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EU Competition Law Update

11 July 2012

Arnold & Porter’s EU Competition Law UpdateSeminar/Webinar

11 July 20124:00 p.m. – 5:00 p.m. CET60 minutes

Table of Contents

Agenda ..................................................................................Tab 1

Presentation Slides ...............................................................Tab 2 Moderator/Speaker Biographies............................................Tab 3 Marleen Van Kerckhove, Silvio Cappellari, Axel Gutermuth

Practice Overview .................................................................Tab 4 EU Competition Law Practice

Tab 1: Agenda

Arnold & Porter’s EU Competition Law UpdateSeminar/Webinar

11 July 20124:00 p.m. – 5:00 p.m. CET60 minutes

Agenda

I. Introduction............................................................................4:00 – 4:05 p.m. Marleen Van Kerckhove, Antitrust/Competition Practice, Arnold & Porter LLP

II. Presentation and Discussion .................................................4:05 – 4:50 p.m.

Speakers: Marleen Van Kerckhove, Antitrust/Competition Practice, Arnold & Porter LLP

Silvio Cappellari, Antitrust/Competition Practice, Arnold & Porter LLP Axel Gutermuth, Antitrust/Competition Practice, Arnold & Porter LLP

III. Questions and Answers.........................................................4:50 – 5:00 p.m.

Attending this webinar qualifies you for one accredited CPD hour - Ref 2616/ARPO. CLE is pending.

Tab 2: Presentation Slides

Webinar:EU C titi L U d tEU Competition Law Update

Marleen Van KerckhoveSilvio CappellariAxel Gutermuth

11 July 2012

Agenda

Cartel enforcement

– Substance – Dow/DuPont (GC) and Window Mountings (EC)

– Procedure – new Best Practices, “Manual of Procedure” and dawn raid litigation

– Private enforcement – disclosure issues

Mergers

– Trends: Policy and Statistics

– Interesting cases

Abuse of dominance

– Commission activity

– Court judgments: Post Danmark, Microsoft, Tomra, Telefónica

Q&A

2

Cartel Enforcement

Overview

Substance

– GC: DuPont and Dow => liability of JV parents

– Statistics on GC proceedings

– EC: Window Mountings => fines

Procedure

– Reform of the EC’s procedural framework

EC’s “Manual of Procedure”– EC s Manual of Procedure

– Litigation on dawn raids (AG Bot in E.On)

Private enforcement – disclosure issues

– Aftermath of Pfleiderer

– Disclosure under Regulation no. 1049/20014

Substance

GC: Dow and DuPont (Chloroprene Rubber), 2 February 2012

– Court confirmed parent liability for 50/50 JV due to “economic, organizational and

legal links”

– Need to prove ability to exercise decisive influence and actual exercise of such

influence

• Ability I: parent representatives in Member Committee, which had broad approval rights

on strategic issues (appointment/dismissal of board and management members,

approval of business and strategic plans )approval of business and strategic plans ...)

• Ability II: approval of JV creation by the EC, which had found joint control

• Actual exercise: decisions by the Member Committee, inter alia, (i) to appoint top

managers; (ii) to close a production plant in the UK; and (iii) to conduct an internal

audit into potential cartel participation

5

Substance (cont’d)

GC: Dow and DuPont (cont’d)

– Counter-arguments of the parent companies rejected

• No knowledge of the cartel => irrelevant

• Full-function character of the JV

=> economic autonomy does not necessarily translate into strategic autonomy

• Only “negative control”

=> veto rights sufficient, power to impose decisions not necessary

• Concept of “single economic entity” contradicts case-law on applicability of Article 101

TFEU t t t l l ti hi b t t d JVTFEU to contractual relationship between parents and JV

=> no legitimate expectation that previous EC approach will be maintained

– Conclusions

• Confirmation of GC’s and EC’s tough stance on parent liability also for JVs

• Important (though not surprising) clarifications on full functionality and negative control

• Always fact-specific analysis (Industrial Bags, 6 March 2012 – no liability of JV parents

due to insufficient factual evidence presented by the EC) 6


Some statistics on GC proceedings (3/2011 – 3/2012)

– 75 rulings concerning 13 EC decisions

• 40 x EC decision upheld, 27 partial annulments, 8 total annulments

• Reduction of total fines from EUR 3.6 billion to EUR 3.0 billion

– Successful arguments

• Wrong/insufficient analysis of the facts => 23 successful claims (14 relating to duration)

• Incorrect application of the Fining Guidelines => 14 successful claims (in particular cooperation and unequal treatment)> 14 successful claims (in particular cooperation and unequal treatment)

• Parent liability => 5 successful claims

• General issues => 5 successful claims (length of proceedings, time bar, no exercise of full jurisdiction)

CJEU proceedings: 9 rulings concerning 4 EC decisions

– 7 x GC ruling upheld, 2 annulments7


EC: Window Mountings, 28 March 2012

– Decision more than 4.5 years after dawn raids

– Total fines of EUR 86 million imposed on 9 companies

– Exceptional application of point 37 of the 2006 Fining Guidelines as most cartel

participants were single-product firms => significant fine reductions

“Although these Guidelines present the general methodology for the setting of

fines, the particularities of a given case ... may justify departing from such

th d l ”methodology.”

– Yet another example of EC’s increased flexibility on fines

– EC stressed fact-specific nature of the decision – but potentially far-reaching

implications

8


Other EC decisions

– Freight Forwarders, 28 March 2012

• Decision 4.5 years after dawn raids

• Total fines of EUR 169 million imposed on 14 companies

• Follow-up to Air Cargo case – but apparently different approach to single and continuous complex infringement (4 separate cartels)

– Water Management, 27 June 2012

• Decision 3.5 years after dawn raids – even though only 3 companies involved

• Total fines of EUR 13.7 million imposed on two companies

• Sixth settlement case

– Mitsubishi and Toshiba (GIS), 27 June 2012

• Re-adoption of decision after GC annulment (unequal treatment due to different reference years)

• Significant fine reductions – EUR 218.6 million => EUR 131.6 million

9

Procedure

Reform of EC’s procedural framework for antitrust investigationsReform of EC s procedural framework for antitrust investigations

– Notice on Best Practices

• State of play meetings at key points of the proceedings

• Access to key documents already during investigative phase

• Information in the SO about parameters for fine calculation

– Extended mandate of the Hearing Officer

• Supervision regarding effective exercise of rights of defence throughout the proceedings

• In particular in charge of disputes about privilege issues and self-incrimination

• Strengthened role in preparation and conduct of Oral Hearings

– Best Practice Guidelines for the submission of economic evidence

• Recommendations regarding content and presentation of economic analysis

• Guidance on response to requests for quantitative data

10

Procedure (cont’d)

Publication of EC’s “Manual of Procedure”Publication of EC s Manual of Procedure

– EC’s internal guidelines on the handling of antitrust investigations published in

March 2012

– Triggered by the request of a lawyer under Regulation no. 1049/2001

– 278 pages – 28 chapters, inter alia dealing with the handling of complaints, the

treatment of cartel whistleblowers and the decision processes within the EC

– Chapters on sector inquiries and fines/remedies still “under construction”;

chapter on dawn raids kept out completely (“protection of the investigation”)

11

Procedure (cont’d)

Litigation on dawn raids

– AG Bot, opinion in E.On case, 21 June 2012

• GC upheld EC decision imposing a fine of EUR 38 million on E.On for breaking of seal

• Bot: GC did not fully exercise its jurisdiction but largely relied on the EC’s fine calculation

• Necessary: proportionality analysis based on turnover data – fine must be proportionate to

(i) the seriousness of the infringement (breaking the seal); and

(ii) the fine that E.On would have incurred if found guilty of a cartel infringement

• Also: fine must have sufficient deterrent effect if compared to the infringer’s financial means

– May 2011: EUR 8 million fine for breaking of seal imposed on Suez Environment and

Lyonnaise des Eaux

– March 2012: fines of EUR 2.5 million imposed on two Czech companies for

obstruction of a dawn raid inspection

• Unblocking of e-mail account after it had been blocked by the EC

• Diversion of incoming e-mails from a blocked account to a server12

Private Enforcement – Disclosure

Aftermath of CJEU’s landmark Pfleiderer rulingAftermath of CJEU s landmark Pfleiderer ruling

– Germany: Pfleiderer II, 18 January 2012

• No access to leniency applications and supporting documentary evidence

• Interest in effective leniency program prevails

– UK: National Grid (GIS), 4 April 2012

• No request for access to corporate statements; but documents at issue likely included

leniency materials (or explanations on leniency materials)

• Pfleiderer balancing test to be applied also to documents in the EC’s file

• Focus on principles of legitimate expectations and proportionality

• Legitimate expectations: no greater exposure of leniency applicant to follow-on claims

• Proportionality: (i) information available from other sources?; (ii) relevance of the

information to the private damage action

• Result: disclosure of additional 32 paragraphs of the EC’s decision; very limited

access to RFI responses; no access to SO responses 13

Private Enforcement – Disclosure (cont’d)

Aftermath of Pfleiderer (cont’d)

– Joint Resolution by the Heads of the EU’s 27 NCAs of 23 May 2012:

The NCAs are “determined to defend the effectiveness of leniency programs in

order to ensure a high level of anti-cartel enforcement.”

