The European Commission announced earlier today that it was opening formal proceedings to investigate sales of e-books. In particular, the Commission has opened a cartel investigation to determine whether several international publishers, including Hachette Livre, Harper Collins, Simon & Schuster and Penguin have engaged in anti-competitive practices with respect to the sale of e-books.
In making the announcement, the Commission said in its news release:
“The European Commission has opened formal antitrust proceedings to investigate whether international publishers Hachette Livre (Lagardère Publishing, France), Harper Collins (News Corp., USA), Simon & Schuster (CBS Corp., USA), Penguin (Pearson Group, United Kingdom) and Verlagsgruppe Georg von Holzbrinck (owner of inter alia Macmillan, Germany) have, possibly with the help of Apple, engaged in anti-competitive practices affecting the sale of e-books in the European Economic Area (EEA), in breach of EU antitrust rules. The opening of proceedings means that the Commission will treat the case as a matter of priority. It does not prejudge the outcome of the investigation.
The Commission will in particular investigate whether these publishing groups and Apple have engaged in illegal agreements or practices that would have the object or the effect of restricting competition in the EU or in the EEA. The Commission is also examining the character and terms of the agency agreements entered into by the above named five publishers and retailers for the sale of e-books. The Commission has concerns, that these practices may breach EU antitrust rules that prohibit cartels and restrictive business practices (Article 101 of the Treaty on the Functioning of the European Union – TFEU).”
Unlike Canada, where conspiracy (cartel) agreements between competitors are criminal, the European Commission commonly announces cartel investigations which are not criminal in Europe at an early stage of proceedings.
It is not yet clear what the basis of the Commission’s challenge and theory in this case is, given that the Commission’s investigation also involves Apple and that Article 101 of the EU Treaty prohibits not only agreements (e.g., price-fixing agreements) but also “concerted practices” between competitors which can, among other things, prohibit the exchange of pricing information between competing suppliers.
While the criminal conspiracy provisions of the Canadian Competition Act (under section 45) were amended in 2010, the Competition Bureau has yet to announce any price-fixing or other cartel cases under the new provisions (though in recent public remarks by the Commissioner of Competition, the Commissioner indicated that the Bureau was shortly preparing to do so – see: Commissioner of Competition Addresses Current Enforcement Priorities in Two Wide-ranging Talks in Vancouver).
____________________
For more information about our regulatory law services contact us: contact
For more regulatory law updates follow us on Twitter: @CanadaAttorney
Templates/precedents and checklists to run promotional contests in Canada
Templates/precedents and checklists to comply with Canadian anti-spam law (CASL)
