© 2016 Van Bael & Bellis

TOPICS COVERED IN THIS ISSUE

COMMERCIAL LAW ............................................................................................................................................................................................. 3COMPETITION LAW ............................................................................................................................................................................................ 4DATA PROTECTION ............................................................................................................................................................................................6FINANCIAL LAW ..................................................................................................................................................................................................9INTELLECTUAL PROPERTY ............................................................................................................................................................................ 11LABOUR LAW ......................................................................................................................................................................................................14MARKET PRACTICES ....................................................................................................................................................................................... 16PUBLIC PROCUREMENT ..................................................................................................................................................................................17STATE AID ........................................................................................................................................................................................................... 19

Van Bael & Bellis on Belgian Business Law

July 2016

Chaussée de La Hulpe 166 Terhulpsesteenweg B-1170 Brussels – Belgium

Phone : +32 (0)2 647 73 50 Fax : +32 (0)2 640 64 99

vbb@vbb.com www.vbb.com

Van Bael & Bellis on Belgian Business Law should not be construed as legal advice on any specific facts or circumstances. The content is intended for general informational purposes only. Readers should consult attorneys at the firm concerning any specific legal questions or the relevance of the subjects discussed herein to particular factual circumstances.

VOLUME 2016, NO 7

| HIGHLIGHTS | COMMERCIAL LAW: Bill on Trust Services for Electronic Transactions Adopted by Chamber of Representatives

| COMPETITION LAW: Belgian Competition Authority Rejects Request for Interim Measures by Football Club Royal White

Star Bruxelles

| DATA PROTECTION:

| European Commission Adopts EU-US Privacy Shield

| Facebook Wins Privacy Appeal before Belgian Court of Appeal

| FINANCIAL LAW: Supreme Court Rules on Insider Trading Involving Former Fortis Employee

| INTELLECTUAL PROPERTY: Repute of McDonald’s Sufficient to Prevent Registration of MAC-Food/Beverages Trade

Marks

| LABOUR LAW: Bill on Workable and Flexible Work submitted to Stakeholders

| MARKET PRACTICES: Publication of Law containing Miscellaneous Provisions in Economic Matters

| PUBLIC PROCUREMENT:

| Publication of Law on Public Procurement

| Publication of Law on Concession Contracts

| STATE AID: European Commission Opens In-Depth Investigation into Tax Exemptions for Belgian Ports

© 2016 Van Bael & Bellis

Van Bael & Bellis on Belgian Business Law

July 2016

Chaussée de La Hulpe 166 Terhulpsesteenweg B-1170 Brussels – Belgium

Phone : +32 (0)2 647 73 50 Fax : +32 (0)2 640 64 99

vbb@vbb.com www.vbb.com

Van Bael & Bellis on Belgian Business Law should not be construed as legal advice on any specific facts or circumstances. The content is intended for general informational purposes only. Readers should consult attorneys at the firm concerning any specific legal questions or the relevance of the subjects discussed herein to particular factual circumstances.

| COMMERCIAL LAW 3

Bill on Trust Services for Electronic Transactions Adopted by Chamber of Representatives ............................ 3

| COMPETITION LAW 4

Belgian Competition Authority Ends Investigation against Professional Institute for Real Estate Agents ....4

Belgian Competition Authority Rejects Request for Interim Measures by Football Club Royal White Star Bruxelles ............................................................................................4

| DATA PROTECTION 6

European Commission Adopts EU-US Privacy Shield ...... 6

European Parliament Adopts New Cybersecurity Directive ............................................................................................7

Facebook Wins Privacy Appeal before Belgian Court of Appeal .................................................................................................7

| FINANCIAL LAW 9

Supreme Court Rules on Insider Trading Involving Former Fortis Employee ............................................................................. 9

New Statutory Framework on Insider Trading and Market Abuse Entered into Force .........................................................10

| INTELLECTUAL PROPERTY 11

Operators of Physical Marketplaces Are Intermediaries .................................................................................11

Repute of McDonald’s Sufficient to Prevent Registration of MAC-Food/Beverages Trade Marks ....................................11

Court of Justice Rules Payment of Royalties under Licence Agreement where Patent Was Held Invalid May Be Compatible With Article 101 TFEU ...................................12

Advocate General Issues Opinion on French Out-of-Print Books Law.......................................................................................13

| LABOUR LAW 14

Bill on Workable and Flexible Work submitted to Stakeholders ..................................................................................14

| MARKET PRACTICES 16

Publication of Law containing Miscellaneous Provisions in Economic Matters ...................................................................16

| PUBLIC PROCUREMENT 17

Publication of Law on Public Procurement .........................17

Publication of Law on Concession Contracts ...................18

| STATE AID 19

European Commission Opens In-Depth Investigation into Tax Exemptions for Belgian Ports ..........................................19

VOLUME 2016, NO 7

© 2016 Van Bael & Bellis 3 | July 2016

| COMMERCIAL LAW

Bill on Trust Services for Electronic Transactions Adopted by Chamber of Representatives

On 7 July 2016, the Chamber of Representatives adopted a Bill which (i) implements and complements Regulation (EU) 910/2014 of 23 July 2014 on electronic identification and trust services for electronic transactions in the inter-nal market and repealing Directive 1999/93/EC (the “eIDAS Regulation”); and (ii) supplements the eIDAS Regulation to create legal equivalence between electronic and non-elec-tronic legal transactions (Wetsontwerp tot uitvoering en aanvulling van de Verordening (EU) nr. 910/2014 van het Europees Parlement en de Raad van 23 juli 2014 betreffende de elektronische identificatie en vertrouwensdiensten voor elektronische transacties in de interne markt en tot intrek-king van Richtlijn 1999/93/EG, houdende invoeging van titel 2 in boek XII “Recht van de elektronische economie” van het Wetboek van economisch recht, en houdende invoeging van de definities eigen aan titel 2 van boek XII en van de rechtshandhavingsbepalingen eigen aan titel 2 van boek XII, in de boeken I, XV en XVII van het Wetboek van economisch recht/Projet de loi mettant en œuvre et complétant le règle-ment (UE) n° 910/2014 du Parlement européen et du Conseil du 23 juillet 2014 sur l’ identification électronique et les ser-vices de confiance pour les transactions électroniques au sein du marché intérieur et abrogeant la Directive 1999/93/CE, portant insertion du titre 2 dans le livre XII “Droit de l’économie électronique” du Code de droit économique et portant insertion des définitions propres au titre 2 du livre XII et des dispositions d’application de la loi propres au titre 2 du livre XII, dans les livres I, XV et XVII du Code de droit économique; the “Bill”).