“[L]eniency materials should be protected against disclosure to the extent

necessary to ensure the effectiveness of leniency programs.”

EU legislation on private enforcement

– EC “Roadmap” foresees legislative proposal still in 2012 – probably a directive

– Topics:

• Access to the case file/protection of leniency programs

• Standing of indirect purchasers/passing-on defense

• Ways to make NCA decisions legally binding throughout the EU

14

Private Enforcement – Disclosure (cont’d)

Disclosure under Regulation no. 1049/2001

– GC: EnBW (GIS), 22 May 2012

• EC: no access to case file due to “unreasonable burden” to check the individual documents for

business secrets or other confidential information

• GC: any exception to general access right to be interpreted and applied strictly – EC needs to

assess all options to grant access “in a concrete, specific and detailed manner”

– CJEU: Édition Odile Jacob, 28 June 2012

• EC had turned down access request by a complainant in merger proceedings

• GC: EC needs to demonstrate “in a concrete and individual manner” that disclosure would

run counter to protection of commercial interests and/or protection of the investigation

• CJEU: “general presumption” that disclosure of EC’s correspondence with merging parties

and third parties would undermine both objectives

• Same presumption for EC-internal documents if proceedings are pending or likely to be re-

opened

• Relevance also for antitrust files?15

Mergers

StatisticsJanuary 2012 - June 2012

Phase I decisions: 116, of which– 79 under the simplified procedure– 3 with commitments

Phase II decisions: 3, of which– 2 with commitments– 1 prohibition

Phase II proceedings initiated: 6Appeals bro ght 4 of hich Appeals brought: 4, of which– 3 against a clearance decision (both with and without

commitments, both by merging party and by third parties)– 1 against a prohibition decision

17

Trends

Review certain aspects of merger controlReview certain aspects of merger control regime:– Capture (certain) non-controlling minority acquisitions

– More streamlining between EC and national regimes

Simplification of the process:– Pre-notification contacts: short, informal, flexible (see , , (

also priority issue below)

– Simplified procedure: further streamline

18

Priority principle in merger assessments

Seagate/Samsung: 4 to 3– First EC contact on 3/14; notified and announced on 4/19

– Unconditional clearance after Phase II

Western Digital/Viviti: 3 to 2– Announced on 3/7; first EC contact on 3/10; notified on 4/20

– Conditional clearance after Phase II (on appeal)

Seagate/Samsung decision:– “competitive conditions existing at the time of notification constitute– competitive conditions existing at the time of notification constitute

the relevant framework”

– “neither necessary nor appropriate to take into account future changes [...] resulting from subsequently notified transactions”

– “legal certainty, transparency and objectivity”

19

Dawn raids in merger investigation

Caterpillar/MWM (19 October 2011 – published in 2012):– Phase II investigation – closed without commitments– Inspections shortly after opening of Phase II re concerns over:

• Lack of bidding data

• Provision of misleading information

• Early implementation

– Art 11(3) letter sent to industry association (IESG) and certain of its members requiring the handing over or completion of share

d/ biddi d tand/or bidding dataNote: in parallel, the EC started an Article 101 investigation into the

issue, which according to unconfirmed press reports has since been closed

20

Parallel EC and national investigations

Hutchison 3G Austria/Orange Austria (pending)Hutchison 3G Austria/Orange Austria (pending)– Both mobile network operators in Austria – 4 to 3

transaction

– Prior to acquisition, Orange will sell YESS! customers to A1 Telekom Austria (but conditional on first deal closing)

Hutchison 3G Austria/Orange is before EC and– Hutchison 3G Austria/Orange is before EC and Orange/A1 Telekom Austria is before Austrian competition authorities – both are currently in Phase II

– Austria asked for referral back

21

Foreclosure

Google/Motorola Mobility (“MM”) (13 February 2012): t ti l l ti hitwo vertical relationships– Google’s Android mobile OS (share attributed to Google) and

Motorola Mobility’s smart mobile devices– Motorola Mobility’s standard essential patents as key inputs into

the smart mobile devices industry

Assessment OS – competitor foreclosure:– Ability to foreclose: Google’s ability to favour one or other

Android partner will not change as result of mergerp g g– Incentive to foreclose: doubtful that Google could capture more

profits from favouring MM’s devices rather than having a large base for its search and advertising services

– Effects: any foreclosure would have limited impact since most competing OEMs have alternatives to turn to

22

Foreclosure (cont’d)

Potential concerns re MM’s SEPs– Raising royalty levels– Raising royalty levels

– Forcing potential licensees into cross-licenses on terms they would not otherwise have agreed to

– Excluding competitors from the market

Ability– Despite FRAND obligations, Google has some ability to seek or threaten injunctions; but only

applies to non-licensees Apple and Microsoft where MM has already sought injunctions – hence, not merger specific

Incentive– MM’s current maximum per-unit royalty is non-merger specific and Google has limited incentives to

raise that level (incl. FRAND)

– Google internal documents show that aim of transaction is to protect Android ecosystem rather than impede competition plus Google public commitment to FRAND (see letter); plus threat of counterimpede competition, plus Google public commitment to FRAND (see letter); plus threat of counter-suits

– None of Google’s internal documents provide evidence that Google would seek injunctions against its competitors with the aim of ultimately excluding them from the market

Effect: not merger specific

23

Prohibition and market definition

Deutsche Börse/NYSE Euronext (1 FebruaryDeutsche Börse/NYSE Euronext (1 February 2012)– European financial derivatives traded on exchanges,

i.e., exchange-traded derivatives

– Not substitutable with “over-the-counter” trade derivatives

C i l i h hi h b i– Creating near-monopoly with high barriers to entry, less innovation and no off-setting efficiencies (see below)

24

Prohibition and efficiencies

Deutsche Börse/NYSE Euronext“It is very rare that we have concerns that prompt a prohibition decision. But this did happen in the Deutsche Börse/NYSE Euronext deal this year, where we found that the transaction would have created a de facto global monopoly on derivatives with European underlyings. In that case, we rejected the efficiency claims that money would be saved by the netting of margins, in part because there was no evidence that without competition these savings would be transmitted to the investors.So let me say something about efficiencies. We are accused of not taking productive efficiencies into account when we assessnot taking productive efficiencies into account when we assess mergers. This is not true and efficiency claims are always carefully assessed when they are submitted.But we cannot accept efficiencies when their benefits are not transmitted to the economy in term of prices or innovation but are instead kept as private profits.” (Almunia, 22 June 2012)

25

Commitments

Sony/Mubadala/BMI (19 April 2012) – music publishing– Issues identified in online licensing of copyright– Concern focused on online licensing of Anglo-American chart

hits in the EEA as an indispensable part of any online platform offering (in partcular UK and Ireland)

– Divestiture of global rights to four catalogues and recent and future works of 12 contemporary Anglo-American artists

Western Digital/Viviti (23 November 2011) – hard disk drives– Need to preserve competition as well as innovation; explicit

obligation imposed that buyer of divested assets should have innovation capability

26

Abuse of dominance

Commission activity

No decisions.

Samsung (January 2012), Motorola (April 2012): Cases opened re alleged failure to honor commitments made to the European Telecommunications Standards Institute (ETSI) by seeking and enforcing injunctions in various Member States’ courts against competing mobile device makers based on alleged infringements of certain of its patents which it had declared essential to implement European mobile telephony standards.

Thomson Reuters: Offered Article 9 commitments rejected after market test (March 2012), improved commitments offered in May 2012. Alleged abuse: preventing customers or competitors from translating Reuters Instrument Codes (RIC) to alternative identification codes of other data feed suppliers (“mapping”).

MathWorks (March 2012): Case opened re alleged refusal to provide competitors with end-user software licenses and interoperability information (similar to Microsoft case). Products concerned: commercial control systems.

