Comments to Danish Draft Guidelines on Joint Tendering


The Danish Competition and Consumer Authority has published draft guidelines on joint bidding under competition law and invited comments by 1 September 2017. The following are the comments I have provided in the context of this public consultation. It will be interesting for me to see if the Authority takes any of these issues into account in the final version of its guidance.

The document provides a useful overview of the issues involved in an analysis of the compatibility of undertakings’ collaboration for the submission of joint tenders for public contracts with Article 101 TFEU (and domestic equivalents). The guidance is largely applicable to subcontracting arrangements as well, and it usefully incorporates recent examples of competition investigations in Scandinavian jurisdictions—with special attention given to the recent EFTA Ski Taxi Judgment.[1] It is particularly welcome that the Danish Competition and Consumer Authority has made the effort of publishing the guidelines in English, which can position them as an important point of reference in all EU/EEA jurisdictions after their official adoption.

The draft guidelines pivot centrally around the consideration of whether undertakings seeking to collaborate in the submission of a joint tender could bid independently for a given contract. That is, they follow the standard approach of considering that collaboration in the form of joint bidding (or subcontracting) is problematic where it reduces the level of competition that could otherwise exist for a public contract, unless it generates net efficiencies that are passed on to the contracting authority.[2] From that perspective, the draft guidelines send some useful clear messages, such as the need:

  1. for undertakings to conduct objective self-assessments of their own capacity to individually perform the contract prior to engaging in discussions with potential consortium partners;
  2. to tailor the analysis to the size and requirements of the lots in which a contract can be divided, rather than limiting the assessment to a holistic view in relation to the execution of the whole contract;
  3. to carry out case-by-case assessments of that capacity and the ensuing warning against stable joint tendering arrangements that fail to meet the thresholds for the creation of a full functioning joint venture; and
  4. to keep adequate records of those assessments for the purposes of enabling full and considerate responses to requests for information in the context of a competition investigation.

Given the complexity of the topic, however, there are some aspects of the draft guidelines that are less clear cut and where, in my opinion, there is scope for improvement and further clarification in the guidance finally adopted by the Authority. The assessment of relationships of potential competition in the context of restrictions of competition by object and the treatment of risk-driven collaborations deserve some careful consideration. These are issues that have spillover effects on the treatment of exchanges of information between undertakings considering bidding jointly for a public tender. This contribution addresses these three issues.

1. Treatment of potential competition

 The guidelines concentrate on the analysis of joint tendering by competitors and, implicitly, recognise that non-competing undertakings can freely cooperate in the context of public procurement (as in any other area of economic activity). This could be said explicitly, but there is no indication to the contrary in the draft guidelines. However, given the broad approach to the consideration of potential competition relationships between consortium members, and the assumption that joint bidding can be assessed as a restriction of competition by object because it involves price setting (following the EFTA Ski Taxi Judgement, above, in p. 20, box 2.11), the guidelines create some uncertainty.

On the one hand, because they indicate the possibility of joint tendering benefitting from block exemption regulations (BERs, see p. 30, para 3.2), despite the fact that price fixing is a hardcore restriction that excludes the applicability of the BERs. It would thus need to be clarified whether the Authority considers joint tendering as a restriction by object structurally involving price fixing or not, as well as the consequences of the position taken on this point. On the other hand, the guidelines create uncertainty because they do not address the tricky boundary issue of joint tendering by potential competitors as clearly as it would be possible.

The ambivalence or lack of clarity of the guidelines on this issue permeates the analysis and sometimes results in confusing expressions, such as the indication that chapter 3 assesses “the conditions that must be fulfilled for a consortium (including between competitors) to be exempted from the prohibition against agreements that restrict competition” (p. 23, introduction, emphasis added). Literally, this statement is incorrect, as joint bidding by consortia between non-competing undertakings does not run against the prohibition of Article 101(1) TFEU. In this case, it is possible that some word (such as “potential” competitors) is missing, but it is also possible that the guidelines are not too clearly set on the limits to the extension of the prohibition of Article 101(1) TFEU to (theoretically) potential competitors for a public contract.

This is an issue that has been recently discussed to some length,[3] and one which affects different aspects of the analysis under Article 101(1) and 101(3) TFEU that do not appear explicitly interconnected in the draft guidelines. In my view, there are two aspects that can be clarified.

