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China
On 13 August 2010, the Chinese Ministry of Commerce (MOFCOM) conditionally approved the acquisition of Alcon by Novartis. MOFCOM had concerns in two markets: the China market for opthalmological anti-inflammatory and anti-infective treatment products, and the China market for contact lens care products. MOFCOM granted approval subject to two conditions. First, Novartis must cease selling its own brand of anti-infective treatment products in China, though the merged entity can continue selling the similar Alcon treatments. Second, the merged entity must within twelve months terminate the Sales and Distribution Agreement between Shanghai Shikang and Novartis’ largest rival, Haichang. This is the first MOFCOM decision addressing coordinated effects concerns arising from the proposed merger: the potential reduction of competition between the merged entity (Novartis/Alcon) and other market competitors (Haichang). |
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India
On 9 September 2010, the Supreme Court of India ruled that the Indian Competition Appeals Tribunal does not have the power to stay competition investigations by the Competition Commission of India. The Steel Authority of India challenged before the Tribunal the Commission’s decision to refer an abuse of dominance allegation to its investigative arm. When the Tribunal granted an order to stay the investigative process, the CCI appealed to the Supreme Court. Following the Supreme Court’s ruling, companies under investigation can no longer seek intervention from the Tribunal, allowing the CCI to carry out its investigative functions more efficiently. |
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Russia
On 2 September 2010, Andrey Tsyganov, Deputy Head of the Federal Antimonopoly Service presented a report to the Russian government outlining the achievements, key developments and priorities of the country’s antimonopoly agency. The report, titled ‘On the State of Competition in the Russian Federation’, records the successes of the agency in 2009, listing a total of 9,664 competition cases, with 2,592 fines issued, and analysis reports on the grain, aviation fuel and milk markets. The report also refers to the launch of a new website by 2011, which is expected to be the sole source of information on tenders and auctions for the transfer of rights for a non-exhaustive list of state properties, including state and municipal property, land, and natural resources. These disclosures suggest a development towards greater transparency, which reflects the rise of the Federal Antimonopoly Service in Russia’s legal and commercial environment. |
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Australia
Following the rejection of the proposed merger of National Australia Bank and AXA Asia Pacific in April 2010, the Australian Competition and Consumer Commission again refused to approve the merger, despite the latest remedial offer by AXA to divest its specialized investment platform, North, to its rival company, IOOF Holdings. The proposed divestiture was considered insufficient to address the anticipated substantial lessening of competition in the retail investment platform market. As the divestiture offer did not include North’s distribution assets, the offer would rely heavily on the distribution capability of IOOF Holdings, to maintain competitiveness in the industry in the future. |
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New Zealand
The New Zealand Supreme Court decided on 1 September that the Commerce Commission had failed to prove that Telecom NZ had abused its dominant position in the market for fixed line retail telephone services to residential customers through the introduction of its ‘0867’ package. The Supreme Court endorsed the counterfactual test to determine whether a position of dominance had been “abused”. This requires comparison of the conduct complained of with the conduct to be expected of a hypothetical firm otherwise in the same circumstances as the defendant but lacking dominance. The exercise of the test places a high evidential burden on the Commission and could catalyse amending legislation. |
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UK
The UK Department of Health is inviting submissions on the proposal ‘Liberating the NHS: Regulating Healthcare Providers’, a new government policy which includes providing Monitor, the regulator of the National Health Services, with competition powers. The objective of the proposal is to liberalise the market for national health services with hospitals engaging in active competition with one another. Monitor currently regulates the NHS foundation trusts, but will be established as an independent economic regulator for the NHS by April 2012. Under the new policy, Monitor’s competition powers may include investigative, enforcement and prosecutorial powers, as well as the power to regulate competition issues in the private healthcare industry. |
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United States
The US Federal Trade Commission and the Antitrust Division of the US Department of Justice published the final version of the revised Horizontal Merger Guidelines on 19 August 2010. The Horizontal Merger Guidelines were first adopted in 1968 and most recently revised in 1992. Advances in antitrust scholarship and changes in the practices of the agencies since 1992, coupled with the continuing reliance of judges on the 1992 Guidelines, were among the reasons for the current revision. The objective of the 2010 Guidelines is to promote transparency in the practices and analytical framework used by the FTC and the DOJ in their review of horizontal mergers. Details of the 2010 Guidelines are available at: http://www.ftc.gov/os/2010/08/100819hmg.pdf. |
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Hong Kong
In light of the introduction of the Competition Bill to the Hong Kong Legislative Council, the Asian Competition Law and Economics Centre of the Hong Kong Polytechnic University is offering an introductory course to competition law and policy from 25 October 2010 to 29 November 2010. Introduction to Competition Policy, Law and Economics is a six-week, 12-hour course, which is designed to introduce the basic principles of competition law, policy and economics, with case studies on competition law and policy of comparable jurisdictions that relate to the unique aspects of Hong Kong. A Certificate of Attendance will be provided upon completion of the course. For further information, please contact afleosek@inet.polyu.edu.hk. |
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Copyright © 2010 Asian Competition Law and Economics Centre (ACLEC), The Hong Kong Polytechnic University
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