Source: EURLEX
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# 52013SC0159

**COMMISSION STAFF WORKING DOCUMENT Accompanying the document […] REPORT FROM THE COMMISSION on Competition Policy 2012 /\* SWD/2013/0159 final \*/**

  

I.       LEGISLATION
AND POLICY DEVELOPMENTS

EU competition policy as a
lever of the Single Market: the EU´s main engine for growth

The
key aim of EU competition policy is to protect competition so that markets work
better for consumers and businesses. In this regard, EU competition policy
supports the Europe 2020 Strategy for smart, sustainable and inclusive growth.
In particular, EU competition policy forms is an essential part of and a
complement to the EU's key asset: its Single Market, which encompasses over
half a billion consumers and some 20 million businesses. Tapping the full
potential of the Single Market is therefore essential for the EU to recover
from the economic and financial crisis and to launch a new period of growth.
During the past year, EU competition policy has made significant contributions
in terms of protecting, strengthening and developing the Single Market.
Crucially, the enforcement of EU competition policy was not relaxed as a result
of the crisis, since that would have been directly harmful to the Single Market
and the process of economic recovery.

              State aid

The
economic and financial crisis entailed greater State involvement in the
economy, placing burdens on Member States' budgets with increasingly uneven
spending capacities. At the same time, such State aid involvement – given its
sheer size - created considerable risks of distortions for the Single Market.

The
latest figures on the scale of crisis and non-crisis State aid

The
European Commission's 2012 State Aid Scoreboard revealed that the volume of
national support to the financial sector actually taken by banks between
October 2008 and 31 December 2011 amounted to around EUR 1.6 trillion (13%
of EU GDP). The bulk (67%) of that support came in the form of State guarantees
on banks' wholesale funding.

Support
to the real economy on the basis of temporary crisis rules dropped to EUR
4.8 billion in 2011, a fall of more than 50% compared to 2010, reflecting
both a lower uptake by companies and the budgetary constraints of most EU
Member States.

Total
non-crisis aid decreased and stood at EUR 64.3 billion in 2011, or 0.5% of
EU GDP, and continued to re-focus on less distortive horizontal objectives,
such as aid for research and innovation, protection of the environment and
providing risk capital to SMEs.

The
contribution of State aid policy has been crucial throughout the crisis in
preserving the integrity of the Single Market. Beyond that, State aid policy
can play an important contribution to overcoming the crisis by supporting the
Europe 2020 Strategy, for example by favouring a better and more effective use
of scarce public resources. In other words, EU State aid policy should facilitate
the treatment of aid which is well-designed, targeted at identified market
failures and objectives of common interest, and least distortive ("good
aid"), while
dissuading aid
which does not provide real incentives for companies, crowds out private
investment, and keeps inefficient and non-viable companies on life support ("bad
aid") and harms the Single Market.

1.
State Aid Modernisation: an overhaul of the
State aid rules to strengthen the Single Market and support growth in a context of scarce public resources

On 8 May 2012
the Commission launched an ambitious State Aid Modernisation programme ("SAM")[1]. SAM aims at
orienting scarce public funds towards growth, turning State aid policy into a
smart and inexpensive tool to help Member States "achieve more with
less".

SAM allows
Member States to increase their own level of commitment accordingly. Three key
components of the overall objective of SAM – promoting growth in a context of
severe budgetary constraints – are outlined below.

Making the Single Market
stronger, more dynamic and more competitive to support growth

SAM proposes
a framework for assessing whether State aid is compatible with the Single
Market which has been tailored to promote efficient and well-designed aid
addressing real market failures, directing scarce public resources to common
priorities ("good aid"). Priority will be given to, for example, aid
for research and development, aid facilitating access to finance for SMEs, aid
providing the right incentives for the development of the digital economy, aid
that protects the environment, as well as aid that attracts investment to weaker
regions.

The review of
those rules to ensure compatibility with the Single Market in the context of
SAM is based on a coordinated approach rooted in common principles, so
as to ensure consistency across the different guidelines and block exemptions.

First of all,
in light of the opportunity costs of State aid in terms of the costs of
taxation and the potential distortions it can bring about, State aid should be
granted only where it adds real value. This is the case when aid is directed
towards activities that the market does not adequately support[2]; when aid has
an incentive effect and when aid is an appropriate instrument to tackle a
market failure or an equity objective compared to other available instruments.
Finally, State aid should also be efficient, i.e. reach the desired market
outcome at the least cost.

At the same
time, SAM envisages that the Commission should step up its analysis of
potential negative effects of aid measures. Such negative effects include
windfall profits, the crowding out of private investment, public spending when
similar projects are undertaken without aid, as well as keeping inefficient and
non-viable companies on the market. Taxpayers, companies and public authorities
would also benefit from more transparency on expenditures and aid
beneficiaries.

The
operational aim of SAM is to translate those essential building blocks into
revised State aid guidelines, thereby further aligning those guidelines with
the Europe 2020 Strategy and the Multiannual Financial Framework 2014-2020. This
past year progress was made, in particular, on the review of the guidelines for
regional aid, research & development & innovation aid, environmental
aid as well as aid to risk capital. State aid under those instruments accounts
for more than two-thirds of all aid granted in the EU.

The
Broadband Guidelines: A concrete example of the philosophy underlying SAM

This
past year the Commission adopted new Broadband Guidelines, a set of rules which
illustrate concretely the philosophy underlying SAM. The new Guidelines were
designed to support pro-competitive investments with public funds in line with
the Europe 2020 Strategy in general and the Europe 2020 Digital Agenda flagship
initiative in particular; for example, through the creation of the additional
category of 'ultra-fast networks' in line with the Digital Agenda targets. The
Guidelines will also lay down revised conditions so as to foster investments in
rural areas and to ease administrative burdens on smaller projects. Under the
Guidelines, aid will always be directed to areas of genuine 'market failure'
(i.e. where operators do not invest on commercial terms), verified by detailed
mapping and public consultation. The aid beneficiary shall always be selected
through a competitive tender procedure, so as to ensure that aid is kept to a
minimum and that no technology or company receives an undue advantage. The
'open access' required from the beneficiary company ensures competition in the
subsidised area to create optimal conditions for better and cheaper broadband
services for consumers. All relevant acts and pertinent information about the
aid awarded under aid schemes shall be easily accessible on the Internet by the
Member States, economic operators, the interested public and the Commission.
Finally, an evaluation may be required for aid schemes with large aid budgets,
containing novel characteristics or when significant market, technology or
regulatory changes are foreseen.

Focusing on cases with the
biggest impact on the Single Market

The SAM
policy objective here is two-fold: to reduce to the minimum the administrative
burdens related to smaller amounts of aid or aid with a limited impact on
competition and trade in the Single Market, and to focus on aid which does
not provide real incentives for companies, crowds out private investment and
keeps inefficient and non-viable companies on life support ('bad aid').
The reduction of administrative burdens should go hand in hand with an
increased responsibility of the Member States and with increased transparency
and effective evaluation at both national and EU level. The exclusive
competence of assessing the compatibility of State aid measures will, as set
out in the Treaty, remain with the Commission.

In pursuit of
that objective, the Commission adopted a draft Enabling Regulation[3]
and will subsequently adopt a revised General Block Exemption Regulation
with the aim of cutting red tape for small and routine cases. The proposal for
a new Enabling Regulation provides for the following new categories of aid to be
exempted: aid for innovation, aid for culture and heritage conservation, aid to
compensate damages caused by natural disasters, aid to forestry as well as
certain types of aid for transport and for broadband infrastructure.

Streamlined and clearer
rules and faster decisions

The SAM
Communication emphasises the need to clarify and simplify the existing complex
legal framework. That challenge will be addressed by providing a better
explanation of State aid concepts and a consolidation of horizontal and substantive
rules. A key part of the SAM package involves clarifying and better explaining
the notion of State aid. The Commission sees a substantial value added
for Member States and aid granting authorities by providing guidance on the
notion of aid, including the key concepts of "advantage" and
"selectivity".

The
Commission also proposes measures to make its procedures more efficient. On 5
December 2012 the Commission adopted a draft of the new Procedural
Regulation[4]
which would allow the Commission to handle complaints in a manner that is more
consistent with its priorities and would ensure that the Commission obtains
complete and correct information from the market (market information tools and
sector inquiries).

Moreover, the
objective to strengthen the Single Market and promote growth can only be
achieved if the Commission has the ability to prioritise its work. This
efficiency objective will be achieved by introducing filters to improve the
quality of the information received from the complainants (e.g. mandatory
complaints form) and by making the evaluation of the admissibility of a
complaint subject to the existence of an interest to act. Furthermore, under
SAM, a complaint will be considered withdrawn where the complainant does not
provide meaningful information or fails to cooperate.

Another
essential feature of the procedural reform is the power to collect the
appropriate information on a case within business-relevant deadlines, which
will be achieved by empowering the Commission to obtain faster and more
reliable information from market participants if the information at its
disposal is not sufficient following the formal investigation procedure. The
possibility of conducting sector inquiries to reinforce horizontal information
will also allow the Commission to focus on the most distortive cases.

Finally, the
role of the national courts shall be reinforced: first, by empowering those
courts to obtain information from the Commission for the purpose of applying
Article 107(1) and 108 TFEU and to ask the Commission for an opinion; and,
second, by empowering the Commission to make oral or written submissions to
national courts in the Union public interest (amicus curiae).

2. Monitoring, recovery and cooperation with national courts
Monitoring existing State
aid to ensure a level playing field in the Single Market

Over the
years, the architecture of State aid control has evolved significantly. Today,
more than 87% of aid granted to industry and services is not individually
examined by the Commission, but is granted on the basis of previously approved
aid schemes or under block exemption. DG Competition monitors the way in which
Member States apply existing aid schemes.

To further
improve the effectiveness of that control which is relevant to the proper
functioning of the Single Market, DG Competition decided, in 2011, to
significantly enlarge the scope of the monitoring exercise. Although the
investigation of a number of cases is still on-going, there seems to be an
overall an increase in the number of problematic cases. More than one third of
the cases monitored in 2011/2012 raise problems of varying types and gravity
(non-notified modification of schemes, individual aids exceeding the maximum
thresholds, compatibility conditions not properly reflected in the national
legal basis etc.). Keeping in mind the limited number of cases monitored thus
far (compared to the great number of existing aid schemes), the compliance rate
seems to vary across Member States and across different types of aid. The
Commission will systematically follow-up all irregularities. At the same time,
Member States must step-up their efforts to better comply with the State aid
rules.

Restoring competition in
the Single Market through recovery of State aid granted in contravention of the
rules

To ensure the
integrity of the Single Market, the Commission possesses the power to require
the granting Member State to recover unlawful aid which has been declared
incompatible. In 2012, further progress was made to ensure that recovery
decisions are enforced effectively and immediately.

Much
faster recovery of illegal aid

The
most recent figures also show that Member States are also recovering illegal
aid much faster, with 75% (around EUR 11.7 billion since December 2004)
recovered at the end of December 2012 thanks to the Commission's action and
probably facilitated by the pressure to consolidate public finances. This means
that the percentage of illegal and incompatible aid still to be recovered was
down to 25% by end-December 2012 having stood at 75% at the end of 2004.

By
31 December 2012, the Commission had adopted twelve decisions ordering the
recovery of incompatible aid, thereby ensuring the recovery of over EUR
2.4 billion granted by the Member States. As of the end of December 2012,
the Commission had 49 pending active recovery cases pending[5] (compared to
94 cases at the end of 2004).

Recovery decisions adopted in 2012 || 12

Amount recovered in 2012 (in EUR billion) || EUR 2.4 billion

Active recovery cases pending on 31 December 2012 || 49

A
concrete example of aid that is incompatible with the State aid rules and which
the Commission decided during the past year that should be recovered is the aid
granted by Belgium to BPost, as a public service compensation. That
compensation exceeded the costs related to the delivery of newspapers and
magazines for the period 2006-2010. On 23 January 2012, the Commission ordered
Belgium to recover the incompatible aid. The Belgian authorities diligently
fulfilled their obligation by the end of May 2012.

As the guardian
of the Treaty, the Commission may use all legal means at its disposal to ensure
that Member States implement their recovery obligations, including the
launching of infringement procedures. In the first half of 2012, the Court of
Justice condemned two Member States pursuant to Article 108(2) TFEU (Italy and
Greece) and one Member State pursuant to Article 260 TFEU (Spain) for failure
to recover illegal State aid.

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

As a follow-up to the 2009 Notice on the
Enforcement of State Aid Law by National Courts, advocacy efforts by the
Commission were intensified. In 2012 the Commission was actively involved in
financing training programmes for national judges following an annual call for
projects and also sent trainers to teach at such workshops and conferences. In
February 2012, a dedicated one-day workshop, covering both antitrust and State
aid issues relevant for national courts, was organised by the Commission in cooperation
with the Association of European Competition Law Judges.

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

In a number
of significant judgments, the EU courts clarified certain aspects of key State
aid concepts, such as the notion of aid, the private market economy investor
principle and the relationship between State aid and infrastructure.

In Case
C-288/11 P, Mitteldeutsche Flughafen AG et al. v Commission (also
referred to as the Leipzig Halle airport case), the Court of Justice, in
its judgment of 19 December 2012, dismissed an appeal brought by Mitteldeutsche
Flughafen AG and Flughafen Leipzig‑Halle GmbH (‘FLH’)
against the Leipzig-Halle judgment the General Court[6]. The main
issue at stake in the appeal was whether the General Court had erred in law by
qualifying the financing of the construction of a new runway for the airport as
an economic activity. The Court of Justice fully confirmed the General Court's
judgment, finding that the General Court had not erred in law in holding that
the Commission had correctly considered the construction of the new southern
runway by FLH to constitute an economic activity and that, consequently, the
capital contributions, apart to the amount to be deducted in respect of
expenses linked to the performance of public duties[7], constituted
State aid for the purpose of Article 107(1) TFEU. The Court of Justice held that
the General Court had correctly established that the construction of the runway
could not be dissociated from the operation of the airport infrastructure,
which constituted an economic activity. It had also correctly found that the
construction of the runway was not linked to the exercise of State authority.

In its
judgment of 5 June 2012 in Case C-124/10P, Commission v EDF, the Court
of Justice dismissed the Commission’s appeal against the EDF judgment of
General Court[8],
thus confirming the annulment by the General Court of a Commission decision of
2003 on State aid granted by France to EDF. The judgment is important for the
interpretation of the market economy investor principle (MEIP). The issue
before the Court was whether, in a situation where a Member State is both a
fiscal creditor of a public undertaking and its sole shareholder, that State
aid can rely on the MEIP where it makes a capital injection in that undertaking
by waiving a tax claim, or whether the MEIP is inapplicable (as the Commission
had considered in its decision) in view of the fiscal nature of the claim. The
Court ruled that the role of the State as shareholder must be distinguished
from its role as public authority and the applicability of the MEIP depends on
whether the Member State conferred the fiscal advantage on the undertaking in
its capacity as shareholder and not in its capacity as a public authority. The
Court then clarified that, for a Member State to demonstrate that it acted in
its capacity as a shareholder, it must provide objective and verifiable
evidence showing clearly that, before or at the same time as conferring the
economic advantage, it took the decision to make the investment concerned.
Finally, the Court clarified that the MEIP test is not an exception which applies
only if a Member State so requests.

On 28
February 2012, the General Court gave judgment in Case T-268/08, Land
Burgenland et al v. Commission, concerning a Commission decision in the
field of State aid in connection with the privatisation of Bank Burgenland by
the Province of Burgenland through a tender procedure. In the final phase of
the tender two bids were submitted, one by the Austrian company GRAWE (EUR
100.3 million) and a much higher bid by a Ukrainian Consortium (EUR
155 million). The tender was awarded to GRAWE. The Commission found that
the sale constituted State aid for GRAWE because, by not accepting the highest
bid, the Province of Burgenland did not behave like a private seller operating
in a market economy. In its judgment, the General Court dismissed the actions
brought by the Province of Burgenland, the Republic of Austria and the
purchaser of the bank. The Court confirmed that in the case of a sale of an
undertaking by a public authority the market price corresponds to the highest price
that a private investor operating in normal competitive conditions would be
prepared to pay. When the public authority makes use of an open, transparent
and unconditional tender procedure, it can therefore be presumed that the
market price corresponds to the highest offer, provided that it is established,
firstly, that that offer is binding and credible and, secondly, that the
taking into account of economic factors other than the price is not justified,
such as the off balance-sheet risks existing between the offers. Therefore, the
Commission did not commit a manifest error of assessment in concluding that the
aid element can be assessed from the market price, which itself depends on the
offers actually made within the context of the call for tenders.

