WEEK 6 - ARTICLE 101 TFEU
READING
Literature
Barnard & Peers, Chapter 17: Competton law, par. 17.1-17.6
Legislaton and cases
Council Regulaton (CC No 1/2003 of 16 December 2002 on the implementaton of the rules
on competton laid down in Artcles 81 and 82 of the Treaty
Commission Regulaton (EC No 330/2010 of 20 April 2010 on the applicaton of Artcle
101 3C of the Treaty on the Functoning of the (uropean Enion to categories of vertcal
agreements and concerted practces
Communicaton from the Commission — Notce on agreements of minor importance which
do not appreciably restrict competton under Artcle 101 1C of the Treaty on the Functoning
of the (uropean Enion De Minimis NoticeC
Joined Cases 56 and 5 8/64 Consten GrundigC
Case C-439/09 Pierre FabreC
Commission Decision IV.F.1/36.71 8 CECEDC
QUESTION 1
An electronics goods conventon is held in Amsterdam each year and is regularly atended by
household electrical goods retailers in (urope. At the conventon, a number of these retailers
atended a seminar on Grreener TVs= which advocated the phasing out of non-L(D models, such as
plasma TVs, in order to reduce energy consumptonn as well as strategies to reduce waste. L(D TV=s
are generally more expensive but are more energy efcient than plasma and the older CRT models.
During the seminar the retailers agree to gradually phase-out all non-L(D TV=s from their shelves.
1A) Decide on the compatbility of this arrangement with Artcle 101 TF(E.
- First decide if there is an undertaking. The concept of an undertaking encompasses every
entity engaged in an economic activity, regardless of the legal statss of the entity and the
way in which it is fnanced, economic actiitt means ofering goods or seriices on a market
(Höfner case, book p. 515/516).
o There is a number of retailers engaged in an economic actiitt, namelt selling
teleiisions.
- Is there some form of multlateral conduct? So, check if there is an agreement, concerted
practce or a decision of associaton of undertakings. There has to be a concurrence of wiills
for an agreement (Bater case).
o The retailers agree to graduallt phase-out all non-LED TV’s from their shelies, so
there is an agreement betwieen the retailers, because agreement means that
undertakings haie expressed their joint intenton to conduct themselies on the
market in a specifc wiat (p. 522 book). Thet all haie expressed their intenton to
graduallt phase-out all non-LED TV’s from their shelies.
- Is this agreement horizontal or iertcal?
, o In this case it is horizontal, because all the retailers are operatng on the same leiel
of the producton chain, thet are all selling TV’s.
- Then decide if there is an appreciable restricton of competton? “In order to determine
wihether an agreement is prohibited bt artcle 101 TFEU, a claimant must frst identft the
ant-compettie aspects of an agreement, it must establish a restricton of competton,
wihether bt object or bt efect wiithin the meaning of artcle 101(1) TFEU” (book p. 523).
o In this case the retailers graduallt phase out the selling of LED TV’s, so thet limit or
control markets (art. 101(1)(b) TFEU). This falls wiithin the scope of art. 101 TFEU
because of the object of the agreement. Object restrictons are alwiats restrictie,
so no further iniestgaton is needed. Phasing-out of products is an object
restricton.
- Check if it is appreciable for the market. Appreciabilitt is onlt releiant for efect-
restrictons, so no need to discuss that here.
- Is there interstate trade? There needs to be efect on trade betwieen member states. The
impact on interstate trade can be direct or indirect. Eien agreements wiithin one member
state mat afect trade if market access is impeded (case Wouters) and agreements outside
the EU mat also afect trade wiithin member states. Onlt iert local agreements do not fall
under this.
o There are household retailers from Europe wiho make the agreement, it afects
trade betwieen member states.
Conclusion: it is prohibited under art. 101(1) TFEU. If there is a prohibiton under art. 101(1), there
can stll be an excepton possible under art. 101(3) TFEU if all the 4 cumulatie conditons are met.
- Is there an excepton possible (art. 101(3))?
1. Improiing producton, distributon or promoton of technical or economic progress
a. Look at the case CECED; improiing eniironment is also improiement in
technologt, because that wiill lead to more efcient machines, less
electricitt consumpton, less polluton, so also economic progress. In this
case, the phasing out of old TV’s wiill mean more efcient TV’s, so less
electricitt consumpton wihich wiill lead to less polluton.
2. Fair share for consumers
a. The non-LED TV’s are cheaper, so it wiill not be fair for consumers if thet
wiill be phased out, because the consumers need to but more expensiie
products and there is reduced choice in TV’s. Howieier, this is balanced out,
because their energt bills wiill be lowier as wiell, so in the end, thet wiill haie
to pat less. You could also argue that the eniironment wiill be beter, wihich
wiill be beter for eiertone; in the CECED case the Court accepted this, but
thet later changed their point of iiewi, so an argument like this wiill not be
accepted antmore. It is not reallt clear if it is a fair share for consumers in
the end.
3. Proportonalitt/least restrictie
a. Thet claim to achieie a certain objectie, is this the least restrictie wiat to
achieie that objectie? Thet graduallt phase the TV’s out, so this giies the
consumers tme to get used to it.
The Commission wiould not onlt need to showi that there are other wiats to
meet the objectie. The companies wiould haie to showi that there is no
other wiat to meet that objectie in less restrictie means and that it wiould
not be possible to haie other means wiith the same leiel of efectieness.
Look also in the CECED-case. It is a mater of argumentaton, tou could also
argue that there is no more restrictie wiat of doing so.
