Skip to content

Antitrust in focus - June 2022

Headlines in this article

Related news and insights

Publications: 06 July 2023

DOJ and FTC propose sweeping changes to U.S. antitrust notification regime

Publications: 03 April 2023

Global trends in government scrutiny of semiconductor transactions: an overview of recent cases

Publications: 20 March 2023

Regional snapshots for antitrust enforcement in 2022

Publications: 20 March 2023

A mixed picture for antitrust enforcement

This newsletter is a summary of the antitrust developments we think are most interesting to your business. Frances Dethmers, partner based in Brussels, is our editor this month (learn more about Frances in our Q&A feature at the end of the newsletter). 

She has selected:


Consumer & Retail

Digital & TMT


Financial Services

Life Sciences


Foreign investment screening: new regimes emerge and enforcement action continues

Jurisdictions across the globe continue to take steps to introduce or strengthen powers to scrutinise foreign investments, particularly those that may impact national security. This month, we have seen significant progress towards the implementation of three new regimes as well as enforcement action under existing mechanisms.

1. The Netherlands

The Dutch Parliament has adopted a new investment screening regime, which will operate alongside the existing targeted screening mechanisms in the Dutch energy and telecoms sectors.

The new rules introduce a notification obligation for certain investments in designated critical infrastructure companies (such as nuclear power companies, Schiphol Airport and banks) as well as undertakings that are active in the area of sensitive technologies (currently limited to military and dual use products). Approval ‒ involving the application of a national security test ‒ will have to be obtained before completion.

A Royal Decree will set the date that the new law will enter into force. Read our blog post for more on the new regime, including its retroactive effect to September 2020.

2. Belgium

A cooperation agreement has been reached between the various Belgian governments on developing a foreign investment screening mechanism for acquisitions by non-EU investors in sensitive sectors. These sectors include critical infrastructure related to, for instance, energy, healthcare, media and defence, technology and production assets that are essential to security, provision of basic goods related to food security, energy or raw materials, and access to or control over sensitive information.

An Interfederal Screening Committee will be established as the central body to carry out the reviews.

The cooperation agreement will be debated by the various Belgian parliaments during 2022 and it is expected that the cooperation agreement will enter into force on 1 January 2023.

3. Switzerland

The Federal Council has launched a consultation on proposed legislation for a screening mechanism.

Under the draft law, takeovers by foreign state-owned or foreign state-affiliated investors of Swiss companies in any sector will be subject to review. As will acquisitions by foreign investors ‒ state or private ‒ in certain sectors which are “particularly critical” for public order and security (eg defence and energy/water). Takeovers in other critical sectors (eg pharmaceuticals) will fall within the regime if the target meets certain thresholds.

Approval must be obtained before completion. If it is not, the draft rules provide for sanctions of up to 10% of the value of the transaction. The consultation runs until September 2022.

Enforcement action continues to impact M&A

In recent weeks we have seen two call-ins under the UK’s National Security and Investment Act.

First, the UK Government called in Newport Wafer Fab’s acquisition of Nexperia for a full national security assessment. A day later, the purchase of an additional 6% of shares in BT by Altice was similarly called in. These are the first individually-reported call-ins under the regime, which came into force on 4 January 2022.

The UK Government has also reported on the operation of the regime in its first three months. The report shows that most transactions were approved without being called in by the Government for further assessment. Of the 222 notifications made between January and March 2022, 17 were called in (three of which were subsequently cleared, with the remainder still being considered, by the end of the statistical reporting period). The Government reports that it is completing its reviews within the time periods set by the rules.

Finally, there are reports that the Italian Government has, under “golden power” rules, blocked a couple of acquisitions. First, a transaction involving the acquisition by Chinese EFORT Intelligent Equipment of an additional stake (to move from 40% to 49%) of robotics company Robox together with a technology transfer. Second, an acquisition by a subsidiary of Russian state group Rosatom of Faber Industrie. This follows the prohibition of several deals in 2021 (see our Global trends in merger control enforcement report for more details), as well as a March 2022 decision by the Italian Government which reportedly annulled the acquisition of an interest in an Italian manufacturer of aircrafts and drones by a Chinese company. The deal completed in 2018 but, in breach of the foreign investment rules, it was not notified to the Italian Government.

We will continue to keep you updated on all major foreign investment control developments.

Ukraine resumes regular merger control processes

In response to Russia’s invasion of Ukraine, in early March the Antimonopoly Committee of Ukraine (AMC) suspended consideration of all active merger control and behavioural antitrust cases. Shortly after, it issued guidance outlining its approach to the enforcement of Ukrainian merger control practices during the period of martial law (see our April 2022 edition of Antitrust in focus).