28

Post Danmark: Overview

Preliminary ruling, ECJ, 27 March 2012, case C-209/10 – Grand Chamber

Post Danmark had a monopoly for addressed letters and parcels under a certain weight and a universal service obligation in that regard

Relevant market : distribution of unaddressed mail in Denmark – liberalized, but Post Danmark dominant – same distribution network as for addressed mail

Competitor Forbruger-Kontakt active in distribution of unaddressed mail

Forbruger initially had contracts with three large Danish supermarket chains, which switched to Post Danmark in 2004

National authority found that Post Danmark had abused its dominant position on the market for delivery of unaddressed mail by charging Forburger’s former clients lower rates than its existing clients without justification

Post Danmark appealed in Denmark, Danish Supreme Court referred to ECJ

29

Post Danmark: Predatory pricing (1)

AKZO test for predatory pricing (ECJ 27):

– Prices below average variable costs: abusive

– Prices below average total costs: abusive if they are part of a plan to eliminate a

competitor

In this case:

– Selective low prices (to clients of competitor)

– For one customer (Coop), the resulting price level was lower than Post

Danmark’s average total cost for the business of delivery of unaddressed mail,

but higher than its average incremental costs (~ average variable costs)

– An intention to foreclose rivals in the sense of AKZO has not been established

30

Post Danmark: Predatory pricing (2)

“[A] policy by which a dominant undertaking charges low prices to certain major customers of a competitor may not be considered to amount to an exclusionary abuse merely because the price that undertaking charges one of those customers is lower than the average total costs attributed to the activity concerned, but higher than the average incremental costs pertaining to that activity […]” (emphasis added)

“In order to assess the existence of anti-competitive effects in circumstances such as those of that case, it is necessary to consider whether that pricing policy, without objective justification, produces an actual or likely exclusionarypolicy, without objective justification, produces an actual or likely exclusionary effect, to the detriment of competition and, thereby, of consumers’ interests.”

Thus, a selective price cut for one customer leading to prices in the second AKZO category does not constitute an “automatic” predatory pricing abuse, but an abuse is not excluded.

Relevance of plan to foreclose?31

Post Danmark: Discrimination

Question for preliminary ruling explicitly asked for the existence of an

exclusionary abuse (ECJ, 18)

ECJ, 30: “The presence of price discrimination […] cannot of itself suggest

that there exists an exclusionary abuse.”

Reply: “[…] may not be considered to amount to an exclusionary abuse

merely because” (emphasis added)

Thus selective price cuts may constitute a discrimination abuse – but under Thus, selective price cuts may constitute a discrimination abuse – but under

what circumstances?

32

Microsoft: Overview

GC, 27 June 2012, case T-167/08

Application for annulment regarding the EUR 899 million periodic penalty payment imposed against Microsoft in 2008

Reason for penalty: Microsoft’s non-compliance with the 2004 Commission decision from June 2006 to October 2007 (16 months)

– NB: Earlier penalty of EUR 280.5 million for period from December 2005 to June 2006

2004 decision required Microsoft to make interoperability information available “on reasonable and non-discriminatory terms” (Article 5(a) of 2004 decision)

Interoperability between (i) Microsoft Windows PCs and (ii) work group server operating systems– Interoperability between (i) Microsoft Windows PCs and (ii) work group server operating systems

– Only specifications of protocols, not Microsoft’s source code

2008 decision held that interoperability information was not offered on reasonable terms before October 2007

GC upheld the Commission’s decision, but reduced the fine to EUR 860 million because it found that the Commission had not correctly assessed the gravity of Microsoft’s conduct

33

Microsoft: Two preliminary aspects

GC: Obligation to apply “reasonable terms” not too g pp y

unspecific, can be the basis for a periodic penalty

payment in case of non-compliance

GC: Dominant company must offer reasonable terms on

its own initiative

34

Microsoft: Assessment of “reasonableness” –strategic value vs intrinsic value of information

Commission and GC: the remuneration must not reflect

the “strategic value” of the information, but only the

information’s “intrinsic value”

Strategic value = remuneration rates reflecting the value

resulting from the mere ability to interoperate (GC, 142)

All i Mi ft t h t t i l “ ld i Allowing Microsoft to charge strategic value “would in

effect allow [Microsoft] to transform the benefits of the

abuse into remuneration for the grant of the license”.

(GC, 142)

35

Microsoft: Assessing the intrinsic value of interoperability information

Work Group Server Protocol Pricing Principles to determine intrinsic

value (GC, 31):

i. Protocols = Microsoft’s own creation (not taken from the public domain)?

ii. Protocols = innovation (they must be novel and not obvious to persons skilled in

the art, interpreted as under the European Patent Convention)?

Commission: found that only a very small part of the protocols in question

include innovative information; and

iii. Market valuation of comparable technologies required, excluding the strategic

value stemming from the dominant position of any such technologies.

Commission: comparable technologies are offered remuneration-free by

Microsoft and by other undertakings

GC endorsed this approach and its application by the Commission.

36

Microsoft: Some implications

Burden on dominant company to establish reasonable p y

royalty rates – procedural safeguards do not help.

Assessment of intrinsic value practically possible?

No explicit guidance for situations where patented

technology has to be licensed on reasonable terms –

d i i i li it d t Mi ft’ “N P t t t”decision is limited to Microsoft’s “No Patent agreement”.

Impact on FRAND licensing in the context of standard

setting?

37

Tomra: Overview

ECJ, 19 April 2012, C-549/10 P

Appeal against the dismissal, by the GC in September 2010, of an

application for annulment against a March 2006 Commission

decision fining various Tomra entities EUR 24 million

Dominant position on several national markets for reverse vending

machines (very high market shares for Tomra: above 70% or

t 95%)event 95%)

Abuse : exclusivity agreements, individualized quantity

commitments and individualized retroactive rebate schemes

(period 1998-2002)

ECJ dismissed application, upheld Commission decision38

Tomra: Interesting Points (1)

Confirmation that anti-competitive intent is not relevant for the finding of abuse, and an intention to compete on the merits is no defence – but intent is one factor that can be taken into account

Foreclosure of a “substantial” part of the market is sufficient for a finding of abuse – precise “market coverage” of behaviour does not need to be established (was approximately 40%)

ECJ 42: “[T]he foreclosure by a dominant undertaking of a substantial part of the market cannot be justified by showing that the contestable part of the market is still sufficient to accommodate a limited number of competitors.”

– “Customers on the foreclosed part of the market should have the opportunity to benefit from whatever degree of competition is possible on the market.”

– “Competitors should be able to compete on the merits for the entire market and not just a part of it.”

– “It is not the role of the dominant undertaking to dictate how many viable competitors will be allowed to compete for the remaining contestable portion of demand.”

39

Tomra: Interesting Points (2)

Retroactive (loyalty) rebate schemes: not necessary to make a price

– cost comparison of the dominant company. Largely reliance on

old case law.

– ECJ, 79: “The loyalty mechanism was inherent in the supplier’s ability to drive out

its competitors by means of the suction to itself of the contestable part of

demand.” It “is not necessary to assess the actual effect of the rebates on

competition given that it is sufficient to demonstrate that the conduct at issue is

capable of having an effect on competition” (or tends to restrict competition –capable of having an effect on competition (or tends to restrict competition

ECJ, 68, 72).

Commission’s 2009 Guidance Paper on exclusionary abuses

mentioned, but found to be irrelevant for a decision adopted in 2006

40

Telefónica: Overview

GC, 29 March 2012, cases T-336/07 (Telefónica) and T-398/07 (Spain)

Application for annulment of a July 2007 Commission decision imposing a

fine of EUR 152 million on Telefónica

Abuse: Margin squeeze (2001 to 2006) as between

– prices offered by Telefónica to downstream competitors for wholesale broadband access to

Telefónica’s network at a regional and national level and

– Telefónica’s prices for retail broadband access (downstream market).Telefónica s prices for retail broadband access (downstream market).

GC dismissed application, upheld Commission decision

Telefónica has lodged an appeal

41

Telefónica: Interesting points (1)

Margin squeeze test does not have to be carried out on the basis of an

optimal mix of available wholesale access products, which are offered in

separate product markets.

– Thus, available local loop wholesale access (no abuse) was not relevant for the assessment

of abuse on the market for national and regional wholesale access

Confirmation that margin squeeze is a separate abuse (Deutsche Telekom).

– Excessive pricing on upstream market not relevant

– Predatory pricing on downstream market not relevant

Confirmation that dominance on downstream market is not required

(TeliaSonera).

42

Telefónica: Interesting points (2)

Confirmation that margin squeeze should be assessed based on prices and

costs of the dominant firm (as efficient competitor test) (Deutsche Telekom)

– “Whether an undertaking in a dominant position would have been sufficiently efficient to offer

its retail services to end users otherwise than at a loss if it had first been obligated to pay its

own wholesale prices for the intermediary services.”

Confirmation that strategy of dominant company can also be relevant.

