 Case SA.42225 (2015/N) Regional aid scheme for the promotion of the development of strategic information 
and  communication  technology  (ICT)  projects  on  strategic  sites,  Commission  decision  of  18  February  2016 
available at http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_42225  
68 Case SA.45184 Evaluation plan of the tax credit scheme for regional investment aid in Southern Italy, 
Commission decision of 23 September 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_45184  
69 Case SA.43624 (2015/N) LIP – Aid to Hamburger Rieger GmbH, Commission decision of 13 June 2016 
available at http://ec.europa.eu/competition/state_aid/cases/262014/262014_1770298_115_2.pdf  
70 Case SA.44547 LIP - Aid to STMicroelectronics S.r.l. (M9), Commission decision of 3 October 2016 available 
at http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_44547  

25 

 
                                                            
notification  after  the  initiation  of  a  formal  investigation,  the  Commission  closed  the  case 
without taking a position on the aid71. 

Further, the Commission adopted eight decisions on the mid-term review of the regional aid 
maps  for  Italy,  Spain,  Greece,  Portugal,  Finland,  Germany,  Hungary  and  the  United 
Kingdom72. 

Finally,  further  to  a  judgment  of  the  General  Court  in  201573,  partially  annuling  a 
Commission decision of 2008, the Commission adopted in 2016 a decision to open the formal 
investigation procedure in order to re-assess the aid element of two public guarantees granted 
by Germany in favour of Abalon Hessen GmbH and to determine whether this aid would be 
compatible with the internal market74. 

European Fund for Strategic Investments 

In 2015, the Commission created the European Fund for Strategic Investments (EFSI), with 
the  objective  to  generate  EUR  315  billion  in  investment  in  Europe.  In  that  context  the 
Commission  has  put  in  place  an  accelerated  procedure  for  approving  within  six  weeks 
Member State co-financing  constituting notifiable State aid. This  accelerated procedure was 
applied in some cases and contributes to the necessary public and private financing to reach 
concrete infrastructure and innovation projects as quickly as possible. 

European Structural and Investment Funds 

In  a  Special  Report  on  compliance  with  State  aid  rules  in  ESIF  operations75,  the  European 
Court of Auditors (ECA) found a number of State aid related errors in projects implemented 
by  Member  States  and  co-financed  by  ESIF  in  the  programming  period  2006-2013.  ECA 
recognised that the Commission had already taken several measures to remedy the situation in 
the 2014-2020 programming period and called upon the Commission to continue its efforts to 
further increase awareness and knowledge of State aid rules among ESIF stakeholders in the 
Member  States,  including  Managing  Authorities  and  national  audit  authorities.  The 
Commission will therefore continue to implement the recommendations formulated by ECA.  

2. State Aid Modernisation continues 

Notion of aid: comprehensive clarification including public funding of infrastructure 

In 2016 the Commission took several steps to further clarify the notion of State aid with the 
aim of helping public authorities and companies to identify when public support measures can 
be granted outside the remit of State aid control and approval by the European Commission76.  

71 Case SA.43014 Aid for REHAU AG + Co., Commission decision of 13 June 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_43014  
72 Communication from the Commission, Amending Annex I to the Guidelines on regional aid for 2014-2020, OJ 
C 231, 25.06.2016 p.1 available at http://ec.europa.eu/competition/state_aid/regional_aid/regional_aid.html 
73 Case T-89/09 Pollmeier Massivholz GmbH & Co. KG v the Commission, judgment of the General Court of 17 
March 2015, EU:T:2015:153. 
74 Case SA.24030 Investment loan and working capital loan guarantees in favour of Abalon Hardwood Hessen 
GmbH available at http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_24030 
75 Court of Auditors Special Report 24/2016 "More efforts needed to raise awareness of and enforce compliance 
with State aid rules in cohesion policy" available at 
http://www.eca.europa.eu/Lists/ECADocuments/SR16_24/SR_STATE_AIDS_EN.pdf  
76 For further information see IP/16/1782 of 19 May 2016 available at http://europa.eu/rapid/press-release_IP-16-
1782_en.htm  

26 

 
                                                            
As  a  first  step  the  Commission  continued  the  State  aid  Modernisation  initiative  with  the 
publication of one of its last building block, namely the Notice on the notion of State aid77. 
This  Notice  gives  guidance  on  all  aspects  of  the  definition  of  the  notion  of  State  aid  by 
systematically  summarising  the  case  law  of  the  EU  Courts  and  the  Commission's  decision 
making practice. By doing so it comprehensively clarifies the scope of the EU State aid rules 
and  thereby  facilitates  public  funding  and  investments  in  the  European  Union  by  helping 
Member  States  and  companies  to  design  such  public  funding  in  ways  which  do  not  distort 
competition.  These  clarifications  were  expected,  more  particularly,  in  the  area  of  public 
funding of infrastructure following the Leipzig-Halle judgment of the Court of Justice. 

In  addition,  the  Commission,  through  its  decisional  practice  in  individual  cases,  further 
developed its guidance regarding the question under what circumstances State support granted 
to  activities  having  a  purely  local  impact  do  not  effect  intra-EU  trade  and,  therefore,  fall 
outside the rules on State aid.  

Generally,  State  support  that  distorts  competition  between  companies  will,  due  to  the  high 
level of economic integration within the EU, also have an impact on intra-EU trade. However, 
if State support is granted to an activity which has a purely local impact, there may not be an 
effect on intra-EU trade, where (i) the beneficiary supplies goods or services to a limited area 
within one Member State and is unlikely to attract customers from other Member States and 
(ii)  the  measure  has  no  –  or  at  most  marginal  –  foreseeable  effects  on  cross-border 
investments in the sector or the establishment of firms within the EU's internal market. 

In line with several decisions taken already in 201578 and building on the guidance given on 
that  matter  in  the  Notice  on  the  notion  of  State  aid,  the  Commission  has  concluded  in 
September 2016 that five public measures for purely local operations in Spain, Germany and 
Portugal  did  not  involve  State  aid  within  the  meaning  of  the  EU  rules,  since  they  were 
unlikely to have a significant effect on trade between Member States79.  

These decisions provide Member States and stakeholders with further guidance to determine 
which  cases  do  not  need  to  be  cleared  by  the  Commission  under  EU  State  aid  rules.  They 
thereby complement the Notice on the Notion of State aid, as well as the GBER. 

Lastly,  the  Commission  services  have  updated  the  analytical  grids  on  the  financing  of 
infrastructure  projects.  The  updated  grids  were  presented  to  and  discussed  with  Member 
States  in  a  dedicated  working  group  on  infrastructures  in  November  2016.  They  explain 
when,  in  view  of  the  Commission  services,  public  funding  does  not  involve  State  aid  and 
when a notification for State aid clearance is needed. The grids also contain references to the 
most relevant Commission decisions relating to the sector concerned. 

The Commission services revised these grids, which were last updated very recently in 2015, 
following  the  publication  of  the  Notice  on the notion  of  State  aid,  to  provide  more  detailed 
sectorial  clarifications  which  could  not  have  been  included  in  a  general  and  comprehensive 
document such as the Notice on the notion of State aid. 

77 Commission Notice on the notion of State aid as referred to in Article 107(1) of the Treaty on the Functioning 
of the European Union, C/2016/2946, OJ C 262, 19.7.2016, p. 1–50.  
78 For further information see IP/15/4889 of 29 April 2015 available at http://europa.eu/rapid/press-release_IP-
15-4889_en.htm  
79 For further information see IP/16/3141 of 21 September 2016 available at http://europa.eu/rapid/press-
release_IP-16-3141_en.htm  

27 

 
                                                            
Together these different measures taken in 2016 to further clarify the notion of State aid and, 
thus,  the  scope  of  EU  State  aid  rules  help  to  stimulate  investment  by  reducing  the 
administrative burden for public authorities and companies, avoiding lengthy procedures and 
increasing  legal  certainty  for  aid  beneficiaries  and  competitors.  They  also  allow  Member 
States to take responsibility for their policy choices for local measures and the Commission to 
focus  resources  on  State  aid  investigations  into  measures  with  the  biggest  impact  on 
competition in the Single Market. 

Further extension of the scope of the GBER 

The scope of the General Block Exemption Regulation (GBER) was extended significantly in 
2014  compared  to  the  previous  GBER.  It  includes  provisions  for  a  large  variety  of  aid 
measures  in  many  different  sectors.  However,  the  2014  GBER  has  not  so  far  covered 
investments in ports and airports because at the time of its adoption in 2014, the Commission 
did  not  have  sufficient  case  experience  in  these  areas.  This  said,  recital  1  of  the  GBER 
announced  that  the  Commission  planned  to  propose  criteria  for  exempting  port  and  airport 
infrastructure provided that sufficient case experience was developed.  

In  2016,  the  Commission  adopted  a  series  of  State  aid  decisions  in  particular  relating  to 
investment  aid  to  ports80.  The  Commission's  experience  in  this  field  fully  supports  the 
extension of the scope of the GBER to facilitate the grant of aid in unproblematic cases. 

To fulfil the commitment announced in recital 1 of the 2014 GBER, on the basis of acquired 
experience, two years later, the Commission launched a first public consultation on the GBER 
extension  between  March  and  May  2016  following  which  more  than  200  replies  were 
received from Member States and stakeholders. The draft Regulation was revised accordingly 
and a second public consultation was conducted between 13 October and 8 December 2016 
with a view to adopt the new provisions on ports and airports in the first half of 2017.  

This modification will provide a major simplification for unproblematic investments in ports 
and airports. Member States can implement a measure without the need to notify it after they 
have  checked  that  it  complies  with  the  conditions  of  the  Regulation.  The  revision  will  also 
address  some  other  technical  issues  beyond  ports  and  airports.  In  particular  it  will  become 
easier for public authorities to compensate companies for the additional costs they face in the 
EU's outermost regions. 

This targeted revision of the General Block Exemption Regulation further contributes to the 
objectives of the State Aid Modernisation launched by the Commission in 2012, in the sense 
that  it  minimises  administrative  burdens  and  make  it  easier  for  national,  regional  and  local 
authorities to grant aid that contributes to a more dynamic and competitive Internal Market.  

In  2016,  the  Commission  adopted  a  series  of  State  aid  decisions  in  particular  relating  to 
investment  aid  to  ports81.  The  Commission's  experience  in  this  field  fully  supports  the 
extension of the scope of the GBER to facilitate the grant of aid in unproblematic cases. 

80 For example, cases SA.44479 Extension of the Rostock Overseas Port, Commission decision of 4 May 2016 
available at http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_44479; SA.40680 
Offshore-Terminal Bremerhaven, Commission decision of 14 July 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_40680; SA.45848 Extension of 
cruise ship terminal Putbus-Lauterbach, Commission decision of 19 August 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_45848 and SA.44846 Investment 
aid for Berth 9 in Cuxhaven port, Commission decision of 20 April 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_44846  

28 

 
                                                            
Revision of the Simplified Procedure Notice and Best Practices Code 

In 2016, the Commission launched a review of the Simplified Procedure Notice82 and of the 
Best  Practices  Code83  in  order  to  reflect,  on  the  one  hand,  the  amendments  brought  to  the 
State aid framework within the State aid Modernisation initiative and, on the other hand, to 
take account of the experience gained by the Commission with its implementation.  

The Simplified Procedure Notice sets out the conditions under which the Commission usually 
adopts short-form decisions declaring certain types of State support measures compatible with 
the  internal  market,  and  provides  guidance  in  respect  of  the  procedure  to  be  followed.  The 
Commission launched a public consultation on this notice from January to April 2016. 

The Best Practices Code provides guidance on the day-to-day conduct of State aid procedures 
and exchange of information between the Commission and Member States. In that respect, it 
encourages Member States to engage in informal discussions with Commission services and 
use pre-notification contacts. The Commission launched a public consultation in November in 
order to gather the views of the Member States and stakeholders on the implementation of the 
Best Practices Code over the past seven years.  

In  the  light  of  the  comments  received  from  the  public  consultations,  the  Commission  will 
review these texts with the objective to ensure coherence and consistency in the application of 
the various instruments of the State aid framework. 

3. Monitoring, recovery and cooperation with national courts 

Increased monitoring of existing State aid to ensure a level playing field 

Over the years, the architecture of State aid control has evolved. Today, a substantial part of 
aid  is  granted  under  block-exempted  schemes  which  are  not  examined  by  the  Commission 
before  entering  into  force.  Overall,  roughly  four-fifths  of  aid  is  granted  on  the  basis  of 
previously  approved  aid  schemes  or  Block  Exemption  Regulations.  In  that  context,  it  is 
essential  for  the  Commission  to  verify  that  Member  States  apply  State  aid  rules  for  the 
schemes correctly and that they only grant aid when all required conditions are met.  

To that end, the Commission introduced in 2006 a regular,  ex post, sample-based control of 
existing aid schemes ("monitoring"). After a modest start covering about 20 schemes and ten 
Member  States  in  each  monitoring  cycle,  the  Commission  has  considerably  stepped  up 
monitoring  since  2011.  Building  on  the  Court  of  Auditors  recommendations84,  the 

81 For example, cases SA.44479 Extension of the Rostock Overseas Port, Commission decision of 4 May 2016 
available at http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_44479; SA.40680 
Offshore-Terminal Bremerhaven, Commission decision of 14 July 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_40680; SA.45848 Extension of 
cruise ship terminal Putbus-Lauterbach, Commission decision of 19 August 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_45848 and SA.44846 Investment 
aid for Berth 9 in Cuxhaven port, Commission decision of 20 April 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_44846  
82 Commission notice on a simplified procedure for the treatment of certain types of State aid, OJ C 136, 
16.06.2009, p. 3-12 available at http://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX:52009XC0616(01)  
83 Commission notice on a Best Practices Code on the conduct of State aid control proceedings available at 
http://ec.europa.eu/competition/state_aid/legislation/best_practices_code_en.pdf  
84 In its 2011 report on the efficiency of State aid procedures, the Court of Auditors considered that, in view of 
the importance of aids granted under existing aid schemes, the Commission's monitoring activity should be 
reinforced. For further information see the recommendation n° 1 of the Court of Auditors Report recital 96, p. 41 
available at http://eca.europa.eu/portal/pls/portal/docs/1/10952771.PDF 

29 

 
                                                                                                                                                                                          
Commission  has  substantially  increased  the  size  of  the  monitoring  sample  in  the  last  three 
annual cycles to 78 schemes in the 2016 review. It also extended the scope of its control.  

The  2016  cycle  covered  all  Member  States  and  all  main  types  of  aid  approved  as  well  as 
block-exempted schemes. Furthermore, the sample contained some block-exempted schemes 
implemented under the new GBER85. Also, the Commission continued on targeted monitoring 
where  it  examined  whether  Member  States  correctly  applied  the  criterion  on  aid  granted  to 
companies in difficulty. Furthermore, the Commission monitored some schemes in which the 
granting of illegal aid could be involved. 

The  Commission  systematically  follows  up  on  irregularities  and  uses  the  means  at  its 
disposal, as appropriate, to address the competition distortions that these may have caused. In 
some cases, Member States offer to voluntarily redress the problems detected, for example to 
amend  national  legislation  or  to  recover  the  excess  aid  granted.  In  other  cases,  the 
Commission may need to take formal action.  

Restoring competition through recovery of State aid granted in breach of the rules 

To ensure the integrity of the single market, the Commission has the power and the duty to 
request that Member States recover unlawful and incompatible aid which has unduly distorted 
competition and trade between Member States. In 2016, further progress was made to ensure 
that recovery decisions are enforced effectively and immediately. 

By  31  December,  the  sum  of  illegal  and  incompatible  aid  recovered  from  beneficiaries 
amounted to EUR 12.3 billion86. At the same time, the outstanding amount pending recovery 
was EUR 19.8 billion.  

In 2016, the Commission adopted eleven new recovery decisions and EUR 18.4 million was 
recovered by the Member States. As of the end of December, the Commission had 52 pending 
recovery cases.  

Recovery decisions adopted in 2016 

Amount recovered in 2016 (EUR million) 

Pending recovery cases on 31 December 2016 

11 

18.4 

52 

As a guardian of the Treaty, the Commission may use all legal means at its disposal to ensure 
that  Member  States  implement  their  recovery  obligations,  including  launching  infringement 
procedures. In 2016, the Commission launched two actions under Article 108(2) TFEU87 for 
failure to implement recovery (both instances concerned Greece)88.  

85 Commission Regulation (EU) No 651/2014 of 17 June 2014 declaring certain categories of aid compatible 
with the internal market in application of Articles 107 and 108 TFEU, OJ L 187, 26.6.2014, p. 1. 
86 The reference period is 1 January 1999 to 31 December 2016. 
87 Consolidated version of the TFEU, OJ C 115, 9.5.2008, p.47. 
88 Cases C-481/16 Commission v Greece, action brought on 2 September 2016, OJ C 383, 17.10.2016, p. 9 and 
C-363/16 Commission v Greece, action brought on 30 June 2016, OJ C 363, 22.8.2016, p. 19. 

30 

 
                                                            
Cooperation with national courts to ensure the effectiveness of State aid rules  

The Commission continued its cooperation with national courts and tribunals under Article 29 
of  the  Procedural  Regulation89.  This  cooperation  includes  direct  case-related  assistance  to 
national  courts  when  they  apply  EU  State  aid  law.  The  courts  and  tribunals  can  ask  the 
Commission to provide case related information, or to provide an opinion on the application 
of  State  aid  rules.  The  Commission  may  also  submit  amicus  curiae  observations  at  its  own 
initiative.  

In  2016,  the  Commission  responded  to  two  requests  for  information.  The  Commission 
received a request for information and for a legal opinion from the Dutch Trade and Industry 
Appeals  Tribunal90  related  to  the  aid  scheme  "Subsidy  for  the  preservation  of  sheep  herds 
consisting  of  rare  breeds".  The  other  request  for  information  was  issued  by  Italy  and 
concerned the question whether the Commission was investigating a specific aid measure.  

The  Commission's  possibility  to  submit  amicus  curiae  observations  on  its  own  initiative 
before national courts  is a novelty  brought about  by the 2013 amendment  to  the Procedural 
Regulation. In that respect, Article 29 of the Procedural Regulation mirrors Article 15(3) of 
Regulation  1/2003  in  the  field  of  antitrust.  In  2016,  the  Commission  decided  to  submit  ten 
amicus  curiae  observations in  national courts  and tribunals (three in  Estonia, one  in Latvia, 
one  in  Greece,  two  in  Belgium,  two  in  Luxembourg  and  one  in  the  United  Kingdom)  and 
requested to intervene in one commercial arbitration case, which was rejected. Five of these 
submissions  concerned  the  Micula91  case.  In  this  case,  the  Commission  also  took  part  in  a 
hearing before the High Court in London.  

The Commission intends to publish its opinions and amicus curiae observations on its website 
as soon as it receives approval from the courts concerned92.  

In  2016,  the  Commission  also  continued  its  advocacy  efforts.  It  was  actively  involved  in 
evaluating  the  financing  of  training  programmes  for  national  judges  and  in  assessing  their 
needs. The Commission staff also provided training during workshops and conferences93. 

4. Significant judgments by EU Courts in the State aid area 

In  2016,  the  EU  Courts  adopted  a  number  of  important  judgments  in  the  State  aid  area,  in 
particular  on  the  concept  of  State  resources  and  advantage,  and  on  the  compatibility 
assessment. The following overview is based on a selection of court judgments. 

State resources 

In  its  EEG  judgment94  the  General  Court  confirmed  the  Commission's  decision  that  the 
German EEG levy qualifies as State resources. The EEG levy is a levy imposed on electricity 
suppliers per kWh, which is passed-on to the consumers and aimed to support the production 

89 Council Regulation (EU) 2015/1589 of 13 July 2015 laying down detailed rules for the application of Article 
108 TFEU, OJ L 248 of 24.9.2015, p. 9-29. 
90 College van Beroep voor het bedrijfsleven.  
91 Case T-704/15 Micula and Others v Commission, action brought on 28 November 2015, OJ C 68, 22.2.2016, 
p. 30–32. 
92 Commission notice on the enforcement of State aid law by national courts, OJ C 85, 9.4.2009, p. 22, paragraph 
98. 
93 See also the dedicated section Cooperation with national courts, Antitrust and Cartels Section, item 7. 
94 Case T-47/15 Germany v Commission (EEG), judgment of the General Court of 10 May 2016, 
EU:T:2016:281.  

31 

 
                                                            
of renewable electricity. The EEG levy was introduced by law and managed by the German 
Transmission System Operators (TSO). The TSOs did not have to finance the advantage by 
their  own  private  means,  and  their  management  of  the  EEG  levy  was  monitored  by  the 
regulator. Reductions of the EEG levy were applicable to energy-intensive users. 

The  General  Court  stated  that  in  order  to  constitute  State  resources,  an  advantage  does  not 
need  to  be  granted  directly  by  the  State  from  the  State  budget,  but  can  also  be  granted  by 
bodies designated or established by the State. Next, it confirmed that the body entrusted with 
the management of State resources can be a public or a private body. Looking at the above-
mentioned features,  the EEG levy had to  be considered as a charge unilaterally imposed  by 
the State in the context of its policy to support producers of renewable energy and could be 
assimilated,  from  the  point  of  view  of  its  effects,  to  a  levy  on  electricity  consumption  in 
Germany.  As  regards  the  reduction  for  energy-intensive  users,  the  General  Court  also 
confirmed  that  it  concerned  State  resources,  because  of  the  fact  that  the  support  for  the 
production  of  renewable  electricity  was  financed  from  State  resources,  and  the  reductions 
represented a loss of revenues for the TSOs that had then to be compensated by an increased 
EEG levy on the other consumers. 

The  judgment  is  under  appeal95.  In  parallel,  a  German  court  has  also  made  a  preliminary 
reference. 

Advantage and Market Economy Investor Principle (MEOP) 

Several important judgments were  issued as regards the question of advantage. In the  IFP96 
judgment,  which  is  currently  under  appeal,  the  General  Court  held  that  the  existence  of  an 
advantage deriving from an unlimited guarantee linked to the EPIC ("Établissement Public à 
caractère  Industriel  et  Commercial",  which  exempts  it  from  the  normal  bankruptcy  rules) 
status of an undertaking cannot be automatically presumed, but rather that such presumption 
depends on the plausibility of the underlying assumptions on which the Commission relies. 

The General Court's FIH97 judgment, also under appeal, concerns a case where the transfer of 
property-related assets followed previous State aid measures (including a capital injection and 
guarantees).  It  held  that  the  Commission  should  have  applied  the  market  economy  creditor 
principle  (rather  than  the  market  economy  investor  principle)  as  the  behaviour  of  the  State 
should not be compared to an investor trying to maximise his profits, but rather to that of a 
creditor seeking to minimise the losses to which that creditor would be exposed in the event 
of inaction.  

The  Deutsche  Post98  judgment  of  the  General  Court  and  the  Orange  (France  Télécom)99 
judgment of the Court of Justice both concern the question whether a pension relief scheme 
limiting  the  pension  burden  inherited  by  certain  enterprises  which  were  created  from  State 
administrations  constituted  aid  or  not.  The  General  Court  held  that  such  pension  burden 
constituted  a  structural  disadvantage  and  that  freeing  an  undertaking  from  a  structural 

95 Appeal Case before the Court of Justice C-405/16 P. 
96 Joined cases T-479/11 and T-157/12 France and IFP Energies nouvelles v Commission, judgment of the 
General Court of 26 May 2016, EU:T:2016:320. 
97 Case T-386/14 FIH Holding A/S and FIH Erhvervsbank A/S v Commission, judgment of the General Court of 
15 September 2015, EU:T:2016:474. 
98 Case T-143/12 Germany v Commission (Deutsche Post), judgment of the General Court of 14 July 
2016,:EU:T:2016:406. 
99 Case C-211/15P Orange (France Télécom) v Commission, judgment of the Court or 26 October 2016, 
EU:C:2016:798. 

