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Compecon News Archive 2013.

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Dublin 18th December - High Court Rules Galway County Council did not Abuse a Dominant Position  in setting charges for ferry passengers at Kilronan Harbour.

The judgment related to a judicial review brought by Island Ferries Teoranta (IFT) in respect of a decision by Galway County Council (GCC) to impose a charge of 80 cents per passenger for all ferry passengers landing at Kilronan harbour on Inis Mor, the largest of the three Aran Islands off the coast of Galway. IFT operates passenger ferry services between Rossaveal County Galway and Kilronan. IFT also alleeged that the charges involved an abuse of a dominant position by GCC as they were unfair and/or excessive. GCC had accepted that it had a dominant position as Kilronan harbour was the only harbour for passenger ferries serving Inis Mor. The Court found, however, that the charges were not unfair or excessive and did not therefore constittues an abuse of a dominant position. The Court also rejected IFT's judicial review application.  Compecon advised GCC in this case.


Dublin 11th December - High Court Upholds CER Ruling on Gas Interconnector Charges.

The High Court rejected a judicial review application brought by Shannon LNG Limited challenging a determination by the Commission for Energy Regualtion on user charges in respect of the natural gas transmission network. Shannon LNG had challenged the decision because it provided that usage charges should include the cost of the two natural gas interconnectors between Ireland and Scotland.


Brussels 4th December - Eight Major Banks Agree €1.7 Billion Settlement over rate-rigging.

Eight major banks agreed to pay a settlement of €1.7 billion to the EU Commission in respect of alleged cartels which had fixed key benchmark interest rates.


Dublin 1st November - Competition Authority's Draft Revised Merger Guidelines would reduce clarity and certainty.

This is the main conclusion set out in Compecon's submission to the Authority in respect of its draft revised merger guidelines. The submission suggests that the Authority needs to clarify whether it proposes to retain the consumer welfare test for deciding whether or not a merger will result in a substantial lessening of competition. Click here to download full Compecon submission.


Dublin 16th October - Compecon submission cited in Senate Debate on Taxi Regulation Bill.

For some reason, the Taxi Regulation Bill, contains provisions relating to direct award contracts granting exclusive rights to Dublin Bus and Bus Eireann. Senator Sean Barrett cited Compecon's submission to the National Transport Authority advocating increased competitive tendering of bus services during the Seanad debate on the Bill. Senator Barrett argued against the direct award of contracts to Dublin Bus and Bus Eireann and called for routes to be competitively tendered. Click here to view the full text of the debate. 


Brussels 16th October - EU Commission launches in-depth investigation into possible State Aid to airlines at Barcelona airports.

The European Commission announced that it has opened an in-depth investigation to assess whether marketing agreements concluded between public authorities and airlines using Girona-Costa Brava and Reus airports in Catalonia are in line with EU State aid rules. The Commission stated that it had received a complaint from an airline with operations at Barcelona-El Prat airport in May 2012 about marketing agreements related to Ryanair's operations at Girona and Reus. The complainant alleged that the agreements amounted to illegal state aid in favour of Ryanair. The Commission stated that it will investigate all airlines that have signed similar agreements in respect of Girona and Reus airports. The Commission stated:
"On the basis of the information at its disposal the Commission cannot exclude that the marketing agreements give the airlines and/or the airports involved an undue advantage vis-à-vis their competitors, and are thus incompatible with the internal market."


Dublin 11th October - Compecon submission calls for more ambitious programme of competitive tendering of bus services.

In a submission to the National Transport Authority (NTA), Compecon argued that the NTA had produced no economic case to support a finding that the continued operation of existing Dublin Bus and Bus Eireann services could only be guaranateed by entering new direct award contracts with the State bus operators when their current contracts expire in 2014. The Public Transport Regulation Act, 2009, provides that the NTA may enter into new direct award contracts only if it is satisfied that this is the only way to guarantee the continuation of such services. The NTA plans to reduce the services covered by the contracts by 10% in 2016 and competitively tender these services. Compecon's submission calls for a more ambitious competitive tendering programme with 10% of Dublin Bus and Bus Eireann services being tendered annually beginning in 2015 with a corresponding reduction in their direct award contract services. 40% of services should be competitively tendered by 2019 when any new direct award contract would expire. Click here to download the Compecon submission.


London 8th October - Competition Commission proposes major shake-up in cement and concrete sector.

The Competition Commission (CC) published proposed remedies to address competition concerns in the cement market. The CC's provisional remedies propose requiring Lafarge Tarmac to sell a cement plant (and accompanying ready mix concrete plants if necessary) to facilitate entry of a new cement producer. The CC is also proposing to limit the flow of information and data between cement producers. Additionally, the CC is looking to increase competition in the supply chain for ground granulated blast furnace slag (GGBS—a partial substitute for cement) by ordering the sale of suitable production facilities. The latter remedy is subject to further consultation. The publication of proposed remediies is the penultimate stage of the CC’s investigation. The CC's provisional findings published in May, found that both structure and conduct in the cement sector limited competition by aiding coordination between the three largest producers (Lafarge Tarmac, Cemex and Hanson) and was likely to be resulting in higher prices for all cement users. 


Dublin 4th October Rehab Lotteries to challenge lottery monopoly.

