Version updated on 10 April 2020

1. Adaptation of merger control rules

First of all, it is worth highlighting the European Commission's tough stance on the protection of key European technologies and assets in the context of the current crisis.

On 25 March 2020, the European Commission published Guidelines to ensure a strong EU-wide approach to the filtering of Foreign Direct Investment (FDI) in the context of the current public health crisis and the economic vulnerability it entails.

The objective is to safeguard the Union's critical businesses and assets, in particular in areas such as health, medical research, biotechnology and essential infrastructures for the EU's security and public order, without jeopardising the Union's overall openness to foreign investment:

• The European Commission invites Member States that already have a filtering mechanism in place to make full use of the tools at their disposal;
   
• It also invites the other Member States to set up a comprehensive filtering mechanism and, in the meantime, to consider all possible solutions, in compliance with Union law and international obligations;
   
• It also encourages cooperation between Member States in the event of FDI filtering cases where foreign investment could have an impact on the Union's single market.  

a) Adaptation of merger control rules at EU level

Delay of merger notifications. DG Competition informs on its website that it has put in place a number of measures to ensure business continuity in the application of the European Merger Regulation^[1].

However, in view of the complexities and disruptions caused by the Covid-19 epidemic, companies are encouraged to delay, as far as possible, notifications of mergers initially planned until further notice.

DG Competition states that its invitation to delay notifications is due in particular to the following reasons:

• The services of DG Competition are likely to face difficulties in collecting information from third parties, such as customers, competitors and suppliers, in the coming weeks;
   
• All services of the European Commission are likely to face limitations in the access to information and databases, as well as in the exchange of information, as a result of the teleworking measures taken from 16 March 2020.

Temporary acceptance of electronic submissions. DG Competition indicates on its website that the filing of merger notifications at the premises of DG Competition will continue to be possible but may become difficult due to the reduced presence of staff.

In any event, it is the responsibility of law firms or companies wishing to file notifications to call the Merger Registry in advance.

However, DG Competition indicates that it will also accept, on a temporary basis, all electronic submissions and encourages companies to use electronic means during the crisis period due to the Covid-19 epidemic:

• either by e-mail to the address of the Merger Registry (mailto:comp-merger-registry@ec.europa.eu), copying the members of the case team if a team has been designated;
   
• either electronically through the eTrustEx platform.

The European Commission points out that the submission of paper versions will be organised at a later stage.

Hearings and meetings. DG Competition services in charge of mergers have already cancelled the planned physical meetings in favour of videoconferences.

b) Adaptation of merger control at French level

The premises of the French Competition Authority closed on 17 March 2020 at 11 a.m. and the services have been working remotely since that day.

This situation has several practical consequences for the application of merger control procedures as a result of the Covid-19 epidemic^[2]:

• With regards to the exchange of documents, deliveries of documents in physical form, by hand or by post are no longer possible.

Companies are invited to communicate any notification or document exclusively by electronic means to the email address of the mergers unit: mailto:controle.concentrations@autoritedelaconcurrence.fr or by using the online notification platform (see below).

The Competition Authority's website states that the delivery of master copies documents will be arranged later.

• With regards to time limits for processing merger cases, the French Competition Authority indicates that the measures to prevent the Covid-19 epidemic will have an impact on the ability of the services to deal with merger cases with their usual diligence. In particular, gathering information from third parties will be made more difficult.

In this respect, it is worth mentioning Order No. 2020-306 of 25 March 2020 on the extension of time limits during the period of health emergency and the adaptation of procedures during the same period.

Title II of this Order applies to State administrations, including the French Competition Authority, and Article 7 specifies that "subject to obligations arising from an international commitment or European Union law, the time limits at the end of which a decision, an agreement or an opinion (...) may or must be reached or is implicitly acquired and which has not expired before 12 March 2020 shall, on that date, be suspended until the end of the period," i.e. a period of one month from the date of the end of the state of public health emergency declared on 22 March 2020.

Accordingly, the legal and regulatory time limits for the examination of mergers are suspended from 12 March 2020 until the end of the one-month period after the end of the state of public health emergency.