First, the guidelines are not explicit in indicating how to carry out the analysis of an undertaking’s condition of potential competitor for a contract. There is just a mention to the effect that, in the assessment of “whether a company [rectius, undertaking] could [potentially] be able to bid individually, the Authority looks at whether this could constitute a sustainable economic strategy for the company (sic). This means firstly that a mere theoretical possibility of carrying out a contract is not enough; the possibility must be real and is shall include assessing that the offer must be profitable. The assessment shall be made on an objective basis” (p. 9, para 2.2).

This triggers two issues. One concerns the relevance of economic sustainability where the execution of a public contract is a one-off instance or involves a short to medium term project, where sustainability does not seem to raise particular issues or be the prime consideration. Another one concerns the assessment of profitability, in terms of the existence of economic incentives that justify potential additional investments, which requires a complex analysis of risk (discussed below 2). It seems clear that it is not sufficient to simply establish that an undertaking could have invested in additional resources to tender for the contract individually, but that it is necessary to establish that such investment was the rational economic decision to make under the circumstances (rather than engaging in a joint tender), which is always an ex post facto determination. In my opinion, great caution needs to be exercised here to avoid creating disincentives for joint tendering.

The guidelines could be improved by sketching, at the minimum, the circumstances in which the Authority would be willing to accept that an undertaking is justified in foregoing the potential investment to participate in the public tender, and the extent to which this can (and how it should) be documented. Logically, the same conditions need to justify a decision not to tender at all. If an undertaking is justified in not tendering (i.e., that is considered as the economically rational strategy), then it should also be justified in seeking collaboration. As mentioned below, this relates to an implicit duty to tender or else have a good rational for the tender hold-up, which seems more adequate for analysis under Article 102 TFEU than under Article 101(1) TFEU. In any case, difficult issues arise around any expectation or duty to participate in public tenders and the undertakings’ freedom to conduct a business under Art 16 of the EU Charter of Fundamental Rights, so careful consideration is necessary.

Second, the guidelines could be clearer in terms of the place for the establishment of counterfactual assessments. It seems that the guidelines do not consider the possibility of establishing an undertaking’s condition of potential competitor for a contract on the basis that it could have jointly tendered with undertaking(s) other than the one(s) it is eventually collaborating with. Such a possibility is only mentioned in relation with the assessment of the indispensability of an existing joint tendering agreement, where the draft guidelines indicate that, for an anticompetitive joint tender between (potential) competitors to be justified under Article 101(3) TFEU, “[t]here shall be no other economically viable and less restricting ways of achieving the efficiencies. This can be either in the form of bidding instead individually or forming a consortium with undertakings other than the ones in the current consortium” (p. 29, para 3.1.3, footnote omitted and emphasis added).

The fact that the existence of potential alternatives for collaboration is not use both to establish potential competition and the existence of potentially less restrictive forms of competition (ie, that it is not used both under an assessment of the Art 101(1) prohibition and the Art 101(3) exemption) should be welcome.

However, in my view, its use for the purposes of Art 101(3) is problematic. Once an undertaking has expressed its preference in collaborating with given consortium partner(s), it is difficult to accept the Authority’s role in second-guessing that an alternative collaboration would have been preferable (not only in competition terms, but also in business terms). The analysis of Art 101(3) TFEU should not involve this type of speculation, and it should suffice to establish that the joint bidders have not exceeded the limits required for the generation of the efficiencies derived from their agreement.

The possibility of having partnered with other undertakings seems to belong to the same logical plane as the decision not to partner with anyone (ie bid solo), or whether to tender at all. This is indicated in the draft guidelines itself themselves (see quote above), by linking the assessment of the undertaking’s ability to tender individually or to partner with other undertakings to do so. Those two decisions are equivalent in terms of establishing the undertaking’s condition of potential competitor for the contract, but they are not equally suitable for an assessment of whether less restrictive means existed, for the following reasons.

Where two potential competitors team up, then it can be argued that none of the restrictions was necessary at all and thus the assessment under Article 101(3) TFEU must fail. Conversely, where the agreement is between undertakings that would not have been potential competitors by themselves, the fact that a theoretically superior joint bidding arrangement could be conceived is irrelevant because the analysis under Article 101(3) TFEU must be limited to whether the arrangement in place generates efficiencies by the least restrictive means concerning the undertakings involved in the consortium. Considerations concerning third parties should be limited to an assessment of the fourth condition, concerning the consortium’s ability to eliminate competition for the contract—or, eventually, issues concerning infringements of Article 102 TFEU by the tenderer that could have participated solo and rather decided to ‘grab’ a partner that could have been strategic for a third party.