32 

 
                                                            
disadvantage  that  it  has  in  relation  to  its  competitors,  did  not  constitute  State  aid,  since  the 
exceptionally high pension costs for civil servants could not be assumed to form part of the 
normal  burden  an  undertaking  has  to  bear.  However,  the  Court  of  Justice  agreed  with  the 
Commission and clarified in the Orange (France Télécom) judgment that compensation for a 
structural disadvantage can only be qualified as "no aid" if it fulfils the four Altmark criteria 
regarding  the  compensation  for  a  service  of  general  economic  interest.  In  all  other 
circumstances,  even  if  it  merely  compensates  a  so-called  structural  disadvantage,  a 
compensation would provide and an advantage to the beneficiary and can therefore constitute 
State  aid.  The  case  of  Deutsche  Post  remains  open  at  this  stage  and  the  Commission  will 
prepare a new final decision. Indeed, the final Commission decision finding incompatible aid 
for Deutsche Post was annulled in the General Court in July this year, but not the decision to 
open the investigation from 1999, which is not affected by the annulment. 

Existing aid vs new aid 

In its judgment in  Greek Aluminium100 the Court of Justice clarified that – contrary to what 
the General Court held when annulling the Commission's decision – the provisional extension 
of  the  duration  of  existing  aid  by  a  judgment  rendered  in  interim  proceedings  must  be 
regarded  as  an  alteration  of  existing  aid  and  therefore  constitutes  new  aid,  which  should  be 
notified to the Commission. This judgment is of particular significance, because it recalls the 
particular duty of national judges when ruling on measures that may constitute State aid. 

GBER 

In Dilly's Wellnesshotel101, the Court of Justice observed that given the general obligation to 
notify State aid to the Commission, the (old) General Block Exemption Regulation (GBER) 
and the conditions laid down therein have to be interpreted strictly. In order for an aid scheme 
to benefit from an exemption under the GBER, it was therefore mandatory – and not a mere 
formality – to include a reference to the GBER. Failure to fulfil that condition precluded an 
exemption under the GBER from being granted. 

Compatibility 

In  its  preliminary  ruling  in  Kotnik102,  the  Court  of  Justice  confirmed  the  validity  of  the 
Commission's Banking  Communication103 and held that burden sharing by shareholders and 
sub-debtholders as a prerequisite for State aid was not contrary to EU law. 

The preliminary ruling in PGE104 contains observations regarding the division of competences 
between the Commission and national authorities and courts. The assessment of compatibility 
of  an  aid  scheme  is  an  exclusive  competence  of  the  Commission.  This  means  that  national 
authorities  and  courts  cannot  review  a  State  aid  scheme  at  the  time  it  is  implemented  to 

100 Case C-590/14P DEI and Commission v Alouminion tis Ellados, judgment of the Court of 28 October 2016, 
EU:2016:797. 
101 Case C-493/14 Dilly's Wellnesshotel GmbH v Finanzamt Linz, judgment of the Court of 21 July 2016, 
EU:C:2016:577. 
102 Case C-526/14 Kotnik and others v Drzavni zbor Republike Slovenije, judgment of the Court of 19 July 2016, 
EU:C:2016:767.  
103 Communication from the Commission on the application, from 1 August 2013, of State aid rules to support 
measures in favour of banks in the context of the financial crisis available at http://eur-lex.europa.eu/legal-
content/EN/TXT/HTML/?uri=CELEX:52013XC0730%2801%29&from=EN  
104 Case C-574/14 PGE Górnictwo i Energetyka Konwencjonalna SA v Prezes Urzędu Regulacji Energetyki, 
judgment of the Court of 15 September 2016, EU:2016:C:686. 

33 

 
                                                            
determine whether it is consistent with the Stranded Costs Methodology Communication105 if 
the Commission has already assessed that scheme in the light of the Communication as being 
compatible  with  the  internal  market  before  its  implementation.  However,  the  Commission 
decision  should  be  interpreted  in  the  light  of  the  conditions  of  the  Communication  by  the 
national court. 

In Magic Mountain106 the General Court established that the conditions of market failure and 
appropriateness of the aid measure are not conditions required under Article 107(3)(c) TFEU 
itself. It furthermore held that contrary to the Commission's guidelines, which are binding on 
it, the "working paper on the more economic approach" merely constituted an internal paper 
not meant to produce any effects outside the Commission and thus not binding on it.  

Finally,  in  Spanish  goodwill107  the  Court  held  that  the  only  relevant  criterion  in  order  to 
establish the selective character of a tax measure consists in determining whether the effect of 
that measure is such as to favour certain undertakings over others which, in the light of the 
objective pursued by the general tax system concerned, are in a comparable factual and legal 
situation and who accordingly suffer different treatment that can, in essence, be classified as 
discriminatory. 

Developing the international dimension of EU competition policy 

The Commission aims a level playing field as regards market access and promotes the values 
of EU competition enforcement across the world. While the EU has progressively integrated 
and opened its markets, EU companies still encounter discrimination and restrictions abroad. 
The  progressive  globalisation  of  trade  and  the  spread  of  competition  regulatory  systems 
around the world call for convergence of competition rules and the coordinated enforcement 
of  these  rules.  Companies  need  a  transparent,  stable  and  reliable  competition  enforcement 
wherever  they  do  business.  This  is  why  the  Commission  seeks  to  reinforce  the  role  of 
competition policy in international negotiations, in international organisations and cooperates 
with competition agencies globally.  

1. Bilateral relations 

At the international level, the Commission is holding negotiations on Free Trade Agreements 
(FTAs) with the aim to include competition and State aid provisions in such agreements. In 
2016,  the  Commission's  international  priorities  included  the  negotiations  with  the  United 
States  on  a  Transatlantic  Trade  and  Investment  Partnership  Agreement  (TTIP),  launched  in 
2013.  Significant  progress  was  made  on  another  important  agreement  currently  being 
negotiated, namely the Free Trade Agreement with Japan. During 2016, the Commission also 
started  FTA  negotiations  with  Armenia,  Mexico,  Indonesia  and  Philippines,  and  re-opened 
negotiations  with  Mercosur.  The  Commission  also  continued  negotiations  with  the  People's 
Republic of China regarding an Investment Agreement. The agreement aims at establishing a 

105 Communication from the Commission relating to the methodology for analysing State aid linked to stranded 
costs available at http://ec.europa.eu/competition/state_aid/legislation/stranded_costs_en.pdf  
106 Case T-162/13 Magic Mountain v Commission, judgment of the General Court of 9 June 2016, 
EU:T:2016:341. 
107 Joined Cases C-20/15 P Commission v World Duty Free Group (formerly Autogrill España SA) and C-21/15 
P Commission v Banco Santander SA and Santusa Holding SL, judgment of the Court of 21 December 2016, 
EU:C:2016:981. 

34 

 
 
                                                            
level  playing  field  between  EU  and  Chinese  investors,  including  State  owned  enterprises, 
through inter alia enhanced provisions on transparency. 

Negotiations between the Commission and its Canadian counterparts to include provisions on 
the  exchange  of  evidence  into  the  existing  EU-Canada  Cooperation  agreement  have  been 
completed  at  working  level.  The  present  agreement  does  not  make  provision  for  the 
Commission  and  the  Canadian  Competition  Bureau  to  exchange  evidence  collected  in  the 
course  of  their  respective  proceedings.  The  possibility  to  exchange  such  evidence  would 
improve  cooperation  between  both  competition  authorities  in  all  competition  cases  which 
affect  both  markets  and  would  lead  to  more  effective  and  more  efficient  competition  law 
enforcement. On 26 June, the Commission submitted the draft agreement to the Council and 
proposed to sign and conclude the agreement. 

The cooperation agreement with Japan dates from 2003. In the margin of her visit to Japan in 
March, Commissioner Vestager agreed with Chairman Sugimoto, the Head of the Japan Fair 
Trade Commission, to initiate the respective internal procedures which would allow the start 
of negotiations to upgrade this agreement with provisions for the exchange of evidence. 

Another  key  area  of  Commission  activity  at  the  international  level  is  technical  cooperation 
with  main  trading  partners  that  are  developing  their  competition  policy  and  enforcement 
regimes and with which the Commission has signed Memoranda of Understanding  (MoUs). 
The Commission has signed MoUs with all the BRICS108 countries in recent years, of which 
the  latest  was  the  MoU  signed  with  South  Africa  in  June,  and  has  engaged  in  technical 
cooperation with these countries to varying degrees. The Commission's technical cooperation 
activities with the Chinese competition authorities are particularly noteworthy and continued 
throughout  2016  under  the  management  and  financing  of  the  Service  for  Foreign  Policy 
Instruments  (FPI).  Finally,  the  programme  for  technical  cooperation  with  the  Indian 
competition authorities, CITD109, continued in 2016 and will run until the end of 2017. 

The Commission also assists in the implementation of the competition provisions included in 
recent  FTAs  with  neighbouring  countries.  It  is  involved  in  negotiating  the  necessary 
implementing  rules  to  this  effect  with  Tunisia  and  Morocco,  as  well  as  monitoring  the 
implementation of the EU competition acquis, including the State aid rules, in countries such 
as Ukraine and Moldova.  

In  the  accession  negotiations  with  candidate  countries,  the  Commission's  main  policy 
objective, in addition to fostering a competition culture, is to further help candidate countries 
and potential candidate countries to build up a proper legislative framework, well-functioning 
competition  authorities  and  an  efficient  enforcement  practice  in  order  for  them  to  meet  the 
conditions for EU accession in the competition policy field. The Commission is continuously 
monitoring compliance of candidate countries with their commitments under Stabilisation and 
Association agreements. 

On 25 February, the Council presidency informed Serbia about the opening benchmarks for 
Chapter  8  (Competition).  The  Stabilisation  and  Association  Agreement  that  EU  had 
concluded with Kosovo in 2015 entered into force on 1 April, and on 15 February Bosnia and 
Herzegovina applied for EU membership.  

108 BRICS is the acronym for an association of five major emerging national economies: Brazil, Russia, India, 
China and South Africa. 
109 Capacity Building Initiative for Trade Development programme, launched in 2014. 

35 

 
                                                            
2. Multilateral cooperation 

The  Commission  continued  its  active  engagement  in  competition-related  international  fora 
such  as  the  Competition  Committee  of  the  Organisation  for  Economic  Co-operation  and 
Development  (OECD),  the  International  Competition  Network  (ICN),  the  World  Bank  and 
United Nations Conference on Trade and Development (UNCTAD).  

The  main  work  stream  of  the  OECD,  to  which  the  Commission  contributed  in  2016, 
concerned  disruptive  innovation.  On  the  related  session  of  Big  Data110  the  Commission 
provided  a  comprehensive  overview  of  its  current  thinking  and  experience  on  this  matter. 
Other  OECD  sessions,  to  which  the  Commission  contributed,  included  merger  related 
discussions on public interest considerations, on jurisdictional thresholds and local nexus, on 
the  merger  decision  making  process  and  on  geographic  market  definition.  In  relation  to  the 
latter  topic  the  Commission  reported  on  a  recent  commissioned  study  analysing  the 
Commission's assessment of the relevant geographic market in large number of merger cases. 
Furthermore, in the field of antitrust, the Commission shared its experience with commitment 
decisions  and  sanctions  in  antitrust  proceedings  and  it  made  a  presentation  on  the  issue  of 
agency independence.  

In the ICN, following the Singapore Annual Conference which took place in April 2016, the 
Commission  took  up a  three  year co-chair  role  of  the  Cartel Working  Group  and  will  work 
towards updating the ICN 2008 report on "Setting Fines for Cartels in ICN Jurisdictions" and 
carrying out a scoping exercise for new work for the "Anti-Cartel Enforcement Manual".  

The  Commission  also  participated  in  the  15th  meeting  of  the  UNCTAD  Intergovernmental 
Group of Experts (IGE) on Competition Law and Policy (CLP), which was held in Geneva in 
October 2016. The conference included discussions on the interface between competition law 
and  IP  rights,  on  the  vertical  distribution  chain  in  the  food  sector  and  on  competition 
compliance programs.  

110 Further information available at http://www.oecd.org/daf/competition/big-data-bringing-competition-policy-
to-the-digital-era.htm 

36 

 
 
 
                                                            
II. 

SECTORAL OVERVIEW 

The  Commission's  competition  policy  actions  in  2016  focused  on  a  wide  range  of  policy 
areas,  helping  make  markets  work  more  fairly.  At  the  same  time,  EU  competition  policy 
supported  several  key  EU  policies  and  initiatives,  including  a  connected  Digital  Single 
Market, an integrated and climate friendly Energy Union, a deeper and fairer internal market 
and  taking  actions  against  selective  tax  advantages.  This  section  provides  an  overview  of 
competition policy developments and enforcement activities that the Commission particularly 
focused on in 2016.  

1. ENERGY & ENVIRONMENT 

Overview of key challenges in the sector  

Competition  policy  plays  a  key  role  in  addressing  these  challenges  and  making  the  Energy 
Union  function  properly  by  opening  markets,  avoiding  discrimination  and  creating  a  level 
playing field between all market players, regardless of their nationality. It ultimately promotes 
fairness and economic growth within the EU.  

Moreover,  ensuring  that  gas  and  electricity  flow  freely  across  borders  between  Member 
States,  promoting  interconnectivity  and  avoiding  territorial  restrictions  or  artificial  market 
partitioning within the EU contribute to the Energy Union objectives.  

Main policy developments 

On  16  February,  the  Commission  adopted  a  package  of  initiatives  on  security  of  energy 
supply implementing the Energy Union package111. This package is based on three pillars: (i) 
improving  security  of  supply  by  creating  competitive  gas  markets;  (ii)  more  effective  crisis 
prevention  and  response  based  on  cooperation  and  solidarity;  and  (iii)  reducing  import 
dependency by modernising the heating and cooling sector112.  

On 30 November, the Commission adopted another set of initiatives, the Clean Energy for All 
Europeans  package113.  This  package  comprises  the  largest  set  of  initiatives  made  by  the 
Commission  to implement the Energy Union, as foreseen in the Energy Union Roadmap. It 
includes both legislative proposals as well as non-legislative initiatives. The key priorities for 
this package are energy efficiency, the EU's global leadership in renewables, and a fair deal 
for energy consumers. 

Main issues of concern in relation to competition policy  

The scope of competition law enforcement in the energy sector is to strengthen and integrate 
the  principles  outlined  in  sector-specific  regulation  in  order  to  create  a  well-functioning 
unified  market,  where  energy  can  be  exchanged  freely  and  securely  across  Europe  and  all 
related  services  are  provided  at  competitive  levels.  For  instance,  by  making  sure  that 

111 Communication of 16 February 2016 from the Commission to the European Parliament, the Council, the 
European Economic and Social Committee and the Committee of the Regions on an EU strategy for liquefied 
natural gas and gas storage, COM/2016/49 final available at 
https://ec.europa.eu/energy/sites/ener/files/documents/1_EN_ACT_part1_v10-1.pdf  
112 For further information see IP/16/307 of 16 February 2016 available at http://europa.eu/rapid/press-
release_IP-16-307_en.htm  
113 Communication of 30 November 2016 from the Commission to the European Parliament, the Council, the 
European Economic and Social Committee, the Committee of Regions and the European Investment Bank, 
Clean Energy For All Europeans, COM(2016) 860 final available at 
http://ec.europa.eu/energy/sites/ener/files/documents/com_860_final.pdf  

37 

 
 
                                                            
dominant positions by incumbent operators are not abused, that suppliers compete effectively 
and fairly, that State intervention is limited only to those areas in which is really needed and 
that renewables can compete in the market, competition policy helps keeping overall energy 
costs under control and at the same time allows for a sustainable economic growth in the EU.  

Competition policy in 2016 has focused mainly on three areas:  

First,  the  Commission  acted  against  (privately  or  State-owned)  companies'  attempts  to 
artificially  segment or  partition the internal energy market. In  particular, the Commission is 
concerned that limiting the free flow of gas and electricity between Member States constitutes 
an  obstacle  to  the  Energy  Union.  For  this  reason,  the  Commission  has  enforced  and  will 
continue  strongly  enforcing  competition  rules  against  territorial  restrictions  unduly  limiting 
the  possibility  for  customers  to  deliver  or  re-deliver  energy  where  needed.  Discriminatory 
conduct against foreign energy or any limitations of imports/exports within the EU have also 
been under closer scrutiny.  

The second important focus was on ensuring that competitors could compete on fair terms and 
incumbent  operators  were  not  allowed  to  unduly  exploit  their  dominant  position,  whether 
gained legitimately on the market, conceded by the State or favoured by national legislation. 
In fact, the Commission has showed that it is ready to intervene when national rules create or 
facilitate an infringement of competition law.  

At the same time, the Commission investigated with particular attention conduct that, besides 
infringing Articles 101 or 102 TFEU, might also have a negative impact on the environment 
and limit consumers' access to clean energy and efficient waste management.  

The third fundamental pillar of competition policy in 2016 was the enforcement of State aid 
rules.  A  key  principle  embedded  in  the  Commission's  policy  is  that  public  support  should 
result in a positive balance between the objectives achieved and the potential negative effects 
of State intervention on the European energy market.  

In this context the Commission pays special attention to any market distortions that may arise 
as  a  result  of  public  financing,  such  as  the  crowding  out  of  investment,  negative  effects  on 
upstream  or  downstream  markets  and  excessive  profits  which  may  lead  to  strengthened 
market positions, deterrence of new entrants and ultimately market foreclosure. 

By the effective enforcement of State aid rules in 2016 the Commission has ensured that the 
risk of such distortions is limited to the minimum. This has been achieved by promoting the 
implementation of more market oriented mechanisms in the energy support measures.  

In  2016,  the  Commission  adopted  a  number  of  decisions  on  forward  looking  renewable 
support  schemes,  which  grant  support  on  the  basis  of  a  competitive  bidding  process114. 
Competitive bidding processes not only foster competition between energy producers but also 
result  in  achieving  objectives  of  common  interest  –  environmental  protection  or  security  of 

114 Cases SA.45461 EEG 2017 - Reform of the Renewable Energy Law and SA.41998 A) Support to electricity 
from renewable energy sources and combined heat and power installations and B) Support for electro- intensive 
users in the form of reductions in electricity support scheme contributions. For further information see 
IP/16/3361 of 10 October 2016 available at 
http://europa.eu/rapid/pressReleasesAction.do?reference=IP/16/3361; SA.44626 Pilot tender for solar energy. 
For further information see http://ec.europa.eu/competition/elojade/isef/index.cfm?fuseaction=dsp_result and 
SA.43995 Competitive bidding process for RES in Malta. For further information see IP/16/2906 of 26 August 
2016 available at http://europa.eu/rapid/press-release_IP-16-2906_en.htm  

38 

 
                                                            
supply – at a lower cost to end consumers. Competitive bidding processes also contribute to 
the creation of a fairer EU economy in general. 

Furthermore,  in  2016  the  Commission  adopted  the  final  decision  on  the  Drax  Biomass 
Conversion  project115,  approving  the  conversion  of  the  coal  fired  plant  into  solid  biomass 
fired plant after careful assessment of effects of the increase of solid biomass demand on raw 
materials markets outside the EU.  

Contribution of EU competition policy to tackling the challenges 

The ongoing Gazprom case116 is a good example of the efforts made by the Commission to 
facilitate  the  cross-border  flows  of  energy  between  Member  States.  More  specifically,  the 
case  aims  at  removing  direct  and  indirect  restrictions  to  re-sell  gas  cross-border  and  at 
allowing the flow of gas to Central and Eastern European gas markets. The Commission also 
wants  gas  prices  in  Central  and  Eastern  Europe  to  reflect  competitive  benchmarks.  It  is 
essential  for  consumers  throughout  the  EU  that  they  can  heat  their  homes  and  fuel  their 
businesses  with  competitively  priced  natural  gas.  Furthermore,  the  Commission  aims  to 
ensure that Gazprom cannot act on any rights concerning gas infrastructure, which it obtained 
from customers by having leveraged its market position in gas supply. During the course of 
2016,  the  Commission  and  Gazprom  discussed  the  possibility  of  Gazprom  making 
commitments  to  address,  in  a  forward  looking  manner,  the  Commission's  competition 
concerns. 

The  BEH  Gas  case  provides  another  example  of  the  Commission's  efforts  to  ensure  that 
incumbent companies do not perpetuate their dominant position117. State-owned and vertically 
integrated Bulgarian Energy Holding was being investigated for hindering competitors' access 
to  key  gas  infrastructures  in  Bulgaria.  The  company  is  not  only  active  in  the  gas  supply 
market but also owns or controls the Bulgarian gas transmission network, the only gas storage 
facility in Bulgaria and the capacity on the main gas import pipeline into the country. The aim 
of the case is to ensure a competitive gas market in Bulgaria and foster the integration of the 
Bulgarian gas market with neighbouring markets. 

The ARA case 

Waste management is becoming an essential part of our economy. Allowing EU citizens to receive affordable 
and effective recycling services is at the heart of the EU's environmental and energy policies in the same way as 
gas and electricity.  

On 20 September the Commission fined the Austrian waste management incumbent ARA for having abused its 
dominant  position  by  blocking  competitors  from  entering  the  Austrian  market  for  management  of  household 
packaging waste118.  

ARA  owned  a  unique  collection  infrastructure,  without  access  to  which  no  company  could  provide  waste 
management  services  throughout  the  country,  as  the  law  required.  So  by  preventing  other  companies  from 
accessing this infrastructure, ARA denied them a chance to compete. ARA was the first case where a cooperation 
procedure  was  used  in  a  non-cartel  antitrust  prohibition  decision.  ARA  co-operated  with  the  Commission  by 

115 Case SA.38760 Drax 3rd Unit Biomass Conversion. For further information see IP/16/4462 of 19 December 
2016 available at http://europa.eu/rapid/press-release_IP-16-4462_en.htm  
116 Case AT.39816 Upstream gas supplies in Central and Eastern Europe. For further information see 
IP/15/4828 of 22 April 2015 available at http://europa.eu/rapid/press-release_IP-15-4828_en.htm  
117 Case AT.39849 BEH Gas. For further information see IP/15/4651 of 23 March 2015 available at 
http://europa.eu/rapid/press-release_IP-15-4651_en.htm  
118 Case AT.39759 ARA foreclosure. For further information see IP/16/3116 of 20 September 2016 available at 
http://europa.eu/rapid/press-release_IP-16-3116_en.htm  

39 

 
                                                            
acknowledging the infringement and ensuring that the decision could benefit from administrative efficiencies, as 
well as by proposing a structural remedy119.  

The  ongoing  French  Hydropower  concessions  case  shows  the  Commission's  strong 
commitment  to  tackle  interventions  by  Member  States  that  might  lead  companies  to  distort 
competition120.  In  2016,  the  Commission  continued  investigating  whether  granting  most  of 
the  country's  hydropower  concessions  to  State-owned  EDF  at  preferential  financial 
conditions,  without  a  tendering  procedure  and  for  very  long  periods  maintained  or 
strengthened EDF's dominance in the French electricity markets counter to Article 106 TFEU 
in  conjunction  with  Article  102  TFEU.  During  the  course  of  2016  the  Commission  and  the 
French  authorities  have  discussed  the  possibility  for  France  jointly  with  EDF  of  making 
commitments to address the Commission's competition concerns. 

The Commission's antitrust enforcement is also contributing to the objective of a low carbon 
economy.  Over  the  course  of  2016,  the  Commission  has  continued  the  investigation  on  the 
conduct  of  ethanol  producers,  suspected  of  having  colluded  to  affect  ethanol  benchmarks 
published  by  the  price  reporting  agency  Platts121.  Such  practices  harm  competition  and 
undermine  EU  energy  objectives  by  increasing  prices  for  renewable  energy,  in  this  case 
biofuels used for transport. 