In Case
T-154/10 France v Commission, the General Court, in its judgment of the
General Court of 20 September 2012, upheld a Commission decision from 2010
finding that La Poste's status as an EPIC (Établissement Public à
caractère Industriel et Commercial) resulted in an advantage to the undertaking
in the form of an implicit unlimited guarantee. The Court confirmed the
Commission's finding that French law, in general, did not preclude the
possibility for the State to grant an implied guarantee to EPICs. The existence
of an unlimited State guarantee in favour of EPICs could, in the Court´s view,
be derived from the fact that insolvency and bankruptcy procedures under
ordinary law do not apply to EPICs. The law applicable to EPIC placed creditors
in a more favourable situation as their claims are not cancelled but at the
most postponed. Also, the Court found that the Commission was correct in
concluding that State liability could be incurred for the debts of an EPIC where a creditor
of an EPIC was not able to recover its claim from the undertaking which amounts
to an automatic guarantee mechanism. Finally, the principle of continuity of
public service requires that the rights and obligations attached to the public
service are transferred to the State in the event of a wound-up EPIC which
triggers State liability. With regard to the question of whether that unlimited
guarantee resulted in an advantage for La Poste, the Court confirmed the
Commission's finding that the grant of a guarantee on non-market terms is, as a
rule, liable to confer an advantage on the recipient. The Commission was
allowed to refer to the findings of rating agencies to establish that La Poste
enjoyed more favourable terms of credit and, therefore, a financial advantage.

              Antitrust & Cartels

1.
Moving towards a formal proposal on private
enforcement of the EU antitrust rules

In 2012, the Commission continued preparatory
work on a legislative proposal on antitrust damages actions[9]. As stated in the Commission Work Programme 2012
(Annex I, item 7), the objective of this legislative initiative would be to
ensure effective damages actions before national courts for breaches of EU
antitrust rules and to clarify the relationship between such private actions
and public enforcement by the Commission and the national competition
authorities, notably as regards the protection of leniency programmes, in order
to preserve the central role of public enforcement in the EU[10]. In February
2012, the European Parliament welcomed the initiative and underlined the need
for action at European level[11].
Insofar as collective redress is concerned, the European Parliament requested
that any Union initiative should be of a horizontal nature, not limited to
specific sectors of Union law. However, the Parliament acknowledged the
specificity of competition law enforcement and therefore considered that
specific rules could be laid down in separate articles or chapters of the horizontal
instrument itself or in separate legal instruments in parallel or subsequent to
the adoption of the horizontal instrument[12].

On 6 December, Vice President Almunia declared
his intention to submit to the College a legislative proposal on certain rules
governing actions for damages under national law for infringements of Articles
101 and 102 TFEU. He stated that such a proposal, once adopted, would give more
legal certainty on a number of issues that lie at the crossroads between the
public and private enforcement of EU competition law, in particular regarding
access to evidence relating to leniency requests. Also, the Vice President took
due note of the European Parliament's call for a European initiative on
collective redress to ensure appropriate access to justice for all. He declared
his willingness to continue to work towards a coherent European policy on
collective redress, while drawing attention of the Parliament to the
specificities of competition law.

2. Further refining the leniency regime: a core enforcement tool in the
fight against secret cartels

Leniency
programmes constitute a key driver for the detection of cartels. The European
Competition Network (ECN) recently strengthened the Model Leniency Programme
(“MLP” around which the ECN competition authorities align their own leniency
procedures. Under the refined MLP, agreed in November by the Heads of the
competition authorities within the ECN, all leniency applicants applying to the
European Commission in cases concerning more than three Member States will now
be able to submit a summary application to national competition authorities
while in the past only the immunity applicant could do so. Also, the ECN
agreed on a standard template for summary applications, which companies will be
able to use in all Member States. A number of clarifications are introduced in
the MLP, notably in relation to the conditions which applicants must meet in
order to qualify for leniency, including on the duty to cooperate. The revised
text also clarified that written leniency statements should benefit from the
same level of protection against disclosure by the competition authorities as
oral statements. Furthermore, the ECN underlined the importance of the leniency
programmes in a Resolution endorsed on 23 May, in which the competition
authorities took the joint position that leniency materials should be
protected against disclosure to the extent necessary to ensure the
effectiveness of the leniency programmes[13].
The legislative proposal on antitrust damages actions mentioned above will seek
to ensure the effectiveness of the leniency system.

Settlements:
an additional tool for the cost-effective resolution of antitrust proceedings

Settlement
continues to be a key tool, entailing significant procedural benefits. The fact
that the number of settlement decisions decreased in 2012 as compared to 2011
should not be interpreted as a trend, in view of the number of cases where the
settlement route is pursued or considered. The Commission's policy is to use
this efficiency-enhancing instrument in the future if a case is suitable for
settlement in order to free more quickly additional resources to fight other
cases including via ex officio proceedings. In 2012, the Commission adopted one
such decision, fining producers of water management products EUR 13 million
in sixth cartel settlements (Cases COMP/39611 Water Management Products, press
release of 27 June 2012).

3. Significant judgments by the EU Courts in the area of antitrust

In MasterCard[14]
the General Court dismissed an action brought by MasterCard against a
Commission decision of 2007 prohibiting MasterCard's cross-border inter-bank
fees. The judgment is important because it confirms the Commission's finding
that these fees restrict competition as they inflate the cost of card
acceptance by merchants without leading to benefits for consumers. The judgment
also confirms that banks, in the framework of a card payment scheme, cannot
restrict competition by agreeing on certain charges to the detriment of
consumers.

MasterCard's
business model includes a mechanism through which banks indirectly determine a
minimum price that merchants must pay for accepting the organisation's payment
cards. This mechanism comprises a complex network of multilaterally agreed
inter-bank fees which industry refers to as "multilateral interchange
fees" or MIFs.

In December
2007, the Commission prohibited MasterCard's collectively agreed multilateral
interchange fees because they inflate the base on which acquiring banks charge
prices to merchants, as the interchange fees account for a large part of the
final price merchants pay for accepting MasterCard's payment cards. This
restriction of price competition in the form of a decision of an association of
undertakings was found to harm businesses and their customers, in breach of
Article 101 of the Treaty on the functioning of the EU (TFEU) that prohibits
anticompetitive business practices. There was also no evidence that such fees
generated benefits that were passed on to consumers.

In its
judgment, the General Court rejected MasterCard's claims and upheld the
Commission's finding of an infringement. In particular, the Court endorsed the
Commission's view that multilateral interchange fees constitute a restriction
of competition as they were found to produce anticompetitive effects and
rejected MasterCard's argument that such fees were objectively necessary for
the functioning of its system. Also, the Court endorsed the Commission's
finding that MasterCard constituted an association of undertakings in the sense
of Article 101(1) TFEU, even after the company's listing at the New York Stock
Exchange in 2006. The Court also took the view that the Commission did not
commit procedural errors and that the prohibition it imposed was proportionate.

MasterCard
has appealed the General Court’s judgment to the Court of Justice (Case
C-382/12 P pending).

In AstraZeneca[15]
the Court of Justice dismissed an appeal brought by AstraZeneca against the
judgment by the General Court of 2010 which had upheld – to a very large extent
– a Commission's decision from June 2005. The Commission had fined AstraZeneca EUR
60 million for abusing its dominant position relating to its best-selling
anti-ulcer medicine Losec.

The judgment
concerned two types of misuses of regulatory procedures and systems. It did not
concern abuses or misuses of patents or other intellectual property rights. The
first abuse upheld by the Court involved the provision by AstraZeneca of
misleading information to national patent offices with the aim of preventing or
delaying market entry of competing generic products. On the first abuse the
Court found that the assessment whether representations made to public
authorities for the purposes of improperly obtaining exclusive rights are
misleading must be made in concreto and may vary according to the
specific circumstances of each case.

The second
abuse involved the deregistration by AstraZeneca of its market authorisation
for its bestselling ulcer medicine Losec in selected countries with the aim of
raising barriers against generic entry and parallel trade. The Court stated
that an undertaking which holds a dominant position has a special
responsibility under Article 102 and that it cannot therefore use regulatory
procedures in such a way as to prevent or make more difficult entry of
competitors on the market, in the absence of grounds relating to the defence of
legitimate interests of an undertaking engaged in competition on the merits or
in the absence of objective justification.

The Court
found that the illegality of abusive conduct under Article 102 is unrelated to
the compliance or non-compliance by an undertaking of other legal rules and
that, in the majority of cases abuses of dominant positions consist of
behaviour which is otherwise lawful under branches of law other than
competition law.

The Court´s
judgment also clarifies many issues in relation to the product market
definition. The judgment also confirms that IPRs constitute a factor relevant
to the determination of dominance. The Court's judgment finds that a dominant
position is not prohibited, only its abuse and a finding that an undertaking
has such a position is not in itself a criticism of the undertaking concerned.

Cartel
judgments: the Courts confirm the Commission´s approach to parental liability

In
a number of judgments (e.g. Case T-344/06 Total v Commission, paras 97-109;
Case T-347/06 Nynäs Petroleum and Nynas Belgium v Commission, paras 30-41,
judgments of 27 September 2012.), the Courts confirmed the Commission’s
approach to parental liability. For example, the Courts delivered some orders
(Case 404/11P Elf Aquitaine v Commission, para 23, order of 2 February 2012;
Case C-421/11P Total and Elf Aquitaine v Commission, paras 40-59, order of 7
February 2012; C-493/11P United Technologies v Commission, paras 37-45, order
of 15 June 2012.) in which it again made clear that it fully upholds the rebuttable
presumption that anti-competitive conduct by a wholly owned or virtually wholly
owned subsidiary can be attributed to the parent company unless the parent
proves that its subsidiary decides its commercial strategy on the market in
full autonomy. The General Court also accepted the application of the
rebuttable presumption in case of the ownership by two parents which form part
of one group and together hold 100% of the subsidiary’s shares and upheld in
two other judgments the imputation of parental liability in a 50/50 joint
venture, applying the concept of “single economic entity” to joint venture
constellations (Case T-76/08 EI du Pont de Nemours and Others v Commission,
paras 59 and 76, judgment of 2 February 2012; Case T-77 Dow Chemicals v Commission,
paras 74, 106-112 and 151, judgment of 2 February 2012). The General Court also
accepted that the investment company can be liable for the conduct of its
portfolio company (Case T-392/09
1.garantovana v Commission, judgment of 12 December 2012).

In
the Dutch Bitumen cartel case, the General Court handed down 16
judgments in which it, for the most part, upheld a 2006 Commission decision
that a number of petrochemical companies supplying road pavement bitumen and
their road building clients had participated in a cartel with regard to the
supply of road pavement bitumen in the Netherlands[16]. The General
Court also provided guidance on the scope of the obligation of undertakings to
cooperate during inspections[17].

In Nexans and
Prysmian, it provided guidance on the Commission’s investigatory powers,
such as the legal requirements of an inspection decision[18]. It also
considered that measures implementing the inspection decision such as taking
copies and images of electronic documents and asking questions during an inspection
could not be challenged separately but only in the context of an action for
annulment of the final decision adopted by the Commission under Article 101(1)
TFEU[19].

In Bolloré,
the General Court found that in a re-adoption scenario following the annulment
of a decision due to a procedural error, the re-imposition of a fine in a new
procedure which remedies the error is neither proscribed nor infringes the
party’s rights of defence[20].

In Calcium
Carbide, the General Court confirmed the Commission's analysis of the
parties’ requests for fines reductions because of their alleged inability to
pay (ITP) and concluded that the Commission made no
error when rejecting all ITP claims based on point 35 of the Fining Guidelines[21].

4. The fight against cartels

The Commission
continued its vigorous enforcement of the competition rules against cartels,
arguably the form of anticompetitive conduct which harms consumers, the Single
Market and the economy to the greatest extent. In 2012, the Commission adopted
five cartel decisions imposing fines totalling EUR
1 875 694 000 and concerning products of importance for
consumers. The scope of some of the cases was particularly large, with several
different infringements dealt with in one decision. The Commission also
launched new investigations in a number of sectors, including financial
services (derivatives), car parts, the food sector and maritime transport
services. Several inspections were carried out to that effect. The Commission
furthermore issued three Statements of Objections in cartel cases[22].

The
TV and computer monitor tubes case: fines of EUR 1.47 billon imposed for a
decade-long international cartel

On
5 December, the European Commission fined seven international groups of
companies a total of EUR 1 470 515 000 for participating in
either one or both of two distinct cartels in the sector of cathode ray tubes
("CRT"). For almost ten years, between 1996 and 2006, these companies
fixed prices, shared markets, allocated customers between themselves and restricted
their output. One cartel concerned colour picture tubes used for televisions
and the other one colour display tubes used in computer monitors. The cartels
operated worldwide. The infringements found by the Commission covered the
entire European Economic Area (EEA). Chunghwa, LG Electronics, Philips
and Samsung SDI participated in both cartels, while Panasonic,
Toshiba, MTPD (currently a Panasonic subsidiary) and Technicolor
(formerly Thomson) participated only in the cartel for television tubes.
Chunghwa received full immunity from fines under the Commission's 2006 Leniency
Notice for the two cartels, as it was the first to reveal their existence to
the Commission. Other companies received reductions of their fines for their
cooperation in the investigation under the Commission's leniency programme.

Cathode
ray tubes constitute a very important component in the making of television and
computer screens, accounting for 50 to 70% of the price. The two cartels are
among the most organised cartels that the Commission has investigated. For
almost ten years, the cartelists carried out the most harmful anti-competitive
practices including price fixing, market sharing, customer allocation, capacity
and output coordination and exchanges of commercial sensitive information. The
cartelists also monitored the implementation, including auditing compliance
with the capacity restrictions by plant visits in the case of the computer
monitor tubes cartel.

There are 7
undertakings in TV & Computer Monitor tubes: MTPD and Panasonic (together
with Toshiba for the JV period) formed only one undertaking

Case name || Adoption date || Fine imposed || Undertakings concerned || Procedure

Cathode ray tubes || 05/12/2012 || 1 470 515 000 || 7 || Normal

Gas insulated switchgear || 27/06/2012 || 136 260 000 || 2 || Re-adoption (normal)

Water management products || 27/06/2012 || 13 661 000 || 3 || Settlement

Freight forwarding || 28/03/2012 || 169 382 000 || 15 || Normal

Mountings for windows and window doors || 28/03/2012 || 85 876 000 || 9 || Normal

The
Water Management Products decision was adopted following the
settlement procedure. That brought to six the total number of settlement cases
adopted since the procedure was introduced in 2008.

Antitrust
and cartel output

5. Effective cooperation within the European Competition Network and
with national courts
Convergence of antitrust
enforcement procedures contributes to a more level playing field in the Single
Market

Regulation
1/2003 was a key step in providing a more level playing field for businesses
operating cross-border in the Single Market, as all EU competition enforcers
including the national competition authorities (NCAs) and national courts are
able to apply the EU antitrust rules to cases that affect
trade between Member States. This has meant that to a large extent the EU
antitrust rules have become embedded across the Single Market. The European
Commission and the NCAs cooperate closely within the European Competition
Network (ECN) to ensure that the EU antitrust rules are applied coherently.

While the
NCAs now regularly apply the same substantive competition rules, they do so
according to divergent procedures and they may impose a variety of sanctions.
Even if competition national procedures are increasingly converging in the way
they enforce EU antitrust law, as the 2009 Report on the functioning of
Regulation 1/2003[23]
had already found, differences on important aspects still remain which
necessitates further examination and reflection.

In the field
of leniency, already in 2006 the ECN agreed on the ECN Model Leniency Programme
(MLP) which has acted as a major catalyst in encouraging Member States and/or
NCAs to introduce and develop their own leniency policies and in promoting
convergence between them. In November 2012, the ECN further refined the MLP, as
explained above.