Therefore, it would seem more appropriate to move the assessment of the counterfactual consisting in the potential teaming with third party undertakings to the analysis of Art 101(1) TFEU with the sole purpose of establishing whether the joint tendering agreement is anticompetitive to begin with. In that setting, the circumstances in which a theoretically potential collaboration that is foregone is anticompetitive should also be clarified (as mentioned above) and, in my view, the clarification should be that such theoretical third arrangement is irrelevant.

Overall, taken together, these two issues point towards the need for more clarity in the guidelines concerning the assessment of situations where an undertaking is considered a potential competitor for a given public contract because it could have tendered for it (either individually, or in collaboration with third parties) but rather decides to team up with another potential competitor. As mentioned above, this seems to fit the framework of the rules applicable to a tender hold-up, which could be functionally assimilated to refusals to deal. In my view, developing the draft guidelines along these lines would improve them.

2. Treatment of risk-driven collaborations

The second main area where the draft guidelines could benefit from some clarification concerns the treatment of risk assessments carried out by undertakings considering the possibility to tender for a contract (either at all, or as part of a given consortium).

The first issue concerning risk-assessments that could be clarified is the extent to which they will actually be taken into account by the Authority. It seems contradictory or, at least confusing, that the draft guidelines indicate that “risk spreading is an element of the overall assessment of whether an undertaking can complete a contract on its own or whether it is objectively necessary to work with one or more undertakings” (p. 10, para 2.2) and at the same time that “[i]t will be difficult for a competition authority to make an ex post objective assessment of the risk taking on a contract … In this context, the issue of risk spreading will not necessarily be considered as an element when the Danish Competition and Consumer Authority assesses an undertaking’s capacity” (p. 11, same para). I find this difficult to understand and can see how the undertakings to which the draft guidelines are addressed may be confused. More clarity on the conditions in which the Authority will use or not internal documentation concerning risk-assessments would be desirable.

A second issue concerns the extent to which simultaneous tendering for different public contracts and their impact on the undertaking’s productive capacity features in the analysis. The draft guidelines usefully include a section on the analysis of the undertaking’s available capacity to undertake a contract and they recognise that, in some circumstances, foreseeable (recurring) commitments can be taken into account to establish that an undertaking does not have sufficient capacity to individually participate in a tender (pp. 14-15, para 2.2.4).

However, the guidelines do not seem to take into due consideration that undertakings active in procurement markets may (regularly) be tendering simultaneously for various contracts, which prospects of award are difficult to establish. In these cases, it is possible that a prudent business strategy requires the reservation of certain capacity in case the undertaking is successful in all of the simultaneous tenders (and this includes tenders which process of evaluation is live at the time of preparing the next tender), or at least a mitigation of that risk via cooperation with third parties (either by forming consortia, or through subcontracting).

Given the relevance (and, I would say, practical prevalence) of this circumstance, it would be desirable that the guidelines addressed it explicitly. Not only due to its impact on the assessment of the condition of potential competitor for a contract under Article 101(1) TFEU, but also due to the relevance that the draft guidelines give to this issue in terms of exemption under Article 101(3) TFEU (p. 26, para In that regard, the guidelines indicate that “[i]n many cases, the risk of taking on a specific contract cannot in itself justify that companies shall not be considered competitors with regards to the contract. In such cases, risk considerations will only determine that the agreement is lawful under the competition rules if risk diversification leads to or contributes to companies submitting a better bid together than they would have been able to individually”. However, it could be that sometimes a joint bid is the only bid that potential competitors are willing to consider because their second best option is not a solo tender, but rather to withhold a tender for a contract that, if awarded, could tip them over their maximum capacity. In my view, more nuance could be introduced in relation with this aspect.

