Court ruling confirms that online sales restrictions can amount to a serious infringement of competition law.

By John D. Colahan and Anuj Ghai

On 21 January 2020, the UK’s Court of Appeal ruled that the online sales restrictions contained in Ping’s internet sales policy (ISP) constituted a restriction of competition by object. The Court of Appeal dismissed Ping’s appeal against a judgment of the Competition Appeal Tribunal (CAT) that upheld the CMA’s decision that Ping’s online sales ban constituted a restriction of competition by object under Article 101 of the TFEU and therefore under the Chapter I prohibition of the Competition Act 1998, which is itself modelled on Article 101.

We examine: increasing focus on non-controlling stakes, burdensome document production requests, heightened enforcement of gun jumping rules, examination of vertical deal overlaps, and ongoing political developments.

By John Colahan, Peter Citron, Calum Warren, David Walker, Tom Evans, and Catherine Campbell

In a continually evolving antitrust landscape, we consider five key trends that PE deal teams should be aware of.

Focus on Non-Controlling Stakes in Competing Companies

Antitrust authorities are paying closer attention to “common ownership”, the simultaneous ownership of non-controlling stakes in competing companies, with the EU’s Competition Commissioner, Margrethe Vestager, publicly stating that the European Commission is looking “carefully” into the issue. While public companies were the initial focus, we expect that private companies will face a similar level of scrutiny. As co-investment deals and non-controlling acquisitions become more common, deal teams should not assume that acquiring a minority position will mean that antitrust issues cannot arise.

Increasingly Burdensome Document Production Requests

Burdensome document requests from the European Commission and the UK’s Competition and Markets Authority (CMA) have become more frequent – both regulators are now adopting a more fulsome US-style approach to document production. PE firms need to consider communications made in preparation for and during a deal, and how these may be viewed by competition authorities. Requests for third-party reports, sale documents, and even emails between buyers, sellers, shareholders, and customers are not uncommon. When faced with document requests, firms need to engage in early coordination to handle authorities’ information requests, manage carefully the search and production of discovery materials, and address attorney-client privilege protections and data privacy safeguards. Even if transactions ultimately do not raise substantive concerns, fines can be imposed and delays to transaction timetables can occur as a result of non-compliance.

By Greg Bonné, Jonathan Parker, Richard Butterwick, Terry Charalambous, and Catherine Campbell

As the UK Competition and Markets Authority (CMA) prepares to assume sole jurisdiction for UK competition reviews post-Brexit, M&A deal teams must evaluate the competitive consequences of deals bridging the Brexit period and update their competition strategy accordingly.

Corporates may not be able to implement the same merger control strategies as in the past.

Businesses should review land agreements to avoid infringing competition law.

By John D. Colahan and Anuj Ghai

Many UK businesses operate from, or handle property governed by, some form of land agreement. These land agreements can include agreements for the sale or lease of land and agreements dealing with the use of or access to land. Notably, as with other transaction agreements, land agreements must be compliant with competition law. Prior to 2011, restrictions contained in land agreements were exempt from the application of UK competition law due to the operation of the Land Agreements Exclusion Order; however, the Order was revoked in 2011 following the Competition Commission’s recommendations at the conclusion of the market investigation into the grocery retail sector. Consequently, UK competition law now applies to land agreements.

The UK Competition and Markets Authority (CMA) has not previously taken enforcement action or issued fines in relation to land agreements. However, the decision to impose a £1.6 million fine on Heathrow airport in 2018 indicates the CMA’s increased scrutiny of land agreement restrictions. The Heathrow case represents the first time that the CMA has used its competition enforcement powers to sanction a land agreement restriction. Moreover, on the same day that the CMA announced the Heathrow fine, it also published guidance entitled “Land agreements and competition: do’s and don’ts”. In addition, the CMA has recently sent letters to other airports and hotel operators warning against similar agreements.

By Jonathan Parker and Greg Bonné

As the UK Competition and Markets Authority (CMA) prepares to assume sole jurisdiction for UK competition reviews post-Brexit, private equity deal teams must evaluate the competitive consequences of deals bridging the Brexit period and update their competition strategy accordingly.

What is Changing?

The European Commission (EC) currently acts as a one-stop-shop supranational authority for large transactions that meet Europe-wide competition turnover thresholds, obviating the need for competition filings in individual Member States. However, post-Brexit, transactions impacting competition in the UK and the EU will become concurrently reviewable, i.e., the CMA will review UK aspects and the EC will review European aspects. A significant increase in the number of UK merger reviews carried out by the CMA is likely — the CMA believes that Brexit could result in a further 50 notifications per year, nearly doubling its current workload.

Why Does it Matter?

Timing for the establishment of the CMA’s separate jurisdiction is uncertain. At the earliest, jurisdiction could be effective immediately after the UK leaves the EU  on 29 March 2019. A two-year stay is also possible, depending on the terms of separation. The period building up to the CMA’s separate jurisdiction is likely to be the trickiest for deal teams to navigate. PE firms may not be able to implement the same merger control strategies as in the past.

Click for larger image.

The PSR is to consider whether there is effective competition in the market and makes clear that further reviews of the payments ecosystem could be triggered by its findings

By Brett Carr, Stuart Davis and Christian McDermott

The Payment Systems Regulator (PSR) has issued Draft Terms of Reference for a market review into the supply of card-acquiring services.