In November
2012, Reports by the ECN on investigative and decision-making powers were
published, which for the first time provide an overview of the enforcement
procedures within the ECN. These Reports demonstrate that national legislators
have made clear efforts to make their procedures for the enforcement of
Articles 101 and 102 TFEU more convergent. Basic elements of decision-making
powers and procedures, such as the power to take prohibition or commitment
decisions or to grant interim measures are present in all or in a vast number
of jurisdictions. Moreover, procedural steps that are crucial in terms of
safeguarding the rights of defence of parties (such as the right to be heard
through a statement of objections or equivalent; access to file) are present in
all jurisdictions in one form or another.

However, this
has not led to uniformity. Divergence subsists on a few fundamental questions
such as whether competition authorities have the power to set priorities or
the legal framework for conducting interviews, as well as numerous aspects at a
more detailed level, including the criteria for adopting interim measures and
sanctions for non-compliance with investigatory measures. The Reports are
intended to provide a basis for informed debate about the need for further
procedural convergence within the ECN. The ECN will continue looking into this
matter, in order to further enhance the level playing field for companies
operating in the Single Market.

Continuing
the close cooperation with national courts

As
regards cooperation with national courts, the Commission continued to support
the coherent and consistent application of EU competition rules at national
level. The Commission now publishes its opinions and amicus curiae
observations on its website[24]
as soon as it receives the approval for publication by the national court to
which the opinion or observation was submitted. In 2012, the Commission
submitted three amicus curiae observations under Article 15(3) of
Regulation 1/2003 on different matters to courts in Belgium[25], France[26] and Slovakia[27]. The Belgian
Constitutional Court followed in its judgment of 20 December 2012 the
observations submitted by the Commission, while the two other cases are still
pending. In two of the three amicus curiae observations submitted by the
Commission in 2011, the receiving courts followed the Commission's observations
in judgments handed down in 2012. The first case concerned possible inter
partes disclosure of various documents, some of which contained information
specifically prepared for the purpose of an application under the Commission's
leniency programme[28].
The second case concerned the interpretation of the notion of "appreciable
effect on trade between Member States"[29].
In the third case the receiving court submitted a reference for a preliminary
ruling to the ECJ[30].

Cooperation
with national courts was furthermore supported by the continued funding of a
competition-specific training of judges program by the Commission[31].

6. Developing the international dimension of EU competition policy

The
globalisation of the economy calls for closer cooperation among competition
authorities not only in Europe, but also across the globe. Such cooperation is
essential to ensure interoperability between and consistency in the outcome of
enforcement activities carried out by different authorities, to enhance the
effectiveness of their investigations and to secure a level playing field for
EU businesses in world markets. As in the past, and as encouraged by the
European Parliament, the Commission has engaged in policy dialogues with the
authorities in a number of other jurisdictions, at both multilateral and
bilateral level, so as to promote convergence on both substantive and
procedural competition rules. The Commission has also continued to cooperate
closely with many competition agencies in concrete enforcement activities.

At bilateral
level, in 2012 the Commission strove to further strengthen cooperation with
non-EU competition authorities, focusing its efforts mainly on the EU's main
trading partners (both traditional trading partners and major emerging
economies). In this respect, high-level dialogues were held in 2012 with
representatives of all the competition agencies with which the EU has concluded
a cooperation agreement or a Memorandum of Understanding[32]. Likewise, the
Commission engaged in fruitful discussions with the US federal competition
authorities with a view to improving cooperation in the area of unilateral
conduct, mergers and airline alliances. In the margin of the EU-China Summit on
20 September, DG Competition signed a Memorandum of Understanding for
Cooperation in the area of anti-monopoly law with the National Development and
Reform Council (NDRC) and the State Administration of Industry and Commerce
(SAIC), the two Chinese authorities responsible for the enforcement of the
antitrust provisions of the Anti-Monopoly Law. On 1 June, the Commission
recommended to the Council to sign and conclude a "Second Generation"
cooperation agreement between the EU and Switzerland.

Negotiations
on a similar agreement between the EU and Canada have been progressing well.
The European Commission continued negotiating Free Trade Agreements with a
large number of third countries which all include competition chapters. The
negotiation of the Free Trade Agreement with Singapore was concluded in 2012
and it contains a substantial chapter not only on antitrust, mergers and SOEs
but also on subsidies to services and goods. In addition, the Commission
continued to engage in technical cooperation activities with other non-EU competition
authorities, in particular with the Chinese and Indian competition authorities.

With respect
to the accession negotiations with candidate countries, significant progress
was made in 2012 with the opening and the provisional closure of the
competition chapter with Iceland. In 2012 the Commission continued to monitor
closely the implementation of the provisions of the steel and shipbuilding
protocol included in the Accession Treaty for Croatia.

The
Commission has also continued its active engagement with international
competition related fora such as the Competition Committee of the OECD, the
International Competition Network and Unctad. In 2012, it took up
responsibility as a co-chair of the Mergers Working Group of ICN and moved to a
co-chair position of one of the Sub-Groups of the Cartel Working Group. In that
same year, the Commission was also given responsibility as project leader
(together with US FTC) for the Steering Group projects on investigative
processes in competition enforcement activities.

              Merger control

1.
Deepening cooperation with competition
authorities in the Member States and third countries

The EU merger
control regime is essential in protecting consumer welfare by preventing market
structures that could lead to unjustified price increases or reduction of
choice, quality or innovation. It thus continues to be a key instrument for
keeping the Single Market open and competitive, particularly in times of
economic and financial crisis.

Merger
control by the Commission applies to transactions exceeding the significant
turnover thresholds set up in the Merger Regulation and which have an impact on
the market beyond the national borders of a particular Member State. Such
mergers are reviewed exclusively at EU level in application of a ‘one-stop
shop’ system. Concentrations not covered by the Merger Regulation fall, in
principle, within the remit of the Member States. However, the Merger
Regulation leaves scope for re-allocating cases from the national competition
authorities (NCA) to the Commission and vice versa in order to ensure that the
best placed authority deals with a case. In 2012, based on referral requests by
two national competition authorities, the Commission became competent for
reviewing a case[33].
Cooperation between the Commission and the NCAs can also become an important
element outside the referral system[34].

Cooperation
also proved important with non-EU countries. A number of cases[35] involved
intense cooperation with various competition authorities around the world. In
these cases cooperation was particularly close with the authorities in the
United States.

Further, a
reflection on a review of the Merger Regulation itself has been launched, in
particular in relation to covering the acquisition of non-controlling minority
shareholdings.

2. A significant increase in number decisions with commitments from
2011

The number of
merger notifications in 2012 remained relatively stable. Overall, 283 cases
were notified to the Commission in 2012, which represents about the average of
the last four years. The Commission opened ten in-depth (i.e. second phase)
investigations covering several sectors such as IT, mobile telephony, air
transport, basic industries and music.

The number of
decisions by the Commission increased significantly in 2012 compared to 2011,
but remains stable compared to the average of the last four years. Whereas the
number of prohibition decisions remains unchanged compared to 2011, with one
case concluded by prohibition decision in 2012[36],
six decisions[37]
in second phase were concluded with commitments in 2012 compared to one in
2011. In first phase, the number of clearance decisions which were adopted with
commitments almost doubled with nine compared to five in 2011.

As reflected
in the increased number of second phase investigations and commitments in
second phase decisions the assessment of the notified transactions also became
more complex in 2012, a trend already observable in 2011. The review of, in
particular, the second phase investigations generally requires sophisticated
quantitative and qualitative analyses involving large amounts of data.

Merger decisions

3. Simplifying merger procedures further

In order to
increase efficiency when dealing with unproblematic cases and to make the
notification system more business friendly, a simplification exercise was
launched in 2012, in particular with respect to transactions that clearly pose
no problems to competition. While the current procedures, which also entail
referring cases from EU countries to the Commission, work well, there is scope
for making them smoother and shorter.

4. Significant judgments by the EU Courts in merger control

In Electrabel[38],
the General Court fully dismissed Electrabel's appeal of a Commission decision
of June 2009 fining it EUR 20 million for acquiring control over Compagnie
Nationale du Rhône without prior approval under the EU Merger Regulation. This
was the first time that an EU court rules on a Commission decision to impose a
fine for implementing a concentration of EU dimension without prior
notification to and approval by the Commission. The GC confirmed that such
early implementation constitutes a serious breach of EU merger control law. The
Court also makes clear that the Commission is entitled to adopt effective and deterrent
sanctions in case of such infringements.

In Editions
Odile Jacob and Agrofert[39],
the Court of Justice ruled on appeals by the Commission against two judgments
of the General Court that had annulled a Commission decision refusing access to
documents related to two merger cases. The ECJ confirmed that it is necessary
to ensure a coherent application of the Transparanecy Regulation 1049/2001 with
other rules of EU Law, in particular regulations designed to ensure respect for
professional secrecy. The ECJ held in particular that the Commission can rely
on the general presumption that disclosure of the correspondence between the
Commission and the parties to merger procedures would undermine the protection
of the commercial interests of the parties and the purpose of the Commission's
merger investigations, in order to refuse access to such correspondence even after
the closure of proceedings.

              II.      SECTORAL
OVERVIEW

This
section provides an overview of policy developments and enforcement actions in
a number of selected sectors on which the Commission particularly
focused in 2012: energy and environment, ICT and media, financial services,
manufacturing, the agri-food industry, pharmaceutical and health services, and
transport.

              1. Energy &
Environment

Overview of key challenges in the sector

This
past year was a year in which governments and industry worldwide started a
complex adjustment process in the wake of momentous events affecting the energy
and environment sector in 2011, such as the Fukushima nuclear disaster in
Japan. Coupled with the long-term trend of rising fuel prices and the high cost
of renewable energy, those events added to the
challenges faced by Member States to meet the Europe 2020 Strategy and the EU
energy policy objectives. The strengthening and building of partnerships with
the EU's key partners is also of strategic interest for secure, safe,
sustainable and competitive energy. International cooperation with
industrialised and fast growing economies is necessary to maintain Europe's position
in energy research and innovation.

The
three pilars of the EU energy policy: competitiveness, sustainability and
security of supply

The EU Energy policy is built around three
pillars: sustainability, security of supply and competitiveness. Reducing
greenhouse gas emissions is vital to combating climate change. European
consumers depend heavily on the secure and reliable provision of energy at
competitive prices. Interconnection between European gas and electricity grids
need to be substantially improved. The Commission's  Communication "Energy
2020 - A strategy for competitive, sustainable and secure energy"
Communication calls for action in areas where new challenges are emerging.
These areas are energy efficiency, infrastructure, choice and security for
consumers, energy technology and the external dimension of the internal energy
market. Competition enforcement and advocacy, along with sector-specific
legislative proposals, constitute the main tools the Commission has at is
disposal to achieve these goals and create a single European energy market by
the 2020 target date. Given the strategic importance of the energy sector, the
European Parliament, in its Resolution on the 2011 report on competition policy
(the Sánchez Presedo report) continued to request that the Commission actively
monitors the degree of competition on the market.

EU
Competition policy in the energy field aims to ensure a secure flow of energy,
in particular electricity and gas, at competitive prices to EU households and
businesses. An open and competitive single EU energy market will also guarantee
secure provision of energy in the future by sending the necessary signals for
investment and making the European market attractive to external suppliers.
Such a market should also be open to new energy mixes and play a major role in
developing and deploying new environmentally friendly technologies. Prices that
reflect costs will help encourage energy efficiency, whilst supporting
sustainability and security of supply. However, we are not there yet. The
energy services (both gas and electricity) performed below the average in the
most recent Consumer Markets Scoreboard, with electricity supply being the 5th
worst assessed services market (out of 30)[40].
Both
markets have particularly poor scores on choice, comparability and switching
suppliers and tariffs, suggesting that consumers do not actively participate in
the market and are not making full use of the saving opportunities created by
market liberalisation. The Commission´s action in the area of
competition policy is therefore consistent with and supports the Commission´s
legislative action to integrate the Single Market in electricity and gas (see
the Commission´s Communication "Making the internal energy market
work").

Contribution of EU competition policy in
tackling the challenges
Enhancing competitiveness
across the energy sector

Competition
enforcement and advocacy in the field of energy and the environment contribute
to the competitiveness of EU industry and the integration of the internal
market by opening markets, creating a level playing field between competitors,
preventing incumbents from reinforcing their dominant positions, inducing
economic restructuring and creating a framework for investment that avoids
distortions and ensures the efficient allocation of resources in the Single
Market.

Examples
of enforcement actions by the Commission in 2012 underpinning those strategic
objectives include an investigation into the conduct of power exchanges[41], the opening
of formal proceedings to investigate whether Bulgarian Energy Holding may be
abusing its dominant market position in the wholesale electricity market in
Bulgaria[42],
the opening of formal proceedings against the Romanian power exchange Opcom
with respect to a suspected abuse of dominance in discriminating against
non-Romanian traders[43]
and the decision to make binding commitments that reduce the product scope and
duration of a non-compete obligation in the sector for nuclear technology
(Siemes and Areva[44]).
The Commission also fined three European producers of water management
products[45]
for price coordination in an infringement which lasted from June 2006 to May
2008. Water management products are used in heating, cooling and sanitation
systems and comprise pressurisation systems and products for quality assurance.
The Commission used the settlement procedure to deal effectively with this case
which was concluded on 27 June 2012 with the adoption of a prohibition decision
on 27 June 2012 against three undertakings, which were fined a total of EUR
13.6 million.

Moreover,
the Commission actively monitored the implementation of remedies in several
previous antitrust cases, all aimed at opening up national
markets and preventing incumbents from abusing their dominant position in
several Member States. The monitoring included the implementation of measures
that would remedy competition concerns in the form of foreclosure (ENI[46], E.On gas[47] and GDF[48]), customer
tying through long-term contracts for large electricity customers (EDF in
France[49])
as well as restrictions on export capacity (SVK[50] in Sweden).

The
EU merger rules seek to ensure that mergers harmful to the competitive
process are altered so that these effects do not occur or are avoided all
together whilst allowing beneficial restructuring. During 2012, the Commission
was able to approve a number of mergers, including mergers connected to
restructuring of gas and electricity networks[51]
induced by liberalisation, as well as mergers linked to reneweable energy
sources[52].
While the Commission did not have to intervene in new mergers that would have
anti-competitive effects in 2012, it devoted considerable efforts to defending
the EU's interests before the General Court[53]
and in ensuring that commitments to avoid harmful effects made in earlier
merger cases by companies, such as EDF and GDF Suez[54], were
effectively complied with and enforced. Strict post-decision enforcement is
critical as, otherwise, the anti-competitive effects that the earlier decisions
sought to avoid could nevertheless materialise.

Using
its powers in the State aid field to preserve the integrity of the Single
Market by controlling whether Member States use their public resources in a
non-distortive manner, the Commission undertook enforcement action and adopted new rules in
the field of energy and the environment. For example, the Commission opened a
formal investigation on potential State aid in Romania in the form of
privileged tariffs granted by the main electricity supplier to a range of
companies[55]
and gave conditional approval to the aid component in regulated electricity
tariffs in France[56].
The Commission also adopted rules on national support for industry electricity
costs in the context of the EU Emission Trading Scheme[57].

Contributing to
sustainability

Sustainable development is the long term use of
resources to meet human needs for energy, while preserving the environment.
Sustainability was at the heart of the measures reviewed under the State aid rules under which the Commission
authorised aid that supports renewable energy sources and environmentally
friendly businesses. This is justified on the reasoning that State aid can
correct market failures caused by so-called negative externalities, i.e.
situations where environmental costs for society are not yet reflected in the
production costs borne by companies.

State support for renewable energy remains one
of the key drivers for its deployment, based on the horizontal rules set out in
the Environmental Aid Guidelines[58].
One set of cases concerned energy from renewable sources (e.g. in Ireland[59], the
Netherlands[60],
Austria[61],
the UK[62]
and France[63]).
Other cases relate to the upgrading of existing energy infrastructure to higher
environmental standards (e.g. in Greece[64]
and Poland[65])
and the use of environmentally friendly transport vehicles (UK[66]) and waste
treatment (UK[67]).
Work on the revision of the Environmental Aid Guidelines started in 2012,
aiming both at taking stock of the experience of subsidising a range of
technologies and at taking account of market developments.