The Bill introduces rules into the Code of Economic Law (Wetboek van Economisch Recht/Code de droit économique) governing electronic archiving, electronic registered mail, electronic seals (companies), electronic signatures (natural persons), website authentication, trust service providers and electronic identification schemes (See, this Newsletter, Volume 2015, No. 12, p. 4-5; and Volume 2016, No. 6, p. 5-6).

The Bill will now be published in the Belgian Official Journal. The date of entry into force of the Bill’s provisions will be determined by Royal Decree.

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| COMPETITION LAW

Belgian Competition Authority Ends Investigation against Professional Institute for Real Estate Agents

On 28 June 2016, the Belgian Competition Authority (Bel-gische Mededingingsautoriteit/Autorité belge de la Concur-rence; the “BCA”) ended its investigation against the Pro-fessional Institute for Real Estate Agents (Beroepsinstituut voor Vastgoedmakelaars/Institut Professionnel des Agents Immobiliers; the “PIR”). The BCA had initiated its investiga-tion because of the limited variation in tariffs applied by real estate agents in Belgium, all of whom need to be registered with the PIR. However, the BCA has now reached the con-clusion that real estate agents set their tariffs freely when providing real estate services in Belgium.

The information available to the BCA showed that a 3% tariff (on the sales price) is applied by a large majority of the real estate agents active in Belgium. This caused the Chief Competition Prosecutor (Auditeur-Generaal/Auditeur Général) of the BCA to open an investigation into the PIR, which had already been sanctioned in 2010 by the then Competition Council for having established and circulated recommended minimum scales (See, this Newsletter, Volume 2010, No. 8, p. 3).

It was suspected that the PIR, in spite of the 2010 decision, had again incited its members to apply standardised tar-iffs. In addition, the PIR was believed to prevent innovative services from emerging through the application of discipli-nary procedures.

The BCA had requested over 8,000 real estate agents, which amounts to almost all of the members of the PIR, to complete a survey. The survey inquired about tariffs and tariff structure of the real estate agent’s services, as well as about possible disciplinary proceedings by the PIR. With a participation rate of around 50%, the BCA considered that reliable conclusions could be drawn from the results of the survey.

With regard to the tariffs applied by real estate agents, the BCA concluded that, despite the very limited variation, noth-ing suggested that the PIR had, again, suggested minimum scales. Another related conclusion drawn from the survey

is the fact that price is not a driving factor of competition in the sector. Only 4% of the real estate agents considered price as their primary means of differentiation with their competitors, and 84% did not even consider it to be among the three most important differentiating factors. Rather, correct estimation/appraisal, good reputation, and good negotiation are key, according to the real estate agents.

The BCA pointed out that such parameters are hard to mon-itor for consumers, especially since these do not engage frequently in real estate transactions. Therefore, the BCA encourages more diversification with regard to tariff struc-tures. To that end, it has announced that it will continue to monitor the sector closely, and that it might open a new investigation in case new facts would suggest the exist-ence of anti-competitive practices engaged in by the PIR and/or its members.

With regard to the disciplinary proceedings of the PIR, the BCA also found that it could not be concluded that the PIR prevented innovation in the sale of real estate by means of its disciplinary decisional practice. This conclusion was supported by the results of the survey.

Belgian Competition Authority Rejects Request for Interim Measures by Football Club Royal White Star Bruxelles

On 14 July 2016, the Competition College (Mededingingscol-lege/Collège de la concurrence; the “Competition College”) of the Belgian Competition Authority (Belgische Mededing-ingsautoriteit/Autorité belge de la Concurrence; the “BCA”) rejected a request by football club Royal White Star Brux-elles for interim measures against the Belgian Football Asso-ciation (the “BFA”) and the Belgian Arbitration Court for Sports. Royal White Star had requested these measures following the BFA’s refusal to grant the club a license to play in the highest division of the Belgian football league during the coming 2016-2017 season.

Royal White Star had already brought an appeal against the decision of the BFA, before the Belgian Arbitration Court for Sports. However, the Arbitration Court upheld the BFA’s decision that Royal White Star did not satisfy the general requirements to obtain a license. One of the requirements

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considered not to be fulfilled was the guarantee of conti-nuity of the club during the season for which the license was requested. Due to financial instability, such continuity was not thought to be guaranteed.

Following the Arbitration Court’s decision, Royal White Star filed a complaint with the BCA and a request for interim measures. After its initial examination of the case, the Competition College concluded that there were prima facie insufficient indications that the BFA’s refusal to grant a license might constitute an infringement of competition law. The Competition College therefore rejected Royal White Star’s request for interim measures.

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| DATA PROTECTION

European Commission Adopts EU-US Privacy Shield

On 12 July 2016, the European Commission adopted the EU-US Privacy Shield (the “Privacy Shield”), the new frame-work for transatlantic exchanges of personal data replacing the Safe Harbour agreement. The adoption follows a posi-tive vote by the Member States’ representatives in the Arti-cle 31 Committee on 8 July 2016. US companies can sign up to the Privacy Shield as from 1 August 2016. Once a US company is certified under the new scheme, transfers to this company from the EU will be permitted under Directive 95/46/EC (the “Data Protection Directive”).

Under the Data Protection Directive, personal data must not be transferred to a recipient outside the EEA unless such a recipient is located in a country which is regarded to provide an “adequate” level of protection. The decision of 12 July 2016 declares that US companies registered under the Privacy Shield qualify for “adequate” protection status under the Data Protection Directive.

Improvements Provided by Privacy Shield

The draft framework principles and additional documents composing the Privacy Shield were published on 29 Febru-ary 2016 (See, this Newsletter, Volume 2016, No. 2, p. 8). Since presenting the draft Privacy Shield in February, the European Commission and the US Department of Commerce have updated the texts to include a number of additional clarifications and improvements. These improvements draw on the opinions of the EU’s Article 29 Working Party, an independent European advisory body on data protection and privacy comprised of representatives of the EU Member States’ national data protection authorities, the European Data Protection Supervisor and the European Commission (See, this Newsletter, Volume 2016, No. 4, p. 6). They also reflect a resolution of the European Parliament.