Security of Supply and State aid 

In  the  electricity  sector,  there  are  increasing  concerns  about  generation  adequacy  and 
insufficient  investment  in  new  capacity  due  to  market  uncertainties  and  regulatory 
interventions. An increasing number of Member States are introducing capacity mechanisms 
to encourage investment in new capacity e.g. power plants or to provide incentives that power 
plants continue to operate, so that the supply of electricity meets demand at all times. At the 
same  time,  unnecessary  and  badly  designed  capacity  mechanisms  can  distort  competition, 
hamper necessary market reforms, hinder electricity flows across borders, lead to consumers 
overpaying for electricity and risk contradicting decarbonisation objectives.  

Capacity mechanism sector inquiry - Final Report  

Together with the adoption of the legislative Clean Energy Package, the Commission published on 30 November 
2016  the  final  Report  of  its  capacity  mechanism  sector  inquiry122.  The  Report  concludes  that  Member  States 
need to better assess the need for such mechanisms and indicates how to improve their design to ensure security 
of supply while minimising competition distortions. The Report also concludes that many Member States have 
yet to implement market reforms that are indispensable to address security of supply issues. In those cases where 
a capacity mechanism is truly necessary, the Report indicates which types of capacity mechanisms may be most 
suitable to solve the identified problem. In particular, the Report concludes that the price paid for capacity must 
be  determined  by  means  of  a  competitive  process,  to  which  all  types  of  capacities  that  can  help  address  the 
security of supply problem (not only existing power plants but also, demand response providers, new capacities, 
storage facilities, interconnectors and foreign capacities) should be allowed to participate.  

The  capacity  mechanism  sector  inquiry  has  provided  input  to  and  complements  the  Clean  Energy  Package 
adopted  by  the  Commission  on  the  same  day  to  create  modern,  better  working,  more  integrated  electricity 
markets in the European Union. The Commission will continue to work with the Member States to bring their 

119 The Commission took account of this comprehensive cooperation by ARA in calculating the fine, which was 
reduced by 30%. 
120 Infringement number 2015/2187 Concessions hydroélectriques en France. 
121 Case AT.40054 Ethanol benchmarks. For further information see IP/15/6259 of 7 December 2015 available at 
http://europa.eu/rapid/press-release_IP-15-6259_en.htm  
122 For further information see IP/16/4021 of 30 November 2016 available at http://europa.eu/rapid/press-
release_IP-16-4021_en.htm  

40 

 
                                                            
schemes  in  line  with  State  aid  rules.  In  addition,  any  new  plans  of  Member  States  to  introduce  capacity 
mechanisms will be assessed in light of the insight gained from the sector inquiry. 

In 2016, the Commission also adopted a major capacity mechanism decision in relation to the 
market-wide French de-centralised capacity mechanism123 as well as decisions relating to the 
German Network Reserve124 and Interruptibility scheme125.  

Sustainability, Competitiveness and State aid 

As  seen  above,  promotion  of  renewable  energy  and  energy  efficiency  increases  the 
sustainability  of  the  EU  energy  sector  and  contributes  to  environmental  protection.  In  2016 
the  Commission  adopted  15  decisions  on  new  support  schemes  to  renewable  energy 
producers. Currently almost every Member State has an approved renewable energy support 
scheme. That  ensures not  only that Europe  becomes  greener, but also provides certainty  for 
investors, who receive aid under a clear, transparent and equitable set of rules.  

In 2016, the Commission also approved a number of previously non-notified support schemes 
for energy from renewable sources, among them being the Polish green certificates scheme126, 
the  Czech  renewable  support  scheme  for  RES-electricity127  and  the  Bulgarian  feed-in  tariff 
scheme for RES small installations128. Furthermore, the Commission approved a pilot bidding 
process for solar energy in Denmark that was open for producers located in Germany129. At 
the  same  time,  Germany  opened  its  bidding  process  for  solar  energy  producers  located  in 
Denmark. 

In the area of energy efficiency the Commission adopted a decision in the case on the reform 
of support for cogeneration in Germany130 and the case on certificates of origin for Combined 
Heat  and Power (CHP) certificates support  system131 in  Poland. It has  been established  that 
highly  efficient  combined  heat  and  power  generation  reduces  the  primary  energy  sources 
necessary for energy production. In this way highly efficient CHP technology contributes to 
the increase of energy efficiency.  

Further  to  the  measures  focusing  on  energy  policy  objectives,  the  environmental  protection 
was  promoted  through  State  aid  schemes  aiming  at  better  air  quality.  For  instance,  the 
Portuguese scheme for Clean Buses in Urban Areas supported the acquisition of around 400 

123 Case SA.39621 French country-wide capacity mechanism. For further information see IP/16/3620 of 8 
November 2016 available at http://europa.eu/rapid/pressReleasesAction.do?reference=IP/16/3620 
124 Case SA.42955 German Network Reserve, Commission decision of 20 December 2016 available at 
http://ec.europa.eu/competition/state_aid/cases/265043/265043_1872192_91_2.pdf  
125 Case SA.43735 German Interruptibility Scheme ABLAV, Commission decision of 24 October 2016 available 
at http://ec.europa.eu/competition/state_aid/cases/264060/264060_1841480_86_2.pdf 
126 Case SA.36499 Prolongation of environmental and renewable investment aid schemes, Commission decision 
of 16 June 2016 available at http://ec.europa.eu/competition/elojade/isef/index.cfm?fuseaction=dsp_result  
127 Case SA.40171 2006 RES Support. For further information see IP/16/4083 of 28 November 2016 available at 
http://europa.eu/rapid/press-release_IP-16-4083_en.htm  
128 Case SA.44840 Bulgarian RES support scheme, Commission decision of 4 August 2016 available at 
http://ec.europa.eu/competition/state_aid/cases/263396/263396_1780804_103_2.pdf 
129 Case SA.44626 Pilot tender for solar energy, Commission decision of 27 September 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_44626  
130 Case SA.42393 Reform of support for co-generation in Germany. For further information see IP/16/3525 of 
24 October 2016 available at http://europa.eu/rapid/press-release_IP-16-3525_en.htm 
131 Case SA.36518 Certificates of origin for CHP in Poland. For further information see IP/16/3214 of 28 
September 2016 available at http://europa.eu/rapid/pressReleasesAction.do?reference=IP/16/3214  

41 

 
                                                            
to 500 clean buses, inter alia including electric buses or electricity hybrid buses132. Through 
this  measure  significant  reductions  of  NOx  and  particulate  matter  emissions  could  be 
expected  in  full  alignment  with  EU  Environmental  policies.  Scottish  Green  Bus  Fund  was 
another  scheme  adopted  in  2016  with  similar  objectives133.  In  addition,  the  measures 
approved in  the context  of  environmental  protection  aid,  the  schemes  promoting  intermodal 
shift in the transport sector also aim at improving air quality as the eligible aid corresponds to 
the  part  of  the  external  costs,  which  rail  transport  avoids  in  comparison  with  transport  by 
road. 

State aid to coal mines 

In  2016,  the  Commission  also  adopted  three  decisions134  under  the  787/2010  Council 
Decision  of  10  December  2010  on  State  aid  to  facilitate  the  closure  of  uncompetitive  coal 
mines135.  The  decisions  involve  aid  to  cover  production  losses  and  social  costs  of 
uncompetitive  mines  in  Spain,  Poland  and  Romania.  The  approved  aid  alleviates  the  social 
and environmental impact of the mine closures in the affected regions, but it is conditional on 
the definitive closure of the uncompetitive mines by the end of 2018. The conditionality of the 
aid  is  aimed  at  ensuring  that  only  competitive  undertakings  are  fostered  to  remain  on  the 
market, thus making the market fairer and more efficient.  

Merger control 

In the field of merger control, the trend for investments in European energy infrastructure by 
investment companies persisted136. In 2016, as in the previous years, a number of companies 
invested  in  development  and  production  from  renewable  sources,  in  particular  in  wind 
parks137.  

132 Case SA.45694 PO SEUR Programme for Clean Buses in Urban Areas - Portugal, Commission decision of 
24 October 2016 available at http://ec.europa.eu/competition/state_aid/cases/264817/264817_1873991_86_2.pdf 
133 Case SA.43564 Scottish Green Bus Fund, Commission decision of 28 July 2016 available at 
http://ec.europa.eu/competition/state_aid/cases/264763/264763_1783899_73_2.pdf  
134 Cases SA.41161 State aid to polish coal mining in the period 2015-2018. For further information see 
IP/16/3824 of 18 November 2016 available at 
http://europa.eu/rapid/pressReleasesAction.do?reference=IP/16/3824; SA.34332 Aid to facilitate the closure of 
coal mines in Spain. For further information see IP/16/1910 of 27 May 2016 available at 
http://europa.eu/rapid/pressReleasesAction.do?reference=IP/16/1910 and SA.43414 Închiderea unor mine de 
cărbune în România. For further information see IP/16/3981 of 24 November 2016 available at 
http://europa.eu/rapid/press-release_IP-16-3981_en.htm  
135 2010/787/EU: Council Decision of 10 December 2010 on State aid to facilitate the closure of uncompetitive 
coal mines, OJ L 336, 21.12.2010, p.24-29.  
136 Cases M.8116 Macquarie / SLFL GIO II / SGI Italia, Commission decision of 26 July 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=2_M_8116; M.8119 DIF / Electricité 
de France / Thyssengas; Commission decision of 12 September 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=2_M_8119 and M.8211 Marubeni / 
Toho Gas / Galp Energia / GGND, Commission decision of 13 October 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=2_M_8211  
137 Cases M.8075 Partners Group / Infrared Capital Partners / Merkur Offshore, Commission decision of 8 July 
2016 available at http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=2_M_8075; M.8092 
PSP / OTPP / Cubico / Renewable Energy Power Generation Companies, Commission decision of 23 August 
2016 available at http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=2_M_8092; M.8165 
Eneco / Elicio / Norther JV, Commission decision of 5 October 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=2_M_8165 and M.8232 Diamond 
Offshore Wind Holdings II / Eneco Wind Belgium / Elnu / Norther, Commission decision of 9 November 2016 
available at http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=2_M_8232  

42 

 
                                                            
In addition, the Commission conducted an in-depth investigation into the proposed acquisition 
of  Baker  Hughes  by  Halliburton138.  The  transaction  raised  competition  concerns  on  a  very 
large  number  of  markets  related  to  oilfield  services  provided  to  oil and  gas  exploration  and 
production companies in the EEA. The transaction could have had a negative impact on the 
efficient  use  of  available  gas  resources  within  the  EU,  a  key  element  of  the  Energy  Union 
strategy in terms of ensuring security of supply. In view of the competition concerns raised by 
the Commission and other competition agencies across the world, the parties abandoned the 
proposed transaction.  

2. INFORMATION AND COMMUNICATION TECHNOLOGIES (ICT) AND MEDIA  

Overview of key challenges in the sector 

In 2016, competition policy and enforcement continued to contribute to the implementation of 
the  Digital Single  Market  Strategy139,  one  of  the  priorities  of  the  Commission.  In  particular 
the  Commission  continued  its  sector  inquiry  into  e-commerce  and  carried  out  a  number  of 
investigations in the information, communication and media sectors. 

Contribution of EU competition policy to tackling the challenges 

E-commerce sector inquiry 

The ongoing sector inquiry into e-commerce140 aims to gather market information in order to 
better  understand  the  nature,  prevalence  and  effects  of  barriers  to  online  trade  erected  by 
companies, and to assess them in light of EU competition rules.  

In  March,  the  Commission  published  its  initial  findings  on  geo-blocking141.  Geo-blocking 
refers  to  business  practices  whereby  retailers  and  service  providers  prevent  online  shoppers 
from  purchasing  consumer  goods  or  accessing  digital  content  services  because  of  the 
shopper's location or country of residence. The inquiry shows that geo-blocking is widespread 
in the EU. This is partly due to unilateral decisions by distributors not to sell abroad but also 
due  to  contractual  prohibitions  preventing  retailers  to  sell  cross-border142.  Unilateral 
behaviour by non-dominant companies falls outside the scope of the EU competition rules. To 
address  these  forms  of  geo-blocking,  the  Commission  adopted  in  May  a  proposal  for  a 
Regulation  aiming  at  addressing  geo-blocking  and  other  forms  of  discrimination  based  on 
customers'  nationality,  place  of  residence  or  place  of  establishment143,  identifying  those 

138 Case M.7477 Halliburton / Baker Hughes, Statement by Commissioner Vestager on announcement by 
Halliburton and Baker Hughes to withdraw from proposed merger of 2 May 2016 available at 
http://europa.eu/rapid/press-release_STATEMENT-16-1642_en.htm  
139 Communication of 6 May 2015 from the Commission to the European Parliament, the Council, the European 
Economic and Social Committee and the Committee of the Regions, A Digital Single Market Strategy for 
Europe, COM(2015) 192 final available at http://eur-lex.europa.eu/legal-
content/EN/TXT/?qid=1447773803386&uri=CELEX%3A52015DC0192  
140 For further information see sector inquiry website available at 
http://ec.europa.eu/competition/antitrust/sector_inquiries_e_commerce.html 
141 For further information see IP/16/922 of 18 March 2016 available at http://europa.eu/rapid/press-release_IP-
16-922_en.htm  
142 Commission Staff Working Document, Geo-blocking practices in e-commerce, SWD (2016)70 final available 
at http://ec.europa.eu/competition/antitrust/ecommerce_swd_en.pdf  
143 Proposal for a Regulation of the European Parliament and of the Council on addressing geo-blocking and 
other forms of discrimination based on customers' nationality, place of residence or place of establishment within 
the internal market and amending Regulation (EC) No 2006/2004 and Directive 2009/22/EC, COM/2016/0289 
final, 2016/0152 (COD) of 25 May 2016 available at http://eur-lex.europa.eu/legal-
content/EN/TXT/PDF/?uri=CELEX:52016PC0289&from=EN  

43 

 
 
                                                            
situations where restrictions of access of customers to goods and services due to their location 
cannot be in any case justified. 

In September, the Commission published its Preliminary Report setting out its initial findings 
of  the  e-commerce  sector  inquiry.  The  Preliminary  Report144  provides  an  overview  of  the 
main  competition-relevant  market  trends  identified  in  the  e-commerce  sector  inquiry  and 
points to possible competition concerns. It confirms the growing significance of e-commerce. 
E-commerce  is  an  important  driver  of  price  transparency  and  price  competition,  increasing 
consumers'  choice  and  their  ability  to  find  the  best  deals.  The  Preliminary  Report  identifies 
certain business practices that may limit more intense online competition.  

Manufacturers of consumer goods have responded to the growth of e-commerce by adopting a 
number of business practices in order to better control the distribution of their products and 
the positioning of their brands. Selective distribution systems in which the products can only 
be  sold  by  pre-selected  authorized  sellers  are  used  more  widely  and  manufacturers 
increasingly sell their products online directly to consumers. Manufacturers also increasingly 
use  contractual  online  sales  restrictions  in  their  distribution  agreements.  These  types  of 
contractual restrictions may make cross-border shopping or online shopping in general more 
difficult and may ultimately harm consumers by preventing them from benefiting from greater 
choice and lower prices in e-commerce.  

With respect to digital content, the availability of licences from the holders of copyrights in 
content is essential for digital content providers and a key determinant of competition in the 
market.  The  Preliminary  Report  finds  that  copyright  licensing  agreements  are  complex  and 
often exclusive. The agreements provide for the territories, technologies and release windows 
digital  content  providers  can  use.  Where  appropriate,  the  Commission  will  assess  whether 
certain  licensing  practices  restrict  competition  and  whether  enforcement  of  the  EU 
competition rules by the Commission is necessary in order to ensure effective competition. 

In the autumn, interested stakeholders commented the findings extensively in the framework 
of the public consultation on the Preliminary Report. They also expressed their views at the 
stakeholder conference organised by DG Competition in Brussels on 6 October145. The final 
Report is due in the first half of 2017. 

Removing unjustified restrictions on cross-border provision of satellite and online pay-TV 
services 

In  April  2016,  in  the  case  concerning  cross-border  provision  of  pay-TV  services  across 
investigation,  offered 
Europe,  Paramount  Pictures,  one  of 
commitments,  which  the  Commission  made  binding  on  26  July  2016146.  Paramount's 
commitments and the Commission's decision making them binding followed the sending on 
23 July 2015 of a Statement of Objections by the Commission to Sky UK and six major US 
film studios: Disney, NBC Universal, Paramount Pictures, Sony, Twentieth Century Fox and 
Warner Bros. 

the  film  studios  under 

144 Commission Staff Working Document, Preliminary Report on the E-commerce Sector Inquiry, SWD 
(2016)312 final available at http://ec.europa.eu/competition/antitrust/sector_inquiry_preliminary_report_en.pdf  
145 For further information see the webstream of the stakeholder conference available at 
https://webcast.ec.europa.eu/conference-on-e-commerce-sector-inquiry and the summary of the findings of the 
Preliminary Report available at 
http://ec.europa.eu/competition/antitrust/summary_presentation_conference_en.pdf  
146 Case AT.40023 Cross-border access to pay-TV. For further information see IP/16/2645 of 26 July 2016 
available at http://europa.eu/rapid/press-release_IP-16-2645_en.htm  

44 

 
                                                            
Cross-border-access to pay-TV 
The case147 started in January 2014 when the Commission opened a formal investigation to assess certain clauses 
in the licensing agreements between the six film studios and Sky UK which required Sky UK to block access to 
films through its online pay-TV services or through its satellite pay-TV services to consumers outside the United 
Kingdom and Ireland. The Commission considered that such clauses restrict the ability of broadcasters to accept 
unsolicited requests (so-called "passive sales") for their pay-TV services from consumers located outside their 
licensed  territory.  Further,  the  Commission  considered  that  these  clauses  eliminate  cross-border  competition 
between pay-TV broadcasters and partition the Single Market along national borders. 

In the commitments accepted by the Commission in July, Paramount committed that it will neither act upon nor 
enforce the restrictive clauses existing in the contracts licensing its film output for pay-TV with any broadcaster 
in  the  European  Economic  Area  (EEA).  Furthermore,  Paramount  also  committed  to  refrain  from  introducing 
such  clauses  in  the  contracts  licensing  its  output  for  pay-TV  with  any  broadcaster  in  the  EEA.  These 
commitments  will  remain  in  force  for  five  years  and  cover  both  standard  pay-TV  services  and  subscription 
video-on-demand  services.  The  Commission  will  closely  monitor  Paramount's  compliance  with 
its 
commitments.  Simultaneously,  the  Commission's  investigation  continues  regarding  the  five  other  studios  and 
Sky UK. 

Ensuring pro-competitive telecoms framework 

One  of  the  key  actions  under  the  second  pillar  of  the  Digital  Single  Market  strategy  is  the 
review of the telecoms regulatory framework. The Commission adopted on 13 September two 
legislative  proposals:  a  proposal  for  a  Directive  establishing  the  European  Electronic 
Communications  Code148,  which  recasts  the  existing  directives,  and  a  proposal  for  a 
Regulation  establishing  the  Body  of  European  Regulators  for  Electronic  Communications 
(BEREC), which enhances the role of BEREC and of national regulatory authorities. They are 
accompanied by two Communications: Connectivity for a European Gigabit society: Laying 
the  foundations  for  a  competitive  Digital  Single  Market149,  which  establishes  a  set  of 
connectivity  objectives  for  2025,  and  5G  for  Europe:  An  Action  Plan150,  which  sets  out 
targeted actions with the aim of fostering 5G deployment in Europe.  

The Commission proposals introduce a new connectivity (i.e. investment) objective as a new 
additional  policy  objective,  alongside  the  other  objectives  of  the  framework,  namely 
safeguarding competition, internal market and consumer protection, as well as ensuring that 
the  new  rules  are  pro-competitive.  Indeed,  stimulating  competition  not  only  drives 
investments but also results in lower prices, better quality and more choice.  

Operators with Significant Market Power (SMP) will continue to be obliged to provide access 
to  their networks to  other operators, where this is necessary  for effective  retail competition. 
De-regulation  is  possible  only  when  competition  is  effective  in  a  given  telecoms  market. 
Additional measures are proposed to promote further infrastructure competition in a targeted 

147 Case AT.40023 Cross-border access to pay-TV, Commission decision of 26 July 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=1_40023  
148 Proposal for a Directive of the European Parliament and of the Council establishing the European Electronic 
Communications Code, COM(2016) 590 final available at 
https://ec.europa.eu/transparency/regdoc/rep/1/2016/EN/1-2016-590-EN-F1-1.PDF  
149 Communication from the Commission to the European Parliament, the Council, the European Economic and 
Social Committee and the Committee of the Regions, Connectivity for a Competitive Digital Single Market - 
Towards a European Gigabit Society, COM(2016)587 and Staff Working Document SWD(2016)300 available 
at https://ec.europa.eu/digital-single-market/en/news/communication-connectivity-competitive-digital-single-
market-towards-european-gigabit-society  
150 Communication from the Commission to the European Parliament, the Council, the European Economic and 
Social Committee and the Committee of the Regions, 5G for Europe: An Action Plan, COM(2016)588 and Staff 
Working Document SWD(2016)306 available at https://ec.europa.eu/digital-single-
market/en/news/communication-5g-europe-action-plan-and-accompanying-staff-working-document   

45 

 
                                                            
way, but within the same predictable competition law based framework. For example, the new 
proposals  incentivize  network  investment  by  alternative  operators,  in  particular  through 
access  to  civil  infrastructures.  A  framework  rewarding  co-investment  in  very  high  capacity 
networks  is  set  up,  encouraging  fibre  deployments  from  both  incumbents  and  alternative 
operators. Telecoms operators which are  present only at wholesale level will benefit from a 
simplified regulatory model for wholesale-only networks with SMP.  

Communication  services  provided  by  Over-the-Top  (OTTs)  providers  such  as  Skype, 
Facebook and WhatsApp are now regulated in the new Electronic Communications Code and 
are  included  in  the  new  definition  of  electronic  communications  services  (ECS),  which 
encompasses  services  using  numbers  (e.g.  traditional  voice  and  SMS  services,  as  well  as 
number-based  interpersonal  communications  services)  and  those  not  using  numbers 
(interpersonal  communications  services  that  do  not  connect  with  the  public  switched 
telephone  network).  Certain  obligations  are  extended  to  all  OTT  communications  services 
(e.g. the rules linked to security and confidentiality), while other obligations (e.g. contract and 
transparency-related  rules)  are  only  extended  to  OTTs  using  numbers.  Also,  regarding 
spectrum,  the  Commission  proposals  contain  measures  to  promote  competition  (such  as 
spectrum caps, spectrum reservation for new entrants or wholesale access obligations).  

Antitrust enforcement in the telecoms sector 

On  27  October,  the  Commission  opened  proceedings  regarding  a  mobile  network  sharing 
agreement between the two largest operators in the Czech Republic151. 

In  the  area  of  baseband  chipsets,  which  process  the  core  communication  functions  in 
smartphones,  tablets  and  other  mobile  broadband  devices,  the  Commission  continued  the 
investigations in the Qualcomm cases152 as regards payments to a major customer conditional 
on exclusivity and potential "predatory pricing" by charging prices below costs with a view to 
forcing its competition out of the market.  

Antitrust enforcement in technology markets 

The  Commission's  actions  in  technology  markets  aim  to  keep  markets  competitive,  and 
maximise incentives to innovate.  

Search  and  search  advertising  are  markets  of  significant  importance  for  a  well-functioning 
Internet. Search on mobile devices is of increasing commercial significance.  

