Reading – Article 101 TFEU
Article 101 TFEU
1. The following shall be prohibited as incompatible with the internal market: all agreements
between undertakings, decisions by associations of undertakings and concerted practices
which may affect trade between Member States and which have as their object or effect the
prevention, restriction or distortion of competition within the internal market, and in particular
those which:
a. directly or indirectly fix purchase or selling prices or any other trading conditions;
b. limit or control production, markets, technical development, or investment;
c. share markets or sources of supply;
d. apply dissimilar conditions to equivalent transactions with other trading parties,
thereby placing them at a competitive disadvantage;
e. make the conclusion of contracts subject to acceptance by the other parties of
supplementary obligations which, by their nature or according to commercial usage,
have no connection with the subject of such contracts.
2. Any agreements or decisions prohibited pursuant to this Article shall be automatically void.
3. The provisions of paragraph 1 may, however, be declared inapplicable in the case of:
- any agreement or category of agreements between undertakings,
- any decision or category of decisions by associations of undertakings,
- any concerted practice or category of concerted practices,
which contributes to improving the production or distribution of goods or to promoting
technical or economic progress, while allowing consumers a fair share of the resulting benefit,
and which does not:
a. impose on the undertakings concerned restrictions which are not indispensable to the
attainment of these objectives;
b. afford such undertakings the possibility of eliminating competition in respect of a
substantial part of the products in question
To be liable under Article 101 one needs to answer these questions:
1. Is there an agreement between undertakings, decisions by associations of undertakings or
concerted practices?
2. Is its object or effect the prevention, restriction or distortion of competition within the internal
market?
3. Does it affect trade between member states?
4. Could it benefit from an exemption under article 101(3)?
Start off PQs by discussing that undertakings could have made attempt to cooperate and not compete
(Dyestuffs) and that Article 101 is not limited to actual but also potential anti-competitive effects from
any resulting agreement (Horizontal Cooperation Guidelines para 22, John Deere)
Agreement between Undertakings - PQ
In order for there to be an agreement caught under 101, it is sufficient that at least two undertakings
have expressed their joint intention to conduct themselves in a specific way on the market (ACF
Chemiefarma).
1. Tacit acceptance can constitute an agreement (AEG-Telefunken)
2. The agreement does not have to be beneficial to both sides (Ford)
a. Admission to a network can amount to acceptance (Ford)
3. Lack of concurrence of wills does not amount to agreement (Bayer)
a. Concurrence of wills is the most important part.
4. The standard for ‘agreement’ is lower than in contract law (Sandoz)
5. Active resistance against a policy will constitute a lack of concurrence of wills (Bayer)
a. There must be at least acquiescence
, AEG Telefunken 1983
A refusal to admit new distributors can arise out of an existing agreement between distributor and the
refusing party. Tacit acceptance can constitute an agreement.
AEG, had a selective distribution system for Held: Criteria for permissible SDS were not met.
branded products. Commission found out that Even refusals of approval are acts performed in
the actual application of the SDS did not context of contractual relations with approved
correspond to original scheme and the SDS was distributors.
discriminating against certain distributors. AEG o Benefitted distributors
said it was a unilateral action not an agreement.
Ford Europe v Commission 1985
Despite not operating to the distributors’ advantage, one can still be seen as as a part of agreement.
Ford’s right hand drive cars were sold to Admission to the Ford distribution network implies
German distributors for a lot less than in Britain. acceptance by parties of the policy pursued by Ford
Germans exported them to England for lower with regard to the models delivered. Therefore, there
prices. Ford notified German distributors it was an agreement between the undertakings as to the
would no longer accept orders for right hand right hand cars.
drive cars as it was concerned for Britain. Ford Did not benefit German distributors
said its decision to stop was unilateral. -
Bayer v Commission 2000
if you kick up a fuss, you are usually outside of scope of 101.
Prices for medicine were fixed in Spain and The lack of concurrence of wills between Bayer and
France, 40% lower than in the UK. Bayer Spain the wholesalers led court to see it as unilateral and
and France bought larger orders and sold them outside of 101(1)’s remit. The fact that the
to the UK at a lower price. Bayer AG started to wholesalers still wanted to export and were not okay
cease the large orders of Spain and France with the smaller amount did not amount to an
because Bayer UK was losing revenue. agreement
Wholesalers complained. Bayer limited and
imposed export ban
Sandoz v Commission 1990
Agreements can be tacitly accepted, the standards are not as high as in contract law.
manufacturer had sent invoices to suppliers with Held: repeated orders by suppliers held tacit
(export prohibited) on the agreement. This acquiescence. Agreement between Sandoz and
would be against trade. distributors.