The Commission
also approved State aid for the modernisation of electricity generation
installations in Cyprus, Estonia, Hungary, the Czech Republic and
Romania based on the regime established by Article 10c of the EU Emission
Trading Directive[68].
Those Member States will be allowed to grant emission trading allowances free
of charge with a view to promoting competition and increasing security of
supply. Several other Member States are expected to come forward with similar
plans.

Contributing to security of
supply

The EU energy
sector is characterised by a high dependency on imports, as the EU produces
only 48% of its energy needs[69].
Energy dependency differs greatly among Member States. Denmark appears to be
the only net energy exporter within the EU27, while the Baltic countries
rely on a single source for their gas imports. The EU energy sector is
also characterized by a significant need for investments, e.g. in electricity
generation infrastructure, given the trend for gas and renewables to contribute
more to electricity generation in the EU.

The
Commission's antitrust enforcement
action in the energy sector can contribute to resolving security of supply
issues by facilitating access to the market and encouraging investment. In
2012, the Commission continued its investigation of a possible abuse
of dominance on the Czech electricity market through the hindrance of the entry
of competitors and assessed commitments from ČEZ in the form of the
divestment of lignite fired power plants. The Commission also opened
proceedings against Gazprom[70]
in Russia to investigate whether it abused its dominant market position in
upstream gas supply markets in central and eastern European Member States by
partitioning market, preventing diversification of supply of gas and/or
imposing unfair prices on its customers by linking the price of gas to oil
prices.

              2. Information and
Communication Technologies (ICT) and Media

Overview of key challenges in the sector

As recognised
in the Digital Agenda for
Europe (the "Digital Agenda")[71]
and the Communication on e-commerce and other online services (the “E-commerce
Communication”)[72],
Information and Communication Technologies ("ICT") play a key enabling
role for Europe to achieve its strategic objectives under the Europe 2020
Strategy and, in particular, the objectives under the Digital Agenda flagship
initiative. Creative content is also an essential input into the digital
economy and a key driver of consumer demand for digital services. There is a
very considerable growth potential in these sectors. In mature economies,
internet related expenditure and consumption accounted for 21% of GDP growth
during the past five years[73].

Furthermore,
in light of the rapid technological developments which characterise these
sectors, effective competition policy and enforcement are essential to address
potential malfunctioning in the ICT and media sectors.

Competition
policy also plays an important role in shaping the Commission's legislative
proposals in the media sector such as the July 2012 proposal for the Directive
on collective rights management. The proposal's objective is to improve
transparency and governance of collecting societies as well as facilitate multi-territorial
licensing of the rights managed by collecting societies and consequently
improve access to online music. In light of the Commission's enforcement
experience in competition cases, the proposal contains a number of important
competition law safeguards aimed at ensuring compliance with competition law in
the collective management of copyright.

Contribution of EU competition policy in
tackling the challenges

State aid
policy is of growing importance in the ICT and media field. After the public consultation
on an issues paper in 2011 to prepare the review of the rules for State aid to
films and other audiovisual works[74],
a new draft Cinema Communication was published for consultation on 14 March.
2012. The review of the Broadband Guidelines[75],
which also started with the release of an issues paper in 2011, was pursued
with the publication of draft Guidelines on 1 June 2012. Around 100 comments
received from stakeholders were published on DG COMP's website in October 2012.
The new Guidelines, which mainly refine the previous guidelines, were adopted
on 19 December 2012 and align the rules in this area with the targets of the
Digital Agenda and accommodate changes in technology.

The
Commission has continued to use its enforcement tools to ensure unrestricted
competition and growth in the ICT and media sectors to the benefit of consumers
and to support the Commission's broader Digital Agenda goals. In this context,
State aid has an important role to play in accelerating the deployment of
broadband networks in Europe. Pro-competitive aid measures, which complement
private investments in areas which are not profitable on commercial terms, are
necessary to achieve the objectives of the Digital Agenda. The volume of State
aid approved by the Commission in 21 decisions under the Broadband Guidelines
in 2012 amounted to EUR 6.555 billion in 2012. This is a steep increase
compared with the EUR 1.8 billion budgets approved in 2011 and 2010,
notably because more Member States notify framework schemes with correspondingly
higher budgets.

Enforcement
action against incumbent telecommunicatons operators

In May 2012,
the Commission sent a statement of objections to Slovak Telekom and to its
parent company, Deutsche Telekom, in which the Commission took the preliminary
view that Slovak Telekom may have abused its dominant position on several
wholesale broadband markets in Slovakia since May 2004. In particular, Slovak
Telekom may have refused to supply unbundled access to its local loops and
wholesale services to competitors, and may have imposed a margin squeeze on
alternative operators (Slovak Telekom itself would have operated at a loss if
its own wholesale prices had applied to it. The Commission also considered on a
preliminary basis that Deutsche Telekom may be held liable for the conduct,
because of the nature and degree of its links with its subsidiary Slovak
Telekom, in which it owns a majority stake of 51%.

The
Commission is also examining the observations received on the statement of
objections sent to Telefónica and to Portugal Telecom in October 2011,
regarding their agreement not to compete on the Iberian telecommunications
markets, expressing the preliminary view that this agreement breaches Article
101 TFEU. This is the first case in the sector concerning a cross-border
market-sharing agreement, which is of particular importance to avoid that the
Single Market continues to be artificially compartmentalised along national
borders[76].

Ongoing enforcement in the market for internet
search and advertising (Google) as well as injunctions based on standard
essential patents (Samsung)

Another case
involving an alleged abuse of a dominant position concerns Google. The
Commission has expressed concerns that four types of Google business practices
may constitute an abuse of a dominant position within the meaning of Article
102 TFEU, namely: (i) the way in which Google’s vertical search services are
displayed within general search results as compared to services of competitors;
(ii) the way Google may use and display third party content on its vertical
search services; (iii) exclusivity agreements for the delivery of Google search
advertisements on other websites; and (iv) restrictions in the portability of
AdWords advertising campaigns. Google submitted a detailed commitment text at
the end of January 2013. The Commission's services are currently analysing
Google's proposal with a view to deciding whether it would allow the Commission
to commence the process for the adoption of a decision pursuant to Article 9 of
Regulation 1/2003.

It
also opened three proceedings[77]
concerning possible abuses by Samsung and Motorola of their standard essential
patents, partly in order to provide more clarity in this field where the
Commission received numerous complaints during the year. On 21 December 2012,
in respect of one of those three proceedings, the Commission sent a Statement
of Objections to Samsung, informing it of the Commission’s preliminary view
that Samsung's seeking of injunctions against Apple in various Member States on
the basis of its mobile phone standard-essential patents amounts to an abuse of
a dominant position[78].

Enforcement
linked to digitisation

The
Commission has also pursued several actions focusing on the impact of the
transition to digital networks on content sectors.

To ensure
that the transition from analogue to digital terrestrial broadcasting and that
the resulting digital dividend lead to new entry and broader viewer choice, EU
law[79]
requires that such dividend is allocated subject to specific conditions (e.g.
open, transparent and non-discriminatory procedures). Following intervention by
the Commission, France assigned frequencies to new operators in 2012, Bulgaria
took legislative steps to address the breaches and Italy took steps with a view
to assigning new digital frequencies (multiplexes) in 2013.

On 12
December 2012, the Commission also adopted a commitment decision in the e-books
sector, another nascent and fast-moving part of the digital economy, that
rendered legally binding commitments offered by Apple and four international
e-book publishers: Simon & Schuster (CBS Corp.), Harper Collins (News
Corp.), Hachette Livre (Lagardère Publishing) and Verlagsgruppe Georg von
Holtzbrinck (owner of inter alia Macmillan).

The
Commission had opened proceedings in December 2011 against these companies, as
well as a fifth international e-book publisher, Penguin (Pearson Group). While
the December 2012 decision was not addressed to Penguin as that publisher chose
not to offer commitments to the Commission, the Commission is currently engaged
in constructive discussions with Penguin on commitments that would allow an
early closure of proceedings also against that publisher.

Furthermore,
following the Premier League judgment[80],
the Commission conducted a fact-finding investigation to examine whether
licensing agreements for premium pay-TV content contain absolute territorial
protection clauses which may restrict competition, hinder the completion of the
Single Market and prevent consumers from cross-border access to premium sports
and film content.

ICT in the context of the Merger Regulation

Finally,
through the Merger Regulation, the Commission ensures that the ICT and media
sectors remain competitive and open for new entrants, and that access to key
elements (whether content, technology or interconnection) is not denied. The
Commission also aims at ensuring that consumers do not suffer from higher
prices, less choice, poorer quality and limited innovation as a result of
mergers in that sector.

One example
of the Commission taking action under the Merger Regulation to preserve
competitiveness and consumer choice in the music sector is the Commission's
conditional clearance decision of the proposed acquisition by Universal
Music of EMI's recorded music assets. The proposed transaction, as
originally notified, would have increased Universal's size in a way that would
likely have enabled it to impose higher prices and more onerous licensing terms
on digital music providers. This, in turn, would have negatively affected the possibilities
for innovative providers to expand or launch new music offerings and would
ultimately have reduced consumers' choice for digital music, as well as
cultural diversity. To remove the Commission's concerns, Universal committed to
divest significant assets, corresponding to around two thirds of EMI's revenues
in the EEA, and including eight of the ten EMI top selling artists. Moreover,
the commitments provide that at least two thirds of the divested assets will
have to be sold to a single purchaser, which will have to have the ability and
the resources to operate in the market as a credible competitor. This case also
shows that the Commission's merger control activity continued to contribute to
the maintenance of market conditions supportive of innovation.

Another
example of the Commission intervening under the Merger Regulation to ensure
that a proposed merger would not have a negative impact on end consumers in
terms of higher prices is the Commission's conditional clearance decision on 12
December of Hutchison's proposed acquisition of Orange in
Austria. The proposed transaction would have led to a four to three
consolidation on the Austrian mobile telecommunications market. The Commission
found that the merger of two mobile network operators, such as Hutchison and
Orange, with a particular strength on the data segments, which are of
particular importance for the future telecoms markets, on a market with high
barriers to entry and absence of buyer power would have led to a significant
price increase for end customers of mobile telecommunication services. To
address these concerns, the parties submitted commitments, including a
wholesale access remedy to improve access possibilities for mobile virtual
network operators. The parties also offered the divestiture of spectrum, which,
together with spectrum reserved for new entrants by the Austrian regulator in
the upcoming auction in 2013, creates the possibility for new mobile network
operators to enter the Austrian market.

              3. Financial Services

Overview of key challenges in the sector

Financial
services play an essential role in the economy in transforming short-term savings into
long-term lending and directing
capital where it is most needed. In 2012, the instability and difficulties in
the financial sector continued.

In 2012 the
European Institutions took initiatives to deepen the Single Market in financial
services by strengthening the EU financial sector (in line with the EU
commitments under the G-20) and the European surveillance of the financial system
and public finances.

In December 2012,
the European Council agreed on a roadmap for the completion of the
Economic and Monetary Union, based on deeper integration and reinforced
solidarity[81].
This process will begin with the completion, strengthening and implementation
of the new enhanced economic governance, as well as – in relation to the
Banking Union - the adoption of the Single Supervisory Mechanism and of the new
rules on recovery and resolution and on deposit guarantees. It will be
completed by the establishment of a single resolution mechanism.

The arrangements
related to banking, would allow direct recapitalisation by the European
Supervisory Mechanism of individual banks which would break the vicious circle
of contagion between banks and their sovereign. Since such measures need to
comply with the State aid rules, the European Commission will continue to play
a crucial role in the context of the envisaged Banking Union.

Contribution of EU Competition Policy in
tackling the challenges

Antitrust enforcement
contributes to the well-functioning of financial markets with incentives for
market participants to improve efficiency and meet consumer needs. Combined
with well-designed regulation, antitrust enforcement should enhance
transparency and reduce entry barriers for new technology and new players.

Action in the area of
financial derivatives

The European
Commission pursued two antitrust investigations in the credit default swaps
(CDS) market[82]
which were opened in 2011. The Commission continued to analyse, in particular,
the cooperation between a number of leading investment banks and an information
service provider. The purpose of the investigation is to
establish whether those players acted to preserve their stronghold in the
profitable Over-The-Counter (OTC) CDS market by hindering the development of alternative
CDS trading platforms in a way which infringed EU competition law.

Action to ensure fair access
to financial information

Access
to reliable information is crucial for the financial markets. On 20
December 2012 the Commission adopted a decision that renders legally binding
the commitments offered by Thomson Reuters to create a new licence
allowing customers, for a monthly fee, to use Reuters Instrument Codes (RICs)
for data sourced from Thomson Reuters´ competitors. RICs are codes that
identify securities and are used by financial institutions to retrieve data
from Thomson Reuters´ real-time datafeeds. To correctly assess investment
opportunities, market participants need to access accurate and timely financial
data, for example, through consolidated real-time datafeeds. The Commission had
concerns that Thomson Reuters might have been abusing its dominant position in
the market for such datafeeds. The decision was preceded by several rounds of
commitments offered by Thomson Reuters and two market tests. In order to
correctly assess investment opportunities, market participants need to access
accurate and timely financial data, for example through consolidated real-time
datafeeds. The commitments offered by Thomson Reuters and rendered legally
binding by the Commission´s decision will enhance competition in this market.
Financial institutions that use RICs will be able to switch to alternative
providers more easily.

Contributing to seamless,
efficient and innovative payment markets

Payment
markets are essential for the Single Market. Regulation, self-regulation and
competition enforcement must work
together to create open, efficient and innovative market structures. In 2012,
there have been significant advances in all three areas.

In terms of
regulation, the Single Euro Payment Area (SEPA) End Date Regulation[83] was adopted
in February. This obliges all users to move from the previous national credit
transfer and direct debit systems to the new SEPA systems established by the
European Payments Council by 2014. From a competition perspective, the key
element in this regulation is that it provides legal clarity on interchange
fees for direct debit. This had been a point of much discussion with the banking
sector for several years, and the regulation specified that interchange fees
for cross-border transactions are prohibited from November 2012 and for
domestic transactions from 2017. In January 2012, a Green Paper on cards,
internet and mobile payments was published. It addressed issues such as lack of
market access, diverging interchange fees, barriers to cross-border acceptance
of card payments, lack of transparency, lack of European technical and security
standards and governance of the SEPA process. 300 replies were received and
published in June. In October, the Commission announced that in the second
quarter of 2013 it would propose a revision of the regulatory framework (in
particular the Payment Services Directive) and would propose to regulate multilateral
interchange fees (MIFs) for payment card transactions.

In payments
self-regulation has played an important role, particularly with the creation of
the European Payments Council, which consists of credit and payment
institutions, following the introduction of the euro. The SEPA Council was
created to represent all stakeholders, but the roles and decision making powers
of the EPC and SEPA Council remain controversial. In the SEPA Regulation the
Parliament required a review of the governance arrangements. This was included
in the Green Paper and it has been much discussed during 2012, including from a
competition perspective.

In terms of
competition enforcement, in May 2012 the General Court fully upheld[84] the Commission's
decision which had found that MasterCard's MIFs for card payments constituted a
restriction of Article 101(1) TFEU and that MasterCard had not demonstrated
that the MIFs were justified on efficiency grounds under Article 101(3). In
July, the Commission issued a supplementary statement of objections to Visa[85] concerning its
MIFs for credit card payments and the limitations it imposed on cross-border
acquiring where merchants use banks in other countries to benefit from better
conditions and in particular lower MIFs. Investigation of the EPC
work on standardisation for e-payment systems continued. The EPC announced in
July 2012 that it would stop its work on the e-Payments Framework.

Antitrust investigations in
the financial sector

In October
2011, the Commission undertook unannounced inspections at the premises of a
number of companies active in the sector of interest-rate derivative products
linked to the Euro Interbank Offered Rate (EURIBOR) in a number
of Member States, as it had concerns that these companies may have violated EU
antitrust rules. The Commission started investigating these cases as a matter
of top priority before the so-called "LIBOR scandal" triggered by
Barclays on the LIBOR/EURIBOR rate manipulation by a number of banks and their
employees.

In 2012, the
Commission continued to investigate a number of cases related to the benchmark
rates of LIBOR, EURIBOR, TIBOR – the Tokyo rate – and with regard to a number of
banks and brokers. The alleged rate-rigging is a major competition concern as
it has to be ensured that competition in financial markets takes place on a
level-playing field.