Circumstances have now changed again for the AMC however. It has relocated back to Kyiv and officials have access to relevant registers.

As a result, from 20 June 2022, all filings must be submitted to the AMC in accordance with pre-war merger control rules and procedures. Importantly, parties can no longer use the simplified notification form nor rely on receiving only symbolic fines for completing a transaction without clearance. In addition, from 9 June 2022, the AMC resumed merger probes that had been on hold since the start of the war.

We will keep you updated should there be any further major developments.

Consumer & Retail

Japan’s Fair Trade Commission again accepts commitments in parity clauses case

Earlier this year, the Japan Fair Trade Commission (JFTC) accepted commitments from to address concerns over its use of parity clauses (see our March 2022 edition of Antitrust in focus). Now, the JFTC has accepted more parity clause commitments – this time from another accommodation booking platform, Expedia.

Like the case, the commitments concern “wide” parity clauses which Expedia used in contracts with accommodation providers in Japan. Such clauses, also called “most-favoured-nation” clauses, prevented those accommodation providers from offering on other sales channels more favourable room rates or room availability than those offered on Expedia’s website.

Under the commitments, Expedia has agreed to stop using wide parity clauses for the next three years. Expedia has also committed to notify accommodation providers of the commitment plan, prepare internal compliance guidelines concerning transactions with accommodation providers, regularly train employees on compliance, and report annually to the JFTC for the next three years on implementation of the commitments.

Also in line with the case, the Expedia commitments do not cover “narrow” parity clauses, which force accommodation providers to offer the same or more favourable room rates and other terms on Expedia than they do on their own sales channels. However, the JFTC will closely monitor the impact on competition among online travel agencies of Expedia’s future management of narrow parity clauses for room rates and will “respond strictly” to any antitrust issues that arise.

Antitrust authorities across the globe have divergent views on parity clauses.

In the EU, the European Commission has toughened its approach to certain wide parity clauses under the new Vertical Block Exemption Regulation, which entered into force on 1 June 2022. So-called “across-platform retail parity obligations” are excluded from the scope of the block exemption. These clauses prevent a buyer of an online intermediation service (such as a seller on an online marketplace) from offering, selling or reselling goods or services to end users under more favourable conditions through another online intermediation service (such as through another online marketplace). However, other types of parity clauses, including wide parity clauses concerning offline sales channels or narrow parity clauses, continue to benefit from the block exemption.

Under the new UK vertical rules, which also entered into force on 1 June 2022, wide retail parity obligations, regardless of whether they are online or offline, are treated as “hardcore restrictions”, requiring an individual assessment of the entire agreement.

And just this month in Switzerland, the Swiss Parliament has amended the law to extend a ban on wide price parity clauses to narrow parity clauses in contracts between online booking platforms and accommodation providers.

You can read more on the approach to the assessment of parity clauses under the new EU and UK vertical rules in our alert on the revised antitrust rules on vertical agreements.

UK consumer protection rules set to get more teeth

Following a consultation in 2021 on possible reforms to the UK’s competition and consumer policy, the UK Government has now confirmed which changes it intends to take forward.

We have already commented on the Government’s plans for the competition regime. Our latest alert, co-authored with Jonathan Kirk GC and Lee Finch of Gough Square Chambers, discusses the key consumer policy-related reforms. These include:

  • boosting the enforcement powers of the Competition and Markets Authority (CMA): the CMA will be able to enforce consumer law directly and to impose civil penalties of up to 10% of global turnover for infringements
  • addressing concerns over “subscription traps” by requiring businesses that offer automatically renewing contracts to (1) give more information and send reminders to consumers and (2) ensure that consumers can easily cancel subscriptions
  • cracking down on “fake reviews” by prohibiting practices such as (1) commissioning or incentivising the writing/submission of fake consumer reviews and (2) hosting consumer reviews without taking certain steps to check they are genuine

The Government intends to produce a Digital Markets, Competition and Consumer Bill in the next 12 months. This will include the competition and consumer policy reforms, alongside provisions for a new “pro-competition regime” for digital markets (see our alert). However, it remains unclear when these changes are likely to come into force – we will keep you updated.

Digital & TMT

Qualcomm wins appeal against approx. EUR1 billion abuse of dominance fine

In 2018 the European Commission (EC) fined Qualcomm EUR997 million for abusing its dominant position on the market for certain LTE chipsets. The EC found that Qualcomm made “exclusivity payments” to Apple on condition that Apple purchased all of its chipsets for iPhones and iPads from Qualcomm.