GC upholds Commission’s calculation of Telefónica’s costs under the

f “ ”discounted cash flow method and the “period-by-period approach”.

Commission was right in holding that the margin squeeze probably

reinforced the barriers to entry and expansion and that the competition

would have probably been stronger in the retail market absent the abuse.

43

Thank you!

Tab 3: Moderator/Speaker Biographies

arnoldporter.com Arnold & Porter (Brussels) LLP is a limited liability partnership organized under the laws of the State of New York that is regulated by the Brussels Bar. It is an affiliate of Arnold & Porter LLP, a limited liability partnership organized

under the laws of the District of Columbia, which does not itself practice in Brussels.

Marleen Van Kerckhove Partner

Marleen Van Kerckhove heads up the firm's European competition practice and its Brussels office. Her practice encompasses advice and representation before EU and national antitrust agencies on merger control, abusive conduct, price fixing and other restrictive practices, as well as litigation before European courts. She

has steered many transactions successfully through EU and national merger control reviews across various industry sectors.In addition, she has advised extensively on the application of EU competition law to the pharmaceutical sector, and on the interplay between antitrust and intellectual property law. Ms. Van Kerckhove is a frequent speaker at programs and conferences in Europe, Japan and North America.

Representative Matters

General Electric and NBCU Universal in connection with the Comcast- NBCU joint venture.

General Electric in its acquisition of Dresser Inc. Clearance in the EU and in multiple jurisdictions world-wide.

Sanyo in its merger with Panasonic. Obtained clearance in the EU.

European Federation of Pharmaceutical Industries Associations (EFPIA) before the European Court of Justice and the General Court in its intervention supporting AstraZeneca in its appeal against the European Commission's decision finding an Article 82 infringement with respect to certain of its alleged regulatory and IP conduct.

Pfizer in its acquisition of certain animal health businesses from Schering-Plough. Clearance in the EU.

Finmeccanica in its acquisition of DRS Technologies. Clearance in multiple jurisdictions world-wide.

Major international company with respect to a global competition compliance audit.

SBC in its acquisition of AT&T. Obtained clearance in multiple jurisdictions world-wide.

Cisco in its acquisition of Scientific-Atlanta. Obtained clearance in the EU.

Contact Information Marleen.VanKerckhove@ aporter.com tel: +32 (0)2 290 7817 fax: +32 (0)2 290 7899

1, Rue du Marquis - Markiesstraat, 1 B-1000 Brussels

Practice Areas Antitrust/Competition FDA and Healthcare Telecommunications, Internet, and Media

Education LLM, London School of Economics, University of London, 1987 Diploma European Law, University of Nancy, France, 1983 LLB, University of Leuven (KUL), Belgium, 1982

Admissions Brussels, Belgium

Marleen Van Kerckhove Arnold & Porter LLP 2

Boston Scientific in its acquisition of Guidant. Obtained clearance in the EU and multiple other jurisdictions world-wide.

Group of consumer electronics companies before the European Commission with respect to an Article 82 EC Treaty complaint regarding abusive licensing conduct.

Pfizer in its acquisition of Pharmacia. Obtained clearance in the EU and multiple other jurisdictions world-wide.

General Electric in its proposed acquisition of Honeywell, assisting both with the notification to the European Commission and the subsequent appeal to the Court of First Instance.

Pfizer in its acquisition of Warner-Lambert. Obtained clearance in the EU and multiple other jurisdictions world-wide.

Rankings

Chambers Global 2012 for Competition/European Law: Belgium

PLC Which lawyer? 2012: Recommended for EU Life sciences: Competition/Anti-trust

PLC Which lawyer? 2012: Recommended for competition/anti-trust

PLC Which lawyer? 2012: Recommended for EU Competition

PLC Which lawyer? 2011: Endorsed for Competition/anti-trust (Belgium), EU Life sciences: competition/anti-trust (European Union), and EU Competition (European Union)

Chambers Europe: Europe’s Leading Lawyers for Business 2011 for Competition/European Law

The Legal 500 EMEA 2011 for Competition

The International Who's Who of Competition Lawyers 2011

Chambers Global: The World's Leading Lawyers for Business 2011 for Competition/European Law

Euromoney's Guide to Women in Business Law 2010: included as an Expert in Competition and Antitrust

Global Competition Review's "Women in Antitrust" 2009

Articles

Marleen Van Kerckhove, Asim Varma and Marco Ramondino "EU Regulatory Procedures In The Pharmaceutical Sector" Competition Law360 Jul. 2010

Asim Varma and Marleen Van Kerckhove "Getting The Deal Through: Pharmaceutical Antitrust - Overview" Global Competition Review 2010

Marleen Van Kerckhove and Asim Varma "Getting The Deal Through: Pharmaceutical Antitrust - Overview" Global Competition Review 2009


Tim Frazer, Luc Gyselen, Marleen Van Kerckhove, Asim Varma and Barbara H. Wootton "Getting The Deal Through: Pharmaceutical Antitrust" Global Competition Review 2008

Deborah L. Feinstein, Marleen Van Kerckhove and Barbara H. Wootton "Merger remedies in the EU and US" Practical Law Company's Cross-border Competition Handbook, Volume 1, 2007/08

Marleen Van Kerckhove "Getting The Deal Through: Intellectual Property & Antitrust - European Union" Global Competition Review 2008

Marleen Van Kerckhove "EU Merger Control: Can You Be Compensated When Things Go Wrong?" The American Lawyer October 2007

Marleen Van Kerckhove "The Application of Article 82 EC Treaty to The Pharmaceutical Sector - Some Recent EC Guidance" The European Antitrust Review. [Reproduced with permission from Law Business Research. This article was first published in the October 2005 Issue.] 2006

Marleen Van Kerckhove "Parallel Trade in Pharmaceutical Products Following the EJC's Bayer Judgment: Can a Case be Made Under Article 82 EC Treaty?" The European Antitrust Review, 2005

Ian Kirby, Lincoln Tsang, Marleen Van Kerckhove and William W. Vodra "Parallel Trade in the EU and US Pharmaceutical Markets" Global Counsel Life Sciences Handbook, 2005/2006

Ian Kirby, Marleen Van Kerckhove and William W. Vodra "Parallel Trade in the EU and US Pharmaceutical Markets" Global Counsel Life Sciences Handbook 2004/2005

Presentations

Marleen Van Kerckhove "Life-Cycle Management & Settlement Strategies Post Sector Inquiry" 18th Annual EU Pharmaceutical Law Forum, May 12, 2009

Marleen Van Kerckhove "Patent Misuse and Abuse in the US and Europe: the Case of Pharmaceuticals" ABA Section of Antitrust Law/GW Law School Competition Law Center, November 20, 2008

Marleen Van Kerckhove "4th Annual In-House Counsel Forum on Pharmaceutical Antitrust" American Conference Institute, May 20,.2008

Marleen Van Kerckhove "Recent Antitrust Developments for Pharmaceutical and Biotechnology Companies" BIO conference, 2008

Marleen Van Kerckhove "Lifecycle Management of Pharmaceutical Products" 17th Annual EU Pharmaceutical Law Forum, May 8, 2008

Marleen Van Kerckhove "Abuse of Dominance - What is the Scope of This Remedy?" Competition Law & Policy Forum, Toronto, April 2006

Marleen Van Kerckhove "The Application of EU and US Antitrust Law to Pharma and Biotech Companies" IBC Life Sciences Conference, London, April 2006

Marleen Van Kerckhove "Competition Law and Parallel Trade" EU Pharmaceutical Law Forum, Brussels, May 2005

Marleen Van Kerckhove "Private Antitrust Enforcement in the EC and the US" IBA Annual Antitrust Conference, Fiesole, September 2004

Marleen Van Kerckhove "EU Merger Control" UCLA Mergers & Acquisitions, February 2004

Advisories


"First EU Judgment on Abusive Conduct Through Use of Regulatory Procedures in the Pharmaceutical Sector" Jul. 2010

"The EC Pharmaceutical Sector Inquiry: Getting Real" Jul. 2009

"New Notice Clarifies EU Commission's Approach to Remedies in Merger Cases" Oct. 2008

"Quota Schemes: The New Rules for Pharmaceutical Companies--The European Court rules on the Use of Quota Schemes by Dominant Pharmaceutical Companies" Sep. 2008

"Schneider Electric v Commission - The European Court of First Instance Breaks Ground In Relation To Damages In Merger Cases" Jul. 2007

"Tetra Laval/Sidel--The European Court of Justice Clarifies the Standard of Proof and the Role of Behavioural Commitments in Merger Cases" Feb. 2005

"Restrictions of Supply by an Allegedly Dominant Pharmaceutical Manufacturer--Do They Infringe EU Antitrust Law?" Oct. 2004

"Restrictions of Supply by an Allegedly Dominant Pharmaceutical Manufacturer" Oct. 2004

"New EU Regulation on Technology Transfer Agreements" Apr. 2004

"EC Competition Policy After 1 May 2004 Frequently Asked Questions" Apr. 2004

"The Impact of the Amendments to the EC Merger Regulation (ECMR)" Jan. 2004



Silvio Cappellari Partner

Mr. Cappellari is a partner in the firm's antitrust and competition practice group. His practice focuses on a broad range of issues under European and German competition law.