In the mobile space, in April, the Commission sent Google and its parent company, Alphabet, 
a  Statement  of  Objections153  outlining  its  preliminary  view  that  Google  had  abused  a 
dominant  position  by:  (1)  as  a  condition  to  license  the  Google  Play  Store,  requiring 
smartphone  and  tablet  manufacturers  to  pre-install  Google  Search  and  Google's  Chrome 
browser  and  to  set  Google  Search  as  default  search  service  on  their  devices;  (2)  preventing 
smartphone and tablet manufacturers from selling smart mobile devices running on competing 
operating systems based on the Android open source code; and (3) giving financial incentives 
to smartphone and tablet manufacturers and mobile network operators on condition that they 

151  For further information see IP/16/3539 of 25 October 2016 available at http://europa.eu/rapid/press-
release_IP-16-3539_en.htm  
152 Statements of Objections were sent to the company on 8 December 2015. For further information see 
IP/16/6271 of 8 December 2015 available at http://europa.eu/rapid/press-release_IP-15-6271_en.htm  
153 Statement of Objections was sent to the company on 20 April, 2016. For further information see IP/16/1492 
of 20 April 2016 available at http://europa.eu/rapid/press-release_IP-16-1492_en.htm  

46 

 
                                                            
exclusively  pre-install  Google  Search  on  their  devices.  The  Commission  believes  that  these 
business  practices  are  part  of  a  strategy  to  maintain  and  strengthen  Google's  dominance  in 
general  internet  search,  and  that  they  hinder  the  development  of  rival  mobile  operating 
systems, applications and services, to the detriment of consumers and innovation.  

In July, the Commission sent Google and Alphabet a supplementary Statement of Objections 
in  the  comparison  shopping  case154.  This  outlines  additional  evidence  reinforcing  the 
Commission's  preliminary  conclusion  from  the  April  2015  Statement  of  Objections  that 
Google has abused its dominant position by systematically favouring its comparison shopping 
service in its search results pages.  

Also in July, the Commission sent Google and Alphabet a Statement of Objections outlining 
its  preliminary  view  that  the  company  has  abused  a  dominant  position  by  artificially 
restricting  the  possibility  of  third  party  websites  to  display  search  advertisements  from 
Google's competitors155. 

Antitrust enforcement in sports markets 

In  September,  the  Commission  sent  a  Statement  of  Objections  to  the  International  Skating 
Union  (ISU)  to  convey  its  preliminary  view  that  the  ISU  rules  under  which  athletes  face 
severe penalties for participation in unauthorised speed skating events could be in breach of 
Article  101  TFEU156.  The  ISU,  made  up  national  ice-skating  associations,  is  the  sole  body 
recognised by the International Olympic Committee to administer the sports of figure skating 
and  speed  skating  on  ice.  The  Commission's  Statement  of  Objections  is  the  second  formal 
step in the formal proceedings opened in October 2015 following a complaint by two Dutch 
professional speed skaters157. In its Statement of Objections, the Commission raised concerns 
that  the  penalties  set  out  in  the  ISU  Eligibility  rules  restrict  the  commercial  freedom  of 
athletes  and  prevent  new  organisers  of  international  speed  skating  events  from  entering  the 
market because they are unable to attract top athletes. The rules concerned have provided, in 
particular, that athletes participating in unauthorised events may face life-time bans from all 
key  international  speed  skating  competitions,  including  the  Olympic  Games  and  the  World 
and European Championships.  

ICT and media in the context of the Merger Regulation 

Overall,  this  sector  saw  an  increased  merger  activity  in  2016  compared  to  2015.  The 
Commission intervened at several occasions in the planned takeovers.  

In the telecommunications sector, the Commission conditionally cleared the acquisition of the 
mobile-only operator BASE by the Belgian subsidiary of Liberty Global, cable operator and 
Mobile  Virtual  Network  Operator  (MVNO)  Telenet  (with  a  fixed  infrastructure  of  regional 
coverage)158  in  February.  The  Commission  had  concerns  that  a  merger  would  have 
significantly reduced competition, with a risk of higher prices and less choice and innovation 

154A supplementary Statement of Objections was sent to the company on 14 July 2016. For further information 
see IP/16/2532 of 14 July 2016 available at http://europa.eu/rapid/press-release_IP-16-2532_en.htm  
155 Statement of Objections was sent to the company on 14 July 2016. For further information see IP/16/2532 of 
14 July 2016 available at http://europa.eu/rapid/press-release_IP-16-2532_en.htm  
156 Case AT.40208 International Skating Union’s Eligibility rules. For further information see IP/16/3201 of 27 
September 2016 available at http://europa.eu/rapid/press-release_IP-16-3201_en.htm  
157 Case AT.40208 International Skating Union’s Eligibility rules available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=1_40208  
158 Case M.7637 Liberty Global / Base Belgium, Commission decision of 4 February 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=2_M_7637  

47 

 
                                                            
for  mobile  consumers.  The  Commission  ultimately  approved  the  acquisition,  subject  to  an 
MVNO remedy involving the transfer of part of BASE's customers to the purchaser.  

In  May,  the  Commission  prohibited  the  acquisition  of  Telefónica  UK,  operating  under  the 
brand  "O2",  by  the  market  challenger  Hutchison,  operating  under  the  brand  "Three", 
combining the first and the fourth players in the market159. The Commission was concerned 
that  the  takeover  would  have  led  to  higher  prices  and  reduced  choice  and  quality  for 
consumers in the United Kingdom. The remedies proposed by Hutchison failed to adequately 
address  the  serious  concerns  raised  by  the  takeover.  The  Commission  decided  to  block  the 
merger to protect consumers in the United Kingdom.  

In  August,  the  Commission  approved,  subject  to  conditions,  the  creation  of  a  joint-venture 
combining  the  Dutch  telecommunication  business  of  Liberty  Global  (cable  operator  and 
MVNO)  and  Vodafone  (Mobile  Network  Operator  (MNO))  and  recent  entrant  in  fixed 
services)160. The Commission considered that the merger would have eliminated the benefits 
brought to the Dutch fixed and multi-play telecoms market by the recent entry (and expected 
expansion) of Vodafone. The transaction was cleared, subject to the divestment of Vodafone's 
fixed consumer business (including customer base).  

In September, the Commission conditionally cleared the proposed creation of a joint venture 
combining the Italian operations of Vimpelcom (WIND) and Hutchison (H3G), respectively 
the third and the fourth players in the retail mobile market161. The parties undertook to divest 
to  a  pre-defined  buyer,  Iliad,  all  assets  needed  to  create  a  viable  fourth  mobile  network 
operator  in  Italy.  Only  once  this  transaction  is  complete,  can  the  parties  go  ahead  with  the 
deal.  

In  the  IT  sector,  the  Commission  approved  two  multi-billion  mergers  in  the  data  storage 
sector  in  February:  the  Commission  cleared  the  acquisition  of  data  storage  manufacturer 
SanDisk  by  rival  Western  Digital162  as  well  as  the  acquisition  of  data  storage  and  software 
provider EMC by computer technology company Dell163, after concluding in both cases that 
there would be no adverse effects on customers.  

The Microsoft / LinkedIn case 

In December, the Commission approved, subject to conditions, the acquisition by Microsoft, a global technology 
company, of LinkedIn164, a provider of professional social networking services. The Commission was concerned 
that  Microsoft  would  use  its  strong  market  position  in  operating  systems  (Windows)  for  personal  computers 
(PCs)  and  productivity  software  (including  Outlook,  Word,  Excel  and  Power  Point)  to  strengthen  LinkedIn's 
position.  The  increase  in  LinkedIn's  user  base  would  make  it  harder  for  new  players  to  start  providing 
professional  social  network  services  in  the  EEA  and  it  could  have  tipped  the  market  towards  LinkedIn  in 
Member  States  where  a  competitor  of  LinkedIn  currently  operates.  The  commitments  offered  by  Microsoft 
address the competition concerns identified by the Commission. 

159 Case M.7612 Hutchison 3G UK / Telefonica UK, Commission decision of 11 May 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=2_M_7612  
160 Case M.7978 Vodafone / Liberty Global / Dutch JV, Commission decision of 3 August 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=2_M_7978  
161 Case M.7758 Hutchison 3G Italy / Wind / JV, Commission decision of 1 September 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=2_M_7758  
162 Case M.7772 Western Digital / SanDisk, Commission decision of 4 February 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=2_M_7772  
163 Case M.7861 Dell / EMC, Commission decision of 29 February 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=2_M_7861  
164 Case M.8124 Microsoft / LinkedIn, Commission decision of 6 December 2016, available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=2_M_8124  

48 

 
                                                            
State aid enforcement in ICT and media 

The  achievement  of  the  European  broadband  targets165,  despite  substantial  progress, 
represents  a  significant  challenge,  in  particular  for  the  deployment  of  ultrafast  networks166. 
Reaching the Digital Single Market connectivity objectives for 2020 and 2025 is estimated to 
require  an  overall  investment  of  around  EUR  500  billion  over  the  coming  decade, 
representing an additional EUR 155 billion over and above a simple continuation of the trend 
of current network investment and modernisation efforts of the connectivity providers167.  

Most  of  the  financing  for  the  upgrade  and  deployment  of  next-generation  networks  in  the 
broadband sector comes from private companies. Private companies tend to invest mostly in 
urban,  highly  populated  areas  which  can  assure  rapid  return  on  investment.  As  a  result,  in 
certain  areas  -  in  particular  rural  -  public  funds  support  the  deployment  of  broadband 
networks, within the broader objectives of inclusion and economic development. Such public 
spending  alongside  private  investment  continues  to  be  the  key  to  achieving  the  longer  term 
objectives set by the Digital Agenda for Europe up to and beyond 2025168. State aid control 
seeks to ensure that where a market failure arises and publicly funded networks are needed, 
these do not crowd out private investments.  

Most  Member  States  have  gradually  adopted  and  even  updated  national  and/or  regional 
broadband strategies169. While their content differs, many of them foresee measures to support 
supply  through  the  use  of  public  funds.  Extensive  national  broadband  schemes  have  been 
approved  by  the  Commission  during  2016,  in  particular  for  the  United  Kingdom,  Italy  and 
France. Over a longer period 2009-2016, the Commission approved State aid for broadband 
totalling  EUR  34.9  billion.  During  the  same  period,  Member  States  adopted  69  broadband 
State aid measures benefitting from the GBER170.  

165 In its Communication "Connectivity for a Competitive Digital Single Market - Towards a European Gigabit" 
(COM/2016/587), the Commission confirmed the importance of Internet connectivity for the Digital Single 
Market and, building on the Digital Agenda for Europe goals for 2020, set out a vision for a European Gigabit 
society operationalised through three strategic objectives for 2025. As indicated in the Communication, the 
Commission will reflect the foreseeable evolution of long-term demand when applying the "step change" 
approach of the Broadband State Aid Guidelines in conjunction with the strategic objectives set in this 
Communication, and will consider favourably efficient blended financing that contributes to lower the aid 
intensity and to reduce risks of distorting competition, as part of its assessment of State aid interventions. 
166 According to Europe’s digital progress report 2016, Next Generation Access (NGA) networks coverage 
continues to improve. By mid-2015, NGA networks were available to 71 % of EU homes. However, deployment 
still focus mainly on urban areas and only 28% of rural homes were covered, mainly by VDSL.  
167 Based on the study by Analysys Mason (SMART 2015/0068) and the Commission's estimates.  
168 As defined in the Communication from the Commission to the European Parliament, the Council, the 
European Economic and Social Committee and the Committee of the Regions, Connectivity for a Competitive 
Digital Single Market - Towards a European Gigabit Society, 14.9.2016 COM(2016) 587 final: 
- Gigabit connectivity for all main socio-economic drivers such as schools, transport hubs and main providers of 
public services as well as digitally intensive enterprises.  
- All urban areas and all major terrestrial transport paths to have uninterrupted 5G coverage.  
- All European households, rural or urban, will have access to Internet connectivity offering a downlink of at 
least 100 Mbps, upgradable to Gigabit speed.  
169 Even though a few Member States do not yet have a single document that can be regarded as a national 
broadband plan, all of them have at least an overall strategic approach for the deployment of next generation 
access networks that is implemented in practice. 
170 The General Block Exemption Regulation (GBER) frees categories of State aid, deemed to bring benefits to 
society, that outweigh the possible distortions of competition in the Single Market triggered by public funding 
from the requirement of prior notification to the Commission. Consequently, Member States may implement 
measures which fulfil the condition of the GBER without prior scrutiny by the Commission. 

49 

 
                                                            
In assessing notified measures, Member States and selected operators must fulfil a number of 
conditions which include measures to ensure third parties' effective (wholesale) access to the 
subsidised  broadband  infrastructure  as  specified  in  the  Broadband  State  Aid  Guidelines171. 
Risks of distortion of competition are addressed through requirements, such as using the open 
selection  process  and  the  least  distortive  public  financing  mechanism.  Overall,  these 
conditions  help  to  ensure  that  the  positive  effects  of  an  aid  measure  outweigh  its  potential 
negative effects and minimise any distortive effect.  

3. FINANCIAL SERVICES 

Overview of the key challenges in the sector 

The financial services sector has become substantially more stable over the last years. While 
anticipating  a  series  of  remaining  challenges,  EU  competition  policy  has  ensured  a  level 
playing  field  and  maintained  the  integrity  of  the  internal  market.  In  view  of  the  essential 
functions  the  sector  provides  for  society,  effective  competition  among  financial  service 
providers is a key component for a stable economy.  

Banks  have  not  only  suffered  from  huge  losses  during  the  financial  crisis  but  are  also 
confronted with the current low interest environment that squeezes their margin income and 
with structural changes such as increased online banking and growing pressure from non-bank 
financial institutions. Existing business models are put into question and the sector will have 
to restructure, for instance, its costly branch network. Finally, society's call for a fairer use of 
taxpayers'  money,  namely  for  a  protection  from  bail-out  requests  by  banks  in  distress,  has 
been reflected in the legislative framework completing the Banking Union, notably in the new 
bail-in  rules  in  the  Bank  Recovery  and  Resolution  Directive  (BRRD)172  which  entered  into 
force in January 2016.  

The insurance sector is also affected by the current low interest rate environment, in particular 
in the life insurance sector. Greater risk-taking by insurers on derivatives markets is one of the 
consequences  that  need  to  be  monitored.  As  to  non-life  insurance,  numerous  legislative 
initiatives  to  remove  regulatory  barriers  have  unfortunately  not  resulted  in  increased  cross-
border  competition,  and  the  markets  remain  fragmented  along  national  barriers  to  the 
detriment of consumers. In contrast, the traditional way to coinsurance unconventional risks 
in wholesale insurance - such as ecological damage, natural catastrophes, terrorism, or nuclear 
risks  -  is  evolving  from  non-competitive  cooperation  frameworks  like  insurer-driven  pools 
towards  more  pro-competitive  arrangements  like  customer-driven  ad-hoc  agreements  and 
broker-led co-insurance. 

As  regards  capital  markets,  a  substantial  set  of  regulatory  technical  standards  and 
implementing  measures  were  adopted  under  MiFID  II173  in  2016  that  aim  in  particular  at 
increasing transparency, strengthening the regulation of market infrastructures, and enhancing 

171 Communication from the Commission, EU Guidelines for the application of State aid rules in relation to the 
rapid deployment of broadband networks, OJ C 25, 26.1.2013, p.1 available at http://eur-
lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:C:2013:025:0001:0026:EN:PDF  
172 European Parliament and Council Directive 2014/59/EU of 15 May 2014 establishing a framework for the 
recovery and resolution of credit institutions and investment firms and amending Council Directive 82/891/EEC, 
and Directives 2001/24/EC, 2002/47/EC, 2004/25/EC, 2005/56/EC, 2007/36/EC, 2011/35/EU, 2012/30/EU and 
2013/36/EU, and Regulations (EU) No 1093/2010 and (EU) No 648/2012, of the European Parliament and of the 
Council Text with EEA relevance, OJ L 173, 12.6.2014 p. 190–348. 
173 European Parliament and Council Directive 2014/65/EU of 15 May 2014 Directive 2014/65/EU on markets in 
financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU Text with EEA relevance, 
OJ L 173, 12.6.2014, p. 349–496. 

50 

 
 
                                                            
competition in capital markets. These measures underpin the Capital Markets Union initiative 
to  create  a  stable,  fair  and  competitive  single  market  and  generate  sustainable  growth  for 
Europe. In addition to this regulatory work, enforcement through individual cases such as in 
the  Deutsche  Börse  /  LSE  merger174  remains  important  to  ensure  that  the  objectives  of 
regulation are not undermined through anti-competitive mergers or conduct.  

As  in  previous  years,  the  Commission  has  remained  very  active  in  the  financial  services 
sector to promote effective and undistorted competition. It continued its role in merger control 
as well as in antitrust enforcement to combat anti-competitive behaviour. The primary aim of 
State  aid  control  was  the  limitation  of  competition  distortions  and  of  the  use  of  taxpayers' 
money  when  aided  financial  institutions  were  restructured  or  had  to  exit  the  market  in  an 
orderly way. 

Contribution of EU competition policy to tackling the challenges  

Contribution of EU competition policy to innovation and fairness in payments 

2016  was  an  important year  for the  European  payments  market, as  the legislative "payment 
package" with new rules profoundly changing the way payment providers operate in the EU 
gradually being implemented.  

In June, the final part of the Interchange Fee Regulation175 was implemented, making payment 
costs  more  transparent  to  retailers  and  consumers  and  allowing  them  to  make  efficient 
choices. The Regulation will generate substantial savings for retailers and consumers, as it is 
expected to reduce hidden fees on card payments by EUR 6 billion annually. It will also make 
business practices fairer and more transparent and allow competition to be more effective176.  

2016 also saw extensive technical work on the Regulatory Technical Standards (RTSs) to be 
drafted  by  the  European  Banking  Authority  (EBA)  under  the  revised  Payment  Services 
Directive  (PSD  II)177,  including  on  the  regulated  access  to  the  internet  payments  market  by 
non-banks to the benefit of retailers and consumers178.  

In  most  Member  States  credit  cards  are  the  main  means  of  internet  payment.  But  card 
payments over the internet are cumbersome, expensive to merchants (with traditionally very 

174 Case M.7995 Deutsche Börse / London Stock Exchange available at 
http://ec.europa.eu/competition/elojade/isef/index.cfm?fuseaction=dsp_result  
175 European Parliament and Council Regulation (EU) No 2015/751 of 29 April 2015 on interchange fees for 
card-based payment transactions, OJ L 123, 19.5.2015, p.1 available at http://eur-lex.europa.eu/legal-
content/EN/TXT/?uri=uriserv:OJ.L_.2015.123.01.0001.01.ENG  
176 The Interchange Fee Regulation was preceded by extensive legal action by the Commission challenging the 
interchange fees applied by MasterCard and Visa, including in particular the prohibition of MasterCard's intra-
regional MIFs in 2007 and commitments from Visa Europe in 2010 and 2014 to reduce significantly all the MIFs 
it fixes in the EU. In September 2014 the Court of Justice endorsed the Commission's decision in the MasterCard 
case. For further information see case C-382/12 P MasterCard and Others v Commission, judgment of the Court 
of 11 September 2014, EU:C:2014:2201. 
177 European Parliament and Council Directive (EU) 2015/2366 of 25 November 2015 on payment services in 
the internal market, amending Directives 2002/65/EC, 2009/110/EC and 2013/36/EU and Regulation (EU) No 
1093/2010, and repealing Directive 2007/64/EC, OJ L 337, 23.12.2015, p. 35 available at 
http://ec.europa.eu/finance/payments/framework/index_en.htm#151008 
178 The Directive was preceded by competition enforcement action against the European Payments Council 
(EPC), the coordination and decision-making body of the European banking industry for payments. For further 
information see memo for Commission decision of 13 June 2013 available at  
http://europa.eu/rapid/press-release_MEMO-13-553_en.htm  The  Commission  then  proposed  PSD  II  which 
provided  a  clear  legal  basis  for  such  bank-independent  players,  who  will  become  Payment  Institutions  and  be 
regulated by financial supervisors. 

51 

 
                                                            
high interchange fees for card transactions over the internet) and insecure with high levels of 
fraud179.  Moreover,  only  60  %  of  EU  citizens  possess  such  cards.  The  PSD  II  opens  the 
market  for  (bank-owned  and  non-bank  owned)  regulated  third-party  players  who  offer 
alternative means of internet payments (e.g. through credit transfers via the consumer's bank's 
website,  including  most  importantly  the  Single  Euro  Payment  Area  (SEPA)  Credit  Transfer 
system).  

The PSD II also enhances the security of internet payments in general. It will open the market 
to  a  whole  range  of  other  secure  and  efficient  services  building  on  the  consumer's  bank 
account,  including  account  information  services  (allowing  consumers  to  keep  track  on  their 
mobile  phone  of their spending  on different bank accounts)  and payment instrument issuers 
(who  are  third  parties  who  can  issue  cards  and  other  payment  instruments  to  consumers). 
Some  of  these  services  are  already  on  the  market  and  many  more  are  expected  after  the 
transitional period elapses. 

The  "payment  package"  opens  the  door  for  competition  and  innovation  in  the  payments 
sector, to the benefit of consumers and merchants.  

Antitrust and cartel investigations in the financial services sector 

In 2016, the Commission continued its antitrust investigations in the financial sector, one of 
the Commission's priority areas to achieve a fairer and more integrated internal market.  

The investigation in the Credit Default Swaps (CDS) market came to an end on 20 July with 
the  adoption  of  two  commitment  decisions  addressed  to  the  International  Swaps  and 
Derivatives  Association  (ISDA)  and  data  provider  IHS  Markit180.  The  commitments  will 
apply  for  ten  years  and  address  the  concerns  of  coordination  and  entry  barriers  in  the 
intransparent  over-the-counter  (OTC)  credit  derivatives  market.  They  aim  at  stabilising 
derivatives markets and facilitating the emergence of more efficient and less costly forms of 
CDS  trading  on  exchanges.  The  key  obligation  is  to  facilitate  entry  by  licensing  industry 
standard inputs for CDS exchange trading purposes.  

In 2016, the Commission continued its antitrust investigations into MasterCard's, Visa Inc.'s 
and Visa International's181 multilateral interchange fees ("MIFs") for transactions in the EEA 
made  with  cards  issued  outside  the  EEA  ("inter-regional  transactions"). Inter-regional  MIFs 
are not capped by the Interchange Fee Regulation, but still represent a significant burden to 
European merchants. The Commission has also continued the investigation into MasterCard's 
rules  with  respect  to  cross-border  acquiring,  which  allegedly  have  prevented  merchants  in 
countries with high prices for acquiring services to seek lower priced services from acquirers 
established  in  other  Member  States.  In  the  MasterCard  case  following  the  Statement  of 
Objections issued to MasterCard in July 2015182, an oral hearing was held in May 2016.  

179 Estimated by the European Central Bank (ECB) to represent about two-thirds of total card fraud in the EU 
worth EUR 800 million in 2014. 
180 Case AT.39745 CDS - Information market, Commission decision of 20 July 2016 available at 
http://ec.europa.eu/competition/antitrust/cases/dec_docs/39745/39745_14237_7.pdf For further information see 
IP/16/2586 of 20 July 2016 available at http://europa.eu/rapid/press-release_IP-16-2586_en.htm  
181 These proceedings were closed as regards Visa Europe following its commitments, Case AT.39398 VISA MIF, 
Commission decision of 26 February 2014 available at 
http://ec.europa.eu/competition/antitrust/cases/dec_docs/39398/39398_9728_3.pdf 
182 Case AT.40049 MasterCard II. For further information see IP/15/5323 of 9 July 2015 available at 
http://europa.eu/rapid/press-release_IP-15-5323_en.htm 

52 

 
                                                            
As technology allows new services to emerge, such as electronic and mobile payments, with 
huge potential benefits for consumers and businesses notably in the Digital Single Market, the 
Commission has monitored developments. It is important to ensure that new and innovative 
services  have  a  fair  chance  to  develop  and  that  incumbents  acting  as  'gate  keepers'  do  not 
exclude new market entrants or attempt to secure substantive parts of markets for themselves. 

