here - Cadwalader

Transcription

here - Cadwalader

Cadwalader, Wickersham & Taft LLP
www.cadwalader.com
New EU Competition Commissioner:
Margrethe Vestager
Webinar
Alec Burnside, Charles F. (Rick) Rule, Rocky Lee
15 September 2014
Panelists
Alec J. Burnside
Partner – Brussels
+32 (0)2 891 81 81
[email protected]
Charles F. (Rick) Rule
Partner – Washington, D.C.
+1 202 862 2420
[email protected]
Rocky T. Lee
Partner – Beijing, Hong Kong
+86 (10) 6599 7288 (China)
+852 2946 1188 (Hong Kong)
[email protected]
2
The EU institutions
Source: University of Portsmouth
3
Key appointments
Jean-Claude Juncker
President of the European Commission
(Luxembourg)
Donald Tusk
President of the European Council
(Poland)
Martin Schulz
President of the European Parliament
(Germany)
Federica Mogherini
High Representative for Foreign Affairs
Vice-President of the Commission
(Italy)
4
The European Commission: College of Commissioners
2014-2019
Source: European Commission
5
Vice-Presidents
Frans Timmermans
Better Regulation,
Inter-Institutional Relations,
the Rule of Law and the
Charter of Fundamental Rights
(Netherlands)
Kristalina Georgieva
Budget & Human Resources
(Bulgaria)
Alenka Bratušek
Energy Union
(Slovenia)
Valdis Dombrovskis
Euro & Social Dialogue
(Latvia)
Jyrki Katainen
Jobs, Growth, Investment
and Competitiveness
(Finland)
Andrus Ansip
Digital Single Market
(Estonia)
6
Key Commissioners
Margrethe Vestager
Competition
(Denmark)
Cecilia Malmström
Trade
(Sweden)
Elżbieta Bieńkowska
Internal Market, Industry,
Entrepreneurship and SMEs
(Poland)
Jonathan Hill
Financial Stability,
Financial Services and
Capital Markets Union
(United Kingdom)
Pierre Moscovici
Economic and Financial Affairs,
Taxation and Customs
(France)
Günther Oettinger
Digital Economy & Society
(Germany)
7
New Competition Commissioner – Margrethe Vestager
•
Until nomination, Denmark’s Deputy Prime Minister & Minister for Economic and Interior Affairs
(2011-14)
•
Born 13 April 1968; married with three children
•
Education
 Masters in Economics from the University of Copenhagen (1993)
•
Career at the European Union
 Stagiaire in the European Parliament, Social Liberal Party (1991)
 Headed Ecofin Council during Denmark’s presidency (2012);
Brokered deal on bank losses and capital requirements
•
Political career in Denmark
facebook.com/margrethevestager
 Minister of Education and Ecclesiastic Affairs (1998-2001)
@vestager
 Member of the Danish Social Liberal Party
Chairwoman (2007-2011) and Party Leader (2011-14)
•
No prior involvement in the competition field
 Business exposure: Board of ID Sparinvest (1996-1998) and Royal Greenland (2004-2007)
 Head of Agency for Financial Management and Administrative Affairs
8
Vestager’s Chef de Cabinet (Chief of Staff) –
Ditte Juul Jørgensen
•
Previously at DG Trade,
Head of Unit for Trade and Sustainable Development (2007-2014)
•
13 years of trade policy experience
 Worked on WTO issues (1995-2002)
 EC Delegation to the United Nations, head of the economic
section (2002-2006)
•
Education
 Graduate in law from the University of Copenhagen
 Post-graduate law degree from the College of Europe
9
Juncker’s mission letter to Vestager
•
The Competition Commissioner shall closely liaise with and contribute to the work of
three Vice-Presidents:
 Jobs, Growth, Investment & Competitiveness
 Digital Single Market
 Energy Union
•
Juncker would like Vestager to focus on:
 using competition policy tools to contribute to areas such as “the digital single market,
energy policy, financial services, industrial policy and the fight against tax evasion”
 “developing an economic as well as a legal approach to the assessment of competition
issues”
 “pursuing an effective enforcement” in all areas of competition law
 “maintaining and strengthening the Commission’s reputation world-wide and promoting
international cooperation”
10
Role of the Vice-Presidents
•
Vice-Presidents will have the power to block any legislative proposals by
Commissioners working under them.
•
Competition Commissioner decides many cases under the power of “habilitation”
without the need to refer to other Commissioners.
•
So what will be the Vice-Presidents’ role in individual competition cases?
11
Project team: A new boost for jobs, growth and
investment
12
Project team: A connected digital single market
13
Project team: A resilient energy union with a forwardlooking climate change policy
14
Joaquín Almunia and Alexander Italianer remain pro tem
Joaquín Almunia
o
Outgoing Competition Commissioner remains in his role until new
Commissioner is in place.
Alexander Italianer – Director-General, DG Competition
Is due to move jobs under mandatory rotation rule, but timing and
successor unknown.
15
DG Competition
16
Almunia’s legacy
•
Antitrust
 Continuing vigorous cartel enforcement resulted in 3 of the top 4 highest cartel fines levied