However, the order does not prevent the adoption of an act or the execution of a formality whose term expires within the period in question: it does allow to consider as not tainted with illegality the act carried out within the additional time allowed^[3]. The Authority's position on this point is to make its best efforts to deliver its decisions and opinions within the normal time limits, without waiting for the expiry of the additional time limits foreseen by these provisions^[4]. This position concerns above all cases considered to be simple, i.e. those which can be settled by a Phase I decision and which do not require a market test, the response rate of which would be compromised by the urgency period.

In addition, the deadlines for the implementation of remedies are therefore suspended or postponed until one month after the end of the state of health emergency.

Indeed, Article 8 of Order No. 2020-306 provides that "where they have not expired before 12 March 2020, the deadlines imposed by the administration, in accordance with the law and regulations, on any person to carry out inspections and work or to comply with requirements of any kind shall, on that date, be suspended until the end of the period."

• With regards to the postponement of proposed mergers, the Competition Authority invites undertakings to postpone any proposed economic concentration which is not urgent.

Focus: French Competition Authority's online notification platform

As already outlined, in the context of the current crisis, companies are invited to communicate any notification or document exclusively by electronic means, and for those that are eligible,  through the online notification platform.

Indeed, as part of its efforts to simplify merger procedures, the French Competition Authority opened its online notification platform on 18 October 2019^[5].  

Eligible operations are the following:

• Operations without overlaps, vertical or related links: the acquirer(s) is (are) not active in the same markets as those in which the acquired (target) business(es) operate(s) or in upstream, downstream or related markets (which includes most of the operations carried out by investment funds);
   
• Notifiable transactions relating to motor vehicle distribution;
   
• Notifiable transactions relating to food distribution which do not entail a change in the name of the retail shop(s) concerned.  

Transactions that currently fall under the simplified regime, which account for half of the cases examined by the Competition Authority, benefit from this electronic procedure.

This procedure is based on the "demarches-simplifees.fr" service, which enables the online processing of administrative procedures. This website is developed, hosted and maintained by the Interministerial Department of the State's Information and Communication System (DINSIC).

For each operation eligible for online notification, there is one form for pre-notification and another for notification. The user will first have to create an account which can be used for each pre-notification or notification.

• In pre-notification, even after the form has been submitted to the Merger Department, the user will be able to continue to fill it in and modify it;
   
• In notification, the sending of the form is definitive: the user will no longer be able to modify or complete the form;
   
• The acknowledgement of receipt that the user receives in each case simply means that the form has been transmitted to the Merger Department: it does not indicate that the file is considered complete.

2. Adaptation of antitrust rules

a) Joint Statement of the European Competition Network

On 23 March 2020, the European Competition Network (hereinafter, the "ECN"), which brings together the European Commission and all competition authorities of the Member States, has published a Joint Statement regarding the application of competition rules during the Covid-19 crisis.

The main features of this statement are the following:

• The ECN acknowledges that the extraordinary situation related to the Covid-19 outbreak may require companies to cooperate to ensure fair production and distribution of scarce products;
   
• In the current circumstances, the ECN will not actively intervene against the necessary and temporary measures put in place to avoid a shortage of supply of these products;
   
• In any event, such measures should not raise competition law concerns as they would not constitute a restriction of competition within the meaning of Article 101 TFEU or would be likely to generate efficiencies that would most likely outweigh such a restriction of competition;
   
• If companies have doubts about the compliance of these cooperation initiatives with competition law, they can at any time approach the Commission or the NCA concerned for informal advice.

This relaxation of the rules of Article 101 TFEU on concerted practices (mainly exchanges of information) is accompanied by a reminder of the need for increased vigilance against undertakings which attempt to reach agreements or engage in abusive practices in order to raise the prices of the products most in demand as a result of the crisis:

• Indeed, the Statement indicates that ECN members will not hesitate to take action against companies that take advantage of the current situation by engaging in cartels or abusing their dominant position, notably in relation to products considered essential to protect the health of consumers in the current situation (e.g. facial masks and sanitising gel);
   
• It should be noted in this respect that on 18 March 2020, the Netherlands Competition Authority issued a press release warning undertakings of the need to ensure their compliance with competition law during the crisis by avoiding any price-fixing agreements or abusive practices aimed at imposing excessive prices.
   