Review of the Insurance Block Exemption Regulation  

In  2016  the  Commission  continued  its  Review  of  the  operation  of  the  Insurance  Block 
Exemption  Regulation183  (IBER).  The  objective  of  the  Review  was  to  verify  whether  this 
instrument  is  still  the  best  approach  to  strike  a  balance  between  the  need  for  effective 
protection  of  competition,  prices  and  innovation  and  the  needs  of  the  insurance  industry  to 
continue  cooperating  by  exchanging  data  and  co-insuring  and  co-reinsuring  risks.  In  March 
the Commission presented to the European Parliament and Council a Report184 accompanied 
by a Commission Staff Working Document185 evaluating the IBER since its adoption in 2010. 
The Commission's preliminary conclusion was that the strict conditions for the creation of an 
Insurance Block Exemption Regulation no longer seem to be met. In addition, complementary 
studies on issues identified during the Review were carried out, in particular: (1) the role of 
asset-switching in the production of insurance products186 and (2) the effects of the different 
forms of co(re)insurance available on the market187. The current IBER is in operation until 31 
March 2017 as foreseen in a sunset clause in this Regulation.  

Merger investigations in the financial sector 

The  Commission  continued  to  ensure  that  concentrations  in  the  financial  services  sector  do 
not  lead  to  consumers  paying  higher  prices  or  being  offered  less  choice.  In  2016,  the 
consolidation  trend  in  a  number  of  financial  services  sectors  continued,  including  in  the 
payments area and the financial infrastructure space. While this consolidation may also be a 
sign of deeper integration between previously national markets dominated by an incumbent, 
the  Commission  remained  vigilant  that  these  developments  do  not  come  at  the  cost  of  the 
consumer. For example, it authorised the acquisition of Equens / Paysquare by Worldline188 
only  after the  parties  submitted remedies,  and  has  opened  an  in-depth  investigation  into the 
merger between Deutsche Börse and London Stock Exchange189. 

183 Commission Regulation (EU) No 267/2010 of 24 March 2010 on the application of Article 101(3) of the 
Treaty on the Functioning of the European Union to certain categories of agreements, decisions and concerted 
practices in the insurance sector, OJ L 83, 30.3.2010, p.1.  
184 Report from the Commission to the European Parliament and the Council on the functioning of Commission 
Regulation (EU) No 267/2010 on the application of Article 101(3) of the Treaty on the functioning of the 
European Union to certain categories of agreements, decisions and concerted practices in the insurance sector, 
COM(2016) 153. 
185 Commission Staff Working Document SWD (2016)62 accompanying the document Report from the 
Commission to the European Parliament and the Council On the functioning of Commission Regulation (EU) 
No 267/2010 on the application of Article 101(3) of the Treaty on the functioning of the European Union to 
certain categories of agreements, decisions and concerted practices in the insurance sector, COM(2016) 153. 
186 For further information see http://ec.europa.eu/competition/sectors/financial_services/KD0216917ENN.pdf 
187 For further information see http://ec.europa.eu/competition/sectors/financial_services/KD0216918ENN.pdf 
188 Case M.7873 Worldline / Equens / Paysquare available at 
http://ec.europa.eu/competition/elojade/isef/index.cfm?fuseaction=dsp_result  
189 Case M.7995 Deutsche Börse / London Stock Exchange available at 
http://ec.europa.eu/competition/elojade/isef/index.cfm?fuseaction=dsp_result  

53 

 
                                                            
State aid investigations in the financial sector 

Coping  with  the  deep  impact  the  financial  and  sovereign  crisis  had  on  European  banks 
continued to be the focus of State aid control also in 2016. Although the crisis years seem to 
be over in some Member States and the overall improvement of the sector at aggregated level 
is obvious, State support is still sought by some banks in difficulty.  

In general, the banking sector is still in need of structural adjustments and investments in view 
of  increasing  competition  from  alternative  suppliers  regarding,  for  instance,  payments. 
Moreover,  historically  low  interest  rates  and  overbanking  put  significant  pressure  on  the 
profitability  of  the  institutions.  These  factors,  combined  with  higher  regulatory  capital 
requirements,  question  the  viability  of  some  business  models.  An  additional  aggravating 
element is the recent economic recession which translated into particularly high levels of non-
performing loans in the banking system of some Member States. As a consequence of all this, 
a  non-negligible  portion  of  the  banks  in  the  EU  is  structurally  weak,  burdened  by  legacy 
losses and incapable of generating sufficient income internally or of raising sufficient capital 
on the market to redress the situation.  

The EU State aid crisis rules, today primarily the Banking Communication of 2013190, which 
is in line with the current key building blocks of the Banking Union – the Single Supervisory 
Mechanism  (SSM),  Bank  Recovery  and  Resolution  Directive  (BRRD)  and  the  Single 
Resolution Mechanism (SRM) - allows State aid when absolutely necessary and ensures that 
distortions of competition are limited. That latter objective is achieved not only by requiring 
the restructuring of the aid beneficiaries and the repayment or adequate remuneration of the 
State support but also by requiring orderly market exits of banks that are not able to return to 
viability. The most distortive type of support, especially at a time when each and every bank 
has  to  carry out  deep  adjustments to ensure that  it keeps  a profitable business  model, is the 
support which keeps artificially alive banks with business models that are not viable anymore 
in the new economic, technological and regulatory environment.  

In addition, to put an end to moral hazard and the unfair burdening of taxpayers when saving 
institutions that are failing or likely to fail, today's rules provide for bail-in tools that require a 
fair contribution from share and debt holders before any State support can kick in.  

This,  however,  also  means  that  State  aid  for  banks  is  still  possible,  both  within  and  outside 
resolution, if it meets all the requirements listed above. As a consequence, State aid control 
will  remain  an  indispensable  and  permanent  component  of  the  day  to  day  operation  of  the 
Banking Union.  

Ensuring  burden  sharing  of  private  shareholders  and  creditors  is  important  to  reduce  the 
burden  for  taxpayers.  However,  there  are  repeated  calls  for  a  continuation  of  full  State 
support,  thereby  trying  to  re-impose  the  entire  burden  on  taxpayers.  This  also  means  that 
those banks taking wrong decisions do not have to face the consequences of their decisions 
with  the  losses  being  shifted  to  the  taxpayer.  In  contrast,  banks  having  taken  the  right  and 
prudent  decisions  are  not  rewarded  in  full,  as  they  continue  to  face  artificially  supported 
competitors  that  would  have  to  exit  the  market  under  normal  conditions  of  a  functioning 
competition undistorted by State aid.  

190 Communication from the Commission on the Application of State aid rules to support measures in favour of 
banks in the context of the financial crisis (Banking Communication), OJ C 216, 30.7.2013, p.1 available at 
http://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:52013XC0730%2801%29&from=EN  

54 

 
                                                            
So far no EU bank has been put into resolution, using the bail-in tool191.  

Member  States  chose  not  to  intervene  in  banks  on  terms  that  do  not  trigger  resolution  and 
thereby  avoid  bail-in,  for  instance  by  structuring  interventions  as  no  aid,  as  precautionary 
recapitalisation192 or under national insolvency regimes. A series of cases can be mentioned 
here, for instance a Hungarian bad bank purchasing Non Performing Loans (NPLs) at market 
price and an Italian scheme for State guarantee on senior debt instruments issued by vehicles 
purchasing  NPLs  where  the  guarantee  was  offered  at  a  market  conform  fee.  Both  measures 
were approved as aid-free measures in 2016.  

Therefore, the current  situation requires a  key role for State aid control  to  play in  close  co-
operation  with  the  new  authorities  created  by  the  Banking  Union  in  order  to  ensure  and 
protect  a  level  playing  field  within the  Union  market  and  equal  treatment  between  Member 
States. In order not to undermine the very core of the Banking Union, this includes the setting 
of limits regarding the increasing creativity in finding solutions outside resolution.  

Early interventions of Deposit Guarantee Schemes outside their pay-out function may or may 
not constitute State aid depending on the individual design and structure of such a scheme. In 
any event, a Deposit Guarantee Scheme's support for an orderly market exit of a bank can be 
easily approved under State aid rules.  

4. TAXATION AND STATE AID 

Overview of key challenges on tax evasion and avoidance and fiscal aid 

The  focus  the  Commission  has  put  on  fighting  tax  evasion  and  tax  avoidance  echoes  the 
priorities set by President Juncker in his Political Guidelines and which are also reflected in 
his  Mission  Letter  to  Commissioner  Vestager.  That  is  also  in  line  with  efforts  at  the 
international  level,  namely  by  the  OECD,  to  tackle  tax  base  erosion  and  profit  shifting  to 
better  align  the  right  to  tax  with  economic  activity193.  State  aid  investigations  into  Member 
States' tax ruling practices, which began in 2013, before the Luxleaks revelations, are one of 
the tools the Commission has at its disposal to ensure that companies pay the taxes they owe 
in the Member States where they generate economic value. 

Tax evasion and avoidance can be the result of aggressive tax planning strategies, in so far as 
they  shift  profits  to  low  or  no-tax  locations  where  there  is  little  or  no  economic  activity, 
resulting  in  little  or  no  overall  corporate  tax  being  paid.  Aggressive  tax  planning  can  be 
pursued  by  making  use  of  preferential  tax  schemes,  or  by  requesting  individual  tax  rulings. 
They all have in common that they result in a loss of tax revenue in the Member State where 
economic  value  is  generated  but  not  taxed,  and  in  Europe  as  a  whole  because  the  tax 
eventually paid is less than it would have been if the profits had not been shifted. 

191 According to the BRRD the 8% bail-in rule is a contribution to loss absorption and recapitalisation equal to 
an amount not less than 8 % of total liabilities including own funds of the institution under resolution to be made 
by the shareholders and the holders of other instruments of ownership, the holders of relevant capital instruments 
and other eligible liabilities through write down, conversion or otherwise according to (see Articles 37 (10)(a) 
and 43 et seq. BRRD). 
192 Precautionary capitalisation is, according to Article 32(4)(d)(iii) BRRD, an exceptionally allowed public 
injection of own funds or purchase of capital instruments outside resolution of a precautionary and temporary 
nature that can be only granted to remedy a serious disturbance in a Member State and preserve financial 
stability when confined to a solvent institution without conferring an advantage upon the institution and is not 
used to offset losses the institution has incurred or is likely to incur in the near future and which is conditional on 
final approval under State aid rules. 
193 OECD (2013) Action Plan on Base Erosion and Profit Shifting, OECD Publishing, Paris. 

55 

 
 
                                                            
The side effects of aggressive tax planning for the EU are particularly negative: first, it results 
in  undue  tax  reliefs  that  distort  competition  by  granting  advantages  only  to  selected 
companies;  second,  it  involves  an  issue  of  social  equity  as  the  revenues  foregone  from 
untaxed multinationals need to be compensated, which normally shifts the burden to the less 
mobile  income  of  SMEs  and  labour  and  third,  from  the  perspective  of  the  dislocation  of 
activities, aggressive tax planning can present a threat to the sustainable growth of the internal 
market if some Member States were to offer exit points for European profits of multinationals 
in exchange for creating jobs on their territory and a limited tax payment. 

The Commission's State aid decision of 30 August, requiring Ireland to recover a selective tax 
advantage granted to Apple in Ireland of up to EUR 13 billion, was another step forward  in 
the Commission´s overall strategy to ensure fair taxation194.  

Both collecting taxes and combating tax avoidance and evasion are normally competences of 
the  Member  States.  However,  even  in  this  area  where  the  Member  States  enjoy  fiscal 
autonomy, any national tax measures adopted have to comply with internal market rules and, 
amongst others, abide by competition law195. 

Contribution of EU competition policy to tackling the challenges 

State aid investigations and decisions concerning aggressive tax planning 

Since  2013,  the  Commission  has  been  looking  into  tax  planning  practices  via  its  dedicated 
Task Force, which was turned into a regular administrative unit in 2016. 

Throughout 2014-2016, the Commission has continued to gather information on tax planning 
practices,  enquiring  into  the  tax  rulings  practice  and  possible  fiscal  aid  schemes  of  all 
Member States. The enquiry is aimed at clarifying allegations that tax rulings may constitute 
State  aid  and  to  allow  the  Commission  to  take  an  informed  view  of  the  practices  of  all 
Member States. Overall the Commission has looked into more than 1 000 rulings. 

Specific cases 

Belgian excess profit system 

On 11 January, the Commission adopted a negative decision with recovery196, concluding that 
selective  tax  advantages  granted  by  Belgium  under  its  "excess  profit"  tax  scheme  are  illegal 
under EU State aid rules. The scheme has benefited at least 35 multinationals mainly from the 

194 President Juncker stressed in his State of the Union speech of 14 September 2016 that the decision shows that 
"every company, big or small, has to pay its taxes where it makes its profits. This goes for giants like Apple too, 
even if their market value is higher than the GDP of 165 countries in the world. In Europe we do not accept 
powerful companies getting illegal backroom deals on their taxes" available at 
http://ec.europa.eu/priorities/state-union-2016_en  
195 The Commission work in the area of tax rulings was closely followed by the European Parliament's Special 
Committee on Tax Rulings and Measures Similar in Nature or Effect (TAXE). On 25 November 2016, European 
Parliament adopted a Report on tax rulings and other measures similar in nature or effect prepared by the TAXE 
Committee, which viewed positively the contribution of State aid control to tax fairness in Europe. In fact, it 
"strongly welcomes and supports the key role of the Commission as the competent competition authority in the 
ongoing State aid inquiries dealing with tax rulings" (para. 130). On 25 November 2016, the Committee issued a 
report which broadly endorsed the Commissions approach on State aid available at 
http://www.europarl.europa.eu/sides/getDoc.do?pubRef=-//EP//TEXT+TA+P8-TA-2015-
0408+0+DOC+XML+V0//EN  
196 For further information see IP/16/42 of 11 January 2016 available at http://europa.eu/rapid/press-release_IP-
16-42_en.htm 

56 

 
                                                            
EU,  who  must  now  return  unpaid  taxes  to  Belgium.  The  scheme  provides  certain  Belgian 
entities that are part of a multinational group with a reduction of their tax base. The tax base 
reduction  concerns  a  part  of  an  entity's  actually  recorded  profit  which  exceeds  the  alleged 
hypothetical  average  profit  of  a  stand-alone  entity  (i.e.  not  part  of  a  group)  deemed  to  be 
comparable.  Belgium  deems  that  part  of  the  profit  "excess  profit".  This  unilateral  downward 
adjustment  of the tax base, is claimed to be granted to prevent double taxation, but it applies 
irrespective of any risk of double taxation. The benefits of the scheme are available subject to 
an advance ruling issued by a Special Ruling Commission.  

Ireland – the Apple decision 

On 30 August, the Commission decided to require Ireland to recover a selective tax advantage granted to Apple by 
way of two tax rulings197. 

The tax rulings endorsed a method to allocate profits within two Apple companies incorporated in Ireland: Apple 
Sales  International  (ASI)  and  Apple  Operations  Europe  (AOE).  The  profits  were  allocated  between  the  Irish 
branches of ASI and AOE and their "head offices" (that existed only on paper). These head offices were not tax 
resident  in  any  country,  had  no  employees  or  premises  and  did  not  engage  in  any  real  activities.  The  profits 
allocated to the respective head offices were not subject to tax because the head offices were not tax resident in any 
tax  jurisdiction.  According  to  the  Irish  tax  rulings  given  to  Apple,  virtually  all  profits  of  ASI  and  AOE  were 
recorded in Ireland and attributed to these untaxed head offices, rather than to the branches, tax resident in Ireland. 
The Commission found that the profit allocation as approved in the rulings had no factual or economic justification 
as the head offices of both companies had no operational capacity to handle or manage any substantive business of 
the company. Only the branches of ASI and AOE had the capacity to generate any income from trading. Therefore, 
the  Commission  found  that  the  sales  profits  of  both  companies  should  have  been  attributed  to  the  branches  and 
taxed in Ireland. 

This "incorrect allocation" of the profits, leading to a very low tax base for both Irish companies, ASI and AOE, 
gave  Apple  a  selective  advantage  over  other  businesses  that  are  subject  to  taxation  in  Ireland.  The  Commission 
estimated that this unfair tax advantage amounts to up to EUR 13 billion since 2003, which Ireland will have to 
recover from Apple. Both Ireland and Apple has appealed the decision.  

Luxembourg - Engie  

On  19  September,  the  Commission  opened  an  in-depth  investigation  into  Luxembourg's  tax 
treatment  of  Engie  (formerly  known  as  GDF  Suez)198.  The  Commission  is  assessing  whether 
the tax authorities have selectively derogated from provisions of national tax law in tax rulings 
issued to GDF Suez. In particular, they appear to misapply certain provisions of their national 
law  in  several  rulings  which  endorse  the  treatment  of  the  same  financial  transaction  between 
companies  of  GDF  Suez  (two  zero-interest  convertible  loans)  in  an  inconsistent  way.  The 
borrowers  of  the  convertible  loans  are  allowed  to  significantly  reduce  their  taxable  profits  in 
Luxembourg  by  deducting  the  (provisioned)  interest  payments  of  the  convertible  loan  as 
expenses. At the same time, the lenders avoid paying any tax on the profits the convertible loans 
generate for them, because the ruling considers the income as equity-like remuneration which is 
not subject to taxation. The final result seems to be that a significant proportion of the profits 
recorded by GDF Suez in Luxembourg through the two arrangements are not taxed at all. The 
Commission considers at this stage that the treatment endorsed in the tax rulings resulted in tax 
benefits in favour of GDF Suez, which are not available to other companies subject to the same 
national taxation rules in Luxembourg.  

197 For further information see IP/16/2923 of 30 August 2016 available at http://europa.eu/rapid/press-
release_IP-16-2923_en.htm  
198 For further information see IP/16/3085 of 19 September 2016 available at http://europa.eu/rapid/press-
release_IP-16-3085_en.htm  

57 

 
                                                            
Fight against discriminatory tax schemes and measures sheltering national companies from 
EU competition  

Beyond the cases involving tax rulings, the Commission remains vigilant to ensure that Member 
States  do  not  use  fiscal  tools  to  unduly  favour  certain  companies/sectors  and  shelter  national 
companies from EU competition. 

In  2014,  Hungary  introduced  (1)  a  tax  on  the  turnover  derived  from  the  publication  of 
advertisements in the media (advertisement tax); (2) a tax on the annual turnover derived from 
the  production  and  trade  of  tobacco  products;  and  (3)  amended  an  existing  tax  on  the  annual 
turnover  of  food  chain  operators,  introducing  a  multiple  progressive  rate  structure  for  retail 
stores selling items of daily consumer goods. These three turnover tax measures had progressive 
rates depending on annual turnover, and placed companies with low turnover in an advantaged 
position compared to others.  

In  July  and  November,  the  Commission  adopted  final  negative  decisions  in  respect  of  the 
Hungarian  turnover  tax  measures  considering  that  the  progressivity  of  the  tax  rates  granted  a 
selective advantage to undertakings with low turnover (mainly national) and constituted State 
aid,  which  was  not  compatible  with  the  internal  market199.  Furthermore,  in  September  the 
Commission opened a formal investigation procedure in respect of a Polish retail tax featuring a 
progressive rate structure similar to the Hungarian taxes200.  

With regard to the investigation into fiscal aid to EU ports, in January 2016 the Commission 
adopted  a  negative  decision  as  regards  the  corporate  tax  exemption  for  Dutch  public 
seaports201.  Furthermore,  in  July  2016,  the  Commission  opened  the  formal  investigation 
procedure  as  regards  the  corporate  tax  exemptions  for  ports  in  Belgium202  and  France203. 
Commission's  action  is  consistent  with  the  need  to  ensure  that  all  companies  pay  their  fair 
share  of  taxes  and  that  no  sector  or  company  of  a  certain  type  is  excluded  from  corporate 
taxation. The Commission does not prevent Member States from providing aid to their ports, 
for  instance  when  this  is  necessary  to  develop  port  infrastructure.  However,  corporate  tax 
exemptions  are  neither  transparent,  nor  limited  or  targeted  at  financing  activities  which  are 
objectively justified in  the public interest.  The exemptions grant  operating  aid, which is  the 
most distortive type of aid. 

5.  

BASIC INDUSTRIES AND MANUFACTURING 

Overview of key challenges in the sector 

Basic industries and manufacturing are key to the European economy. In 2016 the Commission 
spent significant resources on competition policy actions in these sectors, which range widely 

199 Cases SA.39235 Hungarian advertisement tax, Commission decision of 4 November 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_39235; SA.40018 Amendment to 
the Hungarian food chain inspection fee, Commission decision of 4 July 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_40018 and SA.41187 
Hungarian health contribution of tobacco industry businesses, Commission decision of 4 July 2016 available at 
http://ec.europa.eu/competition/elojade/isef/index.cfm?fuseaction=dsp_result  
200 Case SA.44361 Polish tax on retail sector with progressive rates, Commission decision of 19 September 
2016 available at http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_44351  
201 Case SA.25398 Corporate tax exemption of Dutch public enterprises, Commission decision of 21 January 
2016 available at http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_25338  
202 Case SA.38393 Ports taxation in Belgium, Commission decision of 8 July 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_38393  
203 Case SA.38398 Ports taxation in France, Commission decision of 8 July 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_38398  

58 

 
                                                            
from consumer products such as toys and musical instruments, to intermediary products such as 
engine parts, lubricants, and solar panels, to industry inputs such as chemicals and outputs such 
as  plastics.  To  ensure  an  economy  and  a  society  where  manufacturers,  distributors  and 
consumers alike reap a fair share of the benefits of a modern specialised economy, the entire 
value chain  of such products is subject to scrutiny under EU competition  rules.  Where unfair 
restrictions on the manufacturing or the distribution of these products to certain customers or in 
certain  areas  within  the  EU  lead  to  a  reduction  in  efficiency  and  to  an  unfair  accrual  of  the 
benefits to one particular part of the value chain, to the detriment of consumers in particular, the 
role of the Commission is to remove these unfair restrictions to the benefit of all.  

Contribution of EU competition policy to tackling the challenges 

Healthy  and  vigorous  competition  is  of  fundamental  importance  to  a  fair  EU  economy  and 
society. Anti-competitive practices stifle innovation, introduce rigidities, push prices up, and 
reduce  the  competitiveness  of  EU  companies  and  the  real  income  of  EU  consumers.  The 
Commission  must  therefore  be  vigilant  to  ensure  that  the  fairness  of  business  dealings  in 
Europe is not jeopardised by such practices.  

Antitrust investigations in basic industries 

Basic manufacturing and consumer goods industries continue to represent a significant share 
of  the  Commission's  enforcement  practice.  In  2016,  the  Commission  continued  its  lines  of 
action  (including  individual  case  work,  market  surveillance  and  advocacy)  in  these  sectors. 
The  EU's  high  value-added  manufacturing  industry  requires  access  to  basic  materials  at 
affordable prices that reflect international cost conditions. In 2016, the Commission actively 
monitored  the  markets  for  these  inputs  to  ensure  there  is  adequate  access  in  a  healthy  and 
competitive environment.  

Cartel investigations in basic industries 

Breaking  cartels  remains  a  priority  for  the  Commission,  in  particular  when  they  affect 
important  consumer  goods,  such  as  cars.  The  collusion  in  the  Alternators  and  Starters 
settlement case204  affected component costs for a number of car manufacturers selling cars in 
Europe, and ultimately European consumers buying them.  

The Alternators and Starters case 

The Alternators and Starters settlement case is the fifth cartel case in the automotive sector which brings the total 
amount of fines imposed in cartel cases in the automotive sector to EUR 1.42 billion. 

An alternator is a device which converts mechanical energy to electrical energy and a starter is a motor that starts 
the  engine  of  the  car.  The  cartel  was  operated  by  three  Japanese  automotive  suppliers:  Denso,  Hitachi  and 
Mitsubishi Electric. However, Hitachi had a limited participation to the cartel, only with respect to the supply of 
alternators and starters to two out of the 12 groups of car manufacturers.  