The PSR will use its powers under the Financial Services (Banking Reform) Act 2013 to carry out the market review in line with its statutory competition, innovation and service user objectives.

Effective competition in the payments market is a focus of the PSR, and this review follows shortly after dawn raids reported by the PSR in February 2018 as part of its first action under the Competition Act 1998.


  • The PSR is taking these steps to investigate concerns that savings from the interchange fee cap are not being passed on to merchants, there is a lack of transparency around the fees paid by merchants to accept card payments and there are barriers to the substitution of acquirer service providers, which all point to competition not working well in the card-acquiring market.
  • A range of actions is open to the PSR, which could see it give directions to the market and its participants, make proposals to the FCA or make a market investigation reference to the CMA.

The CAT’s specific disclosure ruling addresses the use of licensing to support anticompetitive behaviour.

By John D. Colahan and Calum M. Warren

On 2 March 2018, the Chairman of the UK Competition Appeals Tribunal (CAT) granted an application for further specific disclosure in Peugeot S.A. and others v NSK Ltd and others. The disclosure relates to certain licensing arrangements claimed as central to the claimants’ action for damages arising out of anticompetitive practices, for which the European Commission (Commission) fined the defendants in March 2014. The ruling highlights the potential misuse of licensing arrangements to support anticompetitive behaviour, and is a timely reminder of the need for caution when dealing with counterparties in licensing arrangements.

In February 2016, the claimants — Peugeot S.A. and 18 other companies within the Peugeot Citroën group — brought an action for damages before the CAT. The claim was a so-called “follow-on” action based on a Commission decision of 14 March 2014. The defendants — competing suppliers of components to automotive original equipment manufacturers (OEMs) known as automotive bearings — were found to have coordinated pricing strategy in relation to automotive OEMs in the EEA, and received fines totalling approximately €953 million. In particular, the defendants were found to have coordinated their responses to customers’ (including the claimants’) requests for quotations (RFQ), including which undertakings would submit a quote to a given RFQ.

By Stuart Davis and Brett Carr

Driven by payments innovation and new regulation, 2018 is cited as the year for some of the most significant changes retail banking has seen.

At the Westminster Business Forum for Digital Payments, Adoption, Innovation and Policy Priorities, Graeme McLean (Head of Banking, Lending & Distribution at the FCA) appraised a panel and audience including legislators, innovators, and market infrastructure providers on the regulatory state of play heading into 2018.

With the revised Payment Services Directive (PSD2) set to apply from 13 January 2018 (see Latham’s Client Alert Understanding PSD2: Key Points to Know About the Upcoming Regime), the industry finds itself, according to McLean, just weeks away from an impending “diversification the retail banking sector has never seen before”.

Closely following the publication of the long awaited Regulatory Technical Standards (RTS) on Strong Customer Authentication and Secure Communication (SCA), McLean discussed PSD2, competition, and the UK’s Open Banking initiative. McLean highlighted that the transitional period applying to these standards has raised some uncertainty across the industry, and reminded those concerned to familiarise themselves with the FCA’s Approach Document and joint statement with HM Treasury, which detail the FCA’s approach to the transitional period.

By John. D Colahan and David Zhou 


On 2 May 2017, China’s Ministry of Commerce (MOFCOM) announced its conditional clearance of the proposed US$130 billion all-stock merger of equals between the Dow Chemical Company (Dow) and E.I. du Pont de Nemours and Company (DuPont), marking the first conditional clearance that MOFCOM has granted this year. MOFCOM imposed structural and behavioural remedies on both parties — which are active in plastics, chemicals and agro-chemicals, among other sectors — to address various competition-related concerns. The transaction has been subject to merger control clearance from more than 25 competition authorities globally, including the European Commission, which granted conditional clearance on 27 March 2017.

MOFCOM’s concerns

MOFCOM found that the parties horizontally overlapped in nine different national agrochemical markets and seven different global material sciences and specialty products markets. MOFCOM also found that vertical relationships existed between the parties in an additional nine relevant global material sciences and specialty products markets. MOFCOM identified four markets where it believed that there was a risk of competition being eliminated or limited: (i) Chinese rice selective herbicides ,(ii) Chinese rice pesticides,(iii) global acid co-polymer market, and (iv) global ionomer market.

By Jonathan Parker, Hanna Roos, Hayley Pizzey and James Fagan

The Competition Appeal Tribunal (the CAT) in the UK heard on 17 January 2017 an application by Flynn Pharma Ltd and Flynn Pharma (Holdings) Ltd (together Flynn) to suspend the Competition and Markets Authority’s (the CMA) direction to reduce the price of an epilepsy drug. The CMA had given the direction as part of its unfair pricing decision in December 2016. In its judgment on 19 January 2017, the CAT dismissed the interim application.

The case is significant because it concerns the first CMA decision on excessive pricing, and a substantial fine of £90 million by the CMA for an alleged abuse of a dominant market position by Flynn and Pfizer Ltd and Pfizer Inc. (together Pfizer). The interim relief judgment also highlights the CAT’s focus on the public health impact when assessing the need for interim relief. Flynn and Pfizer are expected to file their appeal of the CMA’s December decision by 7 February 2017, and the CAT’s determination of their appeal is anticipated later this year.