The European Commission received additional clarifications from the US National Intelligence Office on the question when bulk collection of data is permitted under US law. In addition, the updated texts of the Privacy Shield strengthen the ombudsman mechanism which provides redress against access by US authorities. The latest changes also impose

more explicit obligations on companies as regards: (i) sec-ondary use of personal data (“purpose limitation” principle); (ii) onward transfers of personal data; and (iii) the duration of data retention and de-identification of personal data.

Commission Adequacy Decision

In its decision, adopted on 12 July 2016 (the “Adequacy Decision”), the European Commission concludes that the US ensures an adequate level of protection for personal data transferred from the EU to organisations in the US that have self-certified under the Privacy Shield.

The European Commission commits to monitor continuously the functioning of the Privacy Shield with a view to assess-ing whether the Privacy Shield and the underlying US laws and regulations continue to ensure an adequate level of protection of personal data.

The Adequacy Decision also provides for an annual revision of the scheme. This will allow the European Commission to assess the compatibility of the Privacy Shield with the General Data Protection Regulation 2016/679 (the “GDPR”) which will enter into effect on 25 May 2018. It is expected that further updates to the Privacy Shield may be required in order to comply with the strengthened rules of the GDPR.

The Adequacy Decision has been notified to the EU Mem-ber States and thereby entered into force on 12 July 2016. On the US side, the Privacy Shield was published in the US Federal Register and companies have been able to self-cer-tify with the US Department of Commerce (“DoC”) since 1 August 2016. The DoC will make both the Privacy Shield list and certification submissions publicly available through a dedicated website. The DoC has also published a document explaining how US companies can register for the Privacy Shield (read it here).

Further reading: Press release of the European Commis-sion; US Department of Commerce Fact Sheet; US Depart-ment of Commerce FAQ; Commission Adequacy Decision; Annexes to the Adequacy Decision.

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© 2016 Van Bael & Bellis 7 | July 2016

European Parliament Adopts New Cybersecurity Directive

On 6 July 2016, the European Parliament adopted Directive (EU) 2016/1148 of the European Parliament and of the Coun-cil of 6 July 2016 concerning measures for a high common level of security of network and information systems across the Union (the “NIS Directive”). The NIS Directive is designed to increase cybersecurity in the EU, create a common level of security for networks and information systems in the EU, enhance cooperation between Member States and enable the implementation of risk management strategies in key sectors. The Council of the European Union had already adopted the NIS Directive on 17 May 2016 (See, this News-letter, Volume 2015, No. 5, p. 7).

The NIS Directive will come into force in August 2016. Mem-ber States have 21 months to implement the NIS Directive into their national laws. Member States will have to under-take several steps, such as:

› the introduction of a national strategy on the security of network and information systems;

› the establishment of a competent authority to monitor the implementation of the NIS Directive;

› the establishment of a cooperation group, in order to sup-port and facilitate strategic cooperation and the exchange of information among Member States; and

› the designation of Computer Security Incident Response Teams (CSIRT).

Obligations relating to risk management and incident report-ing to national authorities will also be introduced for oper-ators of “essential services” such as energy, transport, water, banking, financial market infrastructures and health-care. Moreover, digital service providers such as online mar-ketplaces, cloud computing services and search engines will have to comply with risk management and incident report-ing obligations.

Facebook Wins Privacy Appeal before Belgian Court of Appeal

On 29 June 2016, the Court of Appeal of Brussels (the “Court”) overturned the decision of the President of the Court of First Instance of Brussels of 9 November 2015 (the “Decision”) which had ordered Facebook to cease the use of a cookie under sanction of a daily penalty (See, this Newsletter, Volume 2015, No 11, p. 11-12).

The Belgian Privacy Commission had initiated summary pro-ceedings against Facebook over the allegedly infringing use of a specific cookie, called the “datr” cookie. During the pro-ceedings, Facebook rejected the territorial competence of Belgian courts on this matter and argued that the cookie was necessary for the security and protection of its ser-vices. At first instance, the court sided with the Privacy Commission and issued a cease and desist order against Facebook Inc., Facebook Belgium SPRL and Facebook Ireland Limited (“Facebook”). The Court has now overturned the Decision in its entirety.

First, the Court examined if the Belgian courts have inter-national jurisdiction over Facebook Ireland Limited and Face-book Inc. The Court determined that Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the protection of individuals with regard to the processing of personal data and on the free movement of such data (the “Data Protection Directive”) does not have direct effect in Belgian legislation and that therefore the Belgian courts do not have jurisdiction over Facebook Inc. and Facebook Ireland Limited.

The Court then turned to national legislation. It determined that Article 32, §3 of the Law of 8 December 1992 on the protection of personal data (Wet tot bescherming van de persoonlijke levenssfeer ten opzichte van de verwerking van persoonsgegevens/Loi relative à la protection de la vie privée à l’égard des traitements de données à caractère personnel) does not govern international jurisdiction and therefore cannot be relied on to allow the Belgian courts to exercise jurisdiction over Facebook Inc. and Facebook Ireland Limited.

Furthermore, both Regulation 1215/2015/EU on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters and the Belgian International

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Private Law (Wet van 16 juli 2004 houdende het Wetboek van internationaal privaatrecht/Loi du 16 juillet 2004 por-tant le Code de droit international privé) did not apply to the case at hand. This is because both laws only relate to civil or commercial cases. Conversely, disputes between an individual or commercial company and the government fall outside the scope of these laws when the government acts pursuant to its governmental power.

The Court also considered recent case law of the Court of Justice of the European Union (“ECJ”) interpreting the territorial scope of the Data Protection Directive. First, the Court held that the 2014 Google Spain judgment of the ECJ (See, this Newsletter, Volume 2014, No. 5, p. 6) does not apply, as this case concerned two companies which had both accepted the international jurisdiction of the Spanish courts voluntarily. Regarding the reference to the 2015 Wel-timmo ECJ case (See, this Newsletter, Volume 2015, No. 11, p. 10), the Court held that it does not elaborate on interna-tional jurisdiction, but only covers the power of the super-visory authority. Additionally, in this case, Weltimmo had brought the proceedings itself, therefore recognising the international jurisdiction of the court. Therefore, Weltimmo is not controlling either.