on Philips, LG Electronics and Deutsche Bank AG
 Initiated the Google and Gazprom investigations but did not close them
 Secured the adoption of the Antitrust Damages Directive
 Adopted the Visa decision and the MasterCard prohibition of the application of
multilateral interchange fees
 Action on Standard Essential Patents (SEPs) – Samsung and Motorola
•
Mergers
 30 (3 pending) Phase II merger cases
 3 prohibition decisions: Ryanair/Aer Lingus, UPS/TNT Express and
Deutsche Börse/NYSE Euronext
•
State Aid
 Undertook the modernisation of the entire state aid rulebook
 Redesigned DG Comp’s state aid control instruments to help the rescue and restructuring
of financial institutions in light of the financial crisis
17
Vestager’s in-tray
•
Google: abuse of dominance in Search, Android and others
•
Gazprom investigation into abusive terms of supply – on hold pending international crisis
•
Cartels, especially in financial services (Libor, Forex, CDS), and autoparts
•
Reforms to merger control, especially minority shareholdings
•
Unfair tax competition
•
National protectionism
•
International dimension, especially relations with MOFCOM
18
A sample of Vestager’s politics
On economic matters
•
“There are clear signs the euro area and the EU economy as a whole is growing. It’s not flashy in any
way but the economy is nonetheless slowly expanding out of the crisis.”
Source: Bloomberg, Denmark Meets Fiscal Limits in Bet
on Elusive European Recovery (29 August 2014)
•
“We can’t just stimulate our way out of structural problems. We shouldn’t engage in stop-go policies;
they only create uncertainty.”
Source: Bloomberg, Denmark Criticizes Stimulus
Addiction Missing Structural Fix (15 August 2013)
•
“Basically what we are doing discussing capital requirement is to make sure that the financial sector
is sound and solid both in order to avoid crisis but of course also in order to enable the financial
sector to provide guarantees, loans, whatever for businesses in order to make them create jobs.”
Source: Euractiv, Ecofin highlights EU divisions on
bank capital rules (2 May 2012)
19
Talk around town…
•
“She has been criticized for coming across as being too forceful. But keeping in mind that the
last commission was often and rightfully criticised for lack of action on a number of key
issues, I am confident that she can turn this into strength as well.”
Source: Jeppe Kofod (MEP), in MLex’s Vestager
brings economic nous, political resolve to EU
competition post (10 September 2014)
•
“She is a very bright and strong politician. In Denmark, many saw her as the real leader of the
government.”
Source: Morten Messerschmidt (MEP), Mlex (as above)
(10 September 2014)
•
“She is thus extremely well qualified for the role of competition commissioner. It’s a good
appointment though the Danish government will be worse for her departure.”
Source: Christian Karhula Lauridsen, in GCR’s
Denmark’s Vestager given competition job in
reorganised commission (10 September 2014)
20
Juncker promises greater focus on digital agenda
•
Juncker has called for a greater focus and a new direction in markets related to technology, telecoms,
and digital media.
•
With “500 million potential customers for new digital products and services,” Juncker sees the benefits
of a strong ICT sector and need for reform.
•
“To make better use of the opportunities offered by digital technologies, national silos in telecoms
regulation, in copyright and data protection legislation, in the management of radio waves and in the
application of competition law need to be broken down.”
Source: European Commission Memo Questions
and Answers: The Juncker Commission
(10 September 2014)
21
Key challenge – managing the rise of national
protectionism
•
Pfizer/AstraZeneca and the “public interest test” (UK)
 “One of our options as the government would be to consider using
our public interest test powers. This would be a serious step and
not one that would be taken lightly but I'm open-minded about it.”
Source: Vince Cable, in Reuters’ Britain could
intervene in Pfizer bid for AstraZeneca (6 May 2014)
 Compatible with exclusivity of EU review?
•
“Decret Alstom” (France)
 Adds to list of strategic sectors for which foreign investments
require government approval
 Used as leverage in Alstom/GE/Siemens to secure French interests
 “The rules have to change after this story, because we need to make champions.”
Source: Arnaud Montebourg, on EU competition rules, in GCR’s The European
champions league (25 July 2014)
22
How much does the identity of the Commissioner matter?
Continuity vs. the cult of personality:
•
Continuity – 50 years of precedent
•
The lure of the free market: differing backgrounds, similar approaches
 Leon Brittan, British conservative
 Karel Van Miert, the ‘Flemish socialist’
 Mario Monti, the Professor
 Neelie Kroes, the ‘businesswomen’
