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Publication
Merger law reform in Australia: What next after the Exposure Draft?
As expected, the Australian Commonwealth Treasury released an exposure draft for the proposed new Australian merger regime on 24 July 2024.
Global | Publication | May 2017
On May 10, 2017, the European Commission published the final report on its sector inquiry on competition in the e-commerce sector (the E-Commerce Report) and a mid-term review of its digital single market (DSM) initiative (the DSM Review), both of which were originally announced in May 2015. The DSM initiative is one of the Commission’s highest priorities. The measures already launched and still to come will have significant implications for all businesses operating in the European Union. The continued close coordination between the Commission’s regulatory and antitrust enforcement agendas is remarkable, and the Directorate General for Competition can be expected to continue focusing its enforcement resources in this area in support of the Commission’s broader policy goals.
The E-Commerce Report confirms that the Commission has no plans to revise the Vertical Restraints Block Exemption before its expiry in 2022 as a result of the sector inquiry, and the report is circumspect in identifying any particular online practices as problematic. The Commission has however launched several investigations as a result of the inquiry, and further enforcement action seems likely.
The DSM Review presents a mixed picture; the Commission has launched 35 legislative proposals and policy initiatives, but only one has so far been adopted by the European Council and Parliament. The Mid-Term Review describes several future actions, including a legislative proposal to limit Member States’ ability to impose data localization requirements; an initiative on accessibility and reuse of public and publicly funded data; an initiative (possibly including legislation) to address unfair contractual clauses and trading practices by online platforms; and guidance for online platforms on the notification and removal of illegal content and liability rules.
For additional information on the Commission’s e-commerce sector inquiry and DSM programme, please see our May 2015 client briefing and updates from November 2015 (nine DSM-related consultations), December 2015 (Commission proposals on online portability and digital contracts), August 2016 (Commission proposals on cyber-security, e-commerce, geoblocking, online platforms and digitizing European industry), and January 2017 (the Commission’s data economy consultation and communication).
During the e-commerce sector inquiry, the Commission gathered evidence from nearly 1,900 companies operating in e-commerce of consumer goods and digital content and analysed around 8,000 distribution and license contracts. The Commission published initial findings on geo-blocking in March 2016 and a preliminary report in September 2016; the detailed findings from the inquiry are set out in a staff working document accompanying the E-Commerce Report.
As noted, following completion of the sector inquiry, the Commission has concluded that there is no need to revise the Vertical Restraints Block Exemption before its expiry in 2022. The E-Commerce Report is circumspect in identifying particular e-commerce practices as problematic, but the Commission linked three investigations announced in February 2017 (into retail price restrictions, discrimination based on location and geo-blocking in relation to consumer electronics, videogames and hotel accommodations) to the e-commerce sector inquiry and noted that a number of companies in the clothing and other sectors had reviewed their online sales practices as a result of the inquiry. The Commission continues to look very closely at this sector, and further enforcement actions are likely.
In relation to consumer goods, the E-Commerce Report confirms that manufacturers increasingly sell their products directly to consumers through their own online retail shops, thereby competing with their distributors; use selective distribution systems to better control their distribution networks; and use contractual restrictions, such as pricing restrictions, marketplace (platform) bans, restrictions on the use of price comparison tools and exclusion of pure online players from distribution networks,to control product distribution. The Commission notes that “[s]ome of these practices may be justified,” while others may infringe EU competition rules by unduly preventing consumers from benefiting from greater product choice and lower prices.
The E-Commerce Report singles out several issues for discussion:
In relation to digital content, the E-Commerce Report notes that the sector inquiry confirmed that digital content providers depend on the availability of licences from content copyright holders and points to certain licensing practices that may make it more difficult for new online business models and services to emerge. As in its discussion of consumer goods, the E-Commerce Report does not take firm positions on practices believed to infringe the competition rules, but highlights certain practices for discussion:
The E-Commerce Report notes that the competitive role of big data was not covered by the sector inquiry but observes that big data practices can raise competition concerns, in particular where marketplaces and third party sellers, or manufacturers with their own shops and retailers, are in direct competition. These issues have been addressed in a number of studies and speeches, including speeches in September 2016 and March 2017 by Commissioner Vestager.
In the Mid-Term Review, the Commission notes that it has acted on all 16 of the originally announced DSM action items, delivering 35 legislative proposals and policy initiatives. Only one has been approved by the European Council and Parliament, however, and the Commission calls for speedy action to adopt other proposed legislation, highlighting a proposed update of EU telecommunications regulations intended to encourage investment in high-capacity networks, which were announced in September 2016.
The Commission also identified three priority areas for further action:
The Commission also describes further action in the areas of e-procurement and e-health and stresses the importance of international negotiations in relation to data protection and transfer. Interestingly, the Commission did not announce specific actions in relation to robotics and artificial intelligence, despite a call for action from the European Parliament in its resolution and recommendation in February 2017.
Publication
As expected, the Australian Commonwealth Treasury released an exposure draft for the proposed new Australian merger regime on 24 July 2024.
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