Different to Bayer because there was no clear clause
there merely a lack of concurrence of Wills.
Sandoz v Commission 1990
non-binding calls do not constitute agreement.
Appeal to first case. VW issued calls to General court made error by saying calls were not
distributors requiring them to comply with strict part of it. To see what is part of the overall
price discipline. In the appeal, Commission commercial relationship it will be considered whether
asked CJEU to overrule as the first court they were provided for or authorized by the caluses of
misconstrued Article 101(1) in finding that a the dealtership agreement, taking into account the
call by VW to its authorized dealers did not agreement and its aims.
constitute agreement, despite being part of
continuous business relations governed by a
general agreement drawn up in advance.
Concerted Practice
Forms of coordination between companies which, without reaching the level of an agreement, have
nevertheless established practical cooperation between them and knowingly substitutes the risks of
competition.
,1. May be establish ed by showing parallel conduct between companies that cannot be explained
by any other reason but cooperation (Dyestuffs, Suikerunie).
a. Will not be established when market conditions provide an explanation to the parallel
conduct or where companies adapt themselves intelligently and unilaterally to the
existing and anticipated conduct of their competitors.
2. Concerted practice can only be correctly determined when considering evidence of price
increase while taking into account market definition and features (Dyestuffs, Suikerunie)
3. Advance price announcements eliminate uncertainty to their future conduct (Dyestuffs) –
temporarily eliminated preconditions for competition on market.
a. Contrast with Ahlstrom: system in itself did not eliminate uncertainty as to the furture
conduct of others and was not infringing. Other plausible explanations: PA was
rational response to long term market, high market transparency, oligopolistic
tendencies of the market.
4. A genuinely public announcement can still be found to be a concerted practice if such an
announcement was followed by competitors and could be proven to be a strategy for reaching
common understanding about coordination (Guidelines on Horizontal Co-operation
Agreements)
5. Lack of mutual trust does not rule out possibility of concerted practice (Solvay)
6. Commission does not have to distinguish between concerted practice and agreement
(Suikerunie) – pursuing an aim of removing any uncertainty as to future conduct is enough.
a. Undertakings may be able to disprove existence of concerted practice if they can
provide alternative explanation for parallel behaviour (Suikerunie)
b. Tacit collusion falls outside of 101.
7. Elements of concerted practice: undertakings concerting, subsequent conduct on market and
relationship of cause and effect between the two (Huls)
a. Presumption that undertakings taking part in the concerted action take account of the
information exchanged for purposes of determining their coundct (Huls AG)
b. Concerted practice with an anti-competitive object does not need an anti-competitive
effect (Huls).
c. It can be concerted practice when undertakings have no reached agreement in
advance on a common plan defining their action on the market but have adopted
collusive devices (Huls)
8. Behaviour can be concerted practice where parties have adopted collusive devices which
facilitate coordination of commercial behaviour (Interbrew)
a. Those who did not attend but aligned to give effect to object of meeting were also
liable. However, liability runs from data aligned (Cimenteries CBR)
9. An undertaking needs to publicly distance itself from what was discussed. Without this it
becomes tacit approval. The size of fine might be affected but they still play role (Aalborg)
a. In the absence of evidence manifestly disassociating undertakings from
anticompetitive objetives of meetings, people in attendance were participants
(Interbrew, Huls, Aalborg)
b. Need to demonstrate that they participated in spirit different from competitors
(Toshiba, Aalborg)
c. To assess distance: the understanding which other participants have of undertaking’s
intention is critical to see if that undertaking distanced (Archer Daniles Midland,
Toshiba)
d. Not taking part in the scheme or playing a minor role is immaterial for the
establishment of infringement
e. Huls presumption: if undertakings are in contact and commonality of conduct follows
the burden of proof shifts (ANIC)
f. One has to kick up a fuss to distance, it does not matter if the meeting was forced, out
of courtesy, never implemented (Comap v Commission)
10. When parallel conduct cant be explained other than concertion it is sufficient to prove
circumstances which provide an alternative explanation. (CISAC)
, a. Where proof is based on documents that show collusion undertakings have to
challenge the existence of those facts. (CISAC)
b. Plus factors: increase in market price despite overcapacitym firms not fighting for
market share despite being able to do so, sharing of sensitive information or inter-firm
transactions.
c. Any doubt must benefit the undertaking (CISAC)
11. A situation where only one undertaking discloses strategic information to its competitors who
accept it can also constitute concerted practice, mere attendance suffices (Guidelines on HCA
2011 para 62, Cimenteries)
12. It does not matter if a plan has been worked out, it matters that there has been a metting
(Suikerunie, Para 61 Horizontal Guidelines).