A third issue concerning risk assessment relates to the relevance given in the draft guidelines to the consortium’s expectation of competition for the contract. It is not clear to me why it would be relevant or adequate to consider that “[i]f a consortium that (sic) for instance participates in a public call for tenders where there are many participants and therefore there is effective competition for the contract, there will be greater likelihood that efficiencies are passed on to consumers in terms of lower offer price than if the consortium expects for example only another participant in the call for tenders” (p. 28, para 3.1.2). I find this inconsistent with economic theory. What is important to test the consortium’s incentives to tender aggressively (or the constraints to a limit pricing strategy) is whether they anticipate any (including only one) tender by an equally or more efficient tenderer. And, in any case, I struggle to envisage a legal test that could determine the extent to which the consortium was anticipating more or less competition for the contract. In that regard, I think that this element of risk management / strategic bidding should be clarified in the final version of the guidelines.

3. Spillover effects on exchanges of information

Given the issues surrounding the assessment of risk and the uncertainties concerning the effectiveness of using risk assessments to exclude the consideration of potential competitors of the consortium members or the existence of acceptable efficiencies in their joint tendering, the way in which the illegality of information exchanges is presented could constitute a significant disincentive for undertakings considering joint participation in public tenders.

In particular, the dissuasive effect can derive from the drafting of the paragraph that indicates that “[i]f it turns out that the undertakings that have considered entering into a consortium will themselves be able to bid for the contract and, thus, they are competitors, the information exchange that has taken place, will in fact constitute information exchange between competitors. This will be a criminal offence if the information is sensitive from a competition perspective. It is therefore important that each undertaking clarifies beforehand whether it can complete the contract individually and thus whether the undertakings are competitors” (p. 31, para 4.1, emphasis added).

It is possible that this dissuasion is mitigated by introducing more clarity concerning aspects of risk assessment identified above, in particular concerning the possibility of having teamed up with third parties and the assessment of potential capacity constraints. Otherwise, it could be advisable to provide more detail of the circumstances in which such exchange of information could lead to a prosecution.

In that regard, it would also be necessary to avoid statements that could be potentially misleading. In particular, in my view, it would be necessary to reconsider the indication that seeking legal advice could reduce the likelihood of an investigation or prosecution, not least because that could potentially run contrary to the interpretation of Article 101 TFEU by the Court of Justice of the European Union in its Schenker Judgment,[4] where it clearly indicated that “legal advice given by a lawyer cannot, in any event, form the basis of a legitimate expectation on the part of an undertaking that its conduct does not infringe Article 101 TFEU or will not give rise to the imposition of a fine”.[5]


[1] For discussion, see here and A Sanchez-Graells, “Ski Taxi: Joint Bidding in Procurement as Price-Fixing?” (2017) 8(6) Journal of European Competition Law & Practice, forthcoming, available at, last accessed 07/07/2017.

[2] This is, in my view, the right general approach. See A Sanchez-Graells, Public procurement and the EU competition rules, 2nd edn (Oxford, Hart, 2015) 336-340.

[3] E.g. see here, here, C Thomas, “Two Bids or not to Bid? An Exploration of the Legality of Joint Bidding and Subcontracting Under EU Competition Law” (2015) 6(9) Journal of European Competition Law & Practice 629-638; C Ritter, Joint Tendering Under EU Competition Law (February 1, 2017), available at, last accessed 07/07/2017; and most recently, and with a consolidation of all previous debates, I Herrera Anchustegui, “Joint Bidding and Object Restrictions of Competition: The EFTA Court’s Take in the ‘Taxi Case’” (2017) European Competition & Regulatory Law Review (CoRe) 174-179, available at, last accessed 07/07/2017.

[4] Judgment of 18 June 2013 in Schenker & Co. and Others, C-681/11, EU:C:2013:404.

[5] Idem, para 41.

AG Wathelet proposes creation of excessive presumption of liability for third party infringement of Art 101 TFEU (C-542/14)

In his Opinion of 3 December 2015 in case VM Remonts and Others, C-542/14, EU:C:2015:797 (not yet available in English), Advocate General Wathelet advised the Court of Justice of the European Union (CJEU) on issues concerning the subjective elements (ie mens rea-like requirements) of the prohibition of anticompetitive behaviour in Art 101(1) TFEU. 

In particular, the case addresses issues concerning the imputability of anticompetitive practices in which a third party services provider is engaged to the 'client' undertaking that hired those services (ie how to make the 'client' undertaking liable for the anticompetitive behaviour of one of its services providers). In my view, AG Wathelet's proposal is clearly excessive (see critical assessment below) and deserves closer inspection. 