• In the same line, as early as 5 March 2020, the British authority (the "CMA") warned economic players against excessive pricing and misrepresentation practices, particularly in the protective and hygiene equipment sector. The CMA  warned that it would not hesitate to refer the matter to the government with a view to possible price regulation during the pandemic^[6].

The ECN also underlines that existing rules allow suppliers to set maximum prices for their products. These could be useful to limit unjustified price increases at the distribution level.

Similarly, in French law, paragraph 3 of Article L. 410-2 of the Commercial Code provides that 'the provisions of the first two paragraphs [relating to freedom of prices] shall not prevent the Government from adopting, by decree in Council of State, against excessive price increases or decreases, temporary measures motivated by a crisis situation, exceptional circumstances, a public calamity or a manifestly abnormal market situation in a given sector.'

In order to meet demand and combat the sharp increase in the selling prices of hydro-alcoholic solutions since the outbreak of Covid-19 in France, the French Government has exercised this option, which has rarely been used until now. It has thus published several decrees regulating the prices of these products and extending manufacturing authorizations in order to combat the shortage^[7].

b) Cooperation between undertakings: assisting companies in assessing the compatibility of their agreements linked to the particular circumstances of the health crisis

On 30 March 2020, the European Commission has launched a page on its website dedicated to the consequences of the Covid-19 epidemic on DG Competition's application of antitrust rules.

The European Commission indicates that for initiatives with a European dimension, which need to be put in place promptly in order to effectively combat the Covid-19 pandemic, and where there is uncertainty as to the compatibility of such initiatives with European competition law, DG Competition is ready to provide guidance to companies, professional associations and their legal advisers. This may include cooperation to ensure the provision and fair distribution of essential products and services to consumers.

To this end, on 30 March 2020, DG Competition has set up a mailbox (mailto:COMP-COVID-ANTITRUST@ec.europe.eu), which can be used to request informal advice on specific initiatives. The information provided will be treated with the utmost confidentiality.

In order to facilitate a swift follow-up, enterprises are invited to provide as many details as possible about the initiative from the outset, in particular:

• the firm(s), product(s) or service(s) concerned;
• the scope and set-up of the cooperation;
• the aspects that may raise concerns under EU antitrust law; and
• the benefits that the cooperation seeks to achieve, and an explanation of why the cooperation is necessary and proportionate to achieve those benefits in the current circumstances.

In order to provide guidance to undertakings, the European Commission published on 8 April 2020 a Temporary Notice for the assessment of competition issues arising from cooperation between undertakings in relation to the pandemic.

The Commission envisages enabling companies to coordinate rapidly to mitigate the effects of the crisis. Coordination could take several forms such as coordinating joint transport for inputs, identifying essential medicines for which there is a risk of shortages, sharing aggregated information on supply gaps with a view to filling them by meeting demand (through existing stocks or increased production) or even market-sharing agreements between competitors in case of critical supply shortages.

The Commission has therefore issued guidelines according to which cooperation agreements between competitors will not be prosecuted as soon as they are:

• designed and objectively necessary for the real and most efficient increase in production in order to remedy or avoid a shortage of essential products, mainly medical products;
• of a temporary nature, i.e. until the end of the shortage; and
• strictly necessary to achieve the objective of remedying or avoiding a shortage.

In addition, the Commission proposes to grant comfort letters to companies which have doubts about the compatibility of their initiatives with competition law for their cooperation projects aimed at combating the pandemic. It has thus issued its first comfort letter to "Medicines for Europe" concerning the cooperation project of pharmaceutical producers aimed at combating the shortage of medicines needed to treat patients suffering from Covid-19^[8]. The European Commission adds that in matters of local or national cooperation, undertakings, professional associations and their legal advisers are required to contact the competent national competition authority directly.