13. An ‘in principle’ agreement can also be considered an agreement (Heineken, HFB and
others).
Normative Concerted Practice
1. AG Wahl in Feralpi Holding: It should turn on the specific circumstances of each case if the
requirement of public distancing is met.
ICI v Commision (Dyestuffs) 1972
uniform increase in of price of dyestuffs in The commission was right. Not all elements of a
Union, Commission found several producers contract have to arise for something to be considered
took part in a concerted practice which led to a concerted practice. Through advance price
price increase. announcements by some undertakings allowed
undertakings to observe each other’s reactions and
adapt accordingly. By advance price announcements
all uncertainty was eliminated and it eliminated risk
of competition.
Suikerunie 1975
Article 101 infringement decision by Practical cooperation between undertakings which
Commission, nine undertakings appealed that leads to conditions of competition which are not the
the common organization of the surgar market, normal conditions of the market. Especially if it
involvement of member states in setting the enables undertakings to act to the detriment of free
prices for sugar and fixing basic quotas for movement.
sugar eliminated any effective competition. Only when characteristics of market are taken into
Dutch and Italian markets. consideration
- Each operator must determine independently the
policy which he intends to adopt, including the choice
fo the persons and undertakings to which he makes
offers.
- Lack of mutual trust does not rule out the possibility
of a con erted practice
- Italian Market; If it were not for regulation
implemented by Italy, the cooperation would not have
taken place. The regulations had determinative effect.
- Dutch Market: Pursuing the aim of removing in
advance any uncertainty as to the future conduct of
their competitiors is enough
Ahlstrom 1993
40 Wood pulp producers and three trade Concerterd prac tice refers to coordination which
associations infringe 101 by price fixing. without having been agreed on, the coordinations
Market for pulp had long term supply contracts knowingly substitutes for the risks of competition.
and quarterly price announcements by which Communications arising from quarterly price
producers communicated to customers the price. announcements did not eliminate uncrertainty as to
Commish found this to facilitate collusion. future conduct of others. Parallel conduct is not
Article 101 TFEU
1. The following shall be prohibited as incompatible with the internal market: all agreements
between undertakings, decisions by associations of undertakings and concerted practices
which may affect trade between Member States and which have as their object or effect the
prevention, restriction or distortion of competition within the internal market, and in particular
those which:
a. directly or indirectly fix purchase or selling prices or any other trading conditions;
b. limit or control production, markets, technical development, or investment;
c. share markets or sources of supply;
d. apply dissimilar conditions to equivalent transactions with other trading parties,
thereby placing them at a competitive disadvantage;
e. make the conclusion of contracts subject to acceptance by the other parties of
supplementary obligations which, by their nature or according to commercial usage,
have no connection with the subject of such contracts.
2. Any agreements or decisions prohibited pursuant to this Article shall be automatically void.
3. The provisions of paragraph 1 may, however, be declared inapplicable in the case of:
- any agreement or category of agreements between undertakings,
- any decision or category of decisions by associations of undertakings,
- any concerted practice or category of concerted practices,
which contributes to improving the production or distribution of goods or to promoting
technical or economic progress, while allowing consumers a fair share of the resulting benefit,
and which does not:
a. impose on the undertakings concerned restrictions which are not indispensable to the
attainment of these objectives;
b. afford such undertakings the possibility of eliminating competition in respect of a
substantial part of the products in question
To be liable under Article 101 one needs to answer these questions:
1. Is there an agreement between undertakings, decisions by associations of undertakings or
concerted practices?
2. Is its object or effect the prevention, restriction or distortion of competition within the internal
market?
3. Does it affect trade between member states?
4. Could it benefit from an exemption under article 101(3)?
Start off PQs by discussing that undertakings could have made attempt to cooperate and not compete
(Dyestuffs) and that Article 101 is not limited to actual but also potential anti-competitive effects from
any resulting agreement (Horizontal Cooperation Guidelines para 22, John Deere)
Agreement between Undertakings - PQ
In order for there to be an agreement caught under 101, it is sufficient that at least two undertakings
have expressed their joint intention to conduct themselves in a specific way on the market (ACF
Chemiefarma).
