Brussels Brief - June 6, 2008
June 6, 2008
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KEY DEVELOPMENTS
Mergers: Arjowiggins Takeover of M-Real Zanders' Reflex Paper Mill Cleared, Subject to Conditions
Martino Sforza
On 4 June 2008 the European Commission cleared, subject to conditions, the proposed acquisition by the French paper manufacturer, Arjowiggins, of the Reflex paper production mill in Germany, owned by the Finnish paper manufacturer M-Real. The transaction was notified to the Commission in October 2007. During its initial investigation, the Commission identified serious competition concerns in the market for carbonless paper and opened an in-depth investigation in December 2007. The analysis of the information received from customers and competitors led the Commission to conclude that, as a result of the proposed transaction, Arjowiggins would have obtained a very high market share in this already concentrated market. This would have enabled it to restrict the quantity of paper available in the market and thereby raise prices. In order to overcome the Commission's concerns, Arjowiggins undertook to divest the carbonless paper businesses at the Reflex paper mill, which account for the bulk of the plant's production.
State Aid: Commission Prohibits Tax Exemptions of EUR 3 Million to Alas Slovakia
Geert Dierickx
Under EC Treaty State aid rules, the European Commission has refused authorisation of regional investment aid in the form of tax exemptions amounting to around EUR 2.9 million in favour of Alas Slovakia s.r.o. Alas Slovakia is a Slovakian corporation active in the extraction and processing of gravel and stone. The Commission's in-depth investigation, launched in December 2007, concluded that the proposed aid would distort competition and would not significantly contribute to regional development. Neither the Slovak authorities nor any other interested party responded to the doubts expressed by the Commission. As a result, the Commission concluded that its doubts were justified. As the aid has not yet been granted, a recovery order is not necessary.
State Aid: Commission Gives Green Light to EUR 46 Million Aid to GENESIS Programme
Juan Gutiérrez
The European Commission has approved the granting of EUR 46 million by France to the GENESIS research and development programme. The GENESIS programme is being implemented by a consortium of 17 partners headed by the Arkema Group. It will enable Arkema to develop nanomaterials that will then be applied, in cooperation with its partners, to six areas: (i) car components; (ii) energy storage; (iii) cables; (iv) composites; (v) conductive inks; and (vi) the environment. The Commission considers that the aid meets the conditions set out in the Community Framework for State aid for Research and Development and Innovation, particularly as there are no immediate market incentives for a programme of this nature given the high risks involved, the lack of guarantee of success and the difficulty in putting together a partnership of this kind.
Competition: RWE Offers Commitments to Settle Antitrust Investigation
Patricia Armesto
The European Commission has opened an investigation against RWE, a German energy company. The key concern is that RWE may have used its control over the transmission network in the west of Germany to foreclose supply markets, preventing new entrants from gaining access to the infrastructure and thus abusing its dominant position in the region. RWE has proposed commitments that consist of selling its gas transmission system network in the west of Germany to an independent operator. These commitments would create a structural change in the German gas sector and facilitate competition. The Commission intends to market test RWE's proposals with a view to adopting a decision, under which the commitments would be made legally binding in accordance with Article 9 of Regulation 1/2003.
Environment: Commission Launches Public Consultation on Car Labelling Directive
Mélanie Bruneau
The European Commission has launched a public consultation on information provided to consumers about the fuel consumption and CO2 emissions of new cars. Stakeholders and the general public are invited to submit their views on how such information can be made clearer and more consistent. Currently, a label on fuel consumption (expressed in litres per 100km, or miles per gallon) and CO2 emissions (expressed in grammes of CO2 per km) must be displayed on all new cars. Studies have shown that the Car Labelling Directive that is currently in force could be improved. The results of this consultation will help the Commission to draft a proposal to revise the Directive.
Trade: Plans to Lift US Poultry Ban Rejected by Food Chain and Animal Health Committee
Daniel Kelly
The European Commission, having examined the conditions under which poultry meat treated with antimicrobial substances could be marketed in the European Union, submitted a proposal to the Standing Committee on Food Chain and Animal Health setting out the conditions under which four antimicrobial substances could be used in the decontamination process of poultry carcasses. The Commission argued that: (i) the chemicals had been cleared by the European Food Safety Agency; (ii) the carcasses would be rinsed with potable water after treatment, thereby removing any possible residues on the final product; and (iii) consumers would be fully informed via clear labelling. The Committee, unconvinced by the Commission’s arguments, rejected the proposal. The dossier will be transmitted to EU agriculture ministers who are expected to confirm the Committee's position within the next three months. The outcome is seen as a stumbling block for the Transatlantic Economic Council process, which aims to remove the remaining regulatory obstacles hampering trade and investment between the European Union and United States.
Taxation: Eurozone Rejects French Proposals to Cut Fuel Tax
Daniel Kelly
Finance ministers from the 15 EU eurozone countries, meeting in Frankfurt on 2 June 2008, rejected France’s proposal for Europe-wide fuel tax cuts, despite ongoing strike action across the European Union. The soaring cost of fuel has seen protests from fishermen, farmers and hauliers across Europe in the past four weeks. In response, France announced its proposals for fuel tax cuts, as well as other relief measures such as diverting fuel tax receipts to help households affected by high oil prices and forcing companies to be more transparent about their oil reserves. The chairman, Jean-Claude Juncker, stated after the meeting that there was “no question” of putting fiscal measures in place to offset soaring oil prices. However, the ministers did acknowledge that other relief measures may need to be put in place and Mr Juncker indicated that these may include Brussels seeking to discourage speculative trading in oil.
NEXT WEEK’S EVENTS
Monday 9 June – Friday 13 June 2008
COUNCIL MEETINGS
Employment, Social Policy, Health and Consumer Affairs Council (9 – 10 June 2008)
Transport, Telecommunications and Energy Council (12 – 13 June 2008)
COURT OF JUSTICE
Judgments
Intellectual property
C-533/06 O2 Holdings & O2 (UK)
Taxation
C-462/05 Commission v Portugal
C-458/06 Gourmet Classic
Opinions
Energy policy
C-239/07 Sabatauskas and Others
External relations
C-47/07 P Masdar (UK) v Commission
Own resources of the Communities
C-275/07 Commission v Italy
Taxation
C-288/07 Isle of Wight Council and Others
COURT OF FIRST INSTANCE
Judgments
Intellectual property
T-330/06 Novartis v OHMI (BLUE SOFT)
T-85/07 Gabel Industria Tessile v OHMI - Creaciones Garel (GABEL)