Interbank
interest rate benchmarks are systemic benchmarks which are important for the
transmission of the euro area’s monetary policy. Besides, the integrity of
these benchmarks is critical to the pricing of many financial instruments such
as interest rate derivatives, commercial and non-commercial contracts. Any
failures may cause losses for investors, distort the real economy and undermine
market confidence. The importance of financial derivatives, in particular, is
immense. In 2011, interest-rate derivatives had a gross value of many trillions
of euros. The products are traded every day on a global basis, involving companies such as
banks, pension funds and industrial firms seeking to hedge their exposure. They
play a key role in the management of risk in our economy.

These are
cases that are dealt with worldwide (US, Canada, Australia,
South Korea, Switzerland, Japan, Brazil, etc.) and on the antitrust, criminal
and regulatory law fronts.

Taking action to ensure
competitive prices to hedge against investment risk

On
1 February 2012, the Commission prohibited the proposed merger between Deutsche
Börse (DB) and New York Stock Exchange Euronext (NYX). The transaction was
unproblematic in a broad range of markets, including the markets for listing,
trading and clearing of cash instruments. However, it would have eliminated
competition and lead to a quasi-monopoly in some derivatives markets, in
particular, European single stock and equity index derivatives and European
interest rate derivatives, where globally DB and NYX are de facto the
only credible players. The markets for exchange trading and clearing of these
derivative instruments is characterized by high barriers to entry resulting, in
particular, from the closed vertical silo operated by most derivatives
exchanges. While the transaction would have given rise to certain efficiencies,
it was considered that these would be insufficient to outweigh the significant
harm stemming from the creation of a de facto monopoly, namely the loss
of actual and potential competition between DB and NYX. The Commission
therefore found that the merger was likely to lead to higher prices and less
innovation for derivatives customers and that the remedies proposed by DB and
NYX were insufficient to address these concerns.

In September
2012, the Commission approved, following an in-depth investigation, a joint
venture between three large UK mobile telephone operators[86]. The joint
venture will,
in particular, develop a mobile commerce platform including a
mobile wallet for payments. The investigation revealed that a number of
alternatives for mobile payments already existed and that the joint venture was
unlikely to hinder the emergence of others in the near future. The joint
venture was therefore cleared without conditions.

Resolving the situation of banks that cannot
become viable without continuing taxpayer support

In 2012, the extraordinary State aid crisis
rules had to be prolonged due to the continuing uncertainties in financial
markets. With those rules, State aid control continued to ensure a consistent
policy response to the financial crisis throughout the EU and played an
important role in limiting distortions of competition in the internal market.

As
has been the case throughout the financial crisis, the Commission in 2012
adopted a considerable number of decisions on individual banks in 2012. For
example in the case of Dexia on 28 December the Commission approved a
resolution plan for Dexia submitted on 28 December 2012 by the French, Belgian
and Luxembourgish authorities. Under the plan, as endorsed in the Commission
decision, the Luxemburg part was sold and the Belgian lending activities were
taken over by Belgium and will be continued as the newly created and
restructured retail lender Belfius. The French business is to be wound
down with the exception of the lending activities to municipalities and
hospitals, which will be continued through a development bank. In the case of BayernLB
the Commission approved a plan based on a substantially changed business model
and a reduction of assets by 50%. The Commission also required the bank to pay
back EUR 5 billion of the rescue aid received earlier, which exceeded the
minimum amount required for the restructuring.

In
a number of Member States, the Commission authorised the prolongation of
existing bank guarantee and recapitalisation schemes. Moreover, the Commission
always verified that aid (under schemes or granted on
an individual basis) was limited to the minimum necessary and that moral hazard
was properly addressed by ensuring that shareholders and subordinated debt
holders were not bailed out through such state interventions.

The specific situation of
Programme Countries

Extensive
financial sector conditionality was included among the policy requirements
addressed to the Member States that have received international financial
assistance, i.e. the so-called Programme Countries. In that
context, DG Competition continued to collaborate with DG ECFIN, the IMF and the
ECB regarding the financial sector in programme countries in order to ensure
that the massive support necessary to keep a number of such institutions alive
in a difficult
macro-economic environment will not result in undue distortions of competition.
In addition to the existing programmes in Greece, Portugal and Ireland, a
programme for the banking sector in Spain was adopted.

As regards
Greece, following the 2011 write downs in the Private Sector Involvement the
capital of the banks was seriously depleted. To fill the resulting capital
needs, an increased budget of EUR 50 billion for aiding banks was agreed.
EUR 18 billion of those funds was advanced to the four main Greek banks (National
Bank of Greece, Alpha Bank, Eurobank and Piraeus bank) in May 2012.
On 27 July 2012, the Commission temporarily approved the bridge
recapitalisations while at the same time initiating formal investigation
procedures. Moreover, in 2012, the consolidation of the Greek banking sector
started to take shape. The Agricultural Bank of Greece (ATE) was
resolved with a transfer of its good assets and deposits to Piraeus Bank and
the previously French-owned banks Emporiki and Geniki were
acquired by Alpha and Piraeus bank respectively.

In 2011, the
banks in Ireland were recapitalised in the context of the EU/IMF Programme, and
a number of actions to restore their viability were identified. In 2012, DG
Competition continued to monitor the implementation by Bank of Ireland
of its commitments as well as the progress of Allied Irish Banks and Permanent
TSB to deleverage their balance sheets.

In 2011 the
EU and the IMF
agreed to a EUR 78 billion support package for Portugal. To
strengthen confidence in the financial sector, the Programme requires banks to
achieve high levels of capital. While Banco Espírito Santo managed to
raise all the capital it needed from private investors, Caixa Geral de
Depósitos, Millennium BCP, Banco Português de Investimento and Banif
needed public support and their restructuring plans are currently being assessed
by the Commission. In March 2012, a decision was taken regarding the
restructuring aid granted to Banco Português de Negócios, which entailed
its integration into Banco BIC Português.

In July 2012,
the EU and the ECB concluded a Memorandum of Understanding for a sector
programme for the banking sector in Spain. It made Spanish banks subject to a
rigorous stress test over a three-year period. Banks with a capital shortfall
that could not be met
by mobilising private resources were recapitalised with programme funds and
were subject to restructuring under State aid rules. Two groups of banks were
involved in that process: the first group was composed of banks already
controlled by the Spanish authorities: BFA/Bankia, Catalunya Caixa, Nova
Caixa Galicia and Banco de Valencia, for which the restructuring
plans were approved in November 2012. The second group was composed of other
banks that needed State aid following the stress test: Ceiss, Banco Mare
Nostrum, Caja 3 and Liberbank. The restructuring plans of these
banks were approved in December 2012.

Cyprus and
the Cypriot banks lost access to international funding markets and requested
external financial assistance in June 2012. The Cypriot banks faced
significant capital shortfalls due to their large exposure to Greek sovereign
and private sector debt and excess lending to the domestic real estate sector.

              4. Basic industries and
Manufacturing

Overview of key challenges in the sector

The EU and
the Member States shall, in accordance with Article 173 TFEU, ensure that the
conditions necessary for the competitiveness of the Union's industry exist. For
that purpose, in accordance with a system of open and competitive markets,
their actions shall be aimed at, among other things, speeding up the adjustment
of industry to structural changes as well as fostering better exploitation of
the industrial potential of policies of innovation, research and technological
development. The Treaty framework was given more shape in the Communication
"An Integrated Industrial Policy for the Globalisation Era: Putting
Competitiveness and Sustainability at Centre Stage" adopted by the
Commission in October 2010. Industry accounts for four-fifths of Europe's
exports and private sector R&D investment[87].

Contribution of EU competition policy in
tackling the challenges

During 2012
EU competition policy was applied in the area of manufacturing and basic
industry in line with the EU´s industrial policy centred around
competitiveness; for example, in the field of State aid, State aid rules were
adopted which enable the Member States to support industrial sectors at
significant risk of carbon leakage in the context of the third phase of the
European Emission´s System (ETS)[88].
The Commission´s actions against cartels and abuses of dominant positions are
particularly beneficial to European manufacturing and basic industries since
such enforcement actions deters and sanctions anticompetitive conduct resulting
in excessive input prices (see for example the Commission´s fining decisions in
the Cathode ray tubes cartel case[89]
and the Freight Forwarding cartel[90],
which entailed surcharges for freight forwarding services by air along key
trade lines between Europe and North American and Asian trade lines).

Such
considerations also guide the Commission's assessment of mergers. On 7 November
2012, following an in-depth review, the Commission approved, subject to
conditions, the Finnish firm Outokumpu's acquisition of Inoxum[91],
the stainless steel division of ThyssenKrupp of Germany. The approval is
conditional upon the divestiture of Inoxum's stainless steel production
facility in Terni, Italy. The Commission had concerns that the combination of
the two largest suppliers of cold rolled steel products would have given the
merged entity the power to raise prices. The commitments offered
address those concerns. Stainless steel is a key material for a wide range of
products, from household goods to industrial equipment, and an essential input
for many European industries. The divestment of the Italian Terni plant ensures
that the creation of a new European market leader will not be detrimental to
consumers and businesses in Europe.

The
Commission's in-depth investigation focused on the production of cold rolled
stainless steel products in the European Economic Area (EEA). In that market,
the merger will combine the first and the second largest supplier. The
transaction, as initially notified, would have created a player three times as
big as Aperam of Luxembourg and five times as big as Acerinox of Spain, the closest
competitors, and respectively the third and fourth player in the market. The
Commission's investigation found that while imports account for an appreciable
part of the EEA market, they are insufficient to constrain price increases,
because they are generally not considered fully substitutable by final
customers. Moreover, despite their level of spare capacity, it is likely that
the two main European competitors of the parties, Aperam and Acerinox, would
have found it more profitable to follow price increases by the merged entity
rather than competing sufficiently aggressively to prevent such increases.
Price increases resulting from the transaction, as initially notified, would
have likely been much higher than any potential synergies.

Two weeks
after the Outokumpu decision, on 22 November 2012, the European Commission
cleared under the EU Merger Regulation the proposed acquisition of Xstrata,
the world's fifth largest metals and mining group, by Glencore[92],
the world's leading metals and thermal coal trader. The clearance was
conditional on the termination of Glencore's off-take arrangements for zinc
metal in the European Economic Area (EEA) with Nyrstar, the world's largest
zinc metal producer, and the divestiture of Glencore's minority shareholding in
Nyrstar. The Commission had concerns that the merged entity would have the
ability and incentive to raise prices for zinc metal, an important input for
many EU industries. The commitments ensure that competition in the European
zinc metal market is preserved, so that European customers such as steel
galvanisers and car makers can continue to produce valuable consumer goods at
low prices and good quality. Without the commitments, the merged entity would
have had an even greater ability and incentive to control the level of zinc
metal supplies in the EEA, for example by exporting material to LME[93]-certified
warehouses outside the EEA or otherwise withholding supplies from the EEA
market. The reaction by competitors, including imports, would not have been
sufficient to prevent the risk of a significant price increase for zinc metal.

In the area
of State aid, on 11 July 2012 the Commission opened a formal investigation on
11 July 2012 into whether notified regional aid in favour of an investment
project by German car maker Porsche in Leipzig, Saxony, is in line with
EU State aid rules. Given the high market shares of Volkswagen-Porsche and the
capacity increase brought about by the investment, the Commission has to
undertake an in-depth assessment of the aid. The Commission will check whether
the aid is necessary and proportionate to provide an incentive for the
investment and whether its contribution to regional development outweighs the
distortion of competition and trade. The project aims at manufacturing a new passenger
car model. The total investment costs amount to EUR 521.56 million.
Germany intends to support the project with EUR 43.67 million in the form
of a direct grant and an investment premium. The investment project started in
April 2011 and its completion is planned for 2014. Leipzig is eligible for
regional aid to further the development of certain economic activities or
sectors, pursuant to Article 107(3)(c) of the TFEU.

Sanctioning cartels which raise input costs for
European manufacturers

On
28 March 2012[94],
the Commission fined nine European producers of mountings for windows a total
of EUR 86 million for operating a cartel by which they agreed on common
yearly price increases. The collusion lasted from November 1999 to July 2007
and affected European buyers of windows across the whole EEA. For most of the
parties to this case, mountings for windows constitute a large fraction of
their turnover. For this reason, the fines of nearly all parties would have
been capped at 10% of their worldwide turnover. Exceptionally, the Commission
exercised its discretion in accordance with point 37 of its Guidelines on fines
and reduced the fines in a way that takes into account the concentration of the
total turnover in the sales of cartelized products as well as differences
between the parties in view of their individual participation in the
infringement.

On
26 June 2012, the Commission re-imposed fines on Mitsubishi Electric
Corporation and Toshiba Corporation for their participation in the Gas
Insulated Switchgear cartel[95].
The fines originally imposed on two companies by the Commission in January 2007
were annulled by the General Court on account of the Commission´s use of 2001
as reference year in calculating the fines while upholding all the other
findings of the Commission on the infringement committed by those companies and
their liability. The June 2012 decision thus ensured that Mitsubishi and
Toshiba received an appropriate fine for their participation in the cartel.

              5. The Agri-food industry

Overview of key challenges in the sector

The food supply chain
connects three important sectors of the European economy: (1) agricultural
production: (2) food processing and (3) distribution (wholesale and retail). They play a
significant role in Europe's economic, social, and political life and are
considerable contributors to EU added value, trade and employment, especially
in rural areas[96].
Food purchases also represent a significant part of the household expenditure[97].

Agriculture and
fisheries are among the major policies of the EU. In both sectors, a
comprehensive reform is underway that will have a significant impact upon the
food chain and consumers. The ongoing reform has also fuelled the debate on the
position of different actors in the food chain in general and the relationship
between the farming community and retail level in particular.

On 1 January 2012, a Food
Task Force was set up in DG COMP to better focus on the developments in
this increasingly topical sector.

At EU level, the
Commission set up in 2010 a High Level Forum for a Better Functioning Food
Supply Chain (HLF)[98]
in 2010. The HLF brings together a number of Commission initiatives in
different policy fields which seek to address the challenges in the sector. It
has established a number of expert platforms to focus on different aspects of
the food chain. The work of the platform on Business-to-Business (B2B)
contractual practices deals with concerns about uneven bargaining power in the
food supply chain, which might also involve competition aspects. In December
2012, all operators but farmers agreed on an implementation mechanism of the
code of good practices agreed in 2011, which will be introduced in the second
quarter of 2013.

Given the
many complaints it has received and the reports by some national competition
authorities (NCAs) that concentration and practices in the chain may be
negatively affecting choice and innovation in the food supply chain, DG COMP
has designed and launched the tender for a retail study[99] to assess the
evolution and drivers of the evolution of choice and innovation. The study will
(1) provide quantitative evidence into the Impact Assessment that the
Commission will carry out in 2013 on possible actions (including possibly
regulation) at EU level on unfair commercial practices, and (2) build further
on the work of the NCAs to find out whether certain local areas and/or specific
product categories face competition problems.

The reforms
of the Common Fisheries (CFP) and Agricultural Policies (CAP) put forward by
the Commission in 2011 have important repercussions for competition in these
sectors[100].
In particular, the CAP rules play a significant role for
competition in the upstream food supply chain. To remedy the perceived lack of
bargaining power of the farmers, the CAP proposal seeks to strengthen the role
of Producer Organisations (POs) in all sectors of agricultural production. As
the members of POs are independent agricultural producers and their production
is integrated to varying degrees in the POs, it is essential to ensure that the
POs function in a pro-competitive way. The proposal confirms that Articles 101
and 102 TFEU apply to agricultural production, and keeps the current, limited
derogations from Article 101 to agreements between farmers essentially in their
present form.

The amendments put
forward in the European Parliament draft report on the CAP legislative
proposals go considerably beyond the Commission's proposal to exempt agreements
and practices of farmers from competition rules. These amendments contain measures
that e.g. would confer to POs powers to, under certain circumstances, fix
prices, control output and adopt far-reaching crisis measures without any
antitrust control[101].

Contribution of EU competition policy in
tackling the challenges

The
Commission, in close cooperation with the NCAs, has been an active participant
in the legislative process advocating a procompetitive policy vis-à-vis other
actors in the legislative process and the actors of the food chain.