1. Tacit acceptance can constitute an agreement (AEG-Telefunken)
2. The agreement does not have to be beneficial to both sides (Ford)
a. Admission to a network can amount to acceptance (Ford)
3. Lack of concurrence of wills does not amount to agreement (Bayer)
a. Concurrence of wills is the most important part.
4. The standard for ‘agreement’ is lower than in contract law (Sandoz)
5. Active resistance against a policy will constitute a lack of concurrence of wills (Bayer)
a. There must be at least acquiescence
, AEG Telefunken 1983
A refusal to admit new distributors can arise out of an existing agreement between distributor and the
refusing party. Tacit acceptance can constitute an agreement.
AEG, had a selective distribution system for Held: Criteria for permissible SDS were not met.
branded products. Commission found out that Even refusals of approval are acts performed in
the actual application of the SDS did not context of contractual relations with approved
correspond to original scheme and the SDS was distributors.
discriminating against certain distributors. AEG o Benefitted distributors
said it was a unilateral action not an agreement.
Ford Europe v Commission 1985
Despite not operating to the distributors’ advantage, one can still be seen as as a part of agreement.
Ford’s right hand drive cars were sold to Admission to the Ford distribution network implies
German distributors for a lot less than in Britain. acceptance by parties of the policy pursued by Ford
Germans exported them to England for lower with regard to the models delivered. Therefore, there
prices. Ford notified German distributors it was an agreement between the undertakings as to the
would no longer accept orders for right hand right hand cars.
drive cars as it was concerned for Britain. Ford Did not benefit German distributors
said its decision to stop was unilateral. -
Bayer v Commission 2000
if you kick up a fuss, you are usually outside of scope of 101.
Prices for medicine were fixed in Spain and The lack of concurrence of wills between Bayer and
France, 40% lower than in the UK. Bayer Spain the wholesalers led court to see it as unilateral and
and France bought larger orders and sold them outside of 101(1)’s remit. The fact that the
to the UK at a lower price. Bayer AG started to wholesalers still wanted to export and were not okay
cease the large orders of Spain and France with the smaller amount did not amount to an
because Bayer UK was losing revenue. agreement
Wholesalers complained. Bayer limited and
imposed export ban
Sandoz v Commission 1990
Agreements can be tacitly accepted, the standards are not as high as in contract law.
manufacturer had sent invoices to suppliers with Held: repeated orders by suppliers held tacit
(export prohibited) on the agreement. This acquiescence. Agreement between Sandoz and
would be against trade. distributors.
Different to Bayer because there was no clear clause
there merely a lack of concurrence of Wills.
Sandoz v Commission 1990
non-binding calls do not constitute agreement.
Appeal to first case. VW issued calls to General court made error by saying calls were not
distributors requiring them to comply with strict part of it. To see what is part of the overall
price discipline. In the appeal, Commission commercial relationship it will be considered whether
asked CJEU to overrule as the first court they were provided for or authorized by the caluses of
misconstrued Article 101(1) in finding that a the dealtership agreement, taking into account the
call by VW to its authorized dealers did not agreement and its aims.
constitute agreement, despite being part of
continuous business relations governed by a
general agreement drawn up in advance.
Concerted Practice
Forms of coordination between companies which, without reaching the level of an agreement, have
nevertheless established practical cooperation between them and knowingly substitutes the risks of
competition.
,1. May be establish ed by showing parallel conduct between companies that cannot be explained
by any other reason but cooperation (Dyestuffs, Suikerunie).
a. Will not be established when market conditions provide an explanation to the parallel
conduct or where companies adapt themselves intelligently and unilaterally to the
existing and anticipated conduct of their competitors.
2. Concerted practice can only be correctly determined when considering evidence of price
increase while taking into account market definition and features (Dyestuffs, Suikerunie)
3. Advance price announcements eliminate uncertainty to their future conduct (Dyestuffs) –
temporarily eliminated preconditions for competition on market.
a. Contrast with Ahlstrom: system in itself did not eliminate uncertainty as to the furture
conduct of others and was not infringing. Other plausible explanations: PA was
rational response to long term market, high market transparency, oligopolistic
tendencies of the market.
4. A genuinely public announcement can still be found to be a concerted practice if such an
announcement was followed by competitors and could be proven to be a strategy for reaching
common understanding about coordination (Guidelines on Horizontal Co-operation
Agreements)
5. Lack of mutual trust does not rule out possibility of concerted practice (Solvay)
6. Commission does not have to distinguish between concerted practice and agreement
(Suikerunie) – pursuing an aim of removing any uncertainty as to future conduct is enough.
a. Undertakings may be able to disprove existence of concerted practice if they can
provide alternative explanation for parallel behaviour (Suikerunie)
b. Tacit collusion falls outside of 101.