The  cartel  participants  fixed  prices,  allocated  customers  and  exchanged  commercially  sensitive  information. 
Their  aim  was  to  avoid  a  decline  in  prices  and  to  maintain  their  market  shares  within  the  EEA.  Their  main 
operating principle was the incumbency principle. 

The cartel lasted for five years and five months from 14 September 2004 until 23 February 2010 and covered the 
supplies of alternators and starters to 12 groups of major car manufacturers across the EEA. 

The  Commission's  investigation  in  this  case  started  with  an  immunity  application  in  2011.  The  decision  was 
adopted  under  the  settlement  procedure  concerning  all  three  parties.  Denso  received  full  immunity  under  the 
Commission's  Leniency  Notice  for  revealing  the  existence  of  the  cartel,  while  the  two  other  undertakings 

204 Case AT.40028 Alternators and Starters, Commission decision of 27 January 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=1_40028  

59 

 
                                                            
received fines reductions as leniency applicants. The Commission imposed fines of EUR 137.8 million on the 
three automotive suppliers. 

Merger investigations in basic industries 

Over the past year, there have been several merger investigations in the basic industries and 
manufacturing sectors. The Commission intervened in a number of cases in order to avoid a 
significant loss of competition to the detriment of customers.  

In particular, the Commission investigated further consolidation in the cement sector, after a 
number  of  transactions  which  had  taken  place  in  the  previous  years.  On  26  May,  the 
Commission  cleared  the  acquisition  of  the  Italian  building  materials  group  Italcementi  by 
German-based  HeidelbergCement,  subject  to  the  divestment  of  Italcementi's  integrated 
building  materials  business  in  Belgium205.  The  Commission  also  opened  an  in-depth 
investigation  into  the  joint  acquisition  of  the  Croatian  assets  of  Cemex  by  cement 
manufacturers HeidelbergCement and Schwenk206.  

In  2016  the  Commission  also  closed  its  in-depth  investigation  into  the  acquisition  of  office 
supplies  company  Office  Depot  by  its  rival  Staples,  both  based  in  the  United  States.  The 
Commission  approved  the  transaction  subject  to  the  divestiture  of  the  entire  European 
contract  distribution  business  of  Office  Depot,  as  well  as  Office  Depot's  whole  business 
operations  in  Sweden.  The  two  companies,  however,  abandoned  the  transaction  after  an 
adverse ruling by a US Court on the acquisition207.  

The Commission also carried out an in-depth investigation into the acquisition of French train 
equipment supplier Faiveley Transport by its US rival Wabtec. The transaction was cleared on 
4 October 2016 subject to the divestment of the entirety of Faiveley Transport's activities in 
sintered friction materials208.  

2016 saw also the acquisition by the number one global brewer AB InBev of its largest global 
competitor SAB Miller. After a preliminary investigation, the Commission found a risk that 
the transaction  may have led to  higher prices  in a number of Member states, and may have 
facilitated  tacit  price  coordination  among  brewers  in  the  EEA.  The  acquisition  was  thus 
approved  subject  to  the  divestiture  of  the  whole  of  SAB  Miller's  business  in  a  number  of 
Member  States  (France,  Italy,  the  Netherlands,  the  United  Kingdom,  Czech  Republic, 
Hungary, Poland, Romania and Slovakia)209.  

As  regards  further  interventions  in  basic  industries  and  manufacturing  without  an  in-depth 
investigation,  the  Commission  approved  the  acquisition  of the  crane  and  container handling 
business  of  the  United  States  based  Terex  by  the  Finnish  lifting  equipment  supplier 
Konecranes  subject  to  the  divestiture  of  the  entire  global  business  for  hoists,  cranes  and 
handling  materials  Stahl,  currently  owned  by  Konecranes,  including  a  production  facility 

205 Case M.7744 HeidelbergCement / Italcementi. For further information see IP/16/1929 of 26 May 2016 
available at http://europa.eu/rapid/press-release_IP-16-1929_en.htm  
206 Case M.7878 HeidelbergCement / Schwenk / Cemex Hungary / Cemex Croatia. For further information see 
IP/16/3362 of 10 October 2016 available at http://europa.eu/rapid/press-release_IP-16-3362_en.htm  
207 Case M.7555 Staples / Office Depot. For further information see IP/16/278 of 10 February 2016 available at 
http://europa.eu/rapid/press-release_IP-16-278_en.htm  
208 Case M.7801 Wabtec / Faiveley Transport. For further information see IP/16/3305 of 4 October 2016 
available at http://europa.eu/rapid/press-release_IP-16-3305_en.htm  
209 Case M.7881 AB InBev / SAB Miller. For further information see IP/16/1900 of 24 May 2016 available at 
http://europa.eu/rapid/press-release_IP-16-1900_en.htm  

60 

 
                                                            
based  in  Germany210.  Remedies  were  also  required  by  the  Commission  for  the  clearance  of 
the  acquisition  of  German  laser  supplier  Rofin-Sinar  by  US  rival  Coherent,  subject  to  the 
divestment  of  Rofin-Sinar's  UK  based  business  for  the  manufacturing  of  low  power  CO2 
lasers211, and for the clearance of the acquisition of alumina companies Alteo ARC and Alufin 
by French multinational company Imerys, subject to the divestiture of the entire white fused 
alumina business of Alteo212.  

State aid investigations in basic industries 

On 20 January, the Commission adopted a decision213 finding that a EUR 211 million funding 
granted by the Walloon authorities in Belgium to several steel companies within the Duferco 
group  between  2006  and  2011  distorted  competition  in  breach  of  EU  State  aid  rules.  In  its 
decision, the Commission concluded that no private investor would have accepted to invest on 
the same terms.  

Further,  on  20  January,  the  European  Commission  opened  an  in-depth  investigation214  to 
assess whether Italian State support for the steel producer Ilva granted in 2014 and 2015 is in 
line  with  the  EU  State  aid  rules.  These  measures  amount  to  EUR  806  million  of  publicly 
supported  finance  already  disbursed  to  support  Ilva.  In  May,  the  Commission  extended  the 
proceedings to an additional EUR 300 million State loan215. 

The Commission's State aid investigations in the steel sector have to be considered against the 
background  that  steelmakers  across  the  EU  are  struggling  with  overcapacity.  State 
interventions  should  therefore  be  market  driven  to  avoid  a  harmful  subsidy  race  between 
Member  States,  which  would  increase  overcapacity  and  jeopardise  the  efforts  already  made 
by EU steelmakers to remain competitive.  

On  19  July,  the  Commission  opened  an  in-depth  investigation  to  determine  whether  the 
French  State's  contribution  to  the  financing  of  the  Areva  group's  restructuring  gave  the 
company  a  selective  advantage  not  available  to  its  competitors216.  This  investigation  was 
concluded with two positive decisions, both adopted on 10 January 2017217. Areva is active in 
a range of activities in the nuclear fuel cycle and it is majority-owned by the French State. A 

210 Case M.7792 Konecranes / Terex MHPS. For further information see IP/16/2763 of 8 August 2016 available 
at http://europa.eu/rapid/press-release_IP-16-2763_en.htm  
211 Case M.8055 Coherent / Rofin-Sinar Technologies. For further information see IP/16/3548 of 26 October 
2016 http://europa.eu/rapid/press-release_IP-16-3548_en.htm  
212 Case M.8130 Imerys / Alteo Certain Assets. For further information see IP/16/3572 of 28 October 2016 
available at http://europa.eu/rapid/press-release_IP-16-3572_en.htm  
213 Cases SA.33926 Interventions de la région wallonne en faveur de Duferco, Commission decision of 20 
January 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_33926, decision under appeal 
and T-254/16 Steel Invest & Finance (Luxembourg) v Commission, OJ C 251, 11.07.2016. 
214 Case SA.38613 Alleged Aid for Ilva in A.S., Commission decision of 20 January 2016, OJ C 142, 22.04.2016 
available at http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_38613 
215 Case SA.38613 Alleged Aid for Ilva in A.S., Commission decision of 13 May 2016, OJ C 241, 01.07.2016 
available at http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_38613 
216 Case SA.44727 Restructuring aid to Areva, Commission decision of 19 July 2016, OJ C 301, 19.08.2016 
available at http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_44727 
217 Cases SA.44727 Restructuring aid to Areva, Commission decisions of 10 January 2017 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_44727 (in the form of a capital 
injection of EUR 4.5 billion by the French State) and SA.46077 Aide au sauvetage en faveur du Groupe Areva, 
available at http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_46077 on the rescue 
aid to Areva (regarding a EUR 3.3 billion loan from the French State to two entities in the Areva Group, later 
converted into a capital injection, which is the subject of the restructuring aid decision).  

61 

 
                                                            
significant part of the investigation was to verify whether the long-term viability of Areva is 
ensured to avoid injections of public funds in the future.  

On 26 January, the European Commission has opened an in-depth investigation into whether 
public  measures  in  favour  of  the  Spanish  mining  company  Iberpotash  gave  it  a  selective 
advantage over its competitors218. Iberpotash owns and operates several potash mines in the 
Catalonia  region  of  Spain.  The  investigation  focuses  on  the  legality  of  financial  State 
guarantees  related  to  environmental  protection  legislation  and  to  the  financing  of 
environmental protection measures. 

On 8 April 2016 the Commission opened an in-depth investigation into State support for the 
insolvent Romanian petrochemical company Oltchim219. The company, which is controlled by 
the Romanian State, is in a process of reorganisation, with the aim of paying existing debts 
from  the  proceeds  of  its  privatisation.  The  main  question  is  whether  by  accepting  debt 
waivers, Oltchim's public creditors granted incompatible State aid. 

The  Commission  is  continuing  its  investigation  into  possible  restructuring  aid  to  the  Greek 
railway  company  TRAINOSE220  and  the  cancellation  of  debts  incurred  prior  to  Bulgaria's 
accession to the EU by the Bulgarian rail incumbent BDZ221.  

6. AGRI-FOOD INDUSTRY 

Overview of key challenges in the agricultural sector  

The  European  food  sector  is  facing  important  challenges  at  the  different  levels  of  the  food 
supply chain.  

Specific characteristics of the agricultural sector 

EU farmers face challenges due to the characteristics of the agricultural sector. Unforeseeable 
natural  elements  (such  as  adverse  weather  conditions  and  diseases)  can  significantly  alter 
production,  resulting  in  volatility  of  prices  and  revenues.  Farmers  also  face  increased 
demands  in  terms  of  quality,  variety  and  traceability  by  end  consumers.  In  addition, 
agricultural  producers  form  the  least  concentrated  level  in  the  food  supply  chain.  The  most 
common  situation  across  sectors  and  Member  States  is  that  agricultural  producers  remain 
atomised  or  grouped  into  small  cooperatives  and  other  producer  organisations.  In  contrast, 
their  input  suppliers  and  customers  (processors,  wholesalers  and  retailers)  are  often  much 
larger  and  more  concentrated.  Agricultural  producers  therefore  typically  have  very  little 
bargaining  power  in  their  negotiations  vis-à-vis  large  suppliers  and  buyers.  Integration  of 
producers  in  large  organisations  can  improve  the  management  of  these  challenges 
significantly  where  these  organisations  aggregate  supply  (both  in  terms  of  volumes  and 
variety  of  products),  offer  supporting  services  and  add  value  through  processing.  Such 

218 Case SA.35818 Iberpotash, Commission decision of 26 January 2016, OJ C 14, 22.04.2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_35818 
219 Case SA.36086 Potential aid to Oltchim, Commission decision of 8 April 2016, OJ C 284, 05.08.2016 
available at http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_36086 
220 Case SA.32544 Restructuring of the Greek Railway Group – TRAINOSE S.A., Commission decision of 13 
July 2011, OJ C 272, 15.09.2011 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_32544 
221 Case SA.31250 Restructuring aid to BDZ, Commission decision of 9 November 2011, OJ C 10, 12.01.2012 
available at http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_31250 

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integration can provide more stability, scale to reach more customers, flexibility, more value 
and more bargaining power. 

Contribution of EU competition policy to tackling the challenges 

Making agricultural markets more competitive 

In  order  to  increase  the  competitiveness  of  the  EU  agricultural  sector  and  to  strengthen  the 
bargaining  power  of  smaller  agricultural  producers,  the  2013  Common  Agricultural  Policy 
(CAP) Reform, maintained the application of competition law to agriculture and set out new 
derogations  to  antitrust  rules  for  certain  agricultural  sectors  (olive  oil,  beef  and  veal,  and 
arable crops (cereals, oilseeds, etc.))222. The new rules aim at creating more efficiencies in the 
EU agricultural sector by promoting and stimulating more integration through joint selling by 
producer  organisations  provided  that  the  amounts  sold  remain  at  moderate  levels  in  the 
relevant market (15% or 20%) or other joint activities such as joint storage or distribution. To 
ensure  a  coherent  application  of  the  new  derogations  and  in  order  to  help  farmers  to  apply 
such  derogations  and  provide  guidance  on  how  to  obtain  efficiencies  in  joint  activities,  the 
Commission adopted Guidelines in November 2015223.  

Milk Package 

The  Commission  has  prepared  a  report  on  the  functioning  and  implementation  of  the  Milk 
Package. There is evidence that the package has improved the position of farmers in the chain 
to  some  extent,  including  through  various  collective  actions  of  producers  going  beyond  the 
milk package. The survey ordered by the Commission for the purpose of drafting the report 
shows notably that producer organisations in the sector do much more than negotiating prices 
and deliveries. Most producer organisations provide one or more services that add value to the 
supply  of  milk  and/or  support  producers'  activities,  such  as  milk  collection,  quality  control, 
technical support, and joint procurement of inputs.  

Agricultural Markets Task Force 

The  Agricultural  Markets  Task  Force  (AMTF),  a  task  force  of  experts  set  up  by  the 
Commissioner for Agriculture and Rural Development, delivered its report on 15 November. 
The  report  contains  recommendations  on  various  issues,  including  competition  rules.  The 
AMTF suggests that the rules of collective organisation and competition law should be clear 
and workable, in order to enhance genuinely the opportunities for farmers to cooperate. The 
Commission will analyse the recommendations and assess any impact that they may have. 

Report on the application of competition rules 

The  Commission  is  mandated  by  the  Common  Market  Organisation  Regulation  (CMO 
Regulation224)  to  report  to  the  legislator  on  the  implementation  of  competition  rules  in  the 

222 European Parliament and Council Regulation (EU) No 1308/2013 of 17 December 2013 establishing a 
common organisation of the markets in agricultural products (CMO Regulation) and repealing Council 
Regulations (EEC) No 922/72, (EEC) No 234/79, (EC) No 1037/2001 and (EC) No 1234/2007 available at 
http://eur-lex.europa.eu/legal-content/en/ALL/?uri=CELEX:32013R1308  
223 Commission notice Guidelines on the application of the specific rules set out in Articles 169, 170 and 171 of 
the CMO Regulation for the olive oil, beef and veal and arable crops sectors, OJ C 431, 22.12.2015, p. 1. 
224 European Parliament and Council Regulation (EU) No 1308/2013 of 17 December 2013 establishing a 
common organisation of the markets in agricultural products (CMO Regulation) and repealing Council 
Regulations (EEC) No 922/72, (EEC) No 234/79, (EC) No 1037/2001 and (EC) No 1234/2007 available at 
http://eur-lex.europa.eu/legal-content/en/ALL/?uri=CELEX:32013R1308 

63 

 
                                                            
agricultural  sector  in  all  Member  States,  in  particular,  the  new  specific  competition  rules 
regarding joint selling by producers in the agricultural sector of olive oil, beef and veal and 
arable crops. In addition, the European Parliament called for a review of competition rules in 
the sector in its opinion on the Annual Competition Report of 2015. It asked the Commission 
to  draft  a  report  on  the  application  of  competition  rules  to  the  agricultural  sector  in  all 
Member States. This report shall be finalised and presented to the European Parliament and 
the Council by the end of 2017 as required by the CMO Regulation225.  

Olive sector in Spain 

The Spanish olive oil sector has presented an initiative pursuant to Article 209 of the CMO 
Regulation  to  stabilise  market  prices  and  provide  consumers  with  food  at  reasonable  prices 
through the use of joint facilities for storage. The general derogation contained in this article 
does  not  provide  a  basis  for  a  prior  authorisation  or  opinion  by  any  authority.  The 
Commission  has  been  working  together  with  the  sector  and  the  National  Competition 
Authority to examine if this initiative can comply with the conditions of the derogation. 

Preventing market segmentation and parallel trade restrictions by food manufacturers  

On  29  June,  the  Commission  opened  formal  investigations  into  practices  of  AB  InBev 
restricting imports of its beer from less expensive Member States, such as the Netherlands and 
France, to the more expensive Belgian market. AB InBev practices may result in a violation 
of Article 102 TFEU226. The Commission is investigating, in particular, practices of changing 
the packaging of products to make it more difficult to sell them in other Member States and of 
limiting retailers' access to certain forms of promotion or key products to prevent them from 
importing less expensive products into Belgium.  

Investigating the practices of modern retailers 

In October 2014 the Commission published its study, The Economic Impact of Modern Retail 
on Choice and Innovation in the EU Food Sector (the Study).  

An  important  part  of  the  follow-up  to  the  Study  has  been  an  investigation  into  the  role  of 
private labels, given that the Study suggested that private labels may have a strong negative 
relationship  with  innovation  in  a  given  category  at  the  shop  level.  During  2016,  the 
Commission  worked  with  the  Consortium  who  produced  the  Study  to  extract  some  further 
data  on  private  labels  and  innovation.  The  Commission  used  this  data  to  conduct  some 
additional  analysis  into  the  nature  of  private  labels  and  published  the  results  at  the  end  of 
2016227. Based on the evidence available, it appears that the role and nature of private labels is 
likely to vary depending on specific markets and consumer tastes. It cannot be ruled out that 
in  some  particular  market  situations,  retailers'  practices  involving  their  private  labels  may 
diminish  brands'  incentives  and  ability  to  innovate  but  the  likelihood  of  infringements  of 
competition rules is low at this stage. 

There  are  also  complaints  that  increased  retailer  concentration  has  led  to  fewer  innovative 
products.  The  results  of  the  Study  did  not  support  those  claims.  National  Competition 
Authorities (in France, Germany, Italy, Norway and Spain) have  investigated some national 
buying  alliances  in  the  last  two  years.  In  Italy  and  Norway,  they  ordered  the  dissolution  of 

225 Article 225 of the CMO Regulation, see footnote above.  
226 For further information see IP/16/2361 of 30 June 2016 available at: http://europa.eu/rapid/press-release_IP-
16-2361_en.htm  
227 For further information see http://ec.europa.eu/competition/sectors/agriculture/overview_en.html  

64 

 
                                                            
two buying alliances because the alliances would severely weaken competition. In France in 
2016, one alliance gave up part of its project following an investigation by the authority under 
merger rules. The Commission is in close contact with the National Competition Authorities 
to follow up on these national initiatives.  

Merger investigations in the agri-food industry  

The year 2016 confirmed the trend of consolidation in the agrochemical industry, which had 
been  signalled  in  2015  with  the  failed  offer  of  global  seed  leader  Monsanto  to  acquire  the 
global  crop  protection  leader  Syngenta  and  with  the  announced  merger  between  the  United 
States based Dow and DuPont, both active in seeds and crop protection. In 2016, ChemChina, 
which  controls  Adama,  the  largest  generic  crop  protection  company,  announced  plans  to 
acquire  Syngenta,  while  Bayer,  a  German  multinational  chemical,  pharmaceutical  and  life 
science company, announced an agreement to acquire Monsanto.  

In 2016, the Commission opened in-depth investigations in both the ChemChina / Syngenta 
case228  and  the  Dow  /  DuPont  case229.  In  the  latter,  in  addition  to  investigating  concerns  in 
crop  protection  markets,  the  Commission  also  announced  an  investigation  into  preliminary 
concerns that the merger may lead to a reduction of innovation in crop protection as a whole.  

At  the  end  of  2016,  the  Commission  cleared  the  acquisition  of  WhiteWave,  a  US 
manufacturer  of  packaged  foods  and  beverages,  by  the  French  Danone  group.  The  overlaps 
concerned mainly plant-based and dairy based yoghurts but also plant-based growing-up milk. 
The  Commission's  concerns  were  limited  however,  so  that  the  transaction  could  be  cleared 
subject  only  to  the  divestment  of  a  large  part  of  Danone's  growing-up  milk  business  in 
Belgium230.  

7. PHARMACEUTICAL AND HEALTH SERVICES SECTOR  

Overview of key challenges in the sector  

The ongoing key challenge in the pharmaceutical and health care services sector remains the 
balance  between,  on  the  one  hand,  rewarding  companies  for  successful  R&D  investment 
activities,  and,  on  the  other,  enabling  a  competitive  environment  which  promotes  access  to 
less expensive quality medicines and services231. This challenge is further complicated by the 
high degree of regulation at Member State level which leads to significant national variations 
of medicine pricing and wholesale and pharmacy margins. 

On 17 June, the Council of the European Union published conclusions on strengthening the 
balance  in  the  pharmaceutical  systems  in  the  EU  and  its  Member  States.  In  particular,  it 

228 Case M.7962 ChemChina / Syngenta. For further information see IP/16/3579 of 28 October 2016 available at 
http://europa.eu/rapid/press-release_IP-16-3579_en.htm  
229 Case M.7932 Dow / DuPont. For further information see IP/16/2784 of 11 August 2016 available at 
http://europa.eu/rapid/press-release_IP-16-2784_en.htm  
230 Case M.8150 Danone / The WhiteWawe Foods company. For further information see IP/16/4438 of 16 
December 2016 available at http://europa.eu/rapid/press-release_IP-16-4438_en.htm  
231 See, Reports External reference pricing of medicinal products: simulation-based considerations for cross-
country coordination (2013) prepared by Prof. Mondher Toumi, MD, PhD, MSc, Mrs Cécile Rémuzat, PharmD, 
MSc, Mrs Anne-Lise Vataire, MSc and Mr Duccio Urbinati, PharmD, MSc available at 
http://ec.europa.eu/health//sites/health/files/systems_performance_assessment/docs/erp_reimbursement_medicin
al_products_en.pdf and Study on enhanced cross-country coordination in the area of pharmaceutical product 
pricing (2105) prepared by Gesundheit Österreich Forschung- und Planungs GmbH available at 
http://ec.europa.eu/health//sites/health/files/systems_performance_assessment/docs/pharmaproductpricing_frep_
en.pdf  

65 

 
 
                                                            
invited Member States to cooperate voluntarily, for example, on exchange of information with 
respect to pricing and reimbursement and it invited the Commission to "continue and where 
possible  intensify,  including  through  a  report  on  recent  competition  cases  following  the 
pharma  sector  inquiry  of  2008/  2009,  the  merger  enforcement  pursuant  to  the  EC  Merger 
the  monitoring,  methods  development  and 
Regulation  (Regulation  139/2004)  and 
investigation  -  in  cooperation  with  national  competition  authorities  in  the  European 
Competition Network (ECN) - of potential cases of market abuse, excessive pricing as well as 
other  market  restrictions  specifically  relevant  to  the  pharmaceutical  companies  operating 
within the EU, such in accordance with Articles 101 and 102 of the Treaty on Functioning of 
the European Union"232.  

The  initiative  is  in  line  with  the  Commission's  enforcement  policy  in  this  sector  which  has 
contributed and will continue to promote innovation, R&D and growth while providing access 
to cheaper medicines for European citizens.  