Enforcement and cooperation
with the NCAs

Agricultural
and food markets are often national or regional in scope. Therefore, NCAs play
a key role in applying competition law in this sector. DG Competition has
cooperated closely with NCAs within the framework of the European
Competition Network (ECN) in order to further develop a coherent and common
approach and to ensure that food markets remain competitive and work
efficiently. In this context, on 21 December 2012, the Heads of the European
Competition Authorities adopted a resolution on the CAP in which they
underlined that the enforcement of competition rules helps to ensure a
productive, strong and effective agricultural sector.

Report by the European Competition Network:
competition enforcement intensified after the food price crisis in 2007[102]

On
24 May 2012 the Commission published a report of the ECN on the
enforcement of competition law in the food sector by competition authorities
across Europe. The report showed that the food sector has been a priority of
competition authorities over the last few years and that their action has
intensified since the food price crisis broke out in 2007. From 2004 to 2011, NCAs
have investigated more than 180 antitrust cases, taken close to 1,300 merger
decisions and undertaken more than 100 monitoring actions. The report also made
clear that antitrust and merger activity has benefited all levels in the chain,
in particular farmers, suppliers and consumers. The majority of cases concerned
processing and manufacturing and, to a lesser extent, the retail level. More than 50 cartels
involving price fixing, market and customer allocation as well as the exchange
of sensitive business information have been prohibited, as have exclusionary
practices that were to the detriment of farmers or suppliers.

Merger
decisions by the Commission in the food sector

The food
sector is subject to on-going globalisation and consolidation, as reflected in
the number of mergers the Commission dealt with in 2012. Particular attention
was paid to the sugar markets. The current high prices and scarcity of sugar
across the EU make it all the more important to maintain competition in the
already concentrated European sugar markets and to ensure that supplies are
available to consumers at reasonable prices. In the Südzucker / ED&F MAN
decision[103]
on 16 May 2012 the Commission, following an in-depth review, cleared on 16 May
2012 under the EU Merger Regulation the proposed acquisition of control by
Südzucker of Germany, Europe's largest sugar producer, over ED&F MAN of the
UK, the second largest sugar trader worldwide, which is also active in sugar
production. The approval was made conditional upon the divestiture of ED&F
MAN's interests in the Brindisi refinery, the biggest and most modern
production facility in Italy. Those commitments ensure that the Brindisi
refinery will remain a viable and competitive force in Italy, independent from
the merged entity.

              6. The Pharmaceutical and
health services sector

Overview of key challenges in the sector

Both
pharmaceuticals and health exhibit a number of common characteristics: the
prescribers of the goods or services in question (i.e. the physicians) are
different from the consumers (i.e. the patients). Similarly, the payers (i.e.
usually sickness funds within the Member States) are different from the prescribers
and the consumers. Thus, prescribers and consumers will be less price sensitive
than in other markets. Furthermore, the pharmaceutical and health care sectors
are both fragmented by national regulations regarding authorisation, pricing
and reimbursement status of the goods or services concerned. That fragmentation
of the Single Market can give rise to artificial barriers to entry. EU
competition policy has a key role to play in contributing to competitive
outcomes, cost-containment and innovation in this important area.

The
pharmaceutical sector is highly regulated and R&D driven. On the supply
side, originator companies aim to bring innovative products to the market. The
patent system provides the legislative framework allowing the companies to reap
the benefits of their successful R&D activities. During patent protection,
competition mainly takes place on innovation between originator companies. Upon
loss of exclusivity, generic companies typically enter the market with much
lower price bio-equivalent versions of the originator products. Generic entry
on patent expiry entails savings for public budgets. The threat of generic
entry also incentivises originator companies to pursue their R&D efforts to
develop new and innovative proprietary medicines. Thus, at the point of loss of
exclusivity, competition on price is added to competition on innovation between
originator and generic companies or between generic companies.

A key issue
of concern from the perspective of competition policy is conduct which is aimed
at unduly delaying or blocking generic entry or the development and launch of
innovative medicines. Such practices were analysed in general terms in the
Commission's sector inquiry, the findings of which were published in the final
report in 2009[104].
As set out in the final report, such practices can inter alia involve
misuses of regulatory systems applicable to the pharmaceutical market, misuses
of the patent system and misuses of patent rights (e.g. in connection with
patent settlement agreements). The judgment by the Court of Justice on 6
December 2012 in the AstraZeneca case, upholding to a very large extent
the Commission's finding decision from 2005, confirmed that misuses of the
patent system and the regulatory system applicable to the pharmaceutical market
may, in certain circumstances, constitute abuses of a dominant position within
the meaning of Article 102 TFEU.

Improving
competition in the pharmaceutical sector may also require improvements in the
regulatory framework. For example on 1 March 2012 the Commission tabled a
proposal to repeal and replace the Council Directive 89/10/EEC (also known as
the Transparency Directive)[105].
The aim is to make sure that medicines enter the market faster by further
streamlining and reduce the duration of national decisions on pricing and
reimbursement of medicines. In the future, such decisions should be taken
within 120 days for innovative medicines, as a rule, and for generic medicinal
products within only 30 days, instead of 180 days as is currently the case. The
sector inquiry concluded in 2009 had identified national pricing and
reimbursement decisions as a bottleneck to market entry.

The
organisation of the health care sector is primarily the responsibility of
Member States under Article 168 TFEU. However, to the extent that the
activities in question involve the offering of goods or services in the market[106], the
provision of health care goods or services is generally subject to EU
competition rules, as reflected in the Commission's antitrust decision of 2010
sanctioning the French Association of Pharmacists (ONP)[107].

Contribution of EU competition policy in
tackling the challenges

In 2012, the
Commission continued to investigate the pharmaceutical sector to detect and
pursue possible collusive or otherwise anticompetitive conduct by originator
and generic companies. Anticompetitive conduct can take place in the context of
competition between originator firms, competition between originator, generic
firms and between generic firms. In particular, as a follow up to the sector
inquiry concluded in 2009, it launched investigations in several individual
cases.

As regards
possible anticompetitive conduct delaying generic market entry, the Commission
issued statements of objections in two cases in 2012. According to the
statement of objections in the Perindopril case, the Commission takes the
preliminary view that Les Laboratoires Servier and several generic
competitors entered into agreements where in exchange for payments by Servier
the generic companies agreed not to enter the market with their cheaper generic
products and/or not to further challenge the validity of the patents that
protected Servier's more expensive medicine. In addition, Servier,
in the Commission's preliminary view, bought technologies that would have
enabled generic competitors to enter the market.

According to
the statement of objections in the Citalopram case, the Commission took the
preliminary view that Lundbeck and several generic competitors concluded
agreements at a time when generic entry became possible in principle and where,
in exchange for value transfers from Lundbeck, the generic companies
abstained from entering the market with generic citalopram.

Two further
cases, Cephalon[108]
and Fentanyl[109],
which were opened in 2011 and continued to be investigated during 2012,
predominantly concern agreements and contractual arrangements that potentially
delayed market entry of generic medicines, i.e. potential infringements of
Article 101 TFEU. The Commission also pursued a number of investigations into
cases of generic delay where no official openings have taken place yet[110].

In addition,
in 2012, the Commission ceased its antitrust investigation into the
pharmaceutical companies AstraZeneca and Nycomed[111].
The investigation focused on suspected individual or joint action to delay the
market entry of generic medicines.

The sector inquiry and its follow-up have not
chilled recourse to prima facie unproblematic patent settlements

The
European Commission continued to monitor the market and obstacles to generic
entry with particular emphasis on patent settlements. Following the sector
inquiry, the Commission had already carried out two exercises of monitoring
patent settlements in the EU in 2010 and 2011. A third monitoring exercise was
carried out in 2012. It confirmed the positive trend of potentially problematic
patent settlements stabilizing at a low number. In fact the share of
potentially problematic settlements decreased to 11% of the overall number of
settlements in the period of 2011, compared to 22% in the period of January
2000-June 2008, (i.e. as investigated during the sector inquiry)[112]. At the same
time, resource to prima facie unproblematic patent settlement types
continued to increase by 500% in comparison with the results of the sector
inquiry.

              7. Transport

Overview of key challenges in the sector

The transport
sector is one of the engines of the Single Market. It enables the free flow of
people, goods and services within the Single Market, thereby contributing to
the competitiveness of European industry and the achievement of the Europe 2020
objectives.

The transport
sector provides essential inputs for other economic activities. Transportation
costs represent on average 10-15% of the costs of a finished product. That
figure includes the costs of own account transport operations as well as the
costs of purchasing transport services from specialised companies. Companies
whose main activity is the provision of transport (and transport related)
services generate around 5% of EU GDP. They employ more than 10 million
persons, which is around 5% of the EU labour force.

To improve
the performance of the transport sector, the EU has promoted the integration
and liberalisation of transport markets. There is much variation between the
different transport sectors regarding the speed and scope of the liberalisation
process. While the air and maritime transport markets have been open to
competition for many years, the market for international passenger services by
rail was only liberalised in 2010. Markets for national rail passenger services
have not yet been opened to competition in many Member States. Railway services
are also perceived by consumers as unsatisfactory. In the 2012 Consumer Markets
Scoreboard, train services ranked 27th among 30 consumer services
markets[113].

An
overarching objective of rail transport policy is to increase the share of
freight and passengers transported via rail.

Contribution of EU competition policy in
tackling the challenges
Fighting remaining
regulatory constraints and entry barriers

Competition
policy aims to ensure that markets operate efficiently to the benefit of the
end consumer. This is particularly important in the transport sector where
newly competitive markets have been emerging as a result of the market integration
and liberalisation process. On the one hand, the Single Market has created new
opportunities for cross-border entrants, resulting in increased competition on
fares and services offered between different transport service providers. On
the other hand, regulatory constraints and entry barriers in the sector remain
quite common, contributing to a concentration of supply and a weakening of
competition. In addition, State aid given to transport companies may lead to
undue distortions of competition.

Potential anticompetitive
effects resulting from increased concentration in air transport sector

In air
transport, the emergence of low-cost carriers has contributed to a significant
reduction in fares and a proliferation in the number of regional airports
served, which in turn resulted in an increase in passenger numbers. The
economic and financial crisis, however, caused a sharp drop in traffic. As a
result, many regional airports in Europe are making losses and only survive
thanks to the subsidies they receive from local authorities. The large European
hub airports, on the other hand, remain congested. The long
term outlook indicates that the share of air transport will continue to grow
and that more and more airports will become congested, at least during peak hours.
In addition, the crisis allowed the strongest airlines to consolidate their
position as market leaders. Some of the smaller and less efficient airlines
have exited the market, been restructured or merged into larger entities. Most
of the remaining European airlines have decided to join one of the three big
alliances – Star, SkyTeam and oneworld – as national restrictions
on ownership and control prevent cross-border consolidation through airline
mergers. The main competition concerns relate to the concentration of supply on
certain routes resulting from airline mergers within the EU and the possible
anticompetitive impact of different forms of collaboration within alliances,
which range from bilateral codeshare[114]
agreements to full-fledged joint ventures. In cases involving transatlantic
alliances, the Commission worked closely with the US Department of
Transportation.

One of the
purposes of merger control in air transport is to ensure that airlines do not
undo the pro-competitive effects of liberalisation by acquiring close
competitors. On 10 February 2012, the International Airlines Group (IAG), the
holding company of British Airways and Iberia, notified its intention to
acquire British Midlands Limited (bmi), which had a strong presence in the UK
as well. On 30 March 2012, the Commission decided[115] to approve
the proposed transaction following IAG's commitment to release 14 daily slot
pairs at London Heathrow to competitors and to carry connecting passengers
feeding long-haul flights of competing airlines. On 24 July 2012, Ryanair
notified[116]
its third attempt to take over Aer Lingus, its main rival at Dublin airport. In
November 2012, the Commission issued a statement of objections outlining its
preliminary assessment of the impact of the proposed transaction.

On 23 January
2012, the Commission re-opened its investigation[117] into the SkyTeam
alliance. The new investigation is more limited in scope and focuses
exclusively on the joint-venture agreement between Delta, Air France/KLM
and Alitalia, which co-operate closely on prices, capacity and schedules
for passenger air transport services on the transatlantic market. The
investigation[118]
of the Star Alliance transatlantic joint-venture was opened in 2009 and has
reached a more advanced stage. On 21 December 2012, the Commission decided to
test the commitments proposed by Lufthansa, Air Canada and United Airlines. The
commitments included slot releases at the Frankfurt and New York airports,
competitors' access to the parties' connecting traffic, and the ability of
competitors to combine their fares with those of the parties. The Commission
also continued monitoring the commitments offered by British Airways, Iberia
and American Airlines in the oneworld investigation[119], which was
concluded in 2010. All three alliances are therefore currently under
investigation or have been investigated by the Commission.

Increased scrutiny of State
aid to regional airports and low cost carriers

In 2012 the Commission increased its scrutiny of aid
granted to regional airports and low-cost carriers. Against that backdrop, the
Commission adopted 16 decisions to open a new formal investigation procedure or
to extend the scope of pending investigations of investment aid to airlines or
regional airports[120].
Most of those cases involved discount schemes on airport charges given to low
cost carriers, often in combination with marketing agreements of doubtful value
to the airports. The Commission also adopted three final State aid decisions, concerning
notably Tampere-Pirkkala airport and its agreement with Ryanair, the Irish
travel tax and the financing arrangements concerning Munich airport Terminal 2[121]. In the first of
those decisions, the Commission considered that the agreement between
Tampere-Pirkkala airport and Ryanair was concluded on terms that a private
investor operating under market conditions would have accepted. In particular,
the Commission was able to conclude that the diversification of airlines
operating from the airport, a better allocation of resources as well as the
reduced overcapacity positively contributed to the operational and financial
situation of the airport and increased the market value of the airport for its
shareholders.

As regards
cartels, in the Freight Forwarding case[122] the
Commission fined 15 companies a total of EUR 169 million on 28 March 2012.
The decision sanctioned four separate cartels aimed at fixing prices and other
trading conditions for international air freight forwarding services. Four
different surcharges and charging mechanisms applied by freight forwarders to
the air transport of goods on important trade lanes (in
particular the Europe-USA and the China/Hong Kong-Europe lanes) were subject to
the collusive arrangements. The individual infringements took place in
different geographical areas during various periods between 2002 and 2007. The
infringements were relatively short in duration, between five months and one
year and nine months.

Competition concerns
resulting from State support and barriers to entry in rail transport

An
overarching objective of rail transport policy is to increase
the share of freight and passengers transported via rail. Within this
context, the Commission received a number of notifications of State aid for
investment and operating expenditures in rail transport. In 2012, the
Commission adopted six decisions approving aid for the construction of sidings
and intermodal terminals, for rolling stock specific to combined transport as
well as for offsetting network access charges[123].

According to
current EU regulation, non-discriminatory access to rail infrastructure should
be ensured for railway undertakings. Nevertheless, from a competition policy
perspective the Commission is concerned that railway undertakings that are
controlled by holdings with subsidiaries that are also active on rail transport
markets will leverage their position as subsidiary of the holding and provider
of associated services to hamper potential competitors and benefit other
subsidiaries of the holding. The Commission has been investigating such issues
in the case against Deutsche Bahn, the German railway incumbent[124]. The
Commission initiated proceedings in the Deutsche Bahn case on 13 June 2012
following unannounced inspections in March 2011.

The Deutsche
Bahn case concerns the supply of traction current by DB Energie, a wholly-owned
subsidiary of Deutsche Bahn. DB Energie is the only provider of an input that
is indispensable for railway undertakings to operate in Germany: traction
current, i.e. the special type of electricity that powers trains. The Commission
considers that the pricing system used by DB Energie for selling traction
current to railway undertakings may constitute an abuse of a dominant position
on the market for the supply of traction current and thereby infringe Article
102 TFEU.

Access to port facilities
and fiscal advantages in maritime transport

In maritime
transport, competition policy ensures, inter alia, that shipping
companies have equal access to essential (port) infrastructures and benefit
equally from fiscal advantages offered by the public sector in light of their
high exposure to competition from third countries.