Consequently, the Court declared the action against Face-book Inc. and Facebook Ireland Limited to be non-admis-sible. By contrast, the Court accepted competence over Facebook Belgium. However, the Privacy Commission had initiated summary proceedings, which require urgency. At first instance, the court had considered that urgency is assumed to be present in cases relating to the violation of a fundamental right. The Court now determined that with regard to Facebook Belgium, the urgency requirement had not been met, as the investigation regarding Facebook’s use of datr cookies had already been published in 2011, while the summary proceedings case had only been filed in 2015.

The Privacy Commission has announced that it is consider-ing filing an appeal to the Belgian Supreme Court (Hof van Cassatie/Cour de Cassation). It referred to the Yahoo case, in which the Belgian Supreme Court accepted the interna-tional jurisdiction of the Belgian courts (See, this Newslet-ter, Volume 2015, No. 12, p. 14 and Volume 2011, No. 1, p. 11).

The case on the merits between the Privacy Commission and Facebook is scheduled to be heard in the autumn of 2017.

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© 2016 Van Bael & Bellis 9 | July 2016

| FINANCIAL LAW

Supreme Court Rules on Insider Trading Involving Former Fortis Employee

On 10 June 2016, the Supreme Court (Hof van Cassatie/Cour de Cassation; the “Supreme Court”) rejected the appeal lodged by the FSMA (Autoriteit voor Financiële Dien-sten en Markten/Autorité des Services et Marchés Financi-ers) against the judgment of the Brussels Court of Appeal of 21 May 2015 in an insider trading case brought against a former Fortis employee.

The judgment of the Supreme Court offers a concrete exam-ple on how the prohibition of insider trading laid down in the Law of 2 August 2002 on the supervision of the financial sector and on financial services (Wet betreffende het toe-zicht op de financiële sector en de financiële diensten/Loi relative à la surveillance du secteur financier et aux ser-vices financiers; the “Law”) should be applied in practice.

The defendant, a former Fortis employee, had been accused by the FSMA of insider trading after having sold shares which he owned in Fortis Bank SA/NV (“Fortis”) in 2008 while the latter was in serious financial difficulties during the financial crisis. According to the FMSA, this constituted insider trading in breach of Article 25, §1, 1° of the Law, as applicable at the time of the facts, which provided that:

“it is prohibited for any person possessing information that he or she is aware, or ought to be aware, constitutes inside information […] a) to acquire or dispose of, or try to acquire or dispose of, for his/her own account or for the account of a third party, either directly or indirectly, financial instru-ments to which that information refers […]”.

In particular, the FSMA claimed that the defendant sold shares in Fortis, while possessing inside information about the Emergency Liquidity Assistance plan that Fortis was about to obtain from the Belgian National Bank (the “BNB”). Pursuant to the judgment of the Court of Justice of the European Union in the Spector case (See, this Newsletter, Volume 2009, No. 12, p. 5), the defendant is presumed to have used this inside information while making his decision to sell the shares.

The defendant argued that, despite holding inside informa-tion about the Emergency Liquidity Assistance plan, he had not used or relied upon that information when deciding to sell shares which he owned in Fortis.

The Supreme Court sided with the defendant. According to the Supreme Court, Fortis’ liquidity problems back in 2008 had already been extensively discussed in the press and were well known by the public. Therefore, the Supreme Court considered that the granting by the BNB of an Emer-gency Liquidity Assistance to Fortis was merely a confir-mation of such difficulties.

Moreover, the Supreme Court acknowledged that the defendant had justified the sale of shares which he owned in Fortis by his intention (i) to distance from the manage-ment of Fortis; and (ii) to offset the proceeds from the sale with the amount of other incoming taxes. The defendant added that, in any case, the Emergency Liquidity Assis-tance together with the agreement of the Belgian, Dutch and Luxembourg governments to recapitalise Fortis, could have been legitimately seen as reassuring news about the future of Fortis.

Consequently, the Supreme Court ruled that in light of the information which the defendant already possessed, and taking into account his personal situation, the familiarity with inside information (i.e., the Emergency Liquidity Assis-tance plan) had no influence on his decision to sell shares which he owned in Fortis. Further, according to the Supreme Court, the defendant would have sold the shares even if he had had no knowledge of the Emergency Liquidity Assis-tance plan.

As a result, the Supreme Court rejected the appeal brought by the FSMA and confirmed the judgment of the Brussels Court of Appeal.

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© 2016 Van Bael & Bellis 10 | July 2016

New Statutory Framework on Insider Trading and Market Abuse Entered into Force

On 27 June 2016, Parliament enacted a new law amending the statutory framework governing insider trading and mar-ket abuse (Wet van 27 juni 2016 tot wijziging, met het oog op de omzetting van Richtlijn 2013/50/EU en de tenuitvoerleg-ging van Verordening 596/2014, van de wet van 2 augustus 2002 betreffende het toezicht op de financiële sector en de financiële diensten, van de wet van 16 juni 2006 op de open-bare aanbieding van beleggingsinstrumenten en de toelat-ing van beleggingsinstrumenten tot de verhandeling op een gereglementeerde markt en van de wet van 2 mei 2007 op de openbaarmaking van belangrijke deelnemingen in emit-tenten waarvan aandelen zijn toegelaten tot de verhande-ling op een gereglementeerde markt en houdende diverse bepalingen, en houdende diverse bepalingen/Loi du 27 juin 2016 modifiant, en vue de transposer la directive 2013/50/UE et de mettre en oeuvre le règlement 596/2014, la loi du 2 août 2002 relative à la surveillance du secteur financier et aux services financiers, la loi du 16 juin 2006 relative aux offres publiques d’instruments de placement et aux admis-sions d’instruments de placement à la négociation sur des marchés réglementés, ainsi que la loi du 2 mai 2007 relative à la publicité des participations importantes dans des émet-teurs dont les actions sont admises à la négociation sur un marché réglementé et portant des dispositions diverses, et portant des dispositions diverses; the “Law”).