The case is quite convoluted because it concerns the imputability of a bid rigging offence to a supplying company that engaged a consultant to help it formulate a bid in a tender for a public contract. After the fact, it became apparent that the consultancy engaged in collusion with other tenderers in the same bid. The question was, thus, to what extent the bidder should be liable for the collusion that resulted from the allegedly independent activity of the consultancy (third party services supplier) and, in any case, what level of proof of anticompetitive intent would be necessary to impose liability on the 'client' undertaking.

In AG Wathelet's Opinion, it is not necessary to prove a personal behavior of any corporate officer of the 'client' undertaking, or his knowledge or consent to the behavior of the external services provider that also acted on behalf of other participants in a possibly prohibited agreement. AG Wathelet proposes to create a presumption of (vicarious?) liability, so that it is incumbent upon the 'client' undertaking to adduce sufficiently convincing evidence to rebut that presumption and escape liability. 

In particular, AG Wathelet considers that the necessary proof concerns (i) evidence relating to the fact that the third party (services provider) has acted outside the scope of the functions that had been entrusted to it, (ii) evidence regarding the precautionary measures taken by the 'client' undertaking at the time of designation of the third party and during the monitoring of the implementation of the functions in question, and (iii) evidence regarding the 'client' undertaking's conduct upon becoming aware of prohibited behavior.

AG Wathelet's VM Remonts Opinion follows the expansive/strict interpretation of the subjective elements in the prohibition of Art 101(1) TFEU in recent cases such as AC-Treuhand v Commission (C-194/14 P, EU:C:2015:717, re liability of a cartel facilitator, see an interesting comment here); Schenker and Others (C-681/11, EU:C:2013:404, re reliance on third party advice, see comments here); or Kone (C-557/12, EU:C:2014:917, re extension of 'umbrella' liability for damages to third parties to a cartel, see comments here). 

This is a very relevant opinion, with potentially very significant effects commensurate to those of the presumption of liability of the parent company, which has shaken competition law enforcement in the EU for the last 5 years or so.  

Therefore, it is interesting to look at AG Wathelet's reasoning in some more detail:
60. In my view, two extreme positions must be rejected. On the one hand, the automatic imputation of responsibility to the undertaking for the actions of a third party, regardless of the degree of involvement of the undertaking, which would go against fundamental principles governing the imposition of competition law sanctions (in particular the principles of personal responsibility and legal certainty), and, on the other hand, the obligation of the competent competition authority to demonstrate convincingly that the undertaking receiving the services from the third party was aware of the criminal acts committed by the latter or had consented to them, which would create a risk of seriously undermining the effectiveness of competition law.
61. Indeed, "... the prohibition on participating in anti-competitive practices and agreements and the penalties which infringers may incur are well known, it is normal that the activities which those practices and agreements involve take place in a clandestine fashion, for meetings to be held in secret, frequently in a non-member country, and for the associated documentation to be reduced to a minimum. " Therefore, it would be too easy to "hide" behind a third party in order to go unpunished under competition law.
62. Moreover, the importance of keeping free competition allows for companies that entrust third parties with functions such as those at issue in the present case [ie public procurement consultancy services] to be required to take all possible precautions to prevent such third parties from infringing competition law, avoiding, in particular, any negligence or recklessness in the definition or in the monitoring of these functions.
63. In line with this, the solution I propose for cases such as that in the main proceedings is to establish a rebuttable (iuris tantum) presumption of liability of the undertakings for acts contrary to competition law committed by a third party whose services it has engaged and which cannot be considered its subsidiary or ancillary body. Such a presumption can maintain the balance between, on the one hand, the objective of effectively suppressing behavior contrary to the competition rules, in particular to Article 101 TFEU, and to prevent their recurrence bearing in mind that respect for these rules requires an active corporate behavior at all times and, on the other hand, the requirements arising from the fundamental rights regarding the imposition of sanctions. Such a presumption would apply even if the acts performed by the third party were different from the functions entrusted to it, and even when it was not possible to demonstrate that the undertaking that used the services was aware of the acts of the provider or consented to them.
64. This presumption should apply to an undertaking from the moment the authority responsible for the enforcement of competition rules proves the existence of an act contrary to competition law committed by a person working for (or providing services to) the undertaking but which does not, directly or indirectly, form part of its organisational chart.
 65. In order to respect the balance to which I referred in point 63 of this Opinion, the undertaking may rebut the presumption of liability by submitting all elements supporting its claim that it was unaware of the illegal behavior  in which the third party service provider engaged, and by demonstrating that it took all necessary measures to prevent such a breach of competition law precautions, and this in three stages.
66. The first is when his appointment or hiring occurs. It refers in particular to the choice of supplier, the definition of the functions and the monitoring of its implementation, the conditions (or exclusion) of recourse to subcontracting, obligations to ensure respect for the law, in particular, competition, and the sanctions for breach of contract, as well as whether authorization was required for  any act not provided for in the contract.
67. The second stage includes the period of execution of the functions entrusted to the third party, ensuring that the latter strictly sticks to its functions as defined in the contract.
68. The third stage is when the third party commits a breach of competition law, even if committed at the back of the undertaking. The undertaking cannot simply ignore that behaviour, it should distance itself publicly from the forbidden act, prevent its repetition or report it to the administrative authorities. Indeed, as stated by the Court: "... passive modes of participation in the infringement, such as the presence of an undertaking in meetings at which anti-competitive agreements were concluded, without that undertaking clearly opposing them, are indicative of collusion capable of rendering the undertaking liable under Article [101(1) TFEU], since a party which tacitly approves of an unlawful initiative, without publicly distancing itself from its content or reporting it to the administrative authorities, encourages the continuation of the infringement and compromises its discovery" (C-542/14, paras 60-69, references omitted, own translation from Spanish, emphasis added).
In my own opinion, the creation of the presumption proposed by AG Wathelet goes way too far. In simple conceptual terms, it excessively erodes the principle of personal responsibility and falls short of meeting the desirable balance that the AG presents himself. The 'client' undertaking and the third party service provider are, in these cases, completely independent undertakings and the creation of the presumption would go beyond the acceptable limits of expansion of the concept of (functional) single economic entity. 

