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Two-Minute Recap of Competition Law Matters Around the Globe - March 2022

DOJ assesses “misuse of attorney-client privilege”

The US Department of Justice has requested that Google be penalised for misusing attorney-client privilege by training its employees to include in-house lawyers in written correspondences to protect documents from posing a risk in a possible antitrust investigation. The DOJ indicated that Google placed attorney-client privilege labels on multiple company documents where legal advice from attorneys was not necessary. Google stated that this on-going practice from 2015 is called “Communicate with Care”. The DOJ argued that new employees are directed to participate in these trainings and are especially advised to include such labels for any written communication containing revenue-sharing agreements and mobile application distribution agreements. However, when the content of the documents was examined, most lacked the need for legal advice or responses from the legal departments.

It’s a wrap on the Digital Markets Act!

Following a negotiation period of more than one year, on 25 March 2022 the European Commission, European Parliament and the Council of the EU agreed on the Digital Markets Act (DMA), subject to harmonisation. There are significant changes in the DMA, including the increase of the turnover threshold from EUR 6.5 billion to EUR 7.5 billion and the market capitalisation threshold from EUR 65 billion to EUR 75 billion. In addition, gatekeepers will be obliged to make their messaging services interoperable. The rate of fines is set as up to 10% of worldwide turnover, and up to 20% for repeated infringements. The Commission retains the right to conduct a market investigation and impose reprimands in favour of allowing behavioural and structural remedies. The Commission also restructured its enforcement procedures to be more centralised; the previously proposed veto right of parliaments regarding enforcement at the national level is relinquished in cases that are antagonistic to the DMA.

CJEU backs German authority on non bis in idem

The Court of Justice of the EU (CJEU) has concluded two cases—“bpost” and “Nordzucker and Others”—clarifying the application of the protection against double jeopardy in competition law. bpost was fined by the Belgian postal regulator and later by the Belgian Competition Authority. According to the CJEU, non bis in idem does not preclude an undertaking from being penalised for an infringement of competition law if it has already been the subject of a final decision for failure to comply with sectoral rules on the same facts. In “Nordzucker and Others”, the CJEU ruled that even if a competition authority in one Member State has previously penalised an undertaking for anticompetitive behaviour, the principle does not prohibit proceedings sought against the same undertaking by a competition authority in another Member State, provided that the decision is not based on anticompetitive behaviour in the territory of the first Member State.

Amazon’s MFN case moves to class action in the US

Amazon’s alleged conduct regarding the application of MFN clauses, which resulted in the increase of prices via “fair pricing” agreements, triggered a reaction among consumers and became a class-action lawsuit through a ruling issued on March 11. The class action has proceeded to the US District Court for the Western District in Washington. Although there have been cases where the court took a more relaxed approach with regard to MFN practices, in this case Amazon’s fees were added to the cost of the seller’s products when the products were sold elsewhere, and this leads to an actual increases in prices. Amazon provided defences with respect to fair pricing rules and indicated that the practice requiring merchants to provide the lowest prices is actually beneficial for consumers. The case judge argued that the defences may be accepted at a later stage, as MFN agreements do not constitute per se antitrust infringements.

Japanese watchdog takes a step back

Amer Sports, the main distributor for Wilson Sporting goods tennis rackets in Japan, submitted a commitment plan to the Japanese Fair Trade Commission to protect itself from possible anti-trust violations. The plan contains commitments with respect to ceasing acts preventing other retailers from importing Wilson products in Japan. An investigation was carried out in September 2020 following suspicion of the relevant conduct, which constitutes an infringement of Japan’s Anti-Monopoly Law. While the plan does not represent a determination that the conducts of Amer Sports and Wilson constituted a violation, the investigation will not be further pursued by the JFTC if Amer Sports and Wilson comply with the plan.

For further information please contact Bulut Girgin, Counsel, at bgirgin@gentemizerozer.com, Merve Öner Kabadayı, Associate, at moner@gentemizerozer.com, and Sıla Dilaver, Legal Trainee, at sdilaver@gentemizerozer.com.