The Law implements into Belgian Law Regulation 596/2014 of 16 April 2014 on market abuse (“market abuse Regula-tion”) which repeals Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (the “Regula-tion”). The Regulation introduced a uniform framework on insider trading and market abuse. As a result, the Law abol-ishes most of the current provisions on market abuse and insider trading as they are replaced by the rules set out in the Regulation.

The Law further designates the FSMA as the competent authority to supervise compliance with the Regulation. To that end, it delegates specific additional investigating pow-ers to the FSMA. Among others, the FSMA now can order the production of pre-recorded telephone conversations, e-mail exchanges and overviews of data traffic.

The Law also effects some changes in regard to the sanc-tions and measures which the FSMA may impose, in some cases doubling or even tripling the maximum fines. In case of a violation of the prohibitions on market abuse and insider trading, the FSMA may impose administrative fines of up to EUR 15,000,000 or 15 per cent of the total annual reve-nue of the perpetrator, whichever is the highest, on legal entities and EUR 5,000,000 or 15 per cent of the annual total revenue, on private individuals. In addition, the FSMA may impose a fine amounting to three times the profits gained (or loss avoided) resulting from the market abuse or insider trading. The Regulation contains a list of sanctions and measures which the competent supervisory authority should in any case have at its disposal. It appears, however, that some of these sanctions have yet to be formally imple-mented into Belgian law. It is therefore likely that further amendments to the statutory framework will follow in the weeks and months to come.

Although a Royal Decree still has to determine the date of entry into force of parts of the Law, some clauses relat-ing to the implementation of the Regulation have already entered into force on 3 July 2016 to coincide with the date as of which the bulk of the Regulation applies. Other parts of the Regulation entered into force on 7 July 2016.

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| INTELLECTUAL PROPERTY

Operators of Physical Marketplaces Are Intermediaries

On 7 July 2016, the Court of Justice of the European Union (the “ECJ”) tackled the preliminary question which had been referred to it by the Czech Supreme Court as to whether the reasoning espoused by the ECJ in L’Oréal v. eBay when defining the role of intermediaries in an online marketplace (See, this Newsletter, Volume 2011, No.7, p. 10) also applies to physical marketplaces.

This question arose after trade mark holders had sought an injunction before the Czech Courts against Delta Center, an operator subletting various sales points situated in a physical marketplace in Prague where counterfeits were sold. The trade mark holders argued that Delta Center was to be considered an intermediary within the meaning of Article 11 of Directive 2004/48/EC of 9 April 2004 on the enforcement of intellectual property rights (the “Enforce-ment Directive”), which meant that Delta Center could be the subject of an injunction.

The ECJ agreed with the trade mark holders. It held that, since it is irrelevant for the application of Article 11 of the Enforcement Directive whether a marketplace is online or offline, Delta Center must be regarded as an interme-diary to which injunctions may be addressed. Continuing along these lines, the ECJ added that the conditions for an injunction laid down in L’Oréal v. eBay also apply to physi-cal intermediaries.

Repute of McDonald’s Sufficient to Prevent Registration of MAC-Food/Beverages Trade Marks

On 5 July 2016, the EU General Court (the “Court”) upheld the decision of the EUIPO (European Union Intellectual Prop-erty Office, formerly OHIM) finding the EU trade mark “MAC-COFFEE” invalid after McDonald’s had brought an applica-tion for a declaration of invalidity of that trade mark (Case T-518/13).

For an earlier trade mark to invalidate successfully a simi-lar but not identical trade mark pursuant to Article 8(5) of Regulation No 207/2009 of 26 February 2009 on the Com-munity trade mark (the “Trade Mark Regulation”), a number

of cumulative conditions must be satisfied. First, the earlier trade mark must have been lodged before that for which cancellation is sought and must be registered. Second, the earlier trade mark and that for which cancellation is sought must be identical or similar so that the relevant public could establish a link between the trade marks. The establish-ment of such a link must be assessed globally, taking into account all factors relevant to the circumstances of the case, including the degree of the earlier trade mark’s distinc-tive character, the degree of similarity between the goods and services covered by the trade marks at issue and the relevant public. Third, the earlier trade mark must have a reputation in the EU. Fourth, the use without due cause of the trade mark for which cancellation is sought must lead to the risk that unfair advantage might be taken of the dis-tinctive character or the repute of the earlier trade mark or that it might be detrimental to the distinctive character or the repute of that trade mark.

Given that the first and third requirements had not been challenged, the Court focused on the second and fourth requirements.

As regards the second requirement, the Court first con-firmed that the trade marks at issue had a certain degree of phonetic and conceptual similarity due to their respective initial part, namely the “mac” and “mc” elements. Although the trade marks at issue lacked visual similarity, the Court concluded that they were overall similar.

The Court went on to state that the relevant public was likely to establish a link between the trade marks at issue since the trade mark “MACCOFFEE” could be seen as belong-ing to the “Mc” family of trade marks of McDonald’s. To establish the existence of a “Mc” family of trade marks, the Court referred to the numerous “Mc” trade marks owned by McDonald’s (McMUFFIN, McRIBB, McFLURRY, McNUGGETS, McCHICKEN and EGG MCMUFFIN). The Court found that the combination of the prefix “Mc” with another word had acquired its own distinctive character.

The Court then rejected the appellants’ argument that there was no similarity between the goods and services at issue given that the trade mark “MACCOFFEE” was reg-

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istered mainly for foodstuffs and beverages while the trade mark “McDonald” related to fast food restaurant services. The Court found that there is complementarity between those goods and services since the goods covered by the trade mark “MACCOFFEE” are identical to goods offered on the menu of McDonald’s establishments and they are both intended for the same consumers.

With reference to the fourth criterion, the Court held that it was highly plausible that the trade mark “MACCOFFEE” rode on the coat-tails of the trade mark “McDonald’s” in order to benefit from its power of attraction, its reputation and its prestige, and exploited, without paying any financial compensation, the marketing effort made by McDonald’s in order to create and maintain its image.

Finally, the Court found that the owner of the trade mark “MACCOFFEE” did not have a due cause to use the con-tested trade mark.

This decision is still open to appeal to the Court of Justice of the European Union.