Plainly, it is excessive to impose this type of burden of proof (probatio diabolica) on undertakings that simply lack the knowledge and manpower required to monitor the execution of the activities contracted out to the third party to the standard created by AG Wathelet. This applies at least in stages one (design of the contract) and two (monitoring of execution), where the 'client' undertaking will in many cases be affected by significant asymmetries of information and gaps in human capital. Otherwise, what would be the economic rationale for contracting out something the undertaking could carry out on its own?

I would thus prefer the CJEU to deviate from the proposal of AG Wathelet in this case and to reject the creation of such rebuttable presumption of liability for the anticompetitive behaviour of third parties to which a 'client' undertaking has outsourced certain types of functions. The competent competition authority should always be obliged to demonstrate, at least at the level of sufficient indicia (balance of probabilities, but for?), that the recourse to the third party aimed to circumvent the prohibition of Art 101(1) TFEU--ie, that there was an anticompetitive agreement (by object) between the 'client' undertaking and the third party services provider because the outsourcing had the object of creating further restrictions of competition (on the issue of prohibitions by object, see here). Thus, if the contracting out arrangement was not genuine or if there are indications that the outsourcing aimed at a restriction of competition, then the burden of proof could be reversed. But to create a presumption of liability in the way that AG Wathelet proposes is excessive.

CJEU's new formulation of legal test to distinguish between anticompetitive agreements by object and by effect (C-345/14)

In its Judgment of 26 November 2015 in Maxima Latvija, C-345/14, EU:C:2015:784, the Court of Justice of the European Union (CJEU) has returned to the debate on the distinction between anticompetitive agreements by object and by effect for the purposes of the application of Art 101(1) TFEU [for background commentary of the case, see here].

This is a field of EU competition law of notable and growing complexity, fundamentally due to the lack of clear demarcating lines between both types of anticompetitive conduct [see S King, Agreements that restrict competition by object under Article 101(1) TFEU: past, present and future (2015) PhD Thesis, London School of Economics]. 

Some of the consequences of the distinction remain obscure or highly theoretical, not least because Art 101(1) TFEU covers both types of anticompetitive practices, which should therefore be subjected to similar sanctions (moderated only by the magnitude of the effects, where they exist). Two main areas of debate have emerged, though, around the (practical) boundaries where the categorisation carries legal weight: on the one hand, the possibility to exempt de minimis "by object" infringements; and, on the other hand, the standard of proof applicable to "by object" anticompetitive conduct.