Qualcomm appealed. The General Court has now overturned the EC’s decision, finding fault with both procedural matters as well as the authority’s assessment of the effects of the conduct.

On procedure, the General Court found that a number of “irregularities” affected Qualcomm’s rights of defence. These included no or insufficient records of certain interviews/meetings, in particular with third parties.

There were also differences between the EC’s Statement of Objections (SO) and its final decision – in particular, the SO referred to abuse in the markets for UMTS and LTE chipsets, whereas the decision referred only to the market for LTE chipsets. The Court said that to the extent this change in scope impacted the relevance of the data on which Qualcomm based the economic analysis used in its defence, the EC should have given Qualcomm the opportunity to be heard and to adapt its analysis.

The General Court states that the procedural irregularities were enough for it to annul the EC’s decision. But, significantly, it went on to scrutinise the EC’s analysis of Qualcomm’s conduct anyway, saying it was doing so “in the interests of the proper administration of justice”.

Crucially, the Court concluded that the EC did not take into account all of the relevant factual circumstances when analysing whether the payments to Apple were capable of having anti-competitive effects.

The EC found that the payments reduced Apple’s incentives to switch to competing suppliers of LTE chipsets. But the General Court said that the authority should have taken into account evidence that, for technical reasons, Apple had no alternative to Qualcomm’s chips for the majority of its requirements.

The Court also ruled that there was a “lack of consistency in the evidence” relied on by the EC. The EC’s examination of the actual effects of the exclusivity payments, said the Court, is “founded on an analysis which does not make it possible to support the findings made”.

The judgment is the second major blow for the EC this year in abuse of dominance cases. In January, the General Court annulled its EUR1.06bn fine on Intel, finding that the EC did not properly analyse whether conditional rebates granted by Intel were abusive (see our alert for more details).

The key question for future enforcement action is whether these setbacks will deter the EC from pursuing similar rebates/exclusivity payments cases.

The Qualcomm ruling also highlights that the EC must fully comply with its administrative/procedural obligations, or face its decisions being overturned. The General Court’s judgment is likely to encourage companies subject to EU antitrust proceedings to vigorously challenge procedural aspects of the investigation.


Saudi Arabian competition authority blocks second merger

Saudi Arabia’s General Authority for Competition (GAC) has prohibited the proposed acquisition by National Gas and Industrialization Company (GASCO) of a 55% stake in Best Gas Carrier Company (Best Gas) on the basis of substantive vertical competition concerns. This is the second time that GAC has blocked a merger and the first merger blocked on substantive (as opposed to procedural) grounds.

GAC has not published its full reasoning. However, it is clear from GAC’s release that, in its view, GASCO holds a monopoly on several levels of the gas supply chain: storage, packaging, distribution and wholesale. It considers that the transaction would allow GASCO to also enter the retail level, creating a dominant and vertically integrated entity that could, with “high probability”, exclude Best Gas’s competitors in the liquefied petroleum gas distribution market by, eg raising prices or reducing the quality of services and products.

In reaching its decision, GAC took account of the concerns of Best Gas’s rivals, as well as the Ministry of Energy’s desire to liberalise the gas sector.

Earlier this year, GAC prohibited Delivery Hero’s planned acquisition of rival food delivery app The Chefz on procedural grounds. According to a GAC release, the parties did not submit the information required to enable it to evaluate potential remedies (see our January edition of Antitrust in focus and our alert for more details).

GAC’s second rejection reinforces the significance of Saudi Arabia’s merger control regime. GAC may review transactions where the parties’ combined global revenues exceed the relatively low turnover threshold of SAR100m (approx. EUR24m). Parties to deals with a nexus to Saudi Arabia should consider any potential competition concerns early in the transaction process, and be prepared for scrutiny.

Financial Services

Australian forex cartel prosecution yields first prison sentences as antitrust authority continues to focus on financial services sector

In early June, the Federal Court of Australia (FCA) imposed suspended prison sentences on four individuals linked to money transfer company Vina Money Transfer for fixing the exchange rate between the Australian dollar and Vietnamese dong, and for fixing the fees they charged customers. The criminal charges against Vina Money Transfer and five individuals were laid in 2019, following the joint investigation of the Australian Competition and Consumer Commission (ACCC) and the Australian Federal Police, and related to exchange rates and transaction fees charged when sending money from Australia to Vietnam between 2011 and 2016.