Mr. Cappellari has represented clients in high-profile merger control cases before the European Commission and the German Federal Cartel Office, including several second phase proceedings. He also has gained significant experience in international cartel cases, such as the recent investigations by the EU Commission concerning marine hoses, air cargo, subsea power cables and car components.

In addition, Mr. Cappellari has a general antitrust counseling practice. He regularly advises clients on the compliance of joint ventures and other cooperation arrangements with Article 101 TFEU, as well as on questions of abusive conduct under Article 102 TFEU.

Mr. Cappellari has gained significant experience, inter alia, in the energy, logistics, motor vehicles, pharmaceuticals, and media industries.

Prior to joining the firm, Mr. Cappellari worked with other US law firms in Brussels and Washington, DC. He is fluent in German and Italian.


GE and NBCU in the creation of a joint venture with Comcast before the EU Commission

A major producer of car components in a cartel investigation under Article 101 TFEU before the EU Commission

A Japanese power cable manufacturer in a cartel investigation under Article 101 TFEU before the EU Commission

Cargolux, a leading global cargo airline, in a cartel investigation under Article101 TFEU before the EU Commission

A major Eastern European gas company in Article 102 TFEU proceedings before the EU Commission

Siemens in its acquisitions of UGS Corporation and VA Tech AG before the EU Commission

Contact Information [email protected] tel: +32 (0)2 290 7815 fax: +32 (0)2 290 7899


Practice Areas Antitrust/Competition

Education LLM, Columbia Law School, 1998 German Bar Exam (Assessorexamen), Düsseldorf, Germany, 1996 German Law School Exam, University of Göttingen, Germany, 1992

Admissions Brussels (associate member) Frankfurt, Germany New York

Silvio Cappellari Arnold & Porter LLP 2

Novartis in the sale of its medical nutrition and baby food divisions to Nestlé and in its acquisition of Hexal AG before the EU Commission

CVC Capital Partners, a major private equity firm, in its acquisition of DSI Holding GmbH

Paramount in its acquisition of DreamWorks before the German Federal Cartel Office

Rankings


Chambers Europe: Europe’s Leading Lawyers for Business 2011 for Competition/European Law

The Legal 500 EMEA 2011 for Competition

The International Who's Who of Competition Lawyers 2011

Chambers Global: The World's Leading Lawyers for Business 2011 for Competition/European Law

Professional and Community Activities

Member, American Bar Association

Member, Studienvereinigung Kartellrecht

Articles

Silvio Cappellari "Recent Developments in German Antitrust Law" The Computer and Internet Lawyer, June 2012 (forthcoming)

Silvio Cappellari "Reverse Payment Settlements in the EU - Finding the Right Dosage" Competition Law International, November 2011

Silvio Cappellari "Frankfurter Kommentar zum Kartellrecht" Article 8 ECMR, October 2011

Advisories

"Recent Developments in German Competition Law" Jan. 2012

"NEUE ENTWICKLUNGEN IM DEUTSCHEN" Jan. 2012

"Neuere Entwicklungen im deutschen Kartellrecht" Jul. 2011

"Recent Developments in German Competition Law" Jul. 2011

"Neuere Entwicklungen im deutschen Kartellrecht" Jan. 2011

"Recent Developments in German Competition Law" Jan. 2011

"Recent Developments in German Competition Law" Mar. 2010



G. Axel Gutermuth Counsel

G. Axel Gutermuth is a member of the firm's antitrust/competition group with a focus on a broad range of competition law issues.

Mr. Gutermuth assists and represents clients in merger control proceedings before the

European Commission and the German Federal Cartel Office. He has participated in several second phase German and EC merger proceedings, including landmark cases such as Tetra Laval/Sidel and Oracle/PeopleSoft. In many of his cases, Mr. Gutermuth assesses merger filing requirements in jurisdictions around the world and coordinates the national filing procedures.

As part of his general antitrust counseling practice, Mr. Gutermuth regularly advises clients on the compliance of joint ventures and other cooperation agreements with Articles 101 and 102 of the Treaty on the Functioning of the European Union (formerly Articles 81 and 82 of the EC Treaty) and the specific rules on cooperation in distribution, research and development, technology transfer, and production. He has particular knowledge of the application of competition law in cases involving intellectual property rights. Moreover, Mr. Gutermuth has represented clients in cartel investigations, EC anti-dumping procedures, State aid procedures, and appeals to Court of Justice of the European Union. He advises clients on internal compliance procedures and recently concluded a comprehensive antitrust compliance review of a client's worldwide business in the energy and chemical sectors.

Mr. Gutermuth has worked for clients in various industries, including chemical, energy, life science, healthcare, technology, metals, tobacco, defense and telecommunications/media.


Represent a large technology company in a pending acquisition before the European Commission.

Represent client in ongoing cartel investigation by the European Commission.

Internal competition compliance review of client’s worldwide operations in the energy and chemical sectors.

Securing EU merger clearance for General Electric in its US$ 3 billion acquisition of Dresser, Inc. and coordinating international filings in eight other jurisdictions.

Contact Information [email protected] tel: +32 (0)2 290 7832 fax: +32 (0)2 290 7899


Practice Areas Antitrust/Competition

Education LLM, New York University School of Law, 1999 German Bar Exam (Assessorexamen), Karlsruhe, Germany, 1998 German Law School Exam, University of Heidelberg, Germany, 1996 Certificate of Political Sciences, University of Aix-en-Provence, France, 1993

Admissions Brussels (associate member) Munich New York

G. Axel Gutermuth Arnold & Porter LLP 2

Representing Bucyrus International, Inc. in merger control proceedings before the EU Commission and coordinating filings in several other jurisdictions regarding Caterpillar’s US$ 8.6 billion acquisition of Bucyrus.

Securing German merger clearance for Finmeccanica SpA’s US$ 5.2 billion acquisition of DRS Technologies and coordination of international filings.

Representing German citizens as witnesses in a U.S. cartel damages class action regarding the taking of witness statements in Germany under the Hague Convention.

Coordinating international merger filings in Bucyrus International Inc.’s US$ 1.3 billion acquisition of Terex Corporation’s mining equipment business.

International merger control advice to General Electric on various transactions, including EU merger filings.

Securing German merger clearance for a US$ 2.9 billion merger of pharmaceutical companies.

Advice on international merger control issues to Cisco Systems in its acquisitions of Starent Networks.

Counseling advice to a major international chemicals company regarding complex cooperation agreements for $1+ billion investments.

Participation in the representation before the European Commission and the General Court (previously, the Court of First Instance) of a major international investment bank regarding the violation of State aid obligations by an Accession Country.

Representing a leading German company in an abuse of dominance investigation before the German Federal Cartel Office.

Rankings


Professional and Community Activities

Mr. Gutermuth is author or co-author of several articles and publications on antitrust issues as well as a frequent conference speaker. He is a member of the Studienvereinigung Kartellrecht, the leading association of German speaking antitrust lawyers.