Finally, the European Commission underlines that it will continue to closely and actively monitor relevant market developments in order to identify undertakings that take advantage of the current situation to infringe EU competition law. The Commission also encourages businesses and citizens to continue to report cartels and other anti-competitive practices, including abuses of dominant positions, which may come to their attention.

A number of similar initiatives should be highlighted at national level.

For instance, the FCA supports temporary cooperation initiatives between companies and stands ready to assist them. Nevertheless, it indicated that its investigation services were mobilised in the active surveillance of markets during the crisis with a view to reacting effectively against any abusive behaviour. By way of example, following a report dated 30 March, the FCA had opened an investigation into exclusive import practices likely to be implemented by the Fisher & Paykel Healthcare group active in the supply of respiratory systems and products to hospitals in French Guiana and the French West Indies. Taking note of Fisher & Paykel Healthcare's clarification of the conditions of distribution of its products in these overseas territories with a view to strengthening competition, the Authority closed this investigation on 6 April 2020. On this occasion, the Competition Authority also invites any natural or legal person to notify it in case of suspicion of an anti-competitive practice by using a dedicated address (mailto:signalement.externe@autoritedelaconcurrence.fr). Please see here the Press release of the FCA.

Similarly, the Spanish competition authority has set up a specific mailbox (mailto:covid.competencia@cnmc.es ) for informal complaints and requests for advice in the context of the Covid-19 epidemic. Please see here the Press release of CNMC.

For its part, on 25 March the UK authority published guidelines to help companies in the analysis of the compatibility of their cooperation or product rationing agreements with the competition rules.

Cooperation agreements aimed at ensuring the supply and fair distribution of products and/or services affected by the crisis and contributing to consumer welfare are thus exempted (please see here the Press release of CMA of 25 March 2020). However, such cooperation must relate solely to issues arising in connection with the pandemic and be of a temporary nature.

c) Adaptation of deadlines and procedures of the French Competition Authority during the health emergency period

The FCA has also announced a series of exceptional measures suspending time limits in antitrust matters.

• Extension of time limits for the submission of observations in response to a statement of objections or final report: the Rapporteur-General has decided that the two-month period available to companies to submit, pursuant to Article L. 463-2 of the French Commercial Code, their observations in response to a statement of objections or a final report is suspended as of 17 March 2020. This period will resume as from the day after the publication of the decree lifting the lockdown measures initially instituted by Decree No. 2020-260 of 16 March 2020.

The French Competition Authority advocates a pragmatic approach. For companies that have already benefited from an additional period of time, pursuant to the 4th paragraph of Article L. 463-2 of the French Commercial Code, this extension of deadlines will continue to apply if it is more favorable than the suspension of deadlines. Otherwise, a new extension may, in any event, be requested after the lifting of the lockdown measures, if new exceptional circumstances justify it.

For the duration of the lockdown measures, any request relating to time limits shall be addressed to the investigating and procedural departments only by e-mail.

• Applications for leniency: until the lockdown measures are lifted, and by derogation from Article R. 464-5 of the French Commercial Code, applications for leniency are to be filed electronically, to the exclusion of any other means of transmission, by sending the form available on the FCA's website (form available here), duly filled, to the following address: clemence@autoritedelaconcurrence.fr.
   
• The deadlines already granted in the context of leniency procedures are suspended as of 17 March 2020, and will resume when the lockdown measures are lifted.
   
• Method for submitting procedural documents: given the exceptional circumstances, throughout the duration of the lockdown measures, and by derogation to the provisions of Articles R. 463-1, R. 463-11, R. 463-13, R. 463-15 and R. 464-30 of the French Commercial Code, complaints, observations in response to a statement of objections or a final report, requests for confidential treatment or requests for the lifting of confidential treatment are to be submitted electronically to the FCA, which will acknowledge receipt, at the following electronic address: L-PROCEDURE@autoritedelaconcurrence.fr.

Similarly, statements of objections, measures to lift confidential treatment and final decisions of the FCA and the Rapporteur-General will be notified electronically to the persons concerned and to the Government representative.

These electronic transmissions or notifications may be performed by any means: computer messaging, document exchange platform, file transfer application, etc.