7. Elements of concerted practice: undertakings concerting, subsequent conduct on market and
relationship of cause and effect between the two (Huls)
a. Presumption that undertakings taking part in the concerted action take account of the
information exchanged for purposes of determining their coundct (Huls AG)
b. Concerted practice with an anti-competitive object does not need an anti-competitive
effect (Huls).
c. It can be concerted practice when undertakings have no reached agreement in
advance on a common plan defining their action on the market but have adopted
collusive devices (Huls)
8. Behaviour can be concerted practice where parties have adopted collusive devices which
facilitate coordination of commercial behaviour (Interbrew)
a. Those who did not attend but aligned to give effect to object of meeting were also
liable. However, liability runs from data aligned (Cimenteries CBR)
9. An undertaking needs to publicly distance itself from what was discussed. Without this it
becomes tacit approval. The size of fine might be affected but they still play role (Aalborg)
a. In the absence of evidence manifestly disassociating undertakings from
anticompetitive objetives of meetings, people in attendance were participants
(Interbrew, Huls, Aalborg)
b. Need to demonstrate that they participated in spirit different from competitors
(Toshiba, Aalborg)
c. To assess distance: the understanding which other participants have of undertaking’s
intention is critical to see if that undertaking distanced (Archer Daniles Midland,
Toshiba)
d. Not taking part in the scheme or playing a minor role is immaterial for the
establishment of infringement
e. Huls presumption: if undertakings are in contact and commonality of conduct follows
the burden of proof shifts (ANIC)
f. One has to kick up a fuss to distance, it does not matter if the meeting was forced, out
of courtesy, never implemented (Comap v Commission)
10. When parallel conduct cant be explained other than concertion it is sufficient to prove
circumstances which provide an alternative explanation. (CISAC)
, a. Where proof is based on documents that show collusion undertakings have to
challenge the existence of those facts. (CISAC)
b. Plus factors: increase in market price despite overcapacitym firms not fighting for
market share despite being able to do so, sharing of sensitive information or inter-firm
transactions.
c. Any doubt must benefit the undertaking (CISAC)
11. A situation where only one undertaking discloses strategic information to its competitors who
accept it can also constitute concerted practice, mere attendance suffices (Guidelines on HCA
2011 para 62, Cimenteries)
12. It does not matter if a plan has been worked out, it matters that there has been a metting
(Suikerunie, Para 61 Horizontal Guidelines).
13. An ‘in principle’ agreement can also be considered an agreement (Heineken, HFB and
others).
Normative Concerted Practice
1. AG Wahl in Feralpi Holding: It should turn on the specific circumstances of each case if the
requirement of public distancing is met.
ICI v Commision (Dyestuffs) 1972
uniform increase in of price of dyestuffs in The commission was right. Not all elements of a
Union, Commission found several producers contract have to arise for something to be considered
took part in a concerted practice which led to a concerted practice. Through advance price
price increase. announcements by some undertakings allowed
undertakings to observe each other’s reactions and
adapt accordingly. By advance price announcements
all uncertainty was eliminated and it eliminated risk
of competition.
Suikerunie 1975
Article 101 infringement decision by Practical cooperation between undertakings which
Commission, nine undertakings appealed that leads to conditions of competition which are not the
the common organization of the surgar market, normal conditions of the market. Especially if it
involvement of member states in setting the enables undertakings to act to the detriment of free
prices for sugar and fixing basic quotas for movement.
sugar eliminated any effective competition. Only when characteristics of market are taken into
Dutch and Italian markets. consideration
- Each operator must determine independently the
policy which he intends to adopt, including the choice
fo the persons and undertakings to which he makes
offers.
- Lack of mutual trust does not rule out the possibility
of a con erted practice
- Italian Market; If it were not for regulation
implemented by Italy, the cooperation would not have
taken place. The regulations had determinative effect.
- Dutch Market: Pursuing the aim of removing in
advance any uncertainty as to the future conduct of
their competitiors is enough
Ahlstrom 1993
40 Wood pulp producers and three trade Concerterd prac tice refers to coordination which
associations infringe 101 by price fixing. without having been agreed on, the coordinations
Market for pulp had long term supply contracts knowingly substitutes for the risks of competition.
and quarterly price announcements by which Communications arising from quarterly price
producers communicated to customers the price. announcements did not eliminate uncrertainty as to
Commish found this to facilitate collusion. future conduct of others. Parallel conduct is not