Articles

G. Axel Gutermuth "Der neue Kartellrechtsrahmen für Forschungs- und Entwicklungsvereinbarungen" Wirtschaft und Wettbewerb, March 2012

G. Axel Gutermuth "The Revised EU Competition Rules for Production and R&D Agreements Create a More Coherent Framework of Assessment and Provide Better Guidance to Companies" CPI Antitrust Chronicle, February 2011 (1)

G. Axel Gutermuth "Revision of the EU Competition Rules on Cooperation in Research & Development and Production: Scope for Further Improvement" CPI Antitrust Journal September 2010

G. Axel Gutermuth "Article 82 Guidance: A Closer Look at the Analytical Framework and the Paper's Likely Impact on European Enforcement Practice" This article was originally published in GCP Magazine at www.globalcompetitionpolicy.org, February 2009

ttp://www.globalcompetitionpolicy.org/


Claus-Dieter Ehlermann, Sven B. Volcker and G. Axel Gutermuth "Unilateral Effects: The Enforcement Gap under the Old EC Merger Regulation" World Competition (Printed by Kluwer Law International) 2005

G. Axel Gutermuth, Thomas Mueller and John Ratliff "New European Licensing Rules Require Fresh Assessment of Existing and New Intellectual Property Licenses" Global Intellectual Property Asset Management Report, June 2004

G. Axel Gutermuth "Die EU-Fusionskontrolle ist umstritten" Frankfurter Allgemeine Zeitung, Jan. 2003

G. Axel Gutermuth, Eric Mahr and Thomas Mueller "Navigating the Treacherous Shoals of EC Merger Clearance" International Financial Law Review Supplement, 2002

G. Axel Gutermuth, Paul von Hehn and Christian Duvernoy "New Regulatory Framework for Electronic Communications - The European Commission's Legislative Proposals" The European Antitrust Review, 2000

Presentations

G. Axel Gutermuth "Standard Essential Patents, Injunctions and Abuse of Dominance", co-panelist with DG Competition's Chief Economist Kai-Uwe Kuehn and Pierre Régibeau at the Concurrences Journal's conference on "Intellectual Property and Antitrust: Recent Issues", April 25, 2012" Jul. 2012

G. Axel Gutermuth "Article 102 TFEU - Recent Developments" at the GCR Live Third Annual Law Leaders Europe, Brussels, November 15, 2011

G. Axel Gutermuth "New EU Competition Rules on Research and Development Agreements" at the Conference of the Global Competition Law Center, Brussels, February 16, 2011

G. Axel Gutermuth "The Revised Horizontal Agreement Guidelines" at the IBC Advanced Competition Law Conference, Brussels, November 23-24, 2010

G. Axel Gutermuth "The Reform of the EU's Horizontal Rules" at the GCLC Lunch Talk, Brussels, June 7, 2010

G. Axel Gutermuth "IP & Antitrust" ESCP-Europe Business School, Paris, yearly event (2006-2011)

Advisories

"Will the Lisbon Treaty Have an Impact on Future EU Competition Policy?" Dec. 2009

"Private Enforcement of EC State Aid Law--EC's Revamped Notice on the Role of National Courts" Mar. 2009

"Germany Limits the Reach of its Merger Control Law but Introduces New Foreign Investment Supervision" Feb. 2009

"Private Label Brands, "Must-Have" Brands, and Impact on Retailer Buyer Power" Feb. 2009

"European Commission Endorses A More Economic-Based Approach" Dec. 2008

"New Notice Clarifies EU Commission's Approach to Remedies in Merger Cases" Oct. 2008

Multimedia


Tim Frazer and G. Axel Gutermuth. "The Arnold & Porter eComp KnowHow Series: Competition Compliance Auditing Webinar" March 21, 2012.

G. Axel Gutermuth, Luc Gyselen and Susan Hinchliffe. "WEBCAST: First Half of 2011 in Review: Developments in European Competition Law that Every in-house Counsel Should Know" June 30, 2011. (also available as a Podcast)

Tab 4: Practice Overview

EU Competition Law Practice

EU Competition – An Integrated Practice

The EU Competition team offers the full range of competition law advice on mergers and acquisitions, non-transactional representation, litigation and g q , p , gcounseling. We provide representation before EC, UK and other national competition authorities, as well as in European and national courts. We work with many companies on competition matters including:

antitrust issues, ranging from merger control over licensing and co-operative arrangements to market definition and potential abuse of a dominant position

distribution, and the establishment of lawful quota schemes and innovative cross-border compensation arrangements

services ranging from advice on the application of the law to agreements, conduct, and corporate strategies

obtaining clearances for mergers, acquisitions, and joint ventures from the g g , q , jEuropean Commission and national competition authorities both within the EU and internationally

advice/representation relating to cartel investigations, potential abuses of dominance, structuring of distribution and licensing agreements, strategic alliances, state aids, and public procurement issues

Why Arnold & Porter?

We are the go-to-firm for antitrust in general, and antitrust in regulated markets working for clientslocated globally including in Europe, the Americas, Asia and Africa

Genuine inside knowledge of and well-connected with the EU and Member State antitrustGenuine inside knowledge of and well connected with the EU and Member State antitrustauthorities

Native Danish/Dutch/English/French/German/Italian speakers

We are experienced in dealing with a range of industries, in particular:

– Life sciences,

– Fast-moving consumer goods,

– Chemicals,

– Transport & logistics,

– Technology, media and telecommunications, and

E– Energy.

Representative Matters – Mergers: EU

General Electric/ Converteam (Phase 1) Caterpillar / Bucyrus (Phase 1) Intel / McAfee (Phase 1 with conditions) General Electric / Dresser (Phase 1) BASF / Cognis (Phase 1 with conditions) Syngenta / Negocio Semillas Girasol Monsanto (Phase 2 with conditions) Comcast / NBC Universal (Phase 1) Schneider Electric / AREVA T&D Distribution activities (Phase 1) Alstom Holdings / AREVA T&D Transmission activities (Phase 1) Kraft Foods / Cadbury (Phase 1 with conditions) Philip Morris International/Papastratos (Phase 1) Renesas Technology / NEC Electronics (Phase 1) Panasonic / Sanyo (Phase 1 with conditions) General Electric /NewsCorp / Disney / Hulu JV (Phase 1) Ryanair / Aer Lingus (Phase 2) Kraft / Danone Biscuits (Phase 1 with conditions) Sea-Invest / EMO-EKOM (Phase 2)

Representative Matters – Cartels: EU and EU Member States

We are currently representing the following:

Major player in the optical disk drive sector in an ongoing EU investigation Major player in the optical disk drive sector in an ongoing EU investigation

Large logistics company in an ongoing EU investigation

Power cable supplier in ongoing US and EU investigations

Private investment fund in an ongoing EU investigation

Manufacturer of automotive electronic components in an ongoing EU investigation

Financial institution in an ongoing EU investigation

Manufacturer of automotive wire harnesses in an ongoing EU investigationg g g

International energy company in a national investigation

Major supplier of transmission and distribution equipment in one German and two EU cases

Three clients in different investigations before the Belgian competition authority

Representative Matters – Other: EU

Litigation– AREVA in two appeals to the European Court of Justice and to the General Court

against two European Commission decisions in the Gas Insulated Switchgear case and the Power Transformer caseand the Power Transformer case

– European Federation of Pharmaceutical Industries Associations (Intervener in the European Court of Justice appeal against the AstraZeneca judgment rendered by the General Court in July 2010)

– Parent companies of the international removals company Team Relocations in their appeal to the General Court against the European Commission’s decision to hold jointly and severally liable for the fine

– German witnesses in US private litigation in depositions under the Hague Convention on the taking of evidence abroad

State Aid– Belgian Government (separate EU clearances regarding State aid measures for g ( p g g

manufacturers of plasma-derived medicines and for pharmaceutical companies involved in R&D)

Counseling/Advisory– Compliance programmes for numerous companies, including Sasol, in connection

with an international extensive compliance audit, and an international FMCGmanufacturer in connection with annual compliance audits

Representative Clients

ACAS / ECAS Air Products

Gilead Sciences Intel IPC Media

Allergan AREVA Astellas AT&T BASF Bayer MaterialScience Boston Scientific Bristol-Myers Squibb Bucyrus

Ipsen Komatsu Kraft Foods Kubota Monsanto NovoNordisk Overgas Pfizer Philip Morris International Ranbaxy RenesasBucyrus

Cargolux CEPA Cisco EU Commission General Electric Genzyme

RIZIV Royal Belgian Shipowners Sanyo Sasol Sea-Invest Shire Pharmaceuticals Visa

Life Sciences – Representative Matters

Mergers and acquisitions: Representing Boston Scientific in its acquisition of GuidantAbuse of dominance:Abuse of dominance: Representing EFPIA, the European Federation of Pharmaceutical Industries and Associations, as

an intervener before the European Courts in AstraZeneca’s appeal against a European Commission decision imposing a fine against AstraZeneca for alleged abuses of dominance

Restrictive Practices: Representing a pharmaceutical company in a European Commission investigation focusing on

allegations of restrictive agreements regarding the entry of generic competition (“pay-for-delay”) Representing a pharmaceutical company in an EU Member state investigation into potential

restrictive agreements regarding the entry of generic competitionCompliance, including parallel trade: Advising pharmaceutical companies regarding the European Commission’s enforcement policy g p p g g p p y

regarding parallel trade of pharmaceutical products Advising pharmaceutical companies on various competition compliance matters, such as

distribution strategies and competitor cooperation agreementsAssistance in EU Commission’s general competition inquiry into the pharmaceutical sector: Assisting several large pharmaceutical companies in the EU Commission’s general inquiry into

the pharmaceutical sector

Fast Moving Consumer Goods – Representative Matters

We have deep experience in advising FMCG suppliers on complex competition concerns. For example, we regularly advise on mergers and acquisitions affecting retail markets and provide advice on issues such as: competitive intelligence gathering; price recommendations; promotions and price-marked packs; trade discount schemes; price signalling; hub-and-spoke infringements; trade association activities and supply chain innovations.