Court of Justice Rules Payment of Royalties under Licence Agreement where Patent Was Held Invalid May Be Compat-ible With Article 101 TFEU

On 7 July 2016, the Court of Justice of the European Union (the “ECJ”) issued its judgment on a request for a pre-liminary ruling from the Paris Court of Appeal, which had enquired whether Article 101 TFEU precludes a licensee from paying royalties pursuant to a licensing agreement when the patent which is the subject of that licensing agreement has been held invalid (Case C-567/14, Genen-tech v Hoechst).

The case concerns a long-standing patent dispute relating to a licence agreement signed in 1992 between Behringw-erke, the licensor (of which Sanofi-Aventis Deutschland, a subsidiary of Hoechst, is a successor), and Genentech (a subsidiary of Roche). The licence agreement provided for running royalties in the amount of 0.5% based on the man-ufacture of a medicine incorporating a patented substance even if, in the country of manufacture, the patent was sub-sequently found to be invalid.

In 2008, Hoechst commenced ICC arbitration proceedings for the payment of royalties, subsequent to which Genen-tech was ordered to pay over EUR 108 million plus inter-est dating from 1998. Genentech then requested the Paris Court of Appeal to set aside the arbitration award arguing that ordering the payment of running royalties is contrary to Article 101 TFEU and the principle of free competition, as the licensee must bear unjustifiable costs for a tech-nology which is no longer patented and is thus accessible without restriction.

On 9 December 2014, the Paris Court of Appeal made a request for a preliminary ruling to the ECJ for clarifica-tion. In March 2016, Advocate General Wathelet delivered his opinion in which he opined that Article 101 TFEU is not breached if the commercial purpose of the licence agree-ment is to avoid patent litigation, provided the licensee is able to terminate the licence by giving reasonable notice and retains freedom of action after termination (by, for example, challenging the validity or the infringement of the patent).

In its judgment, the ECJ established that the beneficiary of a patent licence must pay the agreed royalty for the use of technology, even where such use does not give rise to an infringement, or where the technology is deemed never to have been protected following the annulment with ret-roactive effect of the patent.

First, the ECJ clarified that the question from the Paris Court of Appeal not only refers to the case of a revocation of patents, but also to the case of non-infringement of the licensed patents, since Genentech had argued in the main proceedings that it was required to pay the running royalty in the absence of any infringement, contrary to the terms of its licence agreement.

Second, the ECJ recalled the existence of old case-law on the issue of exclusive licence agreements (namely, case 320/87 Kai Ottung v Klee & Weilbach), which determines that the obligation to pay a royalty, even after the expiry of the period of validity of the licensed patent, may reflect a commercial assessment of the value to be attributed to the possibilities of exploitation granted by the licence agree-ment, especially when the obligation to pay is embodied in a licence agreement entered into before the patent was granted. In other words, royalty is the price to be paid for

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commercially exploiting patented technology whilst ensur- ing that the licensor will not bring legal proceedings for an infringement against the licensee. The ECJ crucially added that if the licensee may freely terminate the agreement by giving reasonable notice, an obligation to pay a royalty throughout the validity of the agreement cannot fall under the prohibition set out in Article 101 TFEU.

The ECJ therefore concluded that EU competition rules do not prohibit the imposition of a contractual requirement providing for payment of a royalty for the exclusive use of technology that is no longer covered by a patent, as long as the licensee is free to terminate the contract. Accord-ing to the ECJ, if the licence agreement is still valid and can be freely terminated by the licensee, the royalty pay-ment is due, even where industrial-property rights derived from patents which are granted exclusively cannot be used against the licensee due to the fact that the period of their validity has expired.

Advocate General Issues Opinion on French Out-of-Print Books Law

On 7 July 2016, Advocate General Melchior Wathelet (the “AG”) delivered his opinion in Case C-301/15, Marc Soulier, Sara Doke v. Ministre de la Culture et de la Communica-tion, Premier Ministre. The case involves a challenge of the legality of Decree No 2013-182 of 27 February 2013, imple-menting Articles L. 134-1 to L. 134-9 of the French Intellec-tual Property Code (Code de la Propriété Intellectuelle; the “French Law”). The case specifically addresses the com-patibility of the French law with the limitations set out in Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of cer-tain aspects of copyright and related rights in the informa-tion society (the “Copyright Directive”). The AG concludes that the French Law is incompatible with the Copyright Directive.

The French Law relates to the digital exploitation of out-of-print 20th century books and authorises the creation of a public database indexing out-of-print books without the need of the authors’ prior express consent. If a book has been registered on this database for 6 months, then the right to authorise the reproduction and performance of the book in a digital format is exercised by the Société française des Intérêts des Auteurs de l’Écrit (SOFIA). After these six

months, an author may only object to the exercise by SOFIA of the right to reproduce or perform his work if he considers that the reproduction or performance of that work is liable to affect his good name or reputation adversely.

In the AG’s opinion, Articles 2(a) and 3(1) of the Copyright Directive are incompatible with national legislations, such as the French Law, which replace the author’s express and prior consent for the reproduction or communication to the public of his work with tacit consent or a presumption of consent. This is because the prior express consent consti-tutes an essential prerogative of authors. According to the AG, this conclusion applies even if a copyright management society such as SOFIA has a mechanism allowing authors, and their successors, to oppose the communication of the work.

The AG recommends that the Court of Justice of the Euro-pean Union should hold that the rights provided by Articles 2(a) and 3(1) of the Copyright Directive preclude national legislations, such as the French Law, which give designated copyright management societies the right to authorise the reproduction and the performance in the digital form of ‘out-of-print books’.

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| LABOUR LAW

Bill on Workable and Flexible Work submitted to Stakeholders

Deputy Prime Minister and Minister for Work Kris Peeters submitted a draft Bill on Workable and Flexible Work (Wet-sontwerp Werkbaar en Wendbaar Werk/Projet de loi con-cernant le Travail Faisable et Maniable; the “Bill”) to the so-called “Group of 10”, a group of stakeholders including employer organisations and unions.

The Bill consists of two parts:

1. A general section with measures that apply immediately to companies.

› Annualisation of working hours: There is no question of abolishing the 38-hour work week. It would be possible, however, to determine the 38-hour work week on aver-age over a period of 1 year. During specific periods, work can be performed up to 9 hours per day and 45 hours per week, provided that these hours are compensated with free time during periods of less work. This flexibility is not unlimited. At no time the employee is allowed to perform more than 143 hours above the average working time. If this threshold is reached, the employer must grant com-pensatory rest to his employee. The existing overtime reg-ulation will remain unchanged. The employee will thus be compensated financially if he works in excess of normal working hours during specific periods.