Regarding the possibility to exempt de minimis "by object" infringements, the debate focuses on the implications of the CJEU Judgment of 13 December 2012 in Expedia (C-226/11, EU:C:2012:795), as well as the guidelines issued by the Commission in trying to clarify the state of the law [see the Guidance on restrictions of competition "by object" for the purpose of defining which agreements may benefit from the De Minimis Notice]. For the purposes of this discussion, it is worth stressing para 36, where the CJEU clarified that "the distinction between ‘infringements by object’ and ‘infringements by effect’ arises from the fact that certain forms of collusion between undertakings can be regarded, by their very nature, as being injurious to the proper functioning of normal competition" (emphasis added).

Regarding the standard of proof applicable to cases concerning "by object" anticompetitive conduct, the discussion revolves around the Judgment of 11 September 2014 in CB v Commission ('Cartes bancaires'; C-67/13 P, EU:C:2014:2204) [for discussion from a legal perspective, see here; and for an economic perspective, see here]. The significance of the Cartes bancaires Judgment is commonly seen as resting in the recasting of the case law in para 51, where the CJEU ruled that "it is established that certain collusive behaviour, such as that leading to horizontal price-fixing by cartels, may be considered so likely to have negative effects, in particular on the price, quantity or quality of the goods and services, that it may be considered redundant, for the purposes of applying Article [101(1) TFEU], to prove that they have actual effects on the market" (emphasis added).

In its Judgment in Maxima Latvija, the CJEU has followed the same general approach to the delineation between anticompetitive practices by object and by effect, and has consolidated the Cartes bancaires test. More specifically, the CJEU has ruled that
18 ... the concept of restriction of competition ‘by object’ ... must be interpreted restrictively and can be applied only to certain types of coordination between undertakings which reveal a sufficient degree of harm to competition that it may be found that there is no need to examine their effects ... That case-law arises from the fact that certain types of coordination between undertakings can be regarded, by their very nature, as being harmful to the proper functioning of normal competition ...
19 ... certain collusive behaviour, such as that leading to horizontal price-fixing by cartels, may be considered by their nature as likely to have negative effects, in particular on the price, quantity or quality of the goods and services, so that it may be considered redundant, for the purposes of applying Article 101(1) TFEU, to prove that they have actual effects on the market ... Experience shows that such behaviour leads to falls in production and price increases, resulting in poor allocation of resources to the detriment, in particular, of consumers.
20 ... the essential legal criterion for ascertaining whether an agreement involves a restriction of competition ‘by object’ is ... the finding that such an agreement reveals in itself a sufficient degree of harm to competition for it to be considered that it is not appropriate to assess its effects (C-345/14, paras 18-20, references omitted and emphasis added).
In my view, the formulation of this test is conceptually appealing. However, it is equally problematic because it relies on a test of 'balance of economic probabilities' that actually requires, in most cases, at least a quick look at the effects the anticompetitive practice has (or could have) generated. In terms of alleviating the burden of proof, this is less than clear cut. These complications are self-evident in the Maxima Latvija Judgment itself, where the CJEU applies this newly (re)formulated test as follows:
21 ... Maxima Latvija [an operator of large shops and hypermarkets] is not in a competitive situation with the shopping centres with which it has concluded the [lease] agreements at issue in the main proceedings. Although ... a fact of that nature in no way precludes an agreement from containing a restriction of competition ‘by object’ ... it must, however, be stated that the agreements at issue in the main proceedings are not among the agreements which it is accepted may be considered, by their very nature, to be harmful to the proper functioning of competition ...
22 Even if the clause at issue in the main proceedings could potentially have the effect of restricting the access of Maxima Latvija’s competitors to some shopping centres in which that company operates a large shop or hypermarket, such a fact, if established, does not imply clearly that the agreements containing that clause prevent, restrict or distort, by the very nature of the latter, competition on the relevant market, namely the local market for the retail food trade.
23 Taking account of the economic context in which agreements ... are to be applied, the analysis of the content of those agreements would not ... show, clearly, a degree of harm with regard to competition sufficient for those agreements to be considered to constitute a restriction of competition ‘by object’ within the meaning of Article 101(1) TFEU (C-345/14, paras 21-23, references omitted and emphasis added).
Looking at the application of the test in the Maxima Latvija case, two difficulties emerge. Firstly, there is no existing list of anticompetitive agreements by object (neither an open, closed or indicative list). This creates a significant complication and legal uncertainty, not least because of the potentially moving target of what constitutes "agreements which it is accepted may be considered, by their very nature, to be harmful to the proper functioning of competition".