Representative matters in relation to FMCGs include:

Obtaining clearance for Kraft Foods’ US$19 billion hostile bid for Cadbury PLC from the European Commission including the negotiation of remedies required to secure Phase I clearance.

Obtaining clearance for Kraft Foods’ US$7.2 billion acquisition of the biscuit business of Danone from the European Commission and national competition authorities globally involving the negotiation of divestment remedies.

Obtaining clearance for Philip Morris International in relation to the acquisition of Papastratos SA, a transaction that was cleared without remedies on the basis of complex econometric modelling.

Providing a detailed compliance policy and online training tool for a large FMCG manufacturer including preliminary compliance audits and feedback sessions, development of training materials and advising on the substance of an online training system for employees.

Providing counselling to a European branded goods manufacturers trade association.

Energy – Representative Matters

We have significant experience in providing competition law advice to suppliers of energy equipment and major energy companies. Particular challenges arise in this area from the interplay between competition law and sector-specific regulation and the shared enforcement powers of the European Commission’s Competition and Energy departments. g p p p gy pRepresentative matters handled by our attorneys include:

Mergers and acquisitions:

Securing EU merger clearance and coordinating worldwide merger filings for Areva regarding its acquisition of Alstom’senergy transmission and distribution business and the creation of a joint venture between Areva and Urenco in the uranium enrichment technology area.

Coordinating worldwide merger filings regarding the creation of a strategic alliance between GE Energy and Hitachi in the nuclear energy sector.

Securing EU merger clearance and coordinating worldwide merger filings for GE regarding various acquisitions in the energy equipment sector.

Representing Iberdrola in proceedings before the European Commission and national courts in relation to the proposed Gas Natural/Endesa merger.

Representing Energias de Portugal (EDP) in its application for annulment of the European Commission’s prohibition of the EDP/ENI/GDP merger before the General Court.

Securing EU merger clearance in relation to the merger of Austrian energy companies Verbund/EnergieAllianz.

Obtaining, on behalf of one of the sellers, merger clearance in Germany in relation to the E.ON/Ruhrgas merger and representing German energy utility companies in several merger control cases in Germany.

Representing Belgian transmission companies in merger proceedings before the Belgian competition authority.

Energy – Representative Matters (cont.)

Cartels:

Representing Areva regarding the European Commission’s cartel investigations in the gas insulated switchgear and power transformer sectors and in the subsequent proceedings before the General Courttransformer sectors and in the subsequent proceedings before the General Court.

Representing a major Japanese company regarding the European Commission’s cartel investigation in the power cables sector.

Abuse of dominance:

Representing Overgas, one of Bulgaria’s largest privately held companies, as a complainant before the European Commission in abuse of dominance proceedings against the State-owned incumbents in the natural gas area.

Representing a leading wind turbine manufacturer in an abuse of dominance investigation of the German competition authority.

Assistance in EU Commission’s general competition inquiry into the energy sector:

Assisting a large network operator in relation to the European Commission’s sector inquiry into the gas and electricity markets.

Representing a major gas company in the sector inquiryRepresenting a major gas company in the sector inquiry.

State aid:

Representing the Hungarian government in ICSID arbitration proceedings brought by electricity generators Electrabel and AES, with special focus on stranded costs State aid issues.

Representing Energie Baden-Württemberg AG (EnBW) before the European Commission and the General Court in a challenge against the Commission’s authorization of the German CO2 emission trading plan (Case T-387/04).

Compliance audit and advice:

Conducting an extensive internal competition compliance audit for a multinational company active in oil & gas exploration and in the area of petrochemical products.

Technology, Media, Telecommunications –Representative Matters

We have significant experience in advising TMT companies on complex competition concerns, including mergers and acquisitions and interventions in merger control procedures in the EU and in Member States, standard-setting, licensing, patent enforcement and litigation strategies

Representative matters:

Securing EU merger clearance for Intel regarding its acquisition of McAfee, and coordinating international filings Advising a provider of online music on EU competition law matters in relation to collecting societies Advising one of the Majors in connection with a Commission investigation under Article 102 TFEU Advising one of the Majors regarding interventions in merger control procedures in several jurisdictions Coordinating international merger filings for Cisco in its acquisition of Starent Networks Representing NBCU in merger filings regarding Comcast’s acquisition of a majority stake in NBCU Securing EU merger clearance for Siemens in its acquisition of UGS, a major US software developer Representing NBCU in German merger proceedings relating to the intended creation of a video‐on‐demand

platform

Chemicals – Representative Matters

We have significant and long-standing experience from advising companies active in the (petro-) chemicals industry on a broad array of competition law concerns, including joint production, sub-contracting, joint purchasing and technical cooperation agreements, information exchanges, and merger control matters in the broadest sense:

Representative matters in the chemical industry include:

Advising on the lawfulness of minority shareholdings in competing undertakings on behalf of several companies active in the petrochemical sector;

Advising on the lawfulness of production joint ventures, exclusive supply arrangements and swap agreements between several chemical companies;

Obtaining EU merger control approvals for BASF in relation to several acquisitions, most recently that of Cognis, another large chemical company;

Advising a large European chemicals company on international joint production / joint venture agreements with competitors; andcompetitors; and

Advising Monsanto in various merger proceedings before the European Commission and coordinating international merger filings

Transport & Logistics – Representative Matters

We have significant experience advising companies active in transport and logistics, including shipping companies, airlines, freight forwarders and stevedoring companies, on matters ranging from international cartel investigations to EU merger control proceedings and cooperation agreements. Representative matters include:

Representing Mitsui OSK Lines in obtaining merger control clearance for its acquisition of Nissan Motor Carrier Company.

Representing Sea-Invest in connection with its acquisition of a controlling stake in stevedoring company EMO-EKOM, including in connection with the in-depth investigation by the European Commission under the EU Merger Control Regulation.

Representing Cargolux in the European Commission investigation into the Air Cargo cartel including the coordination of Cargolux’s defense in various other jurisdictions.

Representing several freight forwarding companies in connection with European and national cartel investigations.

Representing a group of leading liquid bulk shipping companies in relation to the establishment of a pool.

Representing the European Community Shipowners Association (ECSA) in discussions with the European Commission concerning the introduction of new guidelines on the application of EU competition rules to maritime transport.

Global RecognitionGlobal

Ranked in Globally, US, EU, Belgium6 lawyers ranked

Ranked #1 in antitrust (8 years)

Bill Baer – World’s Leading Competition Lawyer (2 years)12 lawyers listed

Tier 1 in US(3 attorneys mentioned)

Ranked in Belgium(3 attorneys mentioned)

Ranked in UK (2 attorneys mentioned)

PLC Competition Super League Ranked #14 Worldwide

Recommended for US, EU and Brussels

PLC Which Law Firm?Recommended firm for EU and Belgium

f f S C

UK2 lawyers ranked

Global Ranked No. 4 in the World

Global Elite firmRecommended in Brussels

USAElite in Washington DCWomen in Antitrust

3 attorneys listed

Leading firm for US and Washington DC

PLC Which Lawyer?3 EU attorneys8 US lawyers

15

Debbie Feinstein - “50 Most Influential Women Lawyers in America”

USATop tier firm nationally

Top tier firm in DC (10 years)Ranked in California11 lawyers ranked

EuropeLeading firm in Belgium

Leading firm in UKLeading firm in Europe

5 lawyers ranked

EU/UK/German RecognitionChambers Europe 2011, Competition/European Law , BELGIUMThis firm recently strengthened its EU competition practice with the recruitment of Annette Schild and SilvioCappellari from Shearman & Sterling. The team now includes four German‐qualified partners, making it a perfect fit f li f hi j i di ifor clients from this jurisdiction.KEY INDIVIDUALS: Much admired department head Marleen Van Kerckhove is mainly recognised for her merger control expertise. Highlights include acting for Sanyo on the clearance of its EUR5.9 billion sale to Panasonic, which was the first merger between two major Japanese companies to come before the EC. She also has considerable experience of the pharma industry. Highly reputed partner Annette Luise Schild, who recently moved across from Shearman & Sterling, represented Areva in the competition and merger control aspects of the sale of its transmission and distribution businesses to Alstom and Schneider. Partner Luc Gyselen is praised for his performance on antitrust cases. He is also involved in state aid matters, recently assisting the Belgian government with obtaining clearance from the EC in relation to state aid measures for manufacturers of plasma‐derived medicines. "He knows how the Commission looks at things, the procedures that they use, and also the people who work there ‐ all of which is extremely helpful for us," say sources. "He also provides excellent practical judgement: he is not the kind of lawyer who expounds theories that are not ultimately helpful for your business ‐ he really tries to remove barriers." Partner Silvio Cappellari is recognised for his advice on merger control matters, especially before the EC, but also at a national level before the German and Italian competition authorities. He also handles Article 102 casesArticle 102 cases.