It is the first time that individuals have received prison sentences under Australia’s criminal cartel offences. The judge was clear that such sentences were appropriate (rather than just financial penalties) due to the seriousness of the conduct. The jail time imposed ranges from nine to 30 months (including a 25% discount for guilty pleas). But the FCA also released each of the individuals on good behaviour orders, meaning they will avoid any time in prison if they comply. The fifth individual accused in the case has decided to challenge the charges. The FCA also imposed an AUD1 million (EUR670,000) fine on Vina Money Transfer.

While the ACCC’s success in this case does not make up for the collapse of its banking criminal cartel case earlier this year (see our February 2022 edition of Antitrust in focus), the ACCC will feel encouraged to detect and prosecute other cartel cases in future.

More generally, the financial sector remains a key enforcement priority for the ACCC.

Last month, the ACCC launched proceedings before the FCA against Mastercard for alleged misuse of market power over card payments. The ACCC alleges that the practice started in 2017 in response to a “least-cost routing” initiative launched by the Reserve Bank of Australia.

The goal of the initiative was to improve competition in the debit card market and reduce the costs associated with processing debit card payments by allowing retailers to choose whether their debit transactions were processed by Mastercard, Visa or eftpos (which is often the cheapest option). The ACCC alleges that, in response, Mastercard entered into agreements with more than 20 major retail businesses, granting them discounted rates for Mastercard credit card transactions as long as they committed to processing all or most of their Mastercard-eftpos debit card transactions through Mastercard rather than the eftpos network.

ACCC Chair Gina Cass-Gottlieb has confirmed the authority’s focus on the financial services sector. In the press release announcing the Mastercard proceedings, she notes “[f]inancial service providers should be on notice that we will not hesitate to take action in response to concerns raised about anti-competitive conduct in this important sector of Australia’s economy”. She echoed this comment in a speech a day later, noting that payment systems in particular are one of the ACCC’s key compliance and enforcement priorities for the coming year.

Life Sciences

Italian Antitrust Authority fines Leadiant for charging excessive prices for an orphan drug

The Italian Antitrust Authority (IAA) has fined pharmaceutical company Leadiant EUR3.5 million for abusing its dominant position. It found that Leadiant executed a complex exclusionary strategy which led it to charge excessive prices for the sale of its orphan drug containing chenodeoxycholic acid, used to treat a rare metabolic disorder.

Significantly, the IAA sanctioned Leadiant even though the company had agreed the price of the drug with the Italian Medicines Agency, as required by the national regulatory regime.

Leadiant has indicated that it will appeal the decision.

Our blog post and more detailed alert analyse key aspects of the IAA’s decision and draw out important takeaways for pharma companies operating in the EU.

Leadiant’s conduct wasn’t only under scrutiny in Italy. Investigations in Spain and Belgium, for example, are ongoing. Last year, the Dutch antitrust authority fined the firm EUR17.9m in its first ever penalty for excessive pricing (see our July 2021 edition of Antitrust in focus).

Other pharma companies have also faced excessive pricing charges. In 2021 Aspen agreed behavioural commitments with the European Commission to address concerns over the prices of certain critical cancer medicines. More recently these commitments have been extended by the UK Competition and Markets Authority (CMA) to cover the UK. The CMA has also imposed record fines on several drug makers for excessive pricing and “pay-for-delay” agreements.

As antitrust authorities seek to prioritise consumer welfare and to assist national health services coming under increasing financial pressure in the wake of the Covid-19 pandemic, we may well see other cases at both the EU and national level.

U.S. antitrust agencies continue to scrutinise healthcare/pharma sectors

The healthcare and pharmaceuticals sectors have been under intense scrutiny by the U.S. antitrust agencies – in particular the Federal Trade Commission (FTC) – over the past year. This follows President Biden’s July 2021 Executive Order, which singled out healthcare markets as a particular enforcement priority.

This month, there have been four significant developments:

1. The FTC announced tougher enforcement against illegal bribes and rebate schemes that block cheaper drugs

In a move that mixes antitrust, commercial bribery and marketing practices, the FTC issued an enforcement policy statement, announcing that the FTC will use the full range of its powers to combat illegal prescription drug practices that foreclose competition and harm patients.

It is concerned that drug companies use payments and rebate schemes to incentivise higher list prices for drugs and exclude rivals from offering lower-cost drug alternatives. A particular focus is insulin – the FTC notes that the list price of insulin has increased by over 300% in the last two decades. The statement questions whether this is a result of, for example, conditional rebate and fee agreements offered by manufacturers to encourage pharmacy benefit managers (PBMs) and other intermediaries to steer patients to their higher-cost drugs.

