Cooperation between competitors

If you know the rules, you and your competitor can
get a draw every time -- and no-one suspects collusion

tytoc collie is very fond of the Competition Law Association, but he can't always get to its meetings.  For this reason he's pleased to be able to bring his readers this slightly historical but highly perceptive note of the meeting which hosted veteran European competition guru Ian S. Forrester QC's talk a few weeks ago, "Revised EU Rules on Co-operation Between Competitors: A missed opportunity for reform?"  The note, kindly furnished by CLA Administrator Susan Snook, reads thus:

"Ian spoke about the new Horizontal Restraints Guidelines and R&D Block Exemption Regulation that were published and adopted in December 2010.

He began by setting the latest guidelines into their historical context, tracing the development of the 2003 regulations from the 1962 decision of the Commission to interpret Article 85(1) of the Treaty of Rome as broadly as possible and the practice in the 1980s of viewing the obtaining of an exemption as being so highly desirable as to be almost legally compulsory. He then emphasised that the 2003 regulations marked a profound change to the earlier regime – not only did they mark the end to the notification system, but they were also symptomatic of a policy shift at the Commission. The earlier preoccupation with the building of the common market (for example with its focus on parallel trade) had been broadened into more conventional anti-trust regulation with a corresponding focus on mergers and cartels. 

Turning to the horizontal restraints rules in general, Ian contended that the Block Exemption Regulations (‘BERs’) and guidelines should not be read prescriptively. An agreement that is not covered by a BER is not automatically illegal, it only needs to be assessed under Art 101 of the Treaty on the Functioning of the European Union (TFEU). Conversely, if a case is controversial, the Commission may still intervene, even if the agreement appears to be covered by the terms of a BER. The BERs and Guidelines are nevertheless a useful indication of the Commission’s current thinking and enforcement priorities. 

2010 saw the revision of the substantive rules on the application of Article 101 TFEU. In April 2010 the Commission published and adopted revised Vertical Restraints Guidelines and a corresponding Block Exemption. In December revised Horizontal Restraints Guidelines and R&D and Specialisation block exemption regulations were published. 

After discussing the competition aspects of information exchanges, Ian discussed the recent standards setting cases (Rambus and Qualcomm) and raised the interesting question of whether the company must be dominant at the moment of the controversial conduct, or whether it was an abuse to use when dominant an advantage that had been obtained when not dominant. This, he explained, was an issue which the Commission had avoided addressing in the Rambus settlement [noted by tytoc collie here]".

The full summary can be found on the CLA's website here under Past Events.

tytoc collie rarely tires of saying that a good IP lawyer has to be a good competition lawyer too.  Merpel adds: the thing that distinguishes the CLA is its ability to bring these two disciplines together at its meetings so that each can benefit from understanding the IP lawyer's position.