4. No eliminaton of all competton
READING
Literature
Barnard & Peers, Chapter 17: Competton law, par. 17.1-17.6
Legislaton and cases
Council Regulaton (CC No 1/2003 of 16 December 2002 on the implementaton of the rules
on competton laid down in Artcles 81 and 82 of the Treaty
Commission Regulaton (EC No 330/2010 of 20 April 2010 on the applicaton of Artcle
101 3C of the Treaty on the Functoning of the (uropean Enion to categories of vertcal
agreements and concerted practces
Communicaton from the Commission — Notce on agreements of minor importance which
do not appreciably restrict competton under Artcle 101 1C of the Treaty on the Functoning
of the (uropean Enion De Minimis NoticeC
Joined Cases 56 and 5 8/64 Consten GrundigC
Case C-439/09 Pierre FabreC
Commission Decision IV.F.1/36.71 8 CECEDC
QUESTION 1
An electronics goods conventon is held in Amsterdam each year and is regularly atended by
household electrical goods retailers in (urope. At the conventon, a number of these retailers
atended a seminar on Grreener TVs= which advocated the phasing out of non-L(D models, such as
plasma TVs, in order to reduce energy consumptonn as well as strategies to reduce waste. L(D TV=s
are generally more expensive but are more energy efcient than plasma and the older CRT models.
During the seminar the retailers agree to gradually phase-out all non-L(D TV=s from their shelves.
1A) Decide on the compatbility of this arrangement with Artcle 101 TF(E.
- First decide if there is an undertaking. The concept of an undertaking encompasses every
entity engaged in an economic activity, regardless of the legal statss of the entity and the
way in which it is fnanced, economic actiitt means ofering goods or seriices on a market
(Höfner case, book p. 515/516).
o There is a number of retailers engaged in an economic actiitt, namelt selling
teleiisions.
- Is there some form of multlateral conduct? So, check if there is an agreement, concerted
practce or a decision of associaton of undertakings. There has to be a concurrence of wiills
for an agreement (Bater case).
o The retailers agree to graduallt phase-out all non-LED TV’s from their shelies, so
there is an agreement betwieen the retailers, because agreement means that
undertakings haie expressed their joint intenton to conduct themselies on the
market in a specifc wiat (p. 522 book). Thet all haie expressed their intenton to
graduallt phase-out all non-LED TV’s from their shelies.
- Is this agreement horizontal or iertcal?
, o In this case it is horizontal, because all the retailers are operatng on the same leiel
of the producton chain, thet are all selling TV’s.
- Then decide if there is an appreciable restricton of competton? “In order to determine
wihether an agreement is prohibited bt artcle 101 TFEU, a claimant must frst identft the
ant-compettie aspects of an agreement, it must establish a restricton of competton,
wihether bt object or bt efect wiithin the meaning of artcle 101(1) TFEU” (book p. 523).
o In this case the retailers graduallt phase out the selling of LED TV’s, so thet limit or
control markets (art. 101(1)(b) TFEU). This falls wiithin the scope of art. 101 TFEU
because of the object of the agreement. Object restrictons are alwiats restrictie,
so no further iniestgaton is needed. Phasing-out of products is an object
restricton.
- Check if it is appreciable for the market. Appreciabilitt is onlt releiant for efect-
restrictons, so no need to discuss that here.
- Is there interstate trade? There needs to be efect on trade betwieen member states. The
impact on interstate trade can be direct or indirect. Eien agreements wiithin one member
state mat afect trade if market access is impeded (case Wouters) and agreements outside
the EU mat also afect trade wiithin member states. Onlt iert local agreements do not fall
under this.
o There are household retailers from Europe wiho make the agreement, it afects
trade betwieen member states.
Conclusion: it is prohibited under art. 101(1) TFEU. If there is a prohibiton under art. 101(1), there
can stll be an excepton possible under art. 101(3) TFEU if all the 4 cumulatie conditons are met.
- Is there an excepton possible (art. 101(3))?
1. Improiing producton, distributon or promoton of technical or economic progress
a. Look at the case CECED; improiing eniironment is also improiement in
technologt, because that wiill lead to more efcient machines, less
electricitt consumpton, less polluton, so also economic progress. In this
case, the phasing out of old TV’s wiill mean more efcient TV’s, so less
electricitt consumpton wihich wiill lead to less polluton.
2. Fair share for consumers
a. The non-LED TV’s are cheaper, so it wiill not be fair for consumers if thet
wiill be phased out, because the consumers need to but more expensiie
products and there is reduced choice in TV’s. Howieier, this is balanced out,
because their energt bills wiill be lowier as wiell, so in the end, thet wiill haie
to pat less. You could also argue that the eniironment wiill be beter, wihich
wiill be beter for eiertone; in the CECED case the Court accepted this, but
thet later changed their point of iiewi, so an argument like this wiill not be
accepted antmore. It is not reallt clear if it is a fair share for consumers in
the end.
3. Proportonalitt/least restrictie
a. Thet claim to achieie a certain objectie, is this the least restrictie wiat to
achieie that objectie? Thet graduallt phase the TV’s out, so this giies the
consumers tme to get used to it.
The Commission wiould not onlt need to showi that there are other wiats to
meet the objectie. The companies wiould haie to showi that there is no
other wiat to meet that objectie in less restrictie means and that it wiould
not be possible to haie other means wiith the same leiel of efectieness.
Look also in the CECED-case. It is a mater of argumentaton, tou could also
argue that there is no more restrictie wiat of doing so.
4. No eliminaton of all competton