The agency sets out the various grounds under which the rebate practices may be illegal, including the laws which prohibit unlawful monopolisation, unfair methods of competition and commercial bribery.

2. The FTC and DOJ held a public workshop to examine antitrust enforcement in life science mergers

As the FTC and Department of Justice (DOJ) undertake a review of the U.S. agencies’ merger guidelines, with a major revision expected, the agencies held a workshop that suggests a sector approach to mergers for pharmaceuticals and other life sciences markets. The workshop marks the culmination of the work of a cross-border taskforce on pharma mergers, established in March 2021, involving the U.S. antitrust agencies (and offices of State Attorneys General), Canadian Competition Bureau, European Commission and UK Competition and Markets Authority (CMA).

FTC Commissioner Rebecca Slaughter, giving the keynote speech, noted the importance of considering the impact of a pharma merger on incentives to innovate, and not just limiting enforcement to existing and pipeline products. She said that the taskforce will continue to work together on both specific cases and general approaches. The role of intellectual property was also flagged as an area for merger review consideration.

3. The FTC launched an inquiry into pharmacy benefit managers

After years of effort by some critics, the FTC is looking once more at the role of PBMs on competition. PBMs are ‘middlemen’ in the prescription drug industry who are hired to, for instance, negotiate rebates and fees with drug manufacturers and reimburse pharmacies for patients’ prescriptions.

The FTC will look at the impact of vertically integrated PBMs on the access to and affordability of prescription drugs. The FTC is particularly interested in practices such as fees and clawbacks charged to unaffiliated pharmacies, methods to steer patients towards pharmacies owned by the PBMs, and potentially unfair audits of independent pharmacies.

The FTC already has a bank of information on PBMs. In response to its February 2022 call for information it has received over 24,000 comments. The new inquiry will build on this with information from the PBMs themselves – the agency plans to order the six largest managers to provide records about their business practices.

4. Two healthcare mergers were abandoned after the FTC sued to block

On the same day early this month, the FTC announced challenges to two healthcare transactions.

It claims that the planned merger between Utah healthcare rivals HCA Healthcare and Steward Health Care System will reduce the number of healthcare systems offering inpatient general acute care hospital services, significantly increase concentration levels and, crucially, eliminate Steward as a low-cost competitor.

The FTC’s complaint against RWJBarnabas Health’s acquisition of Saint Peter’s Healthcare is similarly grounded in concerns over inpatient general acute care services. It alleges the deal will remove head-to-head competition between the parties, increase concentration and leave insurers with fewer, less attractive alternatives.

As a result of these challenges, both transactions have been abandoned. In a statement, the FTC notes that the agency “will not hesitate to take action in enforcing the antitrust laws to protect healthcare consumers who are faced with unlawful hospital consolidation”.

The cases follow two abandoned healthcare mergers earlier in 2022 – Lifespan/Care New England and Hackensack/Englewood. Health insurance deals have also been in the spotlight, with the DOJ suing to block United Health Group’s acquisition of Change Healthcare (see our March edition of Antitrust in focus) in February.

The key takeaway from this recent activity is to expect rigorous antitrust scrutiny and aggressive enforcement in healthcare/pharma markets, both in the U.S. and beyond. Transactions in these sectors, as well as certain business practices, such as those that could negatively impact prices, transparency and access to drugs and healthcare services, will likely remain in the spotlight.

A&O Antitrust team in publication

Recent publications by members of our global team include:

Spotlight on Frances

A typical working day in Brussels involves… a nice lunch with colleagues.

If I hadn’t become an antitrust lawyer, I would be… a frustrated politician, a happy gardener or an investigative journalist.

The best career advice I’ve been given is… choose your battles wisely / work hard, play hard / use bullet points (thanks Juules!).

The most interesting matter I’ve worked on is… every case where I learn something new about pharmaceuticals, nuclear reactors, insulation materials, chemicals etc.

For me, being a good lawyer/advisor means… that my clients can trust me to defend their interests and that my colleagues can rely on me when they need me.

Something I’d like to do but haven’t yet done is… visit Graceland (have been a die-hard Elvis fan since the tender age of 7).

My ideal weekend in one sentence… reading the FT weekend edition with a glass of bubbles.

My typical weekend in one sentence… reading the FT weekend edition with a glass of bubbles.

Something that might surprise you about me is… that I like to drive fast.

My top tip for visitors to Brussels is… just wander around a city that is both beautiful and ugly at the same time.