The fifth annual International Competition Network (ICN) conference was recently held from 3–5 May in Cape Town, South Africa. Around 300 representatives of almost 70 antitrust agencies participated, as well as competition experts from international organisations and the legal, business, consumer, and academic communities. The ACCC is active in the ICN, sitting on the steering group, a number of working groups, including participating in the mergers working group, and co-chairing the cartel enforcement techniques working group. The conference highlighted the recent work of four ICN working groups focusing on mergers, cartels, antitrust enforcement in the telecommunications sector, and competition policy implementation.
The mergers working group used the conference to present the release of the Merger guidelines workbook and implementation handbook, as well as hold breakout sessions on how to deal with problems associated with setting notification thresholds.
This year's anti-cartel work included an examination of the obstruction of cartel investigations, an evaluation of electronic evidence-gathering techniques, the development of tips for an effective leniency program, and a review of the interaction of private and public enforcement. The conference agreed to release the two chapters of the Enforcement handbook on digital evidence and leniency programs.
A working group devoted to examining antitrust enforcement in telecommunications presented a report that focused on the enforcement and advocacy role of antitrust authorities in the sector. The group also developed suggested best practices for competition agencies for effective enforcement and advocacy in the sector. The competition policy implementation working group addressed ICN initiatives to assist newer antitrust agencies in developing economies. The group presented reports on assessing technical assistance programs, business outreach programs, lessons learned by new agencies, the relationship between antitrust authorities and the judiciary, and a pilot consultation/partnering program among ICN members.
ICN members adopted suggested best practice for antitrust enforcement in the telecommunications sector, underscored the importance of the ICN's anti-cartel work, and highlighted the significant progress member jurisdictions have made in implementing ICN recommendations and work product. The members also approved a new work agenda that includes a study of agency cooperation in anti-cartel enforcement, and workshops on merger investigation and analysis. In addition, the ICN established a new working group to address unilateral conduct that will be co-chaired by the FTC and the German Federal Cartel Office.
EC fines companies for their role in a chemical cartel
The European Commission (EC) has imposed a fine of A$638 million on seven companies found guilty of participating in a chemical cartel between 1994 and 2000. The companies participated in the cartel in the hydrogen peroxide (HP) and perborate (PBS) markets to allocate market shares and customers, fix prices and limit production. The fine, which is the third largest handed down by the EC, takes into account that many of the companies are repeat offenders.
Nine companies participated in the HP and PBS cartels, with seven of these companies (Akzo Nobel, Edison, FMC/Foret, Kemira, Snia, Solvay and Total/Elf Aquitaine/Arkema) receiving fines. Arkema (formerly Atofina), Solvay and Edison had their fines increased as they were repeat offenders. Degussa, also a repeat offender, received full immunity for providing information about the cartel. L’Air Liquide (and its subsidiary Chemoxal) was subject to the prohibition decision, but the Commission’s right to impose fines expired as the company left the market in 1998. The fine represents the third largest fine ever imposed by the European Commission.
EC launches surprise raids on energy companies
EC and German Competition Authority (BundesKartellamt) officials have conducted raids on the premises of several energy companies suspected of breaching Articles 81 and 82 of the EC Treaty. These raids closely follow the investigations carried out last week against Europe’s largest gas groups, including RWE, Gaz de France, Distrigas and Eon. The EU seeks to remove national obstacles to competition following the liberalisation of the energy industry. The deregulation of the industry gave businesses the right to choose power and gas suppliers as of July 2004 and will extend that choice to household consumers in July 2007.
European court upholds lysine cartel fine
The EC has welcomed the European Court of Justice ruling on the Archer Daniels Midland case which has confirmed that, when setting the level of fines, the EC does not have to take into account fines paid by a company in other jurisdictions. Archer Daniels Midland was fined by the EC in 2000, as well as by regulators in the US and Canada, for operating a world-wide price fixing cartel for amino acids (lysine). Archer Daniels Midland has also been fined by the EC for its participation in two other cartels. In 2001 the EC imposed a fine of A$17.5 million on the company for participating in the sodium gluconate cartel and A$69 million for participating in the citric acid cartel.
