August 8, 2022

Volume XII, Number 220


August 05, 2022

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The Case of Ophthalmic Drugs in Italy and France: A Lesson to Learn - Parallel Antitrust Investigations and Cooperation Between National Competition Authorities

The recent investigations into two pharmaceutical companies active in the ophthalmic drugs market in Italy and France serve as a reminder of the cooperation that takes place between national competition authorities. International groups should therefore take into account all the jurisdictions where they have a presence or do business when developing their antitrust audit and compliance programmes.

On 8 April 2014, the French Competition Authority carried out unannounced inspections at the premises of two pharmaceutical companies active in the ophthalmic drugs market, specifically medicines used for the treatment of “age-related macular degeneration”. On 5 March 2014, the same two companies were fined by the Italian Competition Authority, as they were found in breach of Article 101 of the Treaty on the Functioning of the European Union (TFEU), for allegedly participating in an anticompetitive agreement in the same market in Italy.

On 6 May 2014, EU Competition Commissioner Almunia reportedly indicated that the European Commission is gathering more information on the conduct of the two companies and has been in contact with the national competition authorities of several EU Member States. The Commission will assess whether or not further action is needed in this area, but Commissioner Almunia could not comment further on the content of its current investigative activities.

This sharing of work and closer cooperation between the different national competition authorities has been enhanced by Regulation No 1/2003.

Previously, cooperation between the EU Member States’ competition authorities and the Commission was centralised around the Commission. The means of cooperation were limited to

  • The Commission’s power to request the national competition authorities to undertake investigations the Commission considered necessary

  • The Commission’s power to obtain information from governments and national competition authorities

  • The Commission’s duty to transmit the necessary information and documents to the national competition authorities during a Commission investigation.

In addition, the Court of Justice of the European Union had ruled that, where national authorities undertook investigations at the request of the Commission, they were not entitled to retain and use for the purpose of separate proceedings at national level any information or documents they had acquired when acting on behalf of the Commission (see case C-67/91, Asociación Española de Banca Privada and Others [1992] ECR I-4820).

Since the entry into force of Regulation No 1/2003 and the Commission Notice on Cooperation within the Network of Competition Authorities of 27 April 2004, the Commission and the national competition authorities within the European Economic Area can cooperate more easily and more closely. They can now

  • Inform each other about pending cases, even during informal proceedings

  • Exchange and use information, including documents, statements and digital information, collected by other national competition authorities

  • At the latest, 30 days before the adoption of a decision applying Article 101 or 102 TFEU, send the Commission and national authorities a summary of the case, including the envisaged decision or any other document indicating the proposed course of action.

Very often, when companies are active in several EU Member States, such cooperation results in multiple proceedings before two or more national competition authorities acting in parallel without the intervention of the Commission. As a recent example, the investigations brought by the German and UK competition authorities into an alleged price parity agreement between competitors in the online retail market, showed a very high level of cooperation between the two competition authorities. The investigations were closed on 26 and 29 November 2013 respectively; see the Bundeskartellamt Press Release and Office of Fair Trading Press Release for more information.

There are many other examples of investigations started in parallel by several national competition authorities in the same or neighbouring product and geographic markets. The recent investigation by the Italian Competition Authority into the market for polyurethane foam (see Italian Competition Authority Decision issued on 3 April 2014) followed previous investigations focusing on the same product opened by the European Commission (see Decision issued on 29 January 2014 in Case AT.39801 - Polyurethane Foam) and by the national competition authorities of Spain (see Spanish Competition Authority Decision issued on 17 September 2013 in Case S/0402/12 - Espuma Elastometrica), Canada (see Ontario Superior Court of Justice Judgment issued on 11 February 2014 in Case CV-10-15164) and the United States (several lawsuits were filed during 2010 in US District Courts, e.g., Western District of North Carolina). As for a recent example of parallel investigations in neighbouring product markets, the alleged cartel amongst providers of freight forwarding services was investigated and fined by the Italian Competition Authority following the leniency applications of three companies, which had been involved in the air cargo cartel case, before the European Commission. These are just two recent examples and there are many others.

This latest case in the ophthalmic market should act as an important reminder for companies active across several EU Member States to take into account all jurisdictions where they have a presence or do business when developing their strategies. This should be done in order to minimise the risks of an investigation spreading to other jurisdictions and the amount of potential fines.

In developing such strategies and, in particular, when designing compliance programmes or contemplating a leniency application, international groups should first consider a tailor-made antitrust audit that includes

  • Risk identification, aimed at identifying potential geographic and product areas

  • Risk assessment, by carrying out an analysis of the level of risk and identifying the local employees involved in high risk areas

  • Risk mitigation, by setting up tailored policies and training for the employees in local languages and putting in place rules to ensure they are aware of all the potential risks

  • Monitoring through a periodical review by local counsel, in order to ensure the above points are respected and policies are maintained.

A multi-jurisdictional audit and compliance programme should be tailored to the local premises of each subsidiary and take into account the specificities of the relevant industry where the company is active. At the same time, it should be coordinated at group level, in order to maximise the chances that the entire group will benefit from a reduction of a potential fine in case of an investigation.

When developing their strategies, multinational companies should take into account, in a very practical way, the specific features of all jurisdictions where they have premises or do business. In doing so, they should build efficient global coordination among the various local teams and offices under a single antitrust compliance strategy.

© 2022 McDermott Will & EmeryNational Law Review, Volume IV, Number 127

About this Author

Jacques Buhart, McDermott Will Emery Law Firm, Antitrust Attorney

Jacques Buhart is a partner in the law firm of McDermott Will & Emery and is based in the Firm’s Paris office.  He is head of the Paris office and focuses his practice on corporate mergers & acquisitions and EU/ French competition.

In his cross-border transactional practice, Jacques has represented, among others, Mitsubishi Heavy Industries in its attempt to acquire Alstom with Siemens, Canon in its acquisition of OCE, Total in its acquisition of Elf, Belgacom, Metsäliitto in various acquisitions and divestitures in Europe, Toyota Motor Corporation in setting up its plant in...

33 1 81 69 15 00
Martino Sforza, McDermott Will & Emery Studio Legale Associato, Milan Italy attorney

Martino Sforza is an associate in the law firm of McDermott Will & Emery Studio Legale Associato, based in its Milan office.  He focuses his practice on merger filings, distribution, cartels and abuse of dominance, before the Italian Competition Authority and the European Commission.

39 02 89096073