Web-Companion Essential EU Law in Text: Suggested solutions to the exercises
Please find hereinafter the suggested solutions to the 64 exercises contained in the book "Tobler/Beglinger, Essential EU Law in Text, 5th edition, HVG-ORAC 2020, ISBN 978-963-258-490-4". To give you an idea how the exercises in the book are phrased, they have been added for the first three instances. Any comments or feedback are welcome.Competition law – Exercise 1
Suggested solution:
Such a scenario might involve two different situations:
First, it seems possible that the three companies agreed on the price rise, though this may be difficult to prove. If so, the case involves a horizontal agreement by which prices are fixed within the meaning of Art. 101(1) TFEU. The further conditions for the prohibition under Art. 101(1) TFEU to apply is that the conduct may affect trade between the Member States (inter-state element) and that it has as its object or effect the prevention, restriction or distortion of competition (competition element). The fact that all participating companies are in Austria does not mean that the inter-state element is not present. First, the companies may sell their products in other EU Member States and, second, the Austrian market is susceptible to imports. Conduct meeting the conditions of Art. 101(1) TFEU is prohibited unless an exemption applies, i.e. a block exemption or an individual exemption under Art. 101(3) TFEU. However, price fixing is a hardcore restriction (namely because a price fixing agreement has as its object to restrict the market). Agreements containing hardcore restrictions cannot benefit from the block exemptions.
Second, in the absence of an agreement, it remains that there is parallel behaviour, which raises the question of whether this parallel behaviour is caused by a concerted practice. In this context, it needs to be remembered that parallel conduct may be the natural state of the market, for example where there are only few market players (oligopolistic market). The fact that the companies involved are big might play a role in this context. If the parallel conduct is the natural state of the market, rather than that of a concerted practice, then Art. 101(1) TFEU does not apply (Woodpulp). If not and if it can be proven that the companies exchanged price information, then there is a presumption of a concerted practice (see further question 2).
[Relevant Charts: Chapter 9, in particular Chart 9/7-9/8]
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