Notification of a decision of the FCA that makes time limits for appeal run takes place as usual, by notification through registered mail with acknowledgement of receipt and not when the decision is sent by electronic means. In the light of current practice, the

Authority states that its regular registered mail dispatches will not resume until the day after the decree lifting the lockdown measures.

Documents sent to the FCA by registered mail during the health emergency period must be resent by electronic means to the address indicated above.

• Limitation periods and appeal periods: the acts or decisions referred to in Article L. 462-7 of the French Commercial Code that should have been taken in the period between 12 March 2020 and the expiry of a period of the one month period  following the end of the state of health emergency, in order to avoid the prescription of action by the FCA, may be taken within two months from the end of this period, without being considered as prescribed.
   
• Similarly, appeals against decisions of the FCA, which should have been filed in the period between 12 March and the expiry of one month following the end of the state of health emergency, in accordance with the time limits provided for in Articles L. 464-7, L. 464-8 and L. 464-8-1 of the French Commercial Code, may be filed within two months from the end of this period, without being considered prescribed.
   
• Time limits for the implementation of commitments and injunctions: the deadlines for the implementation of commitments, injunctions or interim measures are suspended or postponed until the end of a period of one month following the end of the state of health emergency.

d) International examples of adaptation of antitrust rules

With particular regards to the mass retail sector, the concerned undertakings had drawn the attention of the European Commission to the need to exchange certain information. Their European association, EuroCommerce (EuroCommerce Press Release of 16 March 2020, "Coronavirus-Statement", available here) also claimed that retail professionals had exchanged information on sourcing and organising home deliveries. On this occasion, the EuroCommerce lobby welcomed the fact that some competition authorities would consider allowing such exchanges, by way of derogation from standard competition rules, in these very particular circumstances.

Following these statements, the European Commission asked the association to provide further information on the nature of the information exchanged between retailers, on the identity of the competition authorities that would have considered not applying the competition rules and on the type of guidelines that would prove necessary for the application of the competition rules in this sector (available here).

For example, a concrete step in this direction was taken by the British Government, which announced on 19 March 2020 an easing of national rules to the benefit of supermarkets. Supermarkets will now be allowed to exchange information on their stocks as well as on their opening hours in order to ensure a sufficient service for consumers. They will also be allowed to pool their employees to meet demand (available here).

The German Government and the German Competition Authority have indicated their willingness to temporarily accept certain restrictions of competition in order to avoid possible food shortages (available here).  The German Minister of Economic Affairs stated: "If the food industry and retailers cooperate to ensure there are no shortages for the citizens during the crisis, then we will take up antitrust issues with the competition authorities and find a solution."

The Minister subsequently clarified that "This is not about changing the existing regulations: The competition authorities in member states and at the EU level can take into account special circumstances when enforcing competition rules" (emphasis added).

The President of the German Competition Authority also stated that: "Competition law permits extensive cooperation between companies if there are good reasons for this — which is the case in the current situation. We are, of course, always available for discussions with companies, associations and policy makers" (emphasis added).

As regards the transport sector, the Norwegian Government has granted a temporary three month-derogation from the prohibition of anti-competitive agreements and practices under the Norwegian Competition Act (available here). It agreed that SAS and Norwegian Air would coordinate their airline schedules (available here). This exception allows, inter alia, for the continued transport of passengers and goods in Norway in order to ensure that the population has access to the necessary goods and services.

As regards the banking sector, the Australian Competition Authority has provisionally authorised the Australian Banking Association and the banks to work together to implement a small business support plan (available here). The plan is notably expected to defer repayment of principal and interest on loans to small businesses affected by the Covid-19 outbreak in all sectors.

Finally, it should be noted that the US competition agencies announced on 24 March 2020 in a Joint Statement how they will approach cooperative efforts between competing healthcare providers and companies in other sectors working together to address public health and safety concerns related to the Covid-19 epidemic:

• The statement establishes shortened evaluation procedures of proposed cooperation;
• It provides guidance to companies that need to act immediately during the outbreak, by giving examples of types of cooperative conduct that are generally considered acceptable under antitrust rules;
• It explains when agencies will take "emergency circumstances" into account when reviewing practices.

e) International examples of increased vigilance against companies attempting to profit from the Covid-19 outbreak

It should be noted that the European Commission and national competition authorities will continue to ensure that, during the crisis period, exceptional cooperation measures are not used to cover up market sharing or price-fixing agreements.