Competition/European Law, EUROPE‐WIDEArnold & Porter received a considerable boost recently, gaining a large share of Shearman & Sterling’s former practice in Germany, including the well‐known Annette Luise Schild. It has expanded its European team from 11 to 18 lawyers and receives significant praise from clients. It is especially noted for its strength in the pharmaceutical sector. Merger control highlights include securing competition clearance for Kraft's GBP12 billion hostile bid for Cadbury and securing Phase 1 clearance of Panasonic’s acquisition of Sanyo. Other key clients include Philip Morris International and Monsanto. Sources say: “They are extremely responsive and thoughtful; they take the time to learn and understand our specific business.” “They have a good cross‐section of lawyers from a number of different jurisdictions so they are able to give an overview of the region, but we also benefit from their American style, given their roots.” “Unlike a lot of lawyers, they are prepared to put their heads on the block. They give good practical advice and suggest a real course of action.”

EMEA Legal 500 2011, CompetitionArnold & Porter LLP is recommended for ‘“heavy” competition issues including cartel work and merger issues’, and the team’s ‘availability, friendliness and competence’. It secured EU competition clearance for Kraft Foods’ £12bn hostile bid for Cadbury, and Panasonic’s acquisition of Sanyo. It represented

EU/UK/German Recognition

Areva before the General Court against two European Commission decisions in the gas insulated switchgear, and power transformer cases, and handles good state aid work. Annette Luise Schild is an ‘extraordinary antitrust lawyer with excellent know‐how and judgement, perfectly connected within the Commission’. The team also provides German competition law advice, where Silvio Cappellari assists. Marleen Van Kerckhove is also recommended.

UK Legal 500 2011, EU CompetitionArnold & Porter (UK) LLP has advised on some big‐ticket merger work out of its London office, and is gainingexpertise acting for clients on hostile acquisitions. It acted for Monsanto in the European Commission’s Phase IIinvestigation of its sale of a business to Syngenta. Tim Frazer is well known for his representation of majorpharmaceuticals companies, and Susan Hinchliffe is also recommended; both are ‘knowledgeable, practical,excellent to work with, and very responsive’.

EU/UK/German Recognition

Chambers 2012, UK / EU CompetitionArnold & Porter is enjoying a burgeoning reputation and strong praise from market commentators. The team is describedas "knowledgeable and practical" by sources and it offers in‐depth sector expertise in the moving consumer goods, retail,biotech, telecommunications and pharmaceutical industries. Recent highlights include advising Philip Morris on itsproposed acquisition of Protabaco in Colombia.

KEY INDIVIDUALS: Tim Frazer is "impressively responsive and commercial," according to market sources. He heads the UKcompetition practice and advises clients on issues across the full range of competition law. Susan Hinchliffe has beenadvisingMonsanto in acquiring clearance from the EC to dispose of its global sunflower business to Syngenta.

Arnold & Porter was named in and achieved second place in The Lawyer's shortlist for "Competition/Regulatory Team of the Year ."

JUVE 2012, German CompetitionRanked by JUVE for German competition law as one of very few law firms without a German office.“Recommended practice in antitrust with a visible presence in the Brussels market, as demonstrated by its work for BASF and Intel in complicated EU merger controls. The depth of its antitrust experience came to the fore in its representation of various parties in prominent antitrust proceedings last year. This is a team to take seriously, confirm competitors, who also point to its close ties to the well‐known US practice.”Strengths: Good contacts in the US and France, established international cooperation.Recommended lawyers: Annette Luise Schild (“one of the most important antitrust lawyers in Brussels” ‐competitor), Silvio Cappellari (“very competent and pleasant” ‐ competitor).

Snapshot of the EU team

Marleen Van Kerckhove, Partner

Marleen heads up the firm's European competition practice and its Brussels office. Her practice encompasses advice and representation before EU and national antitrust agencies on merger control,

Silvio Cappellari, PartnerSilvio’s practice focuses on a broad range of issues under European and German competition law.He has represented clients in high‐profile merger control cases before the European Commission and the German Federal Cartel Office, including several second phase proceedings. He also regularly advises clients on the compliance of joint ventures and other cooperation arrangements with Article 101 TFEU, as well as on abuse cases under Article 102 TFEU.

abusive conduct, price fixing and other restrictive practices, as well as litigation before European courts. She has steered many transactions successfully through EU and national merger control reviews across various industry sectors. In addition, she has advised extensively on the application of EU competition law to the pharmaceutical sector, and on the interplay between antitrust and intellectual property law. Ms. Van Kerckhove is a frequent speaker at programs and conferences in Europe, Japan and North America.

Tim Frazer, Partner

Tim has over 25 years experience in competition and antitrust law representing and advising clients in a range of competition issues including merger, transactional, and conduct cases. He has particular experience in the Life Sciences industry including advising leading pharmaceutical companies on parallel trade, abuse, and other conduct issues, and on State aids. He divides his time equally between the firm's London and Brussels offices.

Snapshot of the EU team

Luc Gyselen, Partner

Luc joined Arnold & Porter LLP in July 2004 after 20 years of public service at various EU institutions, i il t th E C i i ( b f th L l S i d l t h ldi l iprimarily at the European Commission (as a member of the Legal Service and later holding several senior

positions in DG COMP). His competition law practice encompasses advice and representation before EU and national agencies on merger control, abusive conduct, cartels, other restrictive practices, and state aids.

Susan Hinchliffe, Partner

Sue advises clients operating in a variety of industry sectors including: pharmaceuticals branded consumer goods, and tobacco on a broad range of EU and UK competition law issues. Her competition law practice has a particular focus on merger control both in EU and UK, however she also advises on European product regulations applying to a broad range of sectors including food and chemicals (including registration, evaluation, authorisation and restriction of chemical b t )

Annette Schild, PartnerAnnette concentrates her practice in merger and acquisition transactions. Having worked in Brussels, Washington DC, and New York, she has successfully defended numerous companies in investigations of their proposed mergers by the EU, German, and French competition authorities. She has also advised on numerous other high‐profile matters, including cartel investigations, antitrust complaints, horizontal and vertical collaborations, commercial arrangements, and intellectual property matters. She regularly lectures on EU competition law issues and is a co‐author of the Munich and the Brussels commentaries on European and German competition law.

substances).

Snapshot of the EU teamStephanie Birmanns, CounselStephanie is a German‐qualified lawyer and has more than a decade of experience advising on a broad range of matters under German and European antitrust law. She regularly represents clients in merger control cases before the European Commission and the German Federal Cartel Office, including a number

Niels Ersbøll, Counsel

Niels is a Danish qualified lawyer and has more than ten years' experience practicing EU competition law. After a short term at the European Commission's Directorate General for Competition, and several years spent practicing in the Brussels‐based EU competition law groups of leading Danish and international law firms, he joined Arnold & Porter LLP's Brussels office at the beginning of 2004, shortly after the office was established. He has extensive experience advising on cartels and other restrictive practices, merger control at EU and national level, and compliance counseling.

p , gof complex second phase investigations with and without remedies. Her merger control practice also includes the assessment of filing obligations in other jurisdictions worldwide and the coordination of multijurisdictional filings.

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Axel Gutermuth, CounselAxel assists clients in merger control proceedings before the European Commission and the German Federal Cartel Office. He has participated in several second phase German and EC merger proceedings, including landmark cases such as Tetra Laval/Sidel and Oracle/PeopleSoft. He regularly advises clients on the compliance of joint ventures and other cooperation agreements with Articles 101 and 102 of the Treaty on the Functioning of the European Union and the specific rules on cooperation in distribution, research and development, technology transfer, and production, as well as in government investigations.

Contact Information

Luc Gyselen, Partner

Direct Line: +32 (0)2 290 7831E mail: Luc Gyselen@aporter com

Stephanie Birmanns, Counsel

Direct Line: +32 (0)2 290 7816E mail: Stephanie Birmanns@aporter com E‐mail: [email protected]

Annette Schild, Partner

Direct Line: +32 (0)2 290 7814E‐mail: [email protected]

Silvio Cappellari, Partner


E‐mail: [email protected]

Niels Ersbøll, Counsel


Susan Hinchliffe, Partner


Marleen Van Kerckhove, Partner


Axel Gutermuth, Counsel


Tim Frazer, Partner


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