Contribution of EU competition policy to tackling the challenges 

In 2016, the Commission welcomed the General Court judgment233 upholding its Lundbeck234 
decision  in  the  first  pharma  pay-for-delay  case.  The  Commission's  decision  found  that  the 
Danish  pharmaceutical  company  Lundbeck  and  four  generics  competitors  had  concluded 
agreements that harmed patients and health care systems. This allowed Lundbeck to keep the 
price of its blockbuster drug citalopram artificially high, in breach of Article 101 TFEU. The 
decision  imposed  a  fine  of  EUR  93.8  million  on  Lundbeck  and  fines  totalling  EUR  52.2 
million on the four generics competitors Generics UK, Arrow, Alpharma and Ranbaxy.  

In  particular,  before  the  agreements  were  concluded,  Lundbeck's  basic  patent  for  the 
blockbuster antidepressant medicine citalopram had expired. Lundbeck still held a number of 
process  patents  that  provided  limited  protection.  Generics  producers  were  preparing  for 
market entry with much cheaper generic versions of citalopram. Lundbeck paid the generics 
competitors for their promise to stay out of the citalopram market. As a result, Lundbeck was 
certain  to  avoid  competition  from  the  four  companies  for  the  entire  duration  of  the 
agreements.  Lundbeck  and  generics  companies  appealed  the  decision  to  the  General  Court 
which upheld the Commission's decision.  

In  addition,  the  Commission  published  a  second  provisional  non-confidential  version  of  the 
Servier decision235 which is subject to confidentiality claims before the Hearing Officer.  

In its pay-for-delay investigation in relation to the market entry of generic modafinil (sleeping 
disorder  medicine),  the  Commission's  preliminary  view  is  that  Cephalon  induced  Teva  to 
abandon its efforts to enter markets worldwide independently with cheaper generic versions 

232 Conclusions of the Council of the European Union published on strengthening the balance in the 
pharmaceutical systems in the EU and its Member States available at 
http://data.consilium.europa.eu/doc/document/ST-10315-2016-INIT/en/pdf  
233 Cases T-472/13 H. Lundbeck A/S and Lundbeck Ltd v Commission, EU:T:2016:449; T-460/13 Sun 
Pharmaceutical Industries Ltd, formerly Ranbaxy Laboratories Ltd and Ranbaxy (United Kingdom) Ltd v 
Commission, EU:T:2016:453; T-467/13 Arrow Group ApS and Arrow Generics Ltd v Commission, 
EU:T:2016:450; T-469/13 Generics (United Kingdom) Ltd v Commission, EU:T:2016:454; T-470/13 Merck 
KGaA v Commission, EU:T:2016:452 and T-471/13 Xellia Pharmaceuticals ApS and Alpharma, LLC, formerly 
Zoetis Products LLC v Commission, EU:T:2016:460.  
234 Case AT.39226 Lundbeck, Commission decision of 19 June 2013 available at 
http://ec.europa.eu/competition/antitrust/cases/dec_docs/39226/39226_8310_11.pdf  
235 Case AT.39612 Perindopril (Servier), Commission decision of 9 July 2014 available at 
http://ec.europa.eu/competition/antitrust/cases/dec_docs/39612/39612_12422_3.pdf  

66 

 
                                                            
of  modafinil  and  kept  the  prices  for  modafinil  artificially  high  during  several  years.  If 
established,  such  behaviour  to  agree  to  deliberately  delay  the  entry  of  a  cheaper  generic 
medicine  would  have  caused  substantial  harm  to  health  systems  and  patients  and  breached 
Article 101 TFEU236.  

Finally,  the  Commission  continued  monitoring  patent  settlements  between  originator  and 
generic companies. The seventh report published on 13 December, confirmed the continued 
use  of  settlement  agreements  which  reached  125  in  total  in  2015,  the  year  covered  by  the 
seventh monitoring exercise. The portion of B.II settlements (i.e. those containing a limitation 
on generic entry and a value transfer from the originator  to  the generic company) remained 
low, constituting 10% of all settlements concluded in 2015237.  

Recent enforcement trends 

Merger review in the pharmaceutical sector  

The  consolidation  in  the  pharmaceutical  sector  continued  in  2016.  The  main  transactions 
concerned the acquisition by Teva of Allergan's generics business238, acquisition by Mylan of 
Meda239,  as  well  as  the  asset  swap  between  Boehringer  Ingelheim  and  Sanofi240.  The 
Commission  continued  to  ensure  that  consolidation  of  the  industry  does  not  lead  to  market 
distortions and cleared the cases subject to certain conditions. 

Country-wide concerns in the generics industry 

In view of the unprecedented scale of the Teva / Allergan Generics merger, the Commission had to address novel 
competition  issues  in  the  generics  pharmaceutical  sector.  In  addition  to  the  traditional  product-by-product 
assessment,  the  Commission  considered  that  the  impact  of  the  transaction  ought  to  be  assessed  also  from  the 
angle of generics products portfolio competition. The Commission found concerns at country level in the United 
Kingdom,  Ireland  and  Iceland  where  Teva  and  Allergan  were  the  two  largest  generics  manufacturers  closely 
competing  with  their  portfolio  of  generics.  As  a  result  the  commitments  included  the  majority  of  Allergan 
Generics marketed generics activities and generics activities in development pipeline in Ireland and the United 
Kingdom,  covering  all  the  main  steps  in  the  manufacture,  supply  and  distribution  of  these  products  and  a 
manufacturing plant in the United Kingdom. 

Viability and feasibility of a remedy  

The  case  Boehringer  Ingelheim/Sanofi's  animal  health  business  (Merial)  raised  an  issue  of 
viability  and  feasibility  of  a  remedy  consisting  in  a  production  technology  transfer  for  a 
number of animal health vaccines. Production transfer of vaccines poses important challenges 
as to the reproducibility of manufacturing processes in a different environment and in a timely 
manner while complying with strict regulatory requirements. In this case, a remedy evolving 
around the vaccine production technology transfer was ultimately approved following a very 
detailed analysis of production processes and subject to the identification of a buyer having 
suitable  facilities  and  expertise  in  the  relevant  production  processes.  In  the  decision,  the 
Commission  approved  Ceva  Santé  Animale  (Ceva)  as  the  purchaser  of  the  Divestment 
Businesses. 

236 Case AT.39686 Cephalon. For further information see IP/11/511 of 28 April 2011 available at 
http://europa.eu/rapid/press-release_IP-11-511_en.htm  
237 For further information see http://ec.europa.eu/competition/sectors/pharmaceuticals/inquiry/  
238 Case M.7746 Teva / Allergan Generic. For further information see IP/2016/727 of 10 March 2016 available at 
http://europa.eu/rapid/press-release_IP-16-727_en.htm 
239 Case M.7975 Mylan / Meda. For further information see IP/16/2956 of 20 July 2016 available at 
http://europa.eu/rapid/press-release_IP-16-2596_en.htm  
240 Case M.7917 Boehringer Ingelheim / Sanofi animal health business. For further information see IP/16/3641 
of 9 November 2016 available at http://europa.eu/rapid/press-release_IP-16-3641_en.htm  

67 

 
                                                            
Continued merger enforcement practise focused on innovation 

In continuation of its focus on innovation in 2015, the Commission published a competition 
policy  brief  on  "EU  merger  control  and  innovation"241  in  April  2016.  This  publication 
emphasises  that  theories  of  harm  involving  loss  of,  or  harm  to,  innovation  have  been  at the 
core of a number of merger cases where the Commission intervened, and that remedies can 
be, and have been, designed with the specific goal of preserving innovation.  

The 2015 enforcement trend on innovation continued in 2016, with cases such as Boehringer 
Ingelheim/Sanofi's animal health business (Merial) where the Commission found concerns on 
a market despite the absence of high market shares due to the merging parties being amongst 
the leading innovators in the industry having promising products just entering the market or in 
the  pipeline.  In  addition,  in  a  decision  adopted  at  the  very  end  of  2015  (Novartis  /  GSK 
(ofatumumab  auto-immmune  indications242)),  the  Commission  took  the  view  that  it  had 
jurisdiction (under article 5(2) of EUMR) over an acquisition of a pharmaceutical product still 
under  development  to  prevent  companies  from  artificially  splitting  marketed  and  pipeline 
products in different transactions to circumvent the Commission's scrutiny of R&D projects.  

State aid actions in the health services sector 

The  Commission's  State  aid  actions  in  the  health  services  sector  mainly  concern  hospitals, 
related services (e.g., ambulance transport) and health insurance. The Commission decision of 
20 December 2011 (based  on Article 106(2)  TFEU243)  specifies the conditions under which 
compensation to companies for providing public services is compatible with the EU State aid 
rules and does not have to be notified to the Commission in advance. Compensation granted 
to  hospitals,  including  emergency  services  and  ancillary  services,  for  services  of  general 
economic  interest,  benefits  from  the  decision  irrespective  of  the amounts  involved  provided 
that  the  conditions  are  met.  Accordingly,  the  Commission  very  rarely  takes  decisions  on 
financing covered by this exemption decision. 

During  2016,  the  Commission  continued  examining  and/or  decided  on  a  number  of 
complaints lodged by private health service providers about their allegedly unfair treatment or 
potentially  excessive  compensation  of  publicly-owned  hospitals.  Those  complaints  usually 
came  from  operators  in  Member  States  with  healthcare  markets  more  open  to  competition 
(e.g.  Belgium,  France  and  Germany).  In  the  Brussels  hospitals  case244,  the  Commission 
concluded  after  an  in-depth  investigation  that  public  financing  granted  to  compensate  the 
Brussels  public  IRIS  hospitals  for  deficits  incurred  for  the  provision  of  health  and  social 
services of general economic interest since 1996 was in line with EU State aid rules.  

241 For further information see the Competition Policy Brief 1/2016 available at 
http://ec.europa.eu/competition/publications/cpb/2016/2016_001_en.pdf  
242 Case M.7872 Novartis / GSK (ofatumumab autoimmune indications), Commission decision of 18 December 
2015 available at http://ec.europa.eu/competition/mergers/cases/decisions/m7872_329_3.pdf  
243 Commission decision of 20 December on the application of Article 106(2) of the Treaty on the Functioning of 
the European Union to State aid in the form of public service compensation granted to certain undertakings 
entrusted the with operation of services of general economic interest, OJ L 7, 11.1.2012, p.3. 
244 Case SA.19864 Public financing of Brussels public IRIS hospitals, Commission decision of 5 July.2016 
available at http://ec.europa.eu/competition/state_aid/cases/254584/254584_1779214_235_2.pdf  

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8. TRANSPORT AND POSTAL SERVICES 

Overview of key challenges in the sector 

The transport and postal services sectors account for about 4.9 % of the EU economy245, and 
their  performance  can  have  many  beneficial  effects  for  other  sectors  of  the  European 
economy. Transport is the key to both an integrated internal market and to an open economy 
integrated  into  the  world  economy.  While  some  transport  sectors  have  already  been 
liberalised and competition is generally fierce to the benefit of customers, such as the air and 
maritime  transport  sectors,  other  sectors  such  as  passenger  rail  transport  are  still  lagging 
behind.  Similarly,  in  the  postal  sector  parcel  services  are  supplied  by  competitive 
transnational  suppliers  while  other  services  are  mostly  in  the  hands  of  national  postal 
operators often depending on compensation from their government246.  

In 2016, the Commission used its competition tools to keep the transport and postal markets 
open and competitive, and to facilitate entry. A continued benevolent focus is on State aid that 
facilitates  interoperability  between  different  modes  of  transport  as  well  as  on  State  aid  for 
modern infrastructure.  

Contribution of EU competition policy to tackling the challenges 

Antitrust enforcement in air transport  

On 27 October, the Commission sent a Statement of Objections to Brussels Airlines and TAP 
Portugal247  and  informed  both  companies  of  its  preliminary  view  that  their  codeshare 
cooperation  on  passenger  services  between  Brussels  and  Lisbon  restricted  competition 
between the two airlines, in breach of EU antitrust rules. The Commission has concerns that 
the two airlines pursued an anti-competitive strategy on the Brussels-Lisbon route by: 

  discussing a capacity reduction and an alignment of their pricing policy on the route; 
  granting  each  other  unlimited  rights  to  sell  seats  on  each  other's  flights  on  the  route 

 

where they had previously competed; and 
implementing  these  arrangements  by  actually reducing  capacity,  completely  aligning 
their fare structures as well as their ticket prices on the route. 

The  Commission's  preliminary  conclusion  is  that  these  practices  eliminated  competition  on 
prices and capacity between the two airlines on the Brussels-Lisbon route and led to higher 
prices  and  less  choice  for  consumers.  To  safeguard  their  rights  of  defence,  the  parties  have 
been invited to provide comments. 

Merger review in air transport 

The  air  transport  sector  is  still  very  fragmented.  In  the  EU  there  are  more  than  150 airlines 
offering  scheduled  air  passenger  transport.  The  five  largest  airlines  in  the  EU  comprising 

245 See, EU transport in figures Statistical pocketbook (2015) available at http://ec.europa.eu/transport/facts-
fundings/statistics/doc/2015/pocketbook2015.pdf p.19, prepared by the Commission with around EUR 562 
billion in Gross Value Added (GVA) at basic prices, the transport and storage services sector (including postal 
and courier activities) accounted for about 4.9 % of total GVA in the EU-28 in 2012 (or 4.4 % excluding postal 
and courier services). 
246 It should be noted however, that the third postal Directive (2008/6/EC) introduced full opening of the 
Member States' postal markets, allowing new operators and services. 
247 Case AT.39860 Brussels Airlines / TAP Air Portugal. For further information see IP/16/3563 of 27 October 
2016 available at http://europa.eu/rapid/press-release_IP-16-3563_en.htm 

69 

 
 
                                                            
Lufthansa, Air France / KLM and the International Consolidated Airlines Group (i.e. IAG the 
holding company of British Airways and Iberia, Ryanair and EasyJet) account for only 50 % 
of the EU market. In contrast, in the United States, the three legacy carrier groups American 
Airlines, Delta and United together with the low cost carrier Southwest jointly control more 
than  80  %  of  the  United  States  market.  The  drive  towards  further  consolidation  of  the  EU 
market  in  2016  was  lessened  by  low  fuel  costs  which  had  a  positive  impact  on  airline 
profitability.  

In  this  context,  the  Commission  reviewed  the  acquisition  of  the  Irish  carrier  Aer Lingus  by 
IAG248.  The  Commission's  investigation  indicated  that  the  merger  would  raise  two  types  of 
competition concerns. Firstly, on certain routes where both airlines operated there would not 
be sufficient competition. Secondly, the choices of airlines available for connecting long-haul 
flights would have decreased if Aer Lingus were to connect only to long-haul flights operated 
by  IAG  and  vice  versa.  Consequently,  the  transaction  was  cleared  subject  to  two  types  of 
commitments:  (1)  IAG  releasing  up  to  five  slots  at  London  Gatwick  Airport  to  entice  new 
entrants  on  the  Dublin-London  and  Belfast-London  routes.  In  2016,  Ryanair  started 
operations  on  both  routes;  and  (2)  IAG  entering  into  agreements  with  competing  airlines 
which  operate  long-haul  flights  out  of  London  Heathrow,  London  Gatwick,  Manchester, 
Amsterdam, Shannon and Dublin, so that Aer Lingus will continue to provide these airlines 
with  connecting  passengers.  On  several  of  these  routes,  IAG  and  Virgin  Atlantic  Airways 
entered into a special prorate agreement in 2016249.  

In  2016,  in  the  framework  of  the  commitments  attached  to  the  decision  approving  the 
acquisition of British Midlands Limited (bmi) by IAG in 2012, the Commission has approved 
Aeroflot as potential entrant on the London Heathrow – Moscow route250 as well as Flybe as 
potential entrant on two routes connecting London Heathrow to Aberdeen and Edinburgh251. 
Aeroflot started its operations on the route connecting London Heathrow to Moscow as of the 
IATA Winter Season 2016/2017, broadening passengers' choice on the route. Flybe will start 
operating flights from London Heathrow to Aberdeen and Edinburgh as of the IATA summer 
season 2017252. 

248 Case M.7541 IAG / AerLingus, Commission decision of 14 July 2015 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=2_M_7541 
249 Case M.7541 IAG / Aer Lingus, Commission decision of 25 May 2016 concerning the approval of the special 
prorate agreement between Aer Lingus and Virgin Atlantic Airways in accordance with the commitments 
annexed to the Commission decision of 14 July 2015 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=2_M_7541 
250 Case M.6447 IAG / bmi, Commission decision of 17 June 2016 concerning the Assessment of the viability of 
Applicants and evaluation of their formal bids pursuant to Clause 1.4.9 of the commitments attached to the 
Commission decision of 30 March 2012 in case M.6447 IAG/bmi available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=2_M_6447 
251 Case M.6447 IAG / bmi, Commission decision of 4 November 2016 concerning the Assessment of the 
viability of the Flybe Group Plc and evaluation of its formal bid pursuant to Clauses 1.4.4 and 1.4.9 of the 
commitments attached to the decision in the above-mentioned case following the Monitoring Trustee's opinion 
of 24 October 2016 – Summer 2017 IATA Season, not yet published at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=2_M_6447  
252 Flybe's announcement available at http://otp.investis.com/clients/uk/flybe1/rns/regulatory-
story.aspx?cid=59&newsid=830572  

70 

 
                                                            
State aid to airports and airlines 

In  2016,  several  decisions  were  adopted,  closing  long-standing  investigation  into  aid  to 
airports and airlines. The Commission continued to apply the aviation guidelines adopted in 
2014253.  

In  the  Berlin-Brandenburg  airport  case,  a  major  public  funding  package  granted  for  the 
completion of the new single Berlin airport and the upgrade of its capacity compared to the 
initial design was found to be aid free on the basis of an in-depth assessment of the market 
economy investor principle254. The decision on Romanian regional airports partially closed a 
formal  investigation  opened  in  2011  into  operating  aid  for  eleven  small  airports255.  The 
decisions  in  the  Sardinian  airports256  and  Klagenfurt  airport  cases257  imposed  recovery  on 
airlines, notably low cost carriers, bringing to eight the number of recovery decisions against 
airlines  adopted  since  the  entry  into  force  of  the  Aviation  Guidelines.  The  Commission's 
decision  in  SEA  Handling  contained  an  assessment  of  economic  continuity  in  a  labour-
intensive and asset light sector (ground handling) where the case law and previous decisional 
practice did not provide replies to all the questions that arose258.  

The Commission also adopted decisions in cases involving aid to airports and start-up aid to 
airlines259.  

The  Commission  also  proposed  an  extension  of  the  State  aid  General  Block  Exemption 
Regulation  (GBER)  to  airports260.  The  extended  GBER  would  cover  investment  aid  to 
airports with less than three million passengers per year under certain conditions, in particular 
the absence of other airports with scheduled traffic within 100 km or 60 minutes by road/train 
("catchment area condition"). The GBER foresees lighter conditions for very small airports. 

Antitrust enforcement in maritime transport  

In  July,  the  Commission  adopted  a  decision  that  renders  legally  binding  the  commitments 
offered  by  fourteen  container  liner  shipping  companies  (the  Carriers)261.  The  commitments 
addressed  the  Commission's  concerns  that  the  companies'  practice  of  publishing  their 
intentions on future price increases may have harmed competition and customers.  

253 Communication from the Commission, Guidelines on State aid to airports and airlines, OJ C 99, 4.4.2014, p. 
3 available at http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=uriserv:OJ.C_.2014.099.01.0003.01. ENG  
254 Case SA.41342 Flughafen Berlin-Brandenburg, Commission decision of 3 August 2016 available at 
http://ec.europa.eu/competition/state_aid/cases/262544/262544_1846884_138_2.pdf  
255 Case SA.30931 Romanian regional airports, Commission decision of 27 September 2016 available at 
http://ec.europa.eu/competition/state_aid/cases/240754/240754_1283768_107_3.pdf 
256 Cases SA.33983 Sardinian airports, Commission decision of 29 July 2016 available at 
http://ec.europa.eu/competition/state_aid/cases/247487/247487_1426436_82_2.pdf  
257 Case SA.24221 Klagenfurt airport, Commission decision of 11 November 2016 available at 
http://ec.europa.eu/competition/state_aid/cases/243805/243805_1580487_960_2.pdf  
258 Case SA.21420 SEA Handling, Commission decision of 5 July 2016, the public version is not yet available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_21420 
259 Cases SA.43023 Lamezia Terme airport, Commission decision of 28 July 2016 available at 
http://ec.europa.eu/competition/state_aid/cases/260316/260316_1834868_112_2.pdf and SA.41635 Flughafen 
Heringsdorf Commission decision of 5 July 2016 available at 
http://ec.europa.eu/competition/state_aid/cases/258231/258231_1777940_193_5.pdf (first decision on individual 
operating aid to an airport since the entry into force of the Aviation Guidelines). 
260 For further information see IP/16/3398 of 13 October 2016 available at http://europa.eu/rapid/press-
release_IP-16-3398_en.htm  
261 Case AT.39850 Container Shipping, Commission decision of 7 July 2016 available at 
http://ec.europa.eu/competition/antitrust/cases/dec_docs/39850/39850_3377_3.pdf  

71 

 
                                                            
The  Carriers  have  regularly  announced  their  intended  future  increases  of  freight  prices  on 
their websites, via the press, or in other ways. These price announcements, known as General 
Rate  Increases  (GRI)  announcements,  do  not  indicate  the  fixed  final  price  for  the  service 
concerned,  but  only  the  amount  of  the  increase  in  USD  per  transported  container  unit 
(Twenty-foot  Equivalent  Unit,  TEU),  the  affected  trade  route  and  the  planned  date  of 
implementation. They generally concern sizable increases of several hundred USD per TEU. 
GRI  announcements  are  made  typically  three  to  five  weeks  before  their  intended 
implementation date, and during that time some or all of the other carriers announce similar 
intended  rate  increases  for  the  same  or  similar  route  and  same  or  similar  implementation 
dates.  Carriers  are  not  bound  by  the  announced  increases  and  some  carriers  have  indeed 
postponed or  modified  announced General rate increases, possibly aligning them with  those 
announced by other carriers.  

The  Commission  had  concerns  that  GRI  announcements  do  not  provide  full  information  on 
new  prices  to  customers  but  merely  allow  carriers  to  be  aware  of  each  other's  pricing 
intentions  and  may  make  it  possible  for  them  to  coordinate  their  behaviour.  Announcing 
future price increases may signal the intended market conduct of carriers and by reducing the 
level of uncertainty about their pricing behaviour, decrease their incentives to compete against 
each  other.  Because  the  announcements  provide  only  partial  information  to  customers  and 
may not be binding on the carriers, customers may not be able to rely on them and therefore 
carriers may be able to adjust prices without the risk of losing customers. This practice may 
lead  to  higher  prices  for  container  liner  shipping  services  and  harm  competition  and 
customers.  

In  order  to  address  the  Commission's  concerns,  the  carriers  offered  to  stop  making  GRI 
announcements. In addition, those Carriers who choose to make public price announcements 
will  include  in  their  published  price  the  five  main  elements  of  the  price  representing  about 
90%  of  its  full  amount  thus  giving  customers  a  good  basis  to  compare  prices262.  Such 
announcements will be binding on the Carriers as maximum prices allowing customers to rely 
on  them  (customers  could  however  negotiate  lower  prices).  Price  announcements  will  be 
made no later than 31 days before the sailings to which they apply. This time gap corresponds 
to  the  period  when  customers  usually  start  booking  in  significant  volumes.  Earlier 
announcements  may give  competitors insight into  each other's future  prices while not  being 
useful  for  customers  since  they  are  not  booking  yet,  thus  possibly  leading  to  a  collusive 
outcome. 

Merger review in maritime transport 

The  global  container  shipping  industry  is  undergoing  a  period  of  change,  in  reaction  to  the 
challenges  it  has  been  facing  in  recent  years.  The  sector  is  characterised  by  overcapacity, 
resulting from several carriers' expansion and investment in larger vessels in recent years and 
combined  with  the  gradual  recovery  of  demand  following  the  economic  crisis.  Also  as  a 
means  to  improve  their  efficiency  and  reduce  their  operating  costs,  container  shipping 
companies  do  not  only  provide  services  individually,  but  they  have  also  put  in  place 
operational  agreements,  such  as  consortia  or  alliances,  with  other  shipping  companies  that 
allow them to combine their vessels and offer a joint service.  