Vigilance is therefore called for with regard to "crisis cartels" or any imposition of excessive prices by a dominant undertaking.

In this respect, Vice-President Margrethe Vestager stated on 27 March 2020 (please see here) that companies do not have a "carte blanche" to comply with competition rules during the crisis, stressing that cartels and Big Tech practices will continue to be closely scrutinised by DG Competition. She said that the Commission "will stay even more vigilant than in normal times if there is a risk of virus-profiteering."

The Italian Competition Authority (please see here)  is investigating the existence of possible anti-competitive practices in the sector of the sale of hand disinfectants and disposable respiratory protective masks. A request for information has been sent to the main online sales platforms, including Amazon and eBay, and other sales sites concerning the marketing of these products.  

This Italian investigation follows numerous complaints from consumers and associations concerning, on the one hand, allegations regarding the alleged efficacy of these products in terms of protection and/or control of Covid-19 and, on the other hand, the unjustified and significant increase in price of these products in recent days.

The Polish Competition Authority is investigating the practices of two protective masks wholesalers, who allegedly broke existing contracts in order to encourage the entering intro contracts at higher prices (please see here).  

The UK Competition Authority has set up a taskforce dedicated to the Covid-19 (Press release available here) and a form (available here) for consumers and businesses to report unfair commercial practices during the outbreak. The CMA has also indicated that it has already contacted retailers and platforms such as Amazon and eBay regarding the excessive pricing of certain products such as hand sanitizers (please see here).

The Spanish Competition Authority announced on 12 March 2020 that it was monitoring potential abuses that could hamper the supply or increase the prices of products needed to protect citizens during the current crisis (Press release available here). 

The Dutch Competition Authority issued a statement on 18 March 2020 that it was monitoring whether dominant undertakings are raising prices excessively during the crisis (please see here).

__________

[1] Council Regulation (EC) No. 139/2004 of 20 January 2004 on the control of concentrations between undertakings
[2] Press release, 17 March 2020, Adaptation of merger control procedures due to Coronavirus COVID-19", available at the following link: https://www.autoritedelaconcurrence.fr/en/article/adaptation-merger-control-procedures-due-coronavirus-covid-19
[3] Interpretation Circular of 26 March (rectified on 30 March) of Title I of Order No. 2020-306 of 25 March 2020: "The Order does not provide for a general suspension or a general interruption of the time limits that have expired during the legally protected period defined in Article 1, nor does it provide for the abolition of the obligation to carry out all acts or formalities whose term falls within the period in question. The effect of Article 2 of the order is to prevent the act which has been carried out within the new time-limit from being regarded as belated'.
[4] Interpretation Circular of 26 March (rectified on 30 March) of Title I of Order No. 2020-306 of 25 March 2020: "The Order does not provide for a general suspension or a general interruption of the time limits that have expired during the legally protected period defined in Article 1, nor does it provide for the abolition of the obligation to carry out all acts or formalities whose term falls within the period in question. The effect of Article 2 of the order is to prevent the act which has been carried out within the new time-limit from being regarded as belated'.
[5] Press release, 18 October 2019, "Today, the Autorité de la concurrence launched the possibility for companies to notify online mergers", available following this link: https://www.autoritedelaconcurrence.fr/en/article/modernisation-merger-control
[6] CMA press release of 5 March 2020, "Covid-19: sales and pricing practices during Coronavirus outbreak", available at  the following link : https://www.gov.uk/government/news/covid-19-sales-and-pricing-practices-during-coronavirus-outbreak.
[7] Decree  No.  2020-197 of 5 March  2020  on the selling prices of hydro-alcoholic gels.
[8] Commission Press release, available at the following link: https://ec.europa.eu/commission/presscorner/detail/fr/ip_20_618

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