During its
investigation of the acquisition of the Swedish sea port terminal Älvsborg by
the shipping company DFDS and the terminal operator C.RO Ports, the Commission
addressed concerns that rivals of the merging entities might find their access
to the Port of Gothenburg restricted or even closed off completely. On 2 April
2012, the Commission decided[125]
to approve the acquisition because: (1) the Port has alternative terminals to
the one operated by Älvsborg and (2) the concession agreement concluded between
the Gothenburg Port Authority and Älvsborg requires a non-discriminatory
treatment of all shipping companies.

In 2012, the
Commission approved the prolongation of Swedish and Dutch State aid schemes
reducing the social charges borne by shipping companies, because it considered
them to be compatible with the Single Market[126].
The Commission also initiated a formal investigation of the Maltese tonnage tax
as it had doubts that not only genuine shipping companies were benefiting from
that special State aid regime, but also non-maritime companies[127]. Finally,
the Commission approved a modification of a Spanish scheme[128] providing
for early depreciation of certain assets acquired via a financial leasing. The
Commission found that limiting the scope of that measure to tailor-made assets
with a construction period of at least 12 months makes it possible to address
the concerns of the Spanish shipbuilding sector without distorting competition
in the Single Market. As the scheme was otherwise available to all companies
with respect to all categories of assets and without any distinction as to the
origin of the asset, the Commission considered that the scheme did not amount
to State aid.

Public
consultations on antitrust and State aid guidelines in the transport sector

In December
2012 the Commission decided – following a public consultation – to let the 2008
Maritime Antitrust Guidelines lapse with effect from 26 September 2013. The
decision was also taken against the background of the adoption of more recent
horizontal rules – which apply across different sectors – which are more up to
date in terms of legal and economic standards, notably the Horizontal
Guidelines from 2010 which contain a chapter on information exchanges, i.e. the
main focus of the Maritime Antitrust Guidelines.

In 2012, the
Commission also carried out a public consultation on the application of the
guidelines on State aid to maritime transport. The Commission will decide on
the follow up of that public consultation when the responses are fully
analysed.

The responses
to the public consultation on the application of the guidelines on State aid in
the aviation sector carried out in 2011 were analysed with a view to the adoption
of new guidelines in 2013, which will need to better address the public
financing of regional airports and airlines. In that context, the Commission
will take into account the role of regional airports for accessibility and
local development while limiting the distortions of competition and avoiding a
duplication of unprofitable airports and a waste of public resources.

              III.
ANNEXES

(1) List
of DG Competition initiatives adopted under CWP 2012

(2)
List of State aid banking cases
ANNEX 1:
List of DG Competition initiatives adopted under CWP 2012

Guidelines on
certain State aid measures in the context of the greenhouse gas emission
allowance trading scheme post-2012 - SWD(2012) 130 final, SWD(2012) 131
final
Commission
Regulation (EU) No 360/2012 of 25 April 2012 on the application of
Articles 107 and 108 of the Treaty on the Functioning of the European
Union to de minimis aid granted to undertakings providing services of
general economic interest
Communication on EU
State Aid Modernisation - COM/2012/ 209 final
Report on
Competition Policy 2011 – COM(2012) 253 final\*
Communication on
short term export credit insurance – (2012/C 398/02)
EU Guidelines for
the application of state aid rules in relation to the rapid deployment of
broadband networks - C(2012) 9609/2

http://ec.europa.eu/competition/state\_aid/legislation/broadband\_guidelines\_en.pdf

State aid
Scoreboard: Autumn 2012 update[129]
– COM(2012) 778 final\*

\* relates to other measures not included in the CWP 2012

ANNEX 2: List of State aid banking cases

DECISIONS
ADOPTED BY THE COMMISSION IN 2012[130]

Austria

Type of measure / Beneficiary || Type of Decision || Date of adoption

SA.31883 Restructuring of Österreichische Volksbanken AG || Final decision IP/12/982 || 19 September 2012

SA.34716 Recapitalisation of Hypo Tirol || Decision not to raise objections IP/12/1067 || 4 October 2012

SA.32554 Temporary approval of an emergency recapitalisation in favour of Hypo Group Alpe Adria || Decision not to raise objections IP/12/1315 || 5 December 2012

Belgium

Belgium

SA.9833 (MC11/2009) KBC – phasing out and divestment || Decision not to raise objections EXME/12/21.12 || 20 December 2012

Belgium/France/Luxembourg

SA.33760, SA.33763, SA.33764 (2011/C) Dexia – prolongation of guarantees and extension of the in depth investigation || IP/12/523 || 31 May 2012

SA.34925 Dexia – Increase of guarantee ceiling || IP/12/578 || 6 June 2012

SA.34925-SA.34927- SA.34928 (2012/C) Dexia – prolongation of guarantees || MEX/12/0926 || 26 September 2012

SA.33751, SA.33760, SA.33763, SA.33764 (2011/C) and SA.30521 (MC2/2010) Dexia and Belfius || IP/12/1447 || 28 December 2012

Cyprus

SA.34827 Rescue recapitalisation of Cyprus Popular Bank (ex-Marfin) || Decision not to raise objections IP/12/958 || 13 September 2012

SA.35499 State guarantee scheme for Cypriot banks || Decision not to raise objections IP/12/1171 || 6 November 2012

Denmark

SA.35741 Prolongation || EXME/12/14.12 || 14 December 2012

SA.34943 Prolongation of the winding-up scheme and extension of the guarantee scheme for merging banks || EXME/12/26.06 || 26 June 2012

SA 33485 Restructuring plan of Amagerbanken || EXME/12/01.25 || 25 January 2012

SA.34227 Guarantees for merging banks || EXME/12/02.17 || 17 February 2012

SA.34423 Support for the merger of Vestjysk Bank and Aarhus Lokalbank || Decision not to raise objections EXME/12/04.25 || 25 April 2012

SA.34445 (2012/N) The transfer of property-related assets from FIH to the FSC || IP/12/723 || 29 June 2012

Germany

SA.34345 Reactivation || EXME/12/05.03 || 5 March 2012

SA.34897 Prolongation || EXME/12/29.06 || 29 June 2012

SA.35748 Prolongation || EXME/12/07.12 || 7 December 2012

SA.34539 (2012/N) Amendment of restructuring plan of Commerzbank || EXME/12/03.30 || 30 March 2012

SA.34381 Restructuring of NordLB || Decision not to raise objections IP/12/838 || 25 July 2012

SA.28487 Restructuring aid to BayernLB || Decision not to raise objections IP/12/847 || 25 July 2012

Greece

SA 34149 Prolongation || EXME 12/06.02 || 6 February 2012

SA.35002 Prolongation || || 6 July 2012

SA 34148 Prolongation || EXME 12/06.02 || 6 February 2012

SA.34115 Resolution of T bank || IP/12/485 || 16 May 2012

SA.34488 Restructuring aid to Proton bank through creation and capitalisation of Nea Proton || IP/12/854 || 27 July 2012

SA.34823 HFSF Recapitalisation commitment to Alpha Bank || IP/12/860 || 27 July 2012

SA.34824 HFSF Recapitalisation commitment to National Bank of Greece || IP/12/860 || 27 July 2012

SA.34825 HFSF Recapitalisation commitment to EFG Eurobank || IP/12/860 || 27 July 2012

SA.34826 HFSF Recapitalisation commitment to Piraeus Bank || IP/12/860 || 27 July 2012

Hungary

SA 34077 Extension || EXME//08.03 || 8 March 2012

SA.35145 Prolongation || EXME/12/30.07 || 30 July 2012

SA 34078 Extension || EXME/12/07.03 || 7 March 2012

SA.35144 Prolongation || EXME/12/30.07 || 30 July 2012

SA.29608 (C37/2010) Recapitalisation of FHB || EXME/12/22.02 || 22 February 2012

Ireland

SA.34746 Prolongation || Decision not to raise objections || 1 June 2012

SA.35744 Extension || Decision not to raise objections 12/12.12 || 12 December 2012

SA.35209 Prolongation || Decision not to raise objections EXME/12/03.09 || 3 September 2012

SA.35819 Prolongation || Decision not to raise objections EXME/14.12 || 14 December 2012

Italy

SA.34344 Amendment || EXME/12/22.02 || 22 February 2012

SA.35137 MPS recapitalisation || IP/12/1383 || 17 December 2012

Latvia

SA.30704 Temporary approval of support to Latvian Mortgage and Land Bank and opening of in-depth procedure into the measures for the bank's transformation || Opening decision IP/12/77 || 26 January 2012

SA.34747 Amendments to Parex restructuring plan || EXME/12/10.08 || 10 August 2012

Lithuania

SA 34288 Extension || EXME/12/06.03 || 6 March 2012

SA.35129 Prolongation || EXME/12/27.07 || 27 July 2012

SA.34208 Rescue of the Lithuania's Central Credit Unions || MEX/12/0926 || 26 September 2012

Luxembourg

SA.34440 (2012/C) (ex 2012/N) – Sale of Dexia || Opening decision || 3 April 2012

SA.34440 (2012/C) (ex 2012/N) – Sale of Dexia BIL || Final no aid decision IP/12/840 || 25 July 2012

Netherlands

SA.28855 (N 373/2009) ING approval of 2009 restructuring plan || Decision not to raise objections IP/12/468 || 11 May 2012

SA.33305 and SA.29832 Re-notification of recapitalisation aid to ING || Opening decision IP/12/468 || 11 May 2012

SA.33305 and SA.29832 Amendment of the ING restructuring || Final decision IP/12/1226 || 16 November 2012

Poland

SA.34081 Prolongation || EXME/12/08.02 || 8 February 2012

SA.34811 Prolongation || EXME/12/09.07 || 9 July 2012

SA.34066 Prolongation || EXME/12/27.2 || 27 February 2012

SA.34812 Prolongation || EXME/12/29.06 || 29 June 2012

Portugal

SA.34958 Prolongation || EXME/12/27.06 || 27 June 2012

SA.35743 Prolongation || EXME/12/17.12 || 17 December 2012

SA.34055 Prolongation || EXME/12/30.05 || 30 May 2012

SA.35747 Prolongation || EXME/12/17.12 || 17 December 2012

SA.26909 Banco Português de Negócios || Approval of the restructuring IP/12/315 || 27 March 2012

SA.34055 (2011/N) - New recapitalisation scheme for banks in Portugal || Decision not to raise objections EXME/12/30.5 || 30 May 2012

SA.35062 Recapitalisation of Caixa Geral de Depósitos, S.A. (CGD) || Decision not to raise objections IP/12/805 || 18 July 2012

Slovenia

SA.34937 Second Recapitalisation of NLB || Decision not to raise objections IP/12/724 || 2 July 2012

SA.35709 Recapitalisation of NKBM || Decision not to raise objections EXME/12/20.12 || 20 December 2012

Spain

SA.34224 Prolongation || EXME/12/09.02 || 9 February 2012

SA.34904 Extension || EXME/12/29.06 || 29 June 2012

SA.35069 New recapitalisation Scheme for credit institutions || Decision not to raise objections IP/12/849 || 25 July 2012

SA.34255 Restructuring of CAM || Decision not to raise objections IP/12/517 || 30 May 2012

SA.34820 Rescue aid to BFA/Bankia || Decision not to raise objections IP/12/699 || 27 June 2012

SA.33733 Adjudicación UNNIM Banc a favor de BBVA por el FROB. Continuación de SA.33095 (2011/N) Spain Recapitalisation of UNNIM Banc || Decision not to raise objections IP/12/839 || 25 July 2012

SA.35369 Urgent recapitalisation of BFA Group || Decision not to raise objections || 7 September 2012

SA.33735 Restructuring of CatalunyaCaixa || Decision not to raise objections IP/12/1277 || 28 November 2012

SA.35253 Restructuring of BFA/Bankia || Decision not to raise objections IP/12/1277 || 28 November 2012

SA.33734 Restructuring of NovaCaixaGalicia || Decision not to raise objections IP/12/1277 || 28 November 2012

SA.34053 Restructuring of Banco de Valencia || Decision not to raise objections IP/12/1277 || 28 November 2012

SA.34536 Restructuring of CEISS || Decision not to raise objections IP/12/1432 || 20 December 2012

SA.35488 Restructuring of Banco Mare Nostrum || Decision not to raise objections IP/12/1432 || 20 December 2012

SA.35489 Restructuring of Caja3 || Decision not to raise objections IP/12/1432 || 20 December 2012

SA.35490 Restructuring of Liberbank || Decision not to raise objections IP/12/1432 || 20 December 2012

United Kingdom

SA.34218 UK Credit Easing Schemes || EXME/12/14.03 || 14 March 2012

SA.34908 Extension || EXME/12/26.06 || 26 June 2012

SA.35755 Prolongation || EXME/12/14.12 || 14 December 2012

[1] Communication of 8 May 2012 from the Commission to the European
Parliament, the Council, the European Economic and Social Committee and the
Committee of the Regions, EU State Aid Modernisation (SAM), COM(2012) 209 final

[2] For example, State aid for risk capital can leverage private
investments to sustain start-ups and aid. Aid to R&D has the potential to
promote new and otherwise unrealised innovative projects, especially where it increases (rather than
replaces) private funding of R&D

[3] See MEMO/12/936 of 5 December 2012

[4] See MEMO/12/942 of 5 December 2012

[5] Five cases were transferred from the former unit in charge of State
aid in DG TREN to DG COMP and are included in the present statistics for the
first time this year

[6] Joined Cases T-443/08 and T-455/08 Freistaat Sachsen and Others v Commission [2011]
ECR II-1311

[7] Expenses for security and police functions, fire-protection, German
meteorological service and air-traffic control service

[8] Case T‑156/04 EDF v Commission [2009] ECR II‑4503

[9] As stated in the Commission Work Programme 2012 (Annex I, item 7),
the objective of this legislative initiative would be to ensure effective
damages actions before national courts for breaches of EU antitrust rules and
to clarify the relationship between such private actions and public enforcement
by the Commission and the national competition authorities, notably as regards
the protection of leniency programmes, in order to preserve the central role of
public enforcement in the EU. The Work Programme is available at: http://ec.europa.eu/atwork/key-documents/index\_en.htm

[10] The Work Programme is available at: http://ec.europa.eu/atwork/key-documents/index\_en.htm

[11] European Parliament resolution of 2 February 2012 on the Annual
Report on EU Competition Policy, also available at http://www.europarl.europa.eu/sides/getDoc.do?pubRef=-//EP//TEXT+TA+P7-TA-2012-0031+0+DOC+XML+V0//EN

[12] See points 15 and 17 of European Parliament resolution of 2
February 2012 on ‘Towards a Coherent European Approach to Collective Redress’
available at http://www.europarl.europa.eu/sides/getDoc.do?type=TA&reference=P7-TA-2012-0021&language=EN&ring=A7-2012-0012

[13] Resolution of the Meeting of the Heads of the European Competition
Authorities of 23 May 2012

[14] Case T-111/08, MasterCard and Others v Commission,  judgment
of 24 May 2012

[15] Case C-457/10 P AstraZeneca v Commission, judgment of 6
December 2012

[16] See in particular Case T-357/06 KWS v European Commission,
judgment of 27 September 2012

[17] See in particular Case T-357/06 KWS v European Commission,
judgment of 27 September 2012

[18] Cases T-135/09 Nexans v Commission and T-140/09 Prysmian
v Commission, judgments of 14 November 2012

[19] Cases T-135/09 Nexans v Commission and T-140/09 Prysmian
v Commission, judgments of 14 November 2012

[20] Case T-372/10 Bolloré, judgment of 27 June 2012

[21] Case T-400/09 Ecka Granulate v
Commission, judgment of 12 December 2012.