Currently,  there  is  a  significant  change  in  the  alliances  landscape,  with  the  termination  of 
three of the current four global alliances, namely CKYHE, G6 and the Ocean Alliance, and 

262 The remaining elements are charges which are difficult or impossible for the Carriers to publish in advance of 
the sailing.  

72 

 
                                                            
their  replacement  by  three  new  or  enlarged  ones,  namely  2M,  The  Alliance  and  the  Ocean 
Alliance  by  1  April  2017.  Moreover,  a  wave  of  consolidation  can  be  observed,  with  the 
acquisition of Neptun Oriental Lines of Singapore (NOL) by CMA CGM, the acquisition of 
the  UASC  by  Hapag-Lloyd,  the  combination  of  Cosco  and  CSCL  and  the  intended 
combination of activities of the Japanese carriers MOL, NYK and K-Line and the announced 
acquisition  of  Hamburg  Süd  by  Maersk  Line.  Last,  the  Korean  carrier  Hanjin  filed  for 
receivership in August 2016 and is in the process of exiting the market.  

The  Commission  ruled  on  two  major  mergers  in  this  industry.  Earlier  in  2016,  the 
Commission cleared the acquisition of NOL by CMA CGM, a French shipping company with 
worldwide  activities263.  As  initially  notified,  the  transaction  would  have  created  new  links 
between  previously  unconnected  consortia  to  which  the  two  companies  belonged  (CMA 
CGM  is  a  founding  member  of  the  Ocean  Three  Alliance  (O3  Alliance)  whereas  NOL  is 
currently a member of the G6 Alliance). The Commission  had concerns that these potential 
new  links  would  have  resulted  in  anti-competitive  effects  on  two  trade  routes,  notably 
between Northern Europe and North America and between Northern Europe and the Middle 
East.  On  these  routes,  competition  from  liner  shippers  who  have  no  connection  with  the 
merged entity or its alliance partners would have been insufficient. As a result, the transaction 
could have enabled the merged entity, through the consortia that the two companies belong to, 
to  influence  capacity  and  therefore  prices  to  the  detriment  of  shippers  and  consumers  for  a 
very  large  part  of  those markets.  The  companies  offered  to  make  the  transaction  contingent 
upon the removal of the link that would have been created between CMA CGM's O3 Alliance 
and NOL's G6 Alliance. Although CMA CGM had previously stated publicly that it intended 
to  remove  NOL  from  the  G6  alliance,  the  formal  commitment  to  do  so  was  necessary  to 
remove the risk of anti-competitive effects on the two trade routes described above. 

The  Commission  also  cleared  the  acquisition  of  the  Middle-Eastern  UASC,  world's  number 
eleven, by the German Hapag-Lloyd, which after its merger with CSAV was the sixth largest 
container  shipping  company264.  The  Commission  found  that  the  combination  of  the  Parties' 
activities would raise competition concerns on the two legs of the Northern Europe  – North 
America  trade.  Even  though  the  market  position  of  UASC  was  rather  limited,  both  Hapag-
Lloyd and the UASC were members to different alliances and consortia on those markets. As 
consortia  and  alliances  members  decide  jointly  on  a  number  of  parameters  relevant  for 
competition,  such  as  capacity,  schedules,  ports  of  call,  the  merged  entity  would  have 
influence over such competition features over a very large part of those markets. In order to 
ensure that the merged entity would face sufficient competition also on those routes, UASC 
undertook terminating its consortium participation on the two legs of the trade. As a result the 
merged  entity's  position  on  those  markets  will  be  comparable  to  the  current  position  of 
Hapag-Lloyd.  

State aid enforcement in the maritime transport sector 

In  2016,  the  Commission  continued  to  ensure  compliance  with  the  Maritime  State  aid 
Guidelines265.  The  aim  of  those  Guidelines  is  to  maintain  the  European  maritime  sector's 
competitiveness and to avoid flagging out to "flags of convenience" for which environmental 

263 Case M.7908 CMA CGM / NOL, Commission decision of 29 April 2016 available at 
http://ec.europa.eu/competition/mergers/cases/decisions/m7908_1366_3.pdf  
264 Case M.8120 Hapag-Lloyd / United Arab Shipping Company (UASC). For further information see IP/16/2942 
of 23 November 2016 available at http://europa.eu/rapid/press-release_IP-16-3942_en.htm  
265 Communication from the Commission, Community guidelines on State aid to maritime transport, OJ C 13, 
17.01.2004, p. 3. 

73 

 
                                                            
and  security  standards  might  be  low.  The  Commission  is  determined  to  ensure  consistency 
and equal treatment throughout the EU whilst at the same time making sure that the beneficial 
tonnage tax regimes do not contravene internal market rules.  

For example, the Commission adopted decisions concerning the Swedish tonnage tax scheme 
and a prolongation of the German scheme for the reduction of social security contributions for 
seafarers266.  

Antitrust enforcement in the rail sector 

Following  the  inspections  carried  out  in  April,  the  Commission  opened  an  investigation 
against the Czech railway incumbent České dráhy a.s. on 10 November, to assess whether it 
charged prices below costs with the aim of foreclosing competition in rail passenger transport 
services,  in  breach  of  EU  antitrust  rules  (Article  102  TFEU).  Furthermore,  on  28  June  the 
Commission carried out inspections in the rail passenger transport sector in several Member 
States  since  it  has  concerns  that  the  companies  concerned  may  have  entered  into  anti-
competitive agreements aiming to foreclose new entrants from this market, in breach of EU 
antitrust rules (Article 101 TFEU). The Commission's investigations continue in both cases. 

Rail and intermodal State aid enforcement  

In  2016,  the  Commission  approved  a  number  of  schemes  supporting  rail  and  intermodal 
transport,  which  aim  to  support  the  transfer  of  cargo  from  the  road  to  the  safer  and  more 
environmentally friendly rail transport mode267.  

During 2016, the European Parliament and the Council reached an agreement on the so-called 
Fourth Railway Package268. This bundle of legislation should help further open up the railway 
sector to competition. 

State aid review in the road sector 

The  Commission  continued  to  enforce  Regulation  (EC)  No  1370/2007  on  public  passenger 
transport services269. On 10 June, the Commission took a negative decision with recovery on 

266 Cases SA.43642 Tonnage Tax scheme, Commission decision of 18 August 2016 available at 
http://ec.europa.eu/competition/state_aid/cases/261398/261398_1830463_166_2.pdf and SA.45258 
Prolongation and amendment of the scheme on the reduction of nonwage 
labour costs in maritime shipping, Commission decision of 14 November 2016 available at 
http://ec.europa.eu/competition/state_aid/cases/264071/264071_1847335_61_2.pdf  
267 Cases SA.41033 Integrated transport scheme in the Province of Trento, Commission decision of 29 April 
2016 available at http://ec.europa.eu/competition/state_aid/cases/263023/263023_1753823_116_2.pdf; 
SA.45606 Measures for the development of intermodality in the Friuli-Venezia Giulia region, Commission 
decision of 19 July 2016 available at 
http://ec.europa.eu/competition/state_aid/cases/264659/264659_1855847_97_2.pdf , SA.44627 Ferrobonus – 
Incentive for rail transport, Commission decision of 24 November 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_44627 and SA.45482 Rail 
freight transport support scheme, Commission decision of 19 December 2016 available at 
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_45482  
268 Communication from the Commission to the European Parliament, the Council and the European Economic 
and Social Committee and the Committee of the Regions, The Fourth Railway Package – Completing the Single 
European railway area to foster European competitiveness and growth, COM(2013) 25 final available at 
http://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:52013DC0025&from=EN  
269 Regulation (EC) No 1370/2007 of the European Parliament and the Council of 23 October 2007 on public 
passenger transport services by rail and by road and repealing Council Regulations (EEC) Nos. 1191/69 and 
1107/70, OJ L 315, 3.12.2007, p. 1. 

74 

 
                                                            
ex-post  public  service  compensation  granted  by  the  Region  of  Piedmont  (Italy)  to  Arfea270. 
The  Commission  also  adopted  a  decision  in  the  long-standing  Emsländische  Eisenbahn 
case271. 

State aid review in the postal services sector 

The postal sector continues to evolve and traditional letter delivery, against the backdrop of 
electronic  substitution,  remains  on  a  declining  trajectory.  Nevertheless,  postal  services  have 
retained  a  very  significant  economic  and  social  value.  In  a  shrinking  market  of  traditional 
letter  delivery,  many  postal  incumbents  are  being  forced  to  diversify  the  portfolio  of  their 
activities and innovate in order to stay competitive. At the same time, the explosive growth of 
e-commerce necessitates a well-functioning parcel delivery market linking buyers and sellers. 
Efficient postal services are thus a key factor in allowing e-commerce to realise its potential in 
propelling growth and creating jobs.  

Through State aid control in the postal sector, the Commission pursues multiple related goals. 
State aid control ensures that where a postal service provider – typically a postal incumbent – 
is  entrusted  with  a  costly  public  service  obligation,  any  compensation  paid  to  the  provider 
does not undermine a level playing field between postal incumbents and new entrants. State 
aid should not shield the recipients from competitive pressures and market developments, but 
should incentivise efficiency, innovation and investment.  

First, on 11 February the Commission opened the formal investigation procedure in order to 
examine whether State measures since 2004 in favour of Correos, the publicly-owned Spanish 
postal  operator,  were  in  line  with  EU  State  aid  rules272.  Following  complaints  alleging  that 
Correos  had  benefitted  from  several  illegal  and  incompatible  State  aid  measures,  the 
Commission  launched  an  investigation  into  whether  Correos  had  been  overcompensated 
between  2004  and  2010  for  the  provision  of  the  universal  postal  service  given  that 
profitability levels achieved by Correos with the public funding seemed to exceed the level of 
reasonable  profit  allowed  under  EU  State  aid  rules  on  public  service  compensation.  The 
Commission  is  also  investigating  other  measures  granted  by  Spain  to  Correos  since  2004, 
notably  tax  exemptions,  capital  increases  and  compensation  for  the  distribution  of  electoral 
material.  

Second, the Commission found in its decision of 3 June a compensation of EUR 1.3 billion 
granted to the Belgian postal provider Bpost to be compliant with State aid rules273. Belgium 
notified  to  the  Commission  in  spring  2016  its  plan  to  compensate  Bpost  for  the  delivery  of 
certain  postal  services  over  the  period  2016-2020.  In  particular,  Belgium  intended  to 
compensate  Bpost  for  maintaining  a  post  office  network  throughout  Belgium,  delivering 
pension  payments,  providing  universal  cash  at  counter  services,  delivering  printed  material 
related to elections as well as distributing recognised newspapers and periodicals in Belgium. 
The  Commission's  assessment  showed  that  the  compensation  granted  to  Bpost  for  the 

270 Case SA.38132 PSO compensation to ARFEA, Commission decision of 10 June 2016 available at http://eur-
lex.europa.eu/legal-content/EN/TXT/PDF/?uri=OJ:L:2016:321:FULL&from=EN  
271 Case SA.23216 State aid to Emsländische Eisenbahn, Commission decision of 30 September 2016 available 
at http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_C54_2007  
272 Case SA.37977 Complaint regarding unlawful State aid in favour of Sociedad Estatal Correos y Telégrafos, 
S.A. For further information see IP/16/284 of 11 February 2016 available at http://europa.eu/rapid/press-
release_IP-16-284_en.htm  
273 Case SA.42366 Compensations accordées par l’État à Bpost pour la fourniture de services publics au cours 
de la période 2016-2020. For further information see IP/16/2034 of 3 June 2016 available at 
http://europa.eu/rapid/press-release_IP-16-2034_en.htm  

75 

 
                                                            
provision  of  these  services  was  based  on  a  robust  methodology,  which  ensured  that  such 
compensation  will  not  exceed  the  net  cost  of  the  public  service  mission.  The  compensation 
mechanism  also  includes  incentives  for  Bpost  to  increase  the  efficiency  and  quality  of  its 
public  services.  As  regards  the  task  of  delivering  recognised  newspapers  and  periodicals,  it 
has  been  entrusted  to  Bpost  following  an  open,  transparent  and  non-discriminatory 
procurement procedure. This is in line with Belgium's commitment under the Commission's 
May  2013  decision  endorsing  the  public  service  compensation  for  Bpost  between  2013  and 
2015. 

Merger review in postal services 

Postal services play a crucial role in allowing e-commerce to develop, the promotion of which 
is one of the goals of the Digital Single Market strategy. The Commission's investigation of 
the  acquisition  of  TNT  Express  by  FedEx274  focused  on  ensuring  that  prices  for  customers, 
including  SMEs  active  in  e-commerce,  and  ultimately  consumers,  would  not  rise  for  cross-
border  small  package  deliveries,  and  that  the  quality  of  service  would not  be  degraded  as  a 
result of the merger. 

The  in-depth  investigation  opened  by  the  Commission  into  FedEx's  takeover  of  TNT 
Express275 was prompted by concerns that the proposed acquisition would substantially lessen 
competition  in  certain  markets  for  international  deliveries  of  small  packages  up  to  31.5  kg 
within the European Economic Area (EEA) or from the EEA to the rest of the world. 

FedEx  and  TNT  are  two  out  of  four  so-called  "integrators"  currently  operating  in  the  small 
package delivery sector in Europe. Integrators are companies that control a comprehensive air 
and  road  small  package  delivery  network  and  are  capable  of  offering  a  broad  portfolio  of 
reliable delivery services. The Commission was concerned that following the transaction, the 
merged  entity  would  face  insufficient  competitive  constraints  from  the  only  two  remaining 
integrators, DHL and UPS. A lack of sufficient competitive constraints could lead to higher 
prices for business customers and consumers. 

The Commission found, based on a market reconstruction, that the combined market position 
of  the  parties  was  rather  moderate  in  most  markets.  The  parties  were  furthermore  not 
particularly close competitors and no important competitive force would be removed by the 
merger. This was mirrored in the reaction of customers, the vast majority of who adopted a 
neutral  or  even  positive  stance  on  the  merger.  The  Commission  also  carried  out  a  price 
concentration  analysis  that  did  not  establish  likely  price  increases  and  found  that  the 
transaction  would  give  rise  to  efficiencies,  due  to  network  cost  savings  to  the  benefit  of 
customers. The Commission thus cleared the concentration. 

The  Commission  also  thoroughly  investigated  allegations  that  the  transaction  may  cause 
particular  harm  to  small  and  medium  enterprises  (SMEs).  After  a  comprehensive  market 
investigation,  the  Commission  concluded  that  SMEs  will  not  be  more  affected  by  the 
acquisition than other customers. 

274 Case M.7630 FedEx / TNT, Commission decision of 8 January 2016 available at 
http://ec.europa.eu/competition/mergers/cases/decisions/m7630_4582_4.pdf  
275 Case M.7630 FedEx / TNT. For further information see IP/15/5463 of 31 July 2015 available at 
http://europa.eu/rapid/press-release_IP-15-5463_en.htm  

76 

 
 
 
                                                            
Banking State aid cases: Decisions adopted by the Commission in 2016 

Member 
State 

Austria 

Austria 

1. 

2. 

3. 

  Croatia 

By country 

Case number/Title 

Type of Decision 

Date of 
adoption 

SA.45940 (2016/N) - Repurchase offer 
for guaranteed liabilities of Heta Asset 
Resolution AG 

SA.43740 (2015/N) - Prolongation of the 
Austrian short-term export credit 
insurance scheme with regard to disaster 
risks 

SA.46066 (2016/N) - Resolution scheme 
for small credit institutions with total 
assets below EUR 1.5 billion 

no-aid decision 

01/09/2016 

export credit 
scheme 

15/02/2016 

no-objection 
decision 

05/10/2016 

4. 

  Cyprus 

SA.45004 ( 2016/N) State grant scheme 
to borrowers and micro companies 

no-objection 
decision 

28/06/2016 

5. 

6. 

Cyprus 

Cyprus 

SA.45598 (2016/N) - Eighth 
Prolongation of Cypriot guarantee 
scheme for banks - H2 2016 

SA.45051 (2016/N) – Cyprus - Final 
valuation of the Cooperative Central 
Bank Ltd 

no-objection 
decision 

28/06/2016 

no-objections 
decision 

27/04/2016 

7. 

  Estonia 

SA.45282 (2016/N) - Short Term Export 
Credit Insurance Scheme - Estonia 

no-objection 
decision 

20/06/2016 

8. 

France 

SA.37649 (2013/CP); SA.45860 
(2016/PN); SA.45860 (2016/N) – France 
- (i) garantie illimitée octroyée à la Caisse 
Centrale de Réassurance (CCR) pour son 
activité de réassurance des risques de 
catastrophes naturelles en France; (ii) 
transfert d'actifs et passifs liés aux 
activités non garanties de la CCR vers 
une nouvelle filiale, et; (iii) apport en 
capital et souscription d’un prêt 
subordonné par la CCR en faveur de cette 
nouvelle filiale 

77 

no-objection 
decision 

26/09/2016 

 
 
 
 
 
 
 
Member 
State 

Case number/Title 

Type of Decision 

Date of 
adoption 

9. 

Germany 

SA.29338 (2013/C-30), SA.44910 
(2016/N) - HSH Nordbank 

positive final 
decision 

02/05/2016 

10. 

Greece 

SA.46955 (2016/N) – Greece - 
Prolongation of the State Guarantee 
Scheme (Art. 2 law 3723/2008) 

no-objection 
decision 

19/12/2016 

11. 

  Greece 

12. 

  Greece 

13. 

  Greece 

SA.46558(2016/N) - Liquidity support to 
Attica Bank 

no-objection 
decision 

07/10/2016 

HT.4524 – STEC - 2016 Greece 

Communication 

30/06/2016 

SA.45125 (2016/N) - Methodology to 
calculate the aid element in State 
guarantees to companies 

no-objection 
decision 

29/07/2016 

14. 

15. 

16. 

Greece 

SA.45629 (2016/N) - Prolongation of the 
Greek financial support measures (Art. 2 
law 3723/2008) 

no-objection 
decision 

29/06/2016 

Hungary 

SA.38843 (2015/N) – HU - Asset 
purchase program MARK 

no-aid decision 

10/02/2016 

Ireland 

SA.46951 (2016/N) - Ireland - 10th 
prolongation of the Credit Union 
Resolution Scheme H1 2017 

no-objection 
decision 

19/12/2016 

17. 

Ireland 

SA.46437 (2016/N) - Ireland - Fourth 
prolongation of the Credit Union 
restructuring and stabilisation Scheme  

no-objection 
decision 

11/10/2016 

18. 

Ireland 

SA.45522 (2016/N) - Ireland - 9th 
prolongation of the Credit Union 
Resolution Scheme H2 2016  

no-objection 
decision 

20/06/2016 

78 

 
 
 
 
 
 
 
 
 
Member 
State 

Case number/Title 

Type of Decision 

Date of 
adoption 

19. 

Ireland 

SA.45129 (2016/N) - Ireland 
Third prolongation of the Credit Union 
restructuring and stabilisation Scheme  

no-objection 
decision 

04/05/2016 

20. 

Italy 

SA.47082(2016/N) - IT - First 
prolongation of the Italian bank guarantee 
scheme 

no-objection 
decision 

29/12/2016 

21. 

Italy 

SA.47081 (2016/N) - Italy -Liquidity 
support to MPS bank 

no-objection 
decision 

29/12/2016 

22. 

Italy 

SA.39543 (2015/N), SA.41134 (2015/N), 
SA.41925 (2015/N), SA.43547 (2015/N) 
– Italy  
Second amendment to the Resolution of 
Banca delle Marche S.p.A., Banca 
Popolare dell'Etruria e del Lazio Soc. 
Coop., Cassa di Risparmio di Ferrara 
S.p.A. and Cassa di Risparmio della 
Provincia di Chieti S.p.A. 

no-objection 
decision 

07/10/2016 

23. 

Italy 

SA.45753 Italian bank guarantee scheme 

no-objection 
decision 

26/06/2016 

24. 

Italy 

25. 

Italy 

SA.39543 (2015/N), SA.41134 (2015/N), 
SA.41925 (2015/N), SA.43547 (2015/N) 
Amendment to the Resolution of Banca 
delle Marche S.p.A., Banca Popolare 
dell'Etruria e del Lazio Soc. Coop., Cassa 
di Risparmio di Ferrara S.p.A. and Cassa 
di Risparmio della Provincia di Chieti 
S.p.A. 

SA.43296 (2015/N) – Italy - Italian 
methodology to calculate the Gross Grant 
Equivalent for aid in the form of State 
guarantees on loans to "mid-cap" 
companies  

no-objections 
decision, 
amendment 

29/04/2016 

no-objection 
decision 

28/04/2016 

79 

 
 
 
 
 
 
 
 
 
Member 
State 

Case number/Title 

Type of Decision 

Date of 
adoption 

26. 

Italy 

SA.43390 (2016/N) – IT - Italian 
Securitisation Scheme 

27. 

  Malta 

SA.39793 (2016/N) - Malta Development 
Bank 

28. 

Poland 

SA.45857 (2016/N) – Poland - Second 
prolongation of aid-free guarantee 
scheme for export contracts 

no-aid decision 

10/02/2016 

no-objection 
decision 

Corrigendum 

24/08/2016 

18/10/2016 

no-objection 
decision 

19/12/2016 

29. 

  Poland 

30. 

Poland 

SA.46871 (2016/N) – Poland - Fifteenth 
prolongation of the Polish bank guarantee 
scheme – H1 2017 

SA.46575 (2016/N) - Poland - Resolution 
scheme for cooperative banks and small 
commercial banks 

no-objection 
decision 

19/12/2016 

no-objection 
decision 

20/12/2016 

31. 

Poland 

SA.45575 (2016/N) – Poland - 
Fourteenth prolongation of the Polish 
bank guarantee scheme – H2 2016 

no-objection 
decision 

01/07/2016 

32. 

  Poland 

SA.45517 (2016/N)  - Fifth Prolongation 
of the Credit Unions Orderly Liquidation 
Scheme – H2 2016 

no-objection 
decision 

29/06/2016 

33. 

Poland 

SA.43924 (2015/N) – Poland - Thirteenth 
prolongation of the Polish bank guarantee 
scheme – H1 2016 

no-objections 
decision 

01/02/2016 

34. 

  Portugal 

SA.42665 (2016/N) – Portugal -  
Extension of the remit of the Portuguese 
Development Financial Institution 

no-objection 
decision 

28/11/2016 

35. 

Portugal 

SA.43977 (2015/N) * PT* Decision on 
the impaired asset measure in the 
resolution of Banif 

no-objection 
decision 

21/11/2016 

36. 

  Portugal 

SA.45761 (2016/N) - Fourteenth 
Prolongation of the Portuguese Guarantee 
Scheme  

no-objection 
decision 

29/07/2016 

80 

 
 
 
 
 
 
 
 
 
 
Member 
State 

Case number/Title 

Type of Decision 

Date of 
adoption 

37. 

Portugal 

SA.45671 (2016/N) - Sixth prolongation 
of the Portuguese Guarantee Scheme on 
EIB lending 

no-objection 
decision 

28/07/2016 

38. 

  Portugal 

SA.44013 (2015/N) – Portugal - Fifth 
prolongation of the Portuguese Guarantee 
Scheme on EIB lending 

no-objections 
decision 

01/02/2016 

39. 

Portugal 

SA.43996 (2015/N) - Thirteenth 
Prolongation of the Portuguese Guarantee 
Scheme 

no-objections 
decision 

13/01/2016 

40. 

United 
Kingdom 

SA.44887(2016/N) - First Prolongation 
and Amendment of The Big Society 
Capital  

no-objection 
decision 

18/11/2016 

81