Charity group Rehab is reported to have issued proceedings against the State and An Post in respect of restrictions which impose a €20,000 prize cap on charitable lotteries. Rehab claims that this puts them at a competitive disadvantage relative to the State's National Lottery.


Brussels 11th September. Commission proposes major telecoms shake-up.

The EU Commission has announced plans for a major overhaul of the European communications sector. The proposals aim to establish a signle EU communciations market leading to substantial reductions in mobile roaming charges. It is also proposed that operators woudl be able to offer services in amy EU Member State once they had been licensed by their home national regulator.


Dublin 11th September - NTA Proposes Limited Competition for Bus Services by 2016.

The National Transport Authority announced a public consultation on plans to renew the direct award contracts of the State onwed Dublin Bus and Bus Eireann when their current contracts expire in 2014. Effectively the State bus operators' monopoly positions were maintained for a period of 5 years when the NTA was established in 2008. The NTA now proposes to renew these contracts while providng that contracts in respect of 10% of routes will be put out to competitive tender in 2016. Submissions must be made by Friday 11th October. 


London August 28th - UK Competition Commission orders Ryanair to reduce its Aer Lingus shareholding.

The Competition Commission has concluded that Ryanair's 29.8% shareholding in Aer Lingus restricts or is likely to restrict competition on air routes between Ireland and the UK. The Commission has instructed Ryanair to reduce its shareholding to just 5%. Ryanair had offered several remedies but these were rejected by the Commission. Ryanair has said it intends to appeal the decision.


Dublin 23rd August. Newspaper reports Competition Authority searches of flooring contractors.

Newspaper reports claim that the Competition Authority had conducted searches of the offices of a number of flooring contractors as part of an investigation into alleged bid rigging. Accroding to the reports the investigation was prompted by a complaint from a "whistleblower".


Dublin 14th August. High Court overturns ComReg Decision on Call Termination Rates.

The High Court ruled that communications regulator ComReg had acted ultra vires by requiring Vodafone to adopt a particular costt recovery methodology and in setting a maximum price for call termination of 1.01 cent per minute. Vodafone was the only mobile operator to appeal the ComReg decision.


Dublin 11th July. Competition Authority warns doctors.

The Competition Authority announced that it had written to the Irish Medical Organisation warning them that collective action including possible withdrawal of services following a Government decision to reduce fees paid to GPs may be in breach competition legislation. The Authority cited an IMO press release issued on 10th July 2013 which stated that at a meeting of its GP committee on 8th July 2013, it had passed a motion that unanimously condemned the reduction in GP fees which the Government proposes to introduce under the Financial Emergency Measures in the Public Interest Act 2009. In particular, the GP Committee decided at that meeting to immediately withdraw from:

Primary Care Teams;
Community Interrvention Teams; and
Clinical Care Programmes (Chronic Disease).


London 30th May. UK Competition Commission may force Ryanair to reduce Aer Lingus shareholding.

Ryanair may have to reduce its shareholding in Aer Lingus after the UK Competition Commission (CC) provisionally decided that its 29.8 per cent stake could reduce competition on routes between Great Britain and Ireland. The CC has provisionally concluded that the shareholding gives Ryanair the ability to influence the commercial policy and strategy of Aer Lingus, its main competitor on these routes. The Office of Fair Trading referred the matter to the Competition Commission in 2012. Click here for more.


London 21st May. UK Competition Commission finds lack of competition in UK Cement market.

The UK Competition Commission (CC) issued the provisional findings of its inquiry into the aggregates, cement and ready-mixed concrete markets in the UK.  The CC found that there was a combination of structural and conduct features that resulted in a lack of effective competition in cement markets through coordination.


London 26th April - UK Supreme Court refuses Ryanair permission to appeal against Competition Commission investigation of its minority shareholding in Aer Lingus. 

The UK Supreme Court refused to grant Ryaniar permission to appeal a decision by the Competition Appeal Tribunal which had ruled that the Competition Commission was entitled to investigate Ryanair's minority shareholding in Aer Lingus.


Dublin 22nd April - Competition Authority clears Intersnack acquisition of UB Snacks.

The Competition Authority announced that it had cleared the proposed transaction whereby Intersnack International B.V., through its subsidiary Top Snacks Limited, would acquire certain assets, comprising the business known as KP Snacks, from United Biscuits (UK) Limited. The Authority had previously launched a Phase 2 investigation of the proposed transaction on 27th February. Compecon advised Intersnack in relation to the transaction.


Dublin 18th April - Government announces consultation on economic regulation.

The Government published a consultation paper on economic regulation. Submissions must be received by 17th May.


Dublin April - Government introduces fuel tax rebate for road passenger transport operators.

The Finance Act, 2013, provides for an excise duty rebate on diesel for undertakings engaged in the passenger transport industry. The price of diesel in Ireland was crippling bus and coach companies, both public and private. The Coach Tourism and Transport Council (CTTC) campaigned for an excise rebate on diesel to reduce the cost of fuel for the passenger transport industry, which would save companies and jobs. As part of its campaign, the CTTC commissioned Compecon to prepare an economic analysis of the likely cost and impact of a fuel duty rebate.


Brussels, 27th February - EU Commission blocks Ryanair bid for Aer Lingus.

The EU Commission announced that it had decided to prohibit Ryanair's third attempt to acquire full control of Aer Lingus on the grounds that it would reduce competition on flights in and our of Ireland. Click here for more.