[22] Cases COMP/39611 Water Management Products, press release of
27.6.2012, IP/12/704; COMP/39633 Shrimps, press release of 13.7.2012; IP/12/782,
COMP/39639 ODD, press release of 24.7.2012, IP/12/830 and COMP/39583 Retail
Food Packaging, press release of 28.09.2012, IP/12/1044 (with five
different infringements covered by the same Statement of Objections)

[23] See Commission Communication (COM (2009)206 final)

[24] Opinions and amicus curiae observations are available at http://ec.europa.eu/competition/court/overview\_en.html

[25] In its observation (available at the link in footnote 4) the
Commission held that tax deductibility of fines imposed by the Commission for
infringements of Articles 101 and 102 TFEU would undermine the deterrent
character of such fines and is contrary to the principle of loyal cooperation
as laid down in Article 4(3) TEU

[26] The Commission's observations concerned the interpretation of the
notion of a "restriction by object" under Article 101 (3) TFEU

[27] The Commission's observations concerned issues related to the
parallel application of Articles 102 TFEU and the corresponding provisions in
national law and to the possibility for a national competition authority to
impose a fine for an infringement of the general prohibition of abuse of a
dominant position laid down in Article 102 TFEU

[28] Judgment of the High Court of England and Wales in National Grid on
4 April 2012 (available at http://ec.europa.eu/competition/court/overview\_en.html)

[29] Judgment of the French Supreme Court (Cour de Cassation) on 31
January 2012 (available at http://ec.europa.eu/competition/court/overview\_en.html)

[30] Case C-681/11 Bundeswettbewerbsbehörde/Schenker and others,
lodged by the Austrian Supreme Court (Oberster Gerichtshof)

[31] In 2012, the Commission funded eleven training programs in nine
Member States. Further details are available at http://ec.europa.eu/competition/court/training.html

[32] USA, Canada, Japan, South Korea, China, Brazil and Russia

[33] Case COMP/M.6796 Aegean /Olympic II

[34] Case COMP/M.6497 Hutchison 3G Austria/Orange Austria,
decision of 12.12.2012, press release of 12.12.2012, IP/12/1361

[35] Cases COMP/M.6410 UTC/Goodrich, decision of 26.7.2012 and COMP/M.6381
Google/Motorola, decision of 13.2.2012

[36] Case COMP/M.6126 Deutsche Börse/NYSE Euronext, decision of
1.2.2012

[37] Cases COMP/M.6266 J&J/Synthes, decision of 18.4.2012;
COMP/M.6286 Südzucker/ED&F MAN, decision of 16.5.2012; COMP/M.6410 UTC/Goodrich,
decision of 26.7.2012; COMP/M.6458 Universal Music Group/EMI Music,
decision of 21.9.2012; COMP/M.6471 Outokumpu/Inoxum, decision of
7.11.2012 and COMP/M.6497 Hutchison 3G Austria/Orange Austria, decision
of 12.12.2012

[38] Case T-332/09, judgment of 12 December 2012

[39] Cases C-404/10 P and C-477/10 P, judgments of 28 June 2012

[40] 8th Consumer Markets Scoreboard, 2012, Commission, DG SANCO, http://ec.europa.eu/consumers/consumer\_research/editions/cms8\_en.htm

[41] Case COMP/39952 Power exchanges, see MEMO/12/78 of 7.2.2012

[42] Case COMP/39767 BEH electricity, IP/12/1307 of 3.12.2012

[43] Case COMP/39984 Romanian power exchange, IP/12/1355 of
11.12.2012

[44] Case COMP/39736 Siemens/Areva decision of 18.6.2012

[45] Case COMP/39611 Water management products, press release of 27.6.2012, IP/12/704

[46] Case COMP/39315 ENI, decision of 29 September 2010, OJ C352,
23.12.2010, p. 8-10, IP/10/1197

[47] Case COMP/39317 E.ON gas foreclosure, decision of 4 May
2010, OJ C278, 15.10.2010, p. 9-10, IP/10/494

[48] Case COMP/39316 GDF foreclosure, decision of 3 December
2009, OJ C57, 9.3.2010, p. 13-14, IP/09/1872

[49] Case COMP/39386 Long term electricity contracts in France,
decision of 17 March 2010, OJ C133, 22.5.2010, p. 5-6, IP/10/290

[50] Case COMP/39351 Swedish Interconnectors, decision of 14
April 2010, OJ C142, 1.6.2010, p. 28-29

[51] Such as M.6591 Tennet offshore GMBH / Mitsubishi Corporation /
Tenet Offshore 2, M.6698 Cheung Kong Holdings / Cheung Kong
Infrastructure Holdings / Power Assets Holdings / MGN Gas Networks UK and
M.6508 GIP / Fluxys G / Fluxys Switserland

[52] Such as M.6669 CDC Infrastructure / Foresight Solar / Adenium
Solar / VEI Capital / FOR VEI, M.6679 Steag / Fronterasol / OHL
Industrial / Arenales Solar and M.6540 Dong Energy Borkum Riffgrund I
Holdco / Boston Holding / Borkum Riffgrund I Offshore Windpark

[53] Cases T-389/12 and T-389/12 R EDF v European Commission

[54] Such as the remedies accepted in M.5224 EDF
/ BE, M.5549 EDF / Segebel and M.5978 GDF Suez / International Power.
Related cases were M.6422 Tokyo Gas / Siemens /
Tessenderlo Chemie / International Power / GDF Suez / T-Power JV and M.6414 ITOCHU / Tessenderlo Chemie / Siemens Project
Ventures / T-Power JV

[55] Cases SA.33451, SA.33475 and SA.33581 (12/C) Alleged preferential
tariffs in contracts of Hidroelectrica SA with electricity traders, Alleged
preferential purchase tariffs of Hidroelectrica SA – thermo, Alleged
preferential tariffs in contracts of Hidroelectrica SA with industrial
producers, decisions of 25 April 2012, OJ C328, publication pending

[56] Case SA.21918 (C17/2007) Tarifs
réglementés de l'électricité en France, decision of 12 June 2012

[57] Guidelines on certain State aid measures in the context of the
greenhouse gas emission allowance trading scheme post 2012, decision of 22
May 2012, OJ C154, 5.6.2012, p. 4

[58] Community guidelines on State aid for environmental protection,
OJ C82, 1.4.2008, p. 1-33

[59] Case SA.31236 Renewable feed In tariff, decision of 12
January 2012

[60] Case SA.34411 SDE +, decision of 7 September
2012

[61] Cases SA.33384 Green Electricity Act 2012, Austria, decision
of 8 February 2012; SA.32531 Environmental aid in Austria, decision of
21 March 2012

[62] Case SA.34140 Renewable Heat Initiative
(Northern Ireland), decision of 12 June 2012

[63] Case SA.33915 Régime cadre d''aides en
faveur de la protection de l''environnement, decision of 7 June 2012

[64] Cases SA.34642 Expansion
& modernization of Kozani's district heating infrastructure, decision
of 10 September 2012; SA.33621 District heating network infrastructure of
Florina, decision of 10 September 2012 and SA.33405 Expansion of
district heating network infrastructure of Amyntaio area, decision of 10
September 2012

[65] Cases SA.34472 Aid for modernisation of
heating distribution networks in Poland, decision of 10 September 2012;
SA.34471 Aid for
modernisation and replacement of electricity
distribution networks in Poland, decision of 10
September 2012; SA.32832 Aid for modernizing the heat network in Dębica,
decision of 23 January 2012; SA.32831 Aid for modernising the district
heating network in Ropczyce, decision of 23 January 2012; SA.32830 Aid
for modernizing the heat network in Krosno, decision of 4 February 2012 and
SA.32757 Individual aid for the modernisation of the district heating network in Jaslo, decision of 23 January 2012

[66] Case SA.34375 Aid
to purchase of ultra-low emission vehicle, amendment to include vans, decision of 22 June 2012

[67] Case SA.34051 Hull Energy Works,
decision of 19 September 2012

[68] Directive 2003/87/EC as amended by Directive 2009/29/EC. During
2012 Poland, Lithuania and Bulgaria pre-notified similar modernisation plans

[69] Market Observatory for Energy, June 2011

[70] Case COMP/39816, Upstream Gas Supplies in Central and Eastern
Europe, opening of proceedings on 31 August 2012

[71] A Digital Agenda
for Europe, COM(2010) 245 final/2

[72] A coherent framework for building trust in the Digital Single
Market for e-commerce and online services, COM (2011) 942 final

[73] McKinsey Global Institute, “Internet Matters: The Net’s Sweeping
Impact on Growth, Jobs, and Prosperity” (May 2011) as quoted in an Issues Note
on the Digital Economy by the OECD Secretariat (Competition Committee)
(DAF/COMP(2011)16)

[74] Commission communication on certain legal
aspects relating to cinematographic and other audiovisual works (Cinema
Communication) of 26 September 2001, OJ C43, 16.2.2002, p. 6

[75] Community Guidelines for the application of State aid rules in
relation to rapid deployment of broadband networks, OJ C235, 30.9.2009, p. 7

[76] On 23 January 2013 the Commission fined Telefónica and Portugal
Telecom EUR 79 million in this case, which falls within the scope of next
year´s Annual Competition Report

[77] Initiation of proceedings against Samsung on 30 January 2012 (Case
COMP/C-3/39.939); initiation of proceedings against Motorola on 2 April 2012
(Cases COMP/C-3/39.985  and COMP/C-3/39.986)

[78] See press release at http://europa.eu/rapid/press-release\_IP-12-1448\_en.htm

[79] Including Commission Directive 2002/77/EC of 16 September 2002 on
competition in the markets for electronic communications networks and services
(OJ L249, p. 21-26)

[80] Joined Cases C-403/08 and C-429/08, judgment of 4 October 2011

[81] See Conclusions of the European Council held on 13-14 December
(EUCO 205/12)

[82] Press Release of 29.4.2011, IP/11/509

[83] Regulation 260/2012

[84] Case T-111/08 MasterCard Inc.
and Others v Commission, Judgment of the General Court
of 24 May 2012

[85] Press release of 31.7.2012, IP/12/871

[86] Case COMP/M.6314 — Telefónica UK/Vodafone UK/Everything
Everywhere/JV

[87] Industrial Policy Communication Update of 10 October 2012
(COM(2012) 582 final)

[88] Press release of 22.5.2012, IP/12/498

[89] Case COMP/39437 TV and computer monitor tubes, press release of 5.12.2012, IP/12/1317

[90] Case COMP/39462 Freight forwarding,
Summary of Commission Decision of 28 March 2012 relating to a proceeding
under Article 101 of the Treaty on the Functioning of the European Union and
Article 53 of the EEA Agreement

[91] Case COMP/M.6471 OUTOKUMPU / INOXUM, press release of 7.11.2012, IP/12/1185

[92] Case COMP/M.6541 GLENCORE / XSTRATA, press release of 22.11.2012, IP/12/1252

[93] London Metals Exchange

[94] Case COMP/39452 Mountings for windows and window-doors, Press Release of 28.3.2012, IP/12/313, Summary
of Commission Decision of 28 March 2012 relating to a proceeding under
Article 101 of the Treaty and Article 53 of the EEA Agreement (notified under document C(2012) 2069 final)

[95] Case COMP/39966 Gas Insulated Switchgear re-adoption,
Prohibition Decision of 27.6.2012, C(2012) 4381 final

[96] For an overview, see the Report on the Competitiveness of the European Agro-Food Industry of 17 March 2009
(“Competitiveness Report”), p. 59, available at http://ec.europa.eu/enterprise/
sectors/food/files/high\_level\_group\_2008/documents\_hlg/final\_report\_hlg\_17\_03\_09\_en.pdf

[97] The share of food and non-alcoholic beverages in the household
budget differs across countries. For EU27 it accounted for almost 13%; http://epp.eurostat.ec.europa.eu/cache/ITY\_OFFPUB/KS-SF-13-002/EN/KS-SF-13-002-EN.PDF

[98] http://ec.europa.eu/enterprise/sectors/food/competitiveness/forum\_food/index\_en.htm;
http://europa.eu/rapid/press-release\_MEMO-12-941\_en.htm

[99] COMP/2012/015 study on "The economic impact of modern retail on choice
and innovation in the EU food sector", published in the Official Journal
OJ/S S244 on 19.12.2012 (Reference: 2012/S - 244 400412)

[100] http://ec.europa.eu/fisheries/reform/index\_en.htm
and http://ec.europa.eu/agriculture/cap-post-2013/legal-proposals/index\_en.htm

[101] In particular the Dantin report of 5 June 2012 on the proposal for
a regulation of the European Parliament and of the Council establishing a
common organisation of the markets in agricultural products (Single CMO
Regulation), http://www.europarl.europa.eu/committees/en/agri/draft-reports.html?linkedDocument=true&ufolderComCode=AGRI&ufolderLegId=7&ufolderId=07522&urefProcYear=&urefProcNum=&urefProcCode=#menuzone

[102] ECN
activities in the food sector - Report on competition law enforcement and
market monitoring activities by European competition authorities in the food
sector (24 May 2012) Drafted by the ECN food subgroup, Available
at http://ec.europa.eu/competition/ecn/food\_report\_en.pdf
See MEMO/12/373 of 24.5.2012

[103] Case COMP/M.6286 SÜDZUCKER / ED&F MAN, press release of 16.5.2012, IP/12/486

[104] Available at http://ec.europa.eu/competition/sectors/pharmaceuticals/inquiry/index.html

[105] Council Directive 89/105/EEC of 21 December 1988 relating to the
transparency of measures regulating the prices of medicinal products for human
use and their inclusion in the scope of public health insurance systems. (OJ No
40, 11.2.1989, p. 8)

[106] Cases C-118/85 Commission v Italy [1987] ECR 2599,
paragraph 7; C-35/96 Commission v Italy [1998] ECR I-3851,
paragraph 36; Joined cases C-180/98 to C-184/98 Pavlov, [2000] ECR
I-6451

[107] Commission Decision of 8 December 2010, Case
COMP/39510 Ordre National des Pharmaciens

[108] See Press Release IP/11/511 under: http://europa.eu/rapid/pressReleasesAction.do?reference=IP/11/511&format=HTML&aged=0&language=EN&guiLanguage=fr

[109] See Press Release IP/11/1228 under: http://europa.eu/rapid/pressReleasesAction.do?reference=IP/11/1228&format=HTML&aged=0&language=EN&guiLanguage=en

[110] See press releases: MEMO/10/647 of 3/12/2010: http://europa.eu/rapid/pressReleasesAction.do?reference=MEMO/10/647&format=HTML&aged=1&language=EN&guiLanguage=en
; MEMO/09/435 of 6/10/2009: http://europa.eu/rapid/pressReleasesAction.do?reference=MEMO/09/435&format=HTML&aged=1&language=EN&guiLanguage=en

[111] See press release: IP/12/210 of 1/3/2012:http://europa.eu/rapid/press-release\_IP-12-210\_en.htm?locale=en

[112] For further information on patent settlement monitoring see: http://ec.europa.eu/competition/sectors/pharmaceuticals/inquiry/index.html

[113] 27th position out of 30 markets

[114] Agreement between two or more airlines to
list certain flights in a reservation system under each other´s names

[115] Case COMP/M.6447 IAG/ BMI; IP/12/338, 30.3.2012

[116] Case COMP/M.6663 Ryanair/Aer Lingus III

[117] Case COMP/39964 AF-KL/DL/AZ, IP/12/79, 27.1.2012

[118] Case COMP/39595 Continental/United/Lufthansa/Air
Canada

[119] Case COMP/39596 BA/AA/IB

[120] See IP/12/44 of 25.1.2012,
IP/12/108 of 8.2.2012,
IP/12/156 of
22.2.2012, IP/12/265 of
21.3.2012, IP/12/350 of 4.4.2012,
IP/12/400 of
25.4.2012, IP/12/519 of 30.5.2012
and IP/12/698 of 27.6.2012

[121] See IP/12/833 of 25.7.2012
and MEMO/12/597 of
25.7.2012, IP/12/1057 of
3.10.2012

[122] COMP/39462

[123] See for example IP/12/831 of 25.7.2012

[124] Cases COMP/39678 Deutsche Bahn I,
COMP/39731 Deutsche Bahn II and COMP/39915 Deutsche Bahn III

[125] Case COMP/M.6305 DFDS/C.RO Ports/Älvsborg,
IP/12/343, 2.4.2012

[126] Cases COMP/SA.33609 Sweden Maritime Transport Aid, OJ C142,
26.1.2012 and COMP/SA.34004 Netherlands Prolongation of the extension of
reduced remittances for maritime navigation to commercial cruising vessels,
adopted on 10.5.2012

[127] Case COMP/SA.33829 Tonnage tax scheme and other State measures
in favour of shipping companies in Malta, IP/12/843, 25.7.2012

[128] Case COMP/SA.34736 Early depreciation of assets acquired through
a financial leasing, IP/12/1241, 20.11.2012

[129] From 2012 only once/year

[130] As a general rule, aid schemes are
reviewable six months after approval. Some individual decisions are subject to
a review and possible restructuring plan

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