Secondly, there is no clear indication as to what "degree of harm" (ie presumed anticompetitive effects) suffices to allow for an agreement to be categorised as "by object" rather than by effect. The need to consider the anticompetitive agreements in the "the economic context in which [those] agreements ... are to be applied" is a puzzling requirement from a legal perspective. If (one of) the main point(s) concerning the distinction between anticompetitive agreements "by object" and "by effect" is to clarify the burden of proof required for each of them (implicitly, in order to reduce the requirements for a finding of an anticompetitive agreement "by object"), then this requirement does not really help and ends up resulting in a slippery slope of relaxation of requirements depending on the general consensus (?) that some agreements are by their nature harmful.

Given the ongoing uncertainty, the test for the distinction between anticompetitive agreements by object and by effect is not likely to reduce litigation at all. Overall, then, this seems to be a never-ending discussion. In terms of legal simplicity, it could be preferable to return to a state of the law where it was clear that Art 101(1) TFEU covers both types of anticompetitive practices and triggers an enforcement procedure that needs to comply with the same requirements, regardless of whether ex post and in a specific case, it may look like some of the probatory efforts could have been spared. 

The classical justification for per se prohibitions and not rule of reason approaches is fundamentally based on enforcement costs--and that is, at least in part, why they are progressively abandoned in the US (see here). It seems clear to me that trying to create that distinction in this area is, unfortunately, not leading to any savings and, in that case, it may be worth avoiding a shaky per se rule...

La extensión a la Administración Pública de las normas de competencia, o la CNC de nuevo a la espalda del Derecho comunitario

Francisco Marcos acaba de publicar un interesante comentario a la Resolución de la Comisión Nacional de la Competencia de 6 de octubre de 2011, en una de las múltiples patas del cártel de la uva y vino de Jerez ("El ámbito de Aplicación Subjetivo de la LDC y la Condena de la Junta Andalucía en el Cártel de las Uvas y del Mosto de Jerez: Comentario a la RCNC de 6 de Octubre de 2011, Exp. S/0167/09", disponible en

En el paper, y apoyando el voto particular que acompaña a la Resolución, se critica claramente la aplicación directa de la normativa de competencia (en ese caso, el art 1 LDC y el art 101 TFUE) a la Junta de Andalucía porque la conducta que desarrolló no era una conducta de mercado, sino un ejercicio (desviado) de poderes públicos que, por más que dieran cierto amparo y promovieran el desarrollo de conductas contrarias a la libre competencia, queda más allá del ámbito competencial de la CNC.

Creo que el análisis es correcto y la crítica a la Resolución de la CNC justificada, especialmente porque se ajusta mejor al derecho comunitario vigente en la materia y, en concreto, a las restricciones del art 3(2) del Reglamento 1/2003 y la interpretación del concepto de 'empresa' ('undertaking') que ha realizado el Tribunal de Justicia, significativamente en las Sentencias FENIN (C-205/03 P, de 11 de julio de 2006) y Selex (C-481/07 P, de 16 de julio de 2009). 

Por más que, desde una perspectiva normativa, considere deseable una superación de la línea jurisprudencial FENIN-Selex (como ya dije en "Distortions of Competition Generated by the Public (Power) Buyer: A Perceived Gap in EC Competition Law and Proposals to Bridge It", disponible en, creo que dede la perspectiva positiva es importante entender adecuadamente sus restricciones, que son directamente aplicables en España y que vinculan a la CNC en toda su extensión. 

En ese sentido, me resulta preocupante que en las dos resoluciones en que la CNC ha analizado de manera más directa la difícil cuestión de la extensión a la Administración Pública de las normas de competencia haya errado en su análisis: esta vez por exceso, al determinar la ilegalidad (aunque no llega a sancionar) de una conducta iure imperium extralimitándose de sus competencias; y antes por defecto, al construir una exención excesiva para actividades claramente de mercado (en la Resolución del SESCAM, también comentada por Francisco Marcos, en "¿Pueden las Administraciones Públicas infringir el Derecho de la competencia cuando adquieren bienes o contratan servicios en el mercado?: Comentario a la RCNC de 14 de Abril de 2009, Exp. 639/08", disponible en