 Joaquín Almunia, socialist
•
Media coverage of Antitrust: the FT test
•
Commissioner’s role vis-à-vis DG Comp
•
Commissioner’s role within College of Commissioners
23
China – Rocky Lee
•
Rise in Chinese competition enforcement
 Recent raids
 Alleged targeting of non-Chinese companies (ex. US Chamber of Commerce report)
•
Extraterritorial enforcement / departure from positions taken in the EU and US
 P3 Alliance, foreign-to-foreign network cleared in the EU and US, blocked by MOFCOM
•
Call for fairness / due process in Chinese competition proceedings
•
State of collaboration between EU and Chinese competition regulators
24
China (Cont.)
Foreign Luxury Automakers
•
Under the current dealer-franchise agreements, auto makers in China can dictate the prices that their dealers pay
for branded replacement parts and the prices at which those parts are sold to consumers.
•
China’s state media have accused automakers of earning exorbitant profits by overcharging consumers and
controlling the sale of auto parts.
•
Under China’s antimonopoly law, companies could face fines of as much as 10% of their sales from the preceding
year.
 Recently, China’s NDRC levied a record $200M combined fine against 10 Japanese auto-parts and bearings
makers for antitrust activities.
 Denso Corp., Aisan Industry Co., Mitsubishi Electric Corp., Mitsuba Corp., Yazaki Corp., Furukawa
Electric Co., Sumitomo Electric Industries Ltd., NSK Ltd., JTEKT Corp. and NTN Corp. were fined
equivalent to between 4% and 8% of their last year's revenue from China.
 Chrysler (China) Automobile Sales Co. and several dealers in Shanghai were fined by the Shanghai
Municipal Price Bureau the equivalent of $5.5 million for anti-competitive conduct.
•
In response to antitrust probes by NDRC, price cuts on spare parts
 BMW: cut by 20% on average on parts including car bodies, compressors, electric generators, storage
batteries and brakes
 Chrysler: cut by 20% the price of 145 spare parts including headlights, mirrors and starters
 Volkswagen AG’s Audi brand, Tata Motors Co.’s Jaguar Land Rover PLC, Daimler’s Mercedes-Benz,
Toyota, and Honda are also among the automakers that cut prices.
25
China (Cont.)
• Recently, Microsoft was given 20 days by China’s State Administration for Industry and
Commerce to explain compatibility and bundling issues between its Windows operating system
and its Office productivity software.
• Qualcomm has been under investigation by NDRC since last November over how it calculates
patent-licensing and royalty rates in China.
• Baby-formula producers, including Mead Johnson, Danone, Abbott Laboratories, Royal
FrieslandCampina, Fonterra, and Biostime International were fined by NDRC a combined
RMB 669M for fixing minimum resale prices.
• Drug-maker GlaxoSmithKline was subject to probe into its price-fixing practices, in addition to
anti-corruption investigation.
• An operational alliance named P3 Network by three global shipping firms, Maersk Line,
Mediterranean Shipping Company, and CMA-CGM, was rejected by MOFCOM for antitrust
concerns.
• TFT-LCD producers Samsung, LG, Chimei Innolux, and AU Optronics were fined RMB
353M by NDRC for price-fixing practices.
• Starbucks and Apple have also been accused of charging higher prices in China than in other
markets and, along with Caterpillar, Inc., are rumored to be the next targets for anti-monopoly
probes.
26
China (Cont.)
• While some complain about the Chinese government’s targeting of foreign corporations,
there are also instances of enforcement actions against domestic companies.
 State-owned giants China Telecom and China Unicom have been subject to anti-trust
probes by NDRC over internet access pricing practices.
 Alcohol makers Kweichow Moutai and Wuliangye were each fined more than RMB 200M
for monopolistic practices.
 Shanghai Gold & Jewelry Trade Association was fined by NDRC the maximum penalty at
RMB 500,000 for fixing prices of precious metals, and five jewelry shops were fined 1% of
their annual sales at RMB 10M.
 Three Jilin cement companies were fined RMB 114M by the NDRC for price fixing.
27
United States – Charles F. (Rick) Rule
•
Well established cooperation and strong convergence of US and EU law
 Quite a while since GE/Honeywell
 Coordination a regular feature of merger review and cartel cases
•
US-EU coordination (plus other jurisdictions) on Asian cartel cases
•
US and EU joint initiative to developing antitrust regimes world-wide through the
International Competition Network (ICN)
28
United States (Cont.)
•
US (FTC/DOJ) versus EU institutions
 Similarities
 Differences
•
The transatlantic antitrust machine
 The past 5 years – Almunia’s legacy through American eyes
 The next 5 years – prospects (competition law; TTIP)
29
Questions?
30

here - Cadwalader

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