German Competition Law Gets Major Update | 德国反垄断法重大修订：大幅提高经营者集中审查申报营业额门槛和严格监管数码企业

Almost one year after the publication of a first ministerial draft, the 10th amendment to the German Act against Restraints of Competition has entered into force on 19 January.

At the core of the amendment are new tools to address a misuse of market power by companies of the digital economy. Particularly relevant for most companies, however, are significantly higher merger control thresholds which will reduce the number of transactions subject to notification requirements. This part of the amendment has only been introduced last week.

Further relevant changes: Competitors may request the Bundeskartellamt to assess intended co-operations. The Bundeskartellamt receives further investigatory powers which will require many companies to revise their ‘dawn raid guidelines.’ Appropriate and effective compliance programs may help to reduce antitrust fines in the future.

Executive Summary

• Merger control: Significantly higher turnover thresholds
• Abuse of Dominance: Tighter rules for the digital economy
• Procedure:
  • Companies may obtain guidance on intended horizontal co-operations
  • Wider investigatory powers, e.g., when conducting dawn raids
• Fines: Codification of the criteria for the setting of fines; possibility of credits for compliance programs
• Private actions for damages: Rebuttable presumption that transactions with cartel member are affected by the cartel

We have summarised below in more detail the most important changes.

1. Merger Control

Domestic turnover thresholds: The two domestic turnover thresholds have been increased:

• From EUR 25m to EUR 50m and
• from EUR 5m to EUR 17.5m.

From now on, a filing will only be required if one undertaking concerned has a domestic turnover of at least EUR 50m and another of at least EUR 17.5m. The additional threshold requiring a combined worldwide turnover of at least EUR 500m of all undertakings concerned remains unchanged. The domestic turnover thresholds relevant for the transaction value threshold will be increased likewise.

It is expected that the higher thresholds will lead to significantly less notifiable transactions. However, critical cases may be scrutinized more intensively in the future. The Bundeskartellamt has announced to use freed up resources in this respect.

Review periods: The review period (phase 1 and 2) will be extended from four to five months.

Obligation to notify future transactions: The Bundeskartellamt can oblige companies to notify acquisitions of companies even if the thresholds are not met, subject to certain requirements. Among others, the obligation must concern an economic sector which has been subject to a sector inquiry and on which the acquirer has a share of supply or demand of at least 15%. The acquirer must have a worldwide turnover of more than EUR 500m and the target of more than EUR 2m. Further, the target must have generated more than two thirds of its turnover in Germany.

2. Abuse of Dominance: Tighter Rules for the Digital Economy

Companies with paramount significance across markets: The Bundeskartellamt receives new enforcement powers vis-à-vis companies, such as platforms and networks, with gate keeper functions on multi-sided markets which do not necessarily need to dominate such markets. The Bundeskartellamt can determine such a significance across markets and preventively prohibit the following conduct

• giving preference to its own offers over those of competitors when providing access to supply and sales markets (self-referencing);
• taking measures that hinder other companies in their business activities on supply or sales markets if the company's activities are important for access to these markets;
• directly or indirectly hindering competitors in a market in which the company can rapidly expand its position, even without being dominant;
• creating or appreciably raising barriers to entry by processing relevant data collected by the company, or otherwise hindering other companies, or requiring business conditions that permit such processing;
• denying or making more difficult the interoperability of products or services or the portability of data, thereby hindering competition;
• providing other companies with inadequate information about the scope, quality or success of the service provided or contracted for, or otherwise make it difficult for them to assess the value of that service; and
• demanding advantages for the treatment of offers from another company which are not in reasonable proportion to the reason for the demand.

Access to Data: The scope of the essential facilities doctrine is extended to explicitly cover a refusal to share data. A market dominant company must provide against adequate consideration access to data where competitors need such access for their activities on upstream or downstream markets and the refusal is capable of eliminating effective competition, unless there is an objective justification for such a refusal.

A right of access to data may also be available vis-à-vis companies that are not market dominant but have relative market power. In particular, this requires that the company claiming access is dependent on such access for pursuing its own activity.

Other changes: When measuring market power, access to data relevant to competition and the question of whether a platform has so-called intermediation power must be taken into account. With regard to the regulations for companies with relative or superior market power, the scope of protection of the standard is no longer limited to small and medium-sized companies. In addition, special intervention options are provided for the event that a platform market threatens to ‘tip’ in the direction of a large provider.

3. More Legal Certainty for co-operations among competitors

Competitors seeking to cooperate with each other can now more easily obtain legal certainty in this respect. They can apply for a decision by the Bundeskartellamt that there is no infringement of antitrust provisions and therefore no ground for action.

The prerequisite is that there is a considerable legal and economic interest in such a decision with regard to the co-operation. According to the explanatory memorandum, such an interest may exist in particular in the case of complex new legal issues and exceptionally high investment volumes and costs.

Bundeskartellamt has to decide on the application within six months.

The amendment clarifies that companies may also request informal guidance from the Bundeskartellamt. The so called Vorsitzendenschreiben (head of division’s letter) has now a statutory basis.

4. Wider investigatory powers

The investigative powers of the Bundeskartellamt will be extended. This applies, for example, to requests for information, searches and duties to provide information in this context. In the future, natural persons will have a comprehensive duty to provide information and to cooperate with regard to the disclosure of documents, whereby even facts that are likely to lead to prosecution for a criminal or administrative offence must be disclosed. However, this information may only be used against the person concerned with his or her consent.

Violations are subject to fines. Companies should check whether the changes necessitate a revision of their ‘dawn raid guidelines.’

5. Fines

The amendment codifies in law the criteria for immunity from or reduction of fines (leniency program) as well as the criteria for the setting fines.

A welcome change is that existing appropriate and effective compliance measures are now a criterion for reducing fines.

6. Private actions for damages

In order to facilitate private actions for damages, there is now a rebuttable presumption that transactions concerning goods or services with members of a cartel, which fall within the scope of a cartel in terms of their object, time and place, were affected by that cartel. This presumption also applies to indirect customers.