This is for all the football fans among the readers of this Blog.
FIFA Partner Faces Brazil World Cup Antitrust Complaint
For the sake of information, the Antitrust authority in Brazil is the Conselho Administrativo de Defesa Econômica (C.A.D.E.), literally translated as the Council for Economic Defence.
If Ranbaxy’s trouble with the F.D.A. in the U.S.A. and in India wearnt enough, it has now beeen slapped with the fine of 10.3 million Euros by the European Commission for anti-competitive practices in delaying the entry of the generic drug Citalopram into the markets European Economic Area (E.E.A.).
According to the Press Release by the Commission,
“The European Commission has imposed a fine of € 93,8 million on Danish pharmaceutical company Lundbeck and fines totalling € 52,2 million on several producers of generic medicines. In 2002, Lundbeck agreed with each of these companies to delay the market entry of cheaper generic versions of Lundbeck’s branded citalopram, a blockbuster antidepressant. These agreements violated EU antitrust rules that prohibit anticompetitive agreements (Article 101 of the Treaty on the Functioning of the European Union – TFEU). These generic companies were notably Alpharma (now part of Zoetis), Merck KGaA/Generics UK (Generics UK is now part of Mylan), Arrow (now part of Actavis), and Ranbaxy. (Emphasis added)
….
Citalopram is a blockbuster antidepressant medicine and was Lundbeck’s best-selling product at the time. After Lundbeck’s basic patent for the citalopram molecule had expired, it only held a number of related process patents which provided a more limited protection. Producers of cheaper, generic versions of citalopram therefore had the possibility to enter the market. Indeed, one of them had actually started selling its own generic version of citalopram and several other producers had made serious preparations to do so.
….
But instead of competing, the generic producers agreed with Lundbeck in 2002 not to enter the market in return for substantial payments and other inducements from Lundbeck amounting to tens of millions of euros….”
Ranbaxy plans to appeal against the decision and fine.
P.S.: Not sure if this is the correct citation for unreported Commission Orders. Please do correct me if am wrong.
My article titled “Status And Effect of Cooperative Joint Ventures under Indian Competition Law” has recently been published in the Competition Law Reports (January, 2013 Edition)
In the article, I elaborate in detail the competition law regarding cooperative joint ventures and present the measures and methods which may be adopted by the Commission when it is finally called upon to handle such issues. Part I being the introduction, Part II elaborates upon the concept of cooperative/contractual joint ventures and provides a definition for the phrase and elaborates as to what exactly would constitute a cooperative joint venture. Part III elaborates in detail the EU law regarding cooperative joint ventures, including the important Orders and Judgements in EU competition law on the same. Part IV focuses on the competition law (or anti-trust law) in the United States of America (U.S.A.) regarding such agreements. Part V deals with the problem of cooperative joint ventures under the Competition Act, 2002 and suggests the preferred method of analysis which may help the Commission best analyze such ventures or agreements.
Here is my latest post on the India Law and Technology Blog on the Ajay Devgan Films v. Yash Raj Films Order.
Click here to view the post.
P.S.: Also find here Volume 2 of “Fair Play”, the quarterly newsletter of the CCI.
In our post titled “Executive Actions And Indian Competition Law:A Premise”, we tried to develop a premise on when the executive actions may be considered anti-competitive under the Competition Act. In an attempt to grow on that post, a recent article in Mint titled “Ending India’s Food Cartels“ helps us to further stress on the point in the above post. The article focuses on the monopoly of the Food Corporation of India (FCI) and the Agricultural Produce Marketing Committees (APMC’s).
While I do not entirely agree with the article ( APMC’s cannot be considered for anti-competitive practices, the reasons for which please read the previous posts and “hoarding” by the FCI is forgetting the fact that the FCI is also the organisation to manage the buffer stocks of the country), I do feel there may be a case against the FCI with regards some of its procurement policies. However, only a detailed in-dept investigation can reveal more.
It has been recently reported that the Central Electricity Regulatory Commission (CERC) has issued draft regulations intended to prevent abuse of market power and regulate the conduct of companies harming or potentially harming competition in the sector.
As per the news article:
“The proposals allow it to issue directions in the event of anti-competitive agreements, abuse of dominant position or anti-competitive combinations entered into by any entity, licensee, deemed licensee and licence-exempt ones.”
While am sure that the intentions of the CERC are good and their initiative may be applauded in terms of pro-activity, it doesn’t exactly help in settling the jurisdictional conflicts between the CCI and various other sectoral regulators, many of whom have been lobbying to prevent loss of turf. In fact, a bare perusal of the draft shows that the CERC is merely empowering itself with the powers already enumerated for the CCI under the Competition Act. It grants itself the power to investigate anti-competitive agreements, abuses of dominant positions and even combinations related to the power sector !! The only rider is under the proviso to Regulation 8(1) and Regulation 8(2) of the draft which are as follows respectively:
“…Provided that a complaint under sub-regulation (a) or a reference under subregulation (b) shall be accompanied by an affidavit stating that the Competition Commission of India is not inquiring into the matter referred to in the said complaint or the said reference.”
“If during the course of the said inquiry or any subsequent proceedings, it comes to the notice of the Central Commission that the matter under its consideration is also being inquired into by the Competition Commission of India, the Central Commission may refer the matter to the Competition Commission of India as provided in regulation 12 or may seek the opinion of the Competition Commission of India as provided in Regulation 13.”
Click on the following links for the regulations. (Public Notice/ Explanatory Memorandum/ Draft)
I recently wrote a post titled “A Few Thoughts on Competition Law in the Technology and Media Sector” for the India Law and technology Blog. To read the article, please click here.
And others shall bite the dust !! What with the CCI initiating suo moto investigation against milk retailers, not to mention, to quote Mr. Chawla, Chairman of CCI
“Real estate, pharmaceuticals, aviation, telecom and tyre industries are on our radar. The inquiry against tyre companies is in an advanced stage and a decision can be expected soon”
The CCI has a busy monsoon ahead !! However, the intention of this post is to specifically focus on the investigation by the DG against automobile companies. Assuming the facts in the article are true, and please note, the opinion is based strictly on the article’s contents, the odds seem to be heavily stacked against the respondents. Such agreements are unanimously considered as anti-competitive throughout all jurisdictions (See Eastman Kodak Co. v. Image Tech. Svcs., 504 US 451 (1992) and Standard Oil Co. of California v. United States337 US 293 (1949) ). Also, see COMMISSION REGULATION (EU) No 461/2010 of 27 May 2010 on the application of Article 101(3) of the Treaty on the Functioning of the European Union to categories of vertical agreements and concerted practices in the motor vehicle sector.
Closer to home, Both the cases of Tata Engineering & Locomotive Co. Ltd. v. Registrar of Restrictive Trade Practices, [1977] 2 SCR 685 and Mahindra & Mahindra Ltd vs Union Of India & Anr, 1979 SCR (2)1038 dealt with a similar issue.
Indian Competition and Anti-Trust Blog 