› 100 voluntary paid hours of overtime: The employee would be able to choose to perform 100 hours of overtime. In such a case, the employer would pay these hours with overtime allowance.

› Training: The current target to spend 1.9% of the total wage bill on training would be replaced by a new inter-pro-fessional target of 5 training days on average per full-time equivalent (“FTE”) and per year. This measure will entail no additional costs for employers. The new system provides for the possibility to organise the right to training either at sectoral level or at company level, through the crea-tion of an individual training account. If none of these two instruments are available, the employee is entitled to an individual right for 2 days of training per year and per FTE.

› Occasional telework: A regulatory framework would deter-mine the conditions under which an employee is entitled to occasional telework.

If the industrial sectors do not conclude a collective bargain-ing agreement (“CBA”) on all or part of these basic meas-ures before 31 December 2016, these measures (or the part thereof that has not been made the subject of a CBA) will become mandatory.

2. A series of measures that can only be activated by the industrial sectors.

› Overall reform of working time: The social stakeholders would be able to deviate from the normal working time limits by CBA. The absolute thresholds of 11 hours per day and 50 hours per week would remain (if the average of 38 hours per week is respected). It would be possible to shift the starting hour for night work from 8:00 PM to 10:00 PM.

› Modification of work schedules: All full-time work sched-ules would have to be included in the work rules. If multiple work schedules apply, the rules for the transition between these work schedules would also have to be included in the work rules.

› Plus Minus Conto: Internationally competitive sectors would be able to provide by CBA that the calculation of the average 38-hour work week will be spread over sev-eral years. This is already provided for today in the auto-motive industry.

› Temporary agency work of indefinite duration: Tempo-rary agency workers with a contract of indefinite duration would also receive a salary from the agency between two assignments.

› Reform of system of employers’ group: Small businesses would be able to hire an employee together. This is an opportunity for companies that do not have the resources to hire an employee individually.

› Simplification part-time work: The obligation to include all individual work schedules in the work rules would be

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deleted. This is a significant administrative simplification. For employees who work with a variable work schedule, the notification period would remain 5 days. This could be increased or decreased (to a minimum of 1 day), but only if this is agreed in a binding CBA between the social stake-holders. Certain documents which currently have to be kept on paper could also be stored electronically.

› Career saving (loopbaansparen/épargne-carrière): Employ-ees would be able to save up additional holidays. Each sector could decide to implement this option at company or sectoral level. In case of a job change (even to another sector), the employee would be able to opt for a compen-sation payment for the accrued additional holidays from which he has not yet benefited wherever it is impossible to transfer the accumulated additional holidays to the new employer. It is unclear at this stage whether the compen-sation payment would have to be paid by the former or the new employer.

› Adaptation of leave systems: Leave for palliative care could be extended to a maximum of 3 months. Time credit for care purposes could also be extended by 3 months.

› Flexible working hours: A regulatory framework for flexible working hours during which the employee can determine the beginning and the end of his performance, would be subject to certain limits.

› Granting of leave: The employee who has a seriously ill child and has exhausted all leave systems, would be able to ask his employer to open up this system by accepting other employees to donate additional holidays (holidays beyond the statutory leave of 20 days) for the benefit of the employee with the seriously ill child.

After discussion of the Bill within the Group of 10, the Min-ister of Work will submit it to the government. Following the advice of the Council of State, the Bill will be submitted for approval to the Chamber of Representatives.

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| MARKET PRACTICES

Publication of Law containing Miscellaneous Provisions in Economic Matters

On 6 July 2016, the Law of 29 June 2016 containing mis-cellaneous provisions in economic matters (Wet van 29 juni 2016 houdende diverse bepalingen inzake Economie/Loi du 29 juin 2016 portant dispositions diverses en mat-ière d’Economie; the “Law”) was published in the Belgian Official Journal.

The Law strengthens the enforcement of the market prac-tice rules and amends the rules on itinerant trading (See, this Newsletter, Volume 2016, No. 6, p. 24). Subject to some exceptions, the Law entered into force on 16 July 2016.

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| PUBLIC PROCUREMENT

Publication of Law on Public Procurement

On 14 July 2016, the Belgian Official Journal published the Law of 17 June 2016 concerning public procurement (Wet van 17 juni 2016 inzake overheidsopdrachten/Loi du 17 juin 2016 relative aux marches publics; the “Law concerning Public Procurement”). The Law concerning Public Procure-ment, which was adopted by the Chamber of Representa-tives on 12 May 2016 (See, this Newsletter, Volume 2016, No. 5, p. 16), implements into Belgian law Directives 2014/24/EU and 2014/25/EU.

Containing 193 Articles, the Law concerning Public Pro-curement is significantly more elaborate than its prede-cessor, the Law of 15 June 2006 (Wet van 15 juni 2006 inzake overheidsopdrachten en bepaalde opdrachten voor werken, leveringen en diensten/Loi du 15 juin 2006 relative aux marchés publics et à certains marchés de travaux, de fournitures et de service), which consists of 80 Articles. Although the Law concerning Public Procurement maintains a number of provisions stemming from the Law of 15 June 2006, it introduces important innovations, some of which are discussed below.

Greater Flexibility in Choice of Tender Procedures

First, while the Law concerning Public Procurement no longer uses the distinction between “adjudication” (aan-besteding/adjudication) and “call for tender” (offerteaan-vraag/appel d’offres), it continues to put forward the so-called “open procedure” (consisting of one phase in which any interested party can submit an offer) (openbare proce-dure/procedure ouverte) and the so-called “restricted pro-cedure” (in which interested parties first have to submit a request for participation) (niet-openbare procedure/proce-dure restreinte) as the standard procedures to be used by contracting authorities. However, compared to the situation under the Law of 15 June 2006, the open and restricted procedures are no longer given absolute priority.

The Law concerning Public Procurement thus marks an important shift in the choice of tender procedures by pro-moting the use of more flexible procedures, other than the open and closed procedures. In line with the intention of the European legislator to provide greater flexibility for con-tracting authorities in their choice of procurement proce-

dure and to further the use of procedures that contain an element of negotiation, the Law concerning Public Procure-ment relaxes the conditions for the use of the so-called “competitive procedure with negotiation” (the successor of the procedure previously known as the negotiated proce-dure with prior publication) (mededingingsprocedure met onderhandeling/procédure concurrentielle avec négociation) and the competitive dialogue (concurrentiegerichte dialoog/dialogue competitive). The Law concerning Public Procure-ment further introduces a new, flexible tender procedure, the so-called “innovation partnership” (innovatiepartner-schap/partenariat d’innovation).

The innovation partnership is a procedure specifically designed for situations where a need for the development of an innovative product or service or innovative works and the subsequent purchase of the resulting supplies, services or works cannot be met by solutions already available on the market. In such situations, the new procedure allows contracting authorities to establish a long-term innovation partnership for the development and subsequent purchase of a new, innovative product, service or works provided that these can be delivered to agreed performance levels and costs, without the need for a separate procurement procedure for the purchase. According to the parliamen-tary report for the Law concerning Public Procurement, the introduction of this procedure is intended to give a positive signal to innovative sectors.

Award Criteria

A second innovation is the new approach in applying the award criteria. The Law concerning Public Procurement pro-vides that contracting authorities should award their con-tracts to the most economically advantageous tender. While under the current regulatory framework the term “most eco-nomically advantageous tender” refers to the offer with the best price-quality ratio, the meaning of this term is signifi-cantly broadened under the Law concerning Public Procure-ment. Accordingly, a contracting authority can determine the most economically advantageous tender on the basis of criteria of its choice. These can include price, cost, and/or price-quality ratio.

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Thus, even though the Law on Public Procurement no longer uses the concept of “adjudication”, contracting authorities still remain free to award a contract based on price as the sole award criterion. The preparatory works of the Law concerning Public Procurement explicitly state that, in the case of highly standardised products such as needles for hospital use, it seems likely that contracting authorities will prefer to use price as the sole tender criterion, as it suffices to refer to the relevant standards in the techni-cal specifications in order to ensure the desired quality. By contrast, contracting authorities using the competitive dialogue or innovation partnership procedures are obliged to award contracts on the basis of the price-quality ratio and are not authorised to award the contract on the basis of price alone.

The Law concerning Public Procurement generalises the use of tender criteria, which become applicable regardless of the tender procedure used. However, for tenders of limited value and in specific circumstances in which the negotiated procedure without prior publication is applied, contracting authorities are not bound by the rules on award criteria.

Entry into Force

Most of the provisions of the Law concerning Public Pro-curement will enter into force only on a date determined by a Royal Decree yet to be adopted. However, three Arti-cles already entered into force on 27 July 2016. Pursu-ant to these provisions, contracting authorities will only be allowed, as far as a number of products, services and buildings listed in a Royal Decree are concerned, to pur-chase these with a demonstrated high energy efficiency performance. However, even the Articles that have already entered into force still have to wait for the publication of a Royal Decree in order to become operational.

Publication of Law on Concession Contracts

On 14 July 2016, the Law of 17 June 2016 on concession agreements (Wet van 17 juni 2016 betreffende de concessie-overeenkomsten/Loi du 17 juin 2016 relative aux contrats de concession; the “Law on Concession Agreements”) was published in the Belgian Official Journal. The Law on Con-cession Agreements, which was adopted by the Chamber of Representatives on 12 May 2016 (See, this Newsletter, Volume 2016, No. 3, p. 11), implements into Belgian law Direc-tive 2014/23/EU on the award of concession contracts.

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| STATE AID

European Commission Opens In-Depth Investigation into Tax Exemptions for Belgian Ports

On 8 July 2016, the European Commission (the “Commis-sion”) opened an in-depth investigation into corporate tax exemptions granted to Belgian ports.

In Belgium, a number of sea and inland waterway ports (notably the ports of Antwerp, Bruges, Brussels, Charleroi, Ghent, Liège, Namur and Ostend, as well as ports along the canals in Hainaut Province and Flanders) are exempt from the general corporate income tax regime. These ports are subject to a different tax regime, with a different base and tax rates.

However, the main activities of ports are commercial activ-ities, including the transfer of persons and cargo and the provision of infrastructure to shipping companies, shipbuild-ers and other companies. In the Commission’s view, the commercial operation of port infrastructure constitutes an economic activity for which the ports should pay corporate tax like any other company. Still, the tax regime applicable to ports results in an overall lower level of taxation for Bel-gian ports on their commercial activities as compared to other companies in Belgium. Therefore, the Commission has opened an in-depth investigation into this regime. The Com-mission’s investigation does not cover the ports’ activities that are linked to the exercise of essential state responsibil-ities, such as safety, surveillance and traffic control. These activities fall outside the scope of EU state aid control.

As the tax exemptions for ports already existed before the establishment of the European Union in 1958, the aid is regarded as “existing aid”. Therefore, the Commission followed the specific three-step cooperation procedure between Belgium and the Commission applicable to such aid. First, on 9 July 2014, the Commission sent a letter to Belgium outlining its concerns and giving Belgium an oppor-tunity to respond. Second, on 21 January 2016, the Com-mission adopted a decision in which it proposed appropriate measures to bring the taxation of ports into line with EU state aid rules. Third, with the decision of 8 July 2016, the Commission opened an in-depth investigation to verify the compatibility of the aid.

Belgium and interested third parties, such as beneficiaries or competitors of beneficiaries, are invited to comment on the state aid assessment of the tax exemptions, in par-ticular the economic nature of the ports’ activities and the effect on competition and trade.

If the Commission were to conclude that the taxation of ports in Belgium is not compatible with the EU state aid rules, it may require Belgium to put an end to the regime. However, as the aid is regarded as existing aid, the Com-mission cannot ask Belgium to recover aid granted in the past, nor any aid granted up until the moment that a final decision is adopted by the Commission.

On 8 July 2016, the Commission also opened an in-depth investigation into tax exemptions granted under French law to the main French ports. In January 2016, the Commis-sion had already taken a negative final decision regarding corporate tax exemptions granted to the Dutch public sea-ports. The Commission is also investigating the function-ing and taxation of ports in other Member States, including Germany.

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