Competition Law in Italy The first 20 years of law and practice

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Thus far, the Competition Authority and the Communications Authority have adopted diverging decisions only in one instance. This occurred in connection with the acquisition by Seat Pagine Gialle, a subsidiary of the telecom incumbent operator Telecom Italia (“TI”), of sole control of Cecchi Gori Communications, an Italian free to air broadcaster. While the Competition Authority conditionally authorized the transaction pursuant to the Competition Law, 365 the Communications Authority declared it incompatible with applicable regulations of the telecommunications, radio, and television sectors. 366 In particular, the Communications Authority argued that Article 4(8) of Law No. 249/1997 prohibits the “exclusive licensee” providing public telecommunications services from also being active in the broadcast of radio or television programs. According to the Communications Authority, although TI was no longer an “exclusive licensee” following the liberalization of the telecommunications market, it still held a quasi-monopolistic position. Therefore, the prohibition should continue to apply. On appeal, the TAR annulled the Communications Authority’s decision, holding that as a result of the liberalization introduced in the 1990s, Telecom Italia could no longer be considered an “exclusive licensee” and that, accordingly, the prohibition contained in Article 4(8) was no longer applicable to this undertaking. 367 (d) Film Distribution Decree No. 28/2004 provides for special rules aimed at safeguarding competition in the film distribution industry. Pursuant to Article 26(1) of Decree No. 28/2004, an obligation to file a mandatory notification with the Authority is triggered when ad hoc thresholds are met. Specifically, notification is requested where, as a result of the concentration, the merged entity “holds directly or indirectly, more than 25 percent of: (1) the total sales deriving from film distribution in any of the twelve main cities for film distribution (Rome, Milan, Turin, Genoa, Padua, Bologna, Florence, Naples, Bari, Catania, Cagliari and Ancona); and (2) the number of movie theatres active in any such city.” The Competition Authority assesses the impact of the notified transaction on the market based on the standard dominance test set forth in the Competition Law. (e) General Economic Interest Services and Legal Monopolies On August 28, 2008, 368 the Italian Government amended the legal framework 369 governing the special bankruptcy proceedings applicable to “large insolvent companies” 365 Seat Pagine Gialle/Cecchi Gori Communications, 23 Jan. 2001, n. C4158, Bulletin 3/2001. 366 Case 51/01/CONS, Seat Pagine Gialle/Cecchi Gori Communications, 19 Jan. 2001. 367 Telecom Italia v. Autorità per le Garanzie nelle Comunicazioni, 12 Mar. 2001, n. 1852 (Trib. ammin. reg.). The TAR’s judgment was subsequently upheld by the Supreme Administrative Court, with an even more elaborate reasoning. See Autorità per le Garanzie nelle Comunicazioni v. Telecom Italia, 26 June 2001, n. 3463 (Cons. stato). 368 Law No. 134 of 28 Aug. 2008. 369 Law No. 347 of 23 Dec. 2003, amended by Law No. 39 of 18 Feb. 2004. This body of rules, in essence, provides for the appointment by the government of an “extraordinary administrator” in 104
(i.e., companies with no fewer than 500 employees and aggregate indebtedness of not less than € 300 million). This reform sets forth a special merger control regime applicable to the review of concentrations involving large insolvent companies providing “essential public services,” which as a result are exempted from the need to obtain clearance from the Competition Authority under the applicable national merger control regime. 370 Nonetheless, the parties involved remain subject to the obligation of notifying the proposed transaction to the Competition Authority along with a proposal of behavioral remedies aimed at preventing, following the implementation of the transaction, the application to consumers of higher prices or other unjustifiably unfair contractual conditions. Within 30 calendar days from the date of notification, the Competition Authority, moving from the aforesaid proposal, adopts the final decision providing for the most suitable package of remedies and establishing the date (no sooner than three years) by which monopoly positions possibly resulting from the reviewed transaction must be terminated. Failure to comply with such behavioral remedies or time limit would lead to pecuniary sanctions pursuant to Section 19 of the Competition Law. This particular regime was applied for the first time in the context of the consolidation of the two most important Italian airlines (Alitalia and Airone), under the control of Compagnia Aerea Italiana (CAI). The merged entity was found to be dominant on a considerable number of national routes and, thus, in a decision adopted on December 3, 2008, 371 the Competition Authority set forth the behavioral remedies—some of which had been offered at the outset by the notifying parties—aimed at preventing CAI from unlawfully exploiting its market power. In particular, the Competition Authority decided that for a period of three years from the commencement of CAI’s operations: (i) CAI shall establish a frequent flyer program ensuring a broad coverage of both national and international routes; (ii) CAI’s published fares shall be structured in such a way as to fulfill customers’ needs on all the market’s segments—in particular, discounted fares shall be adequately accessible throughout the year, on all routes, on every flight; (iii) in order to protect the most price-sensitive passengers’ segment, CAI shall guarantee availability on every flight of at least 10 percent of tickets at the lowest economy fare offered by the Alitalia and Airone groups on the same route during the previous corresponding IATA season; (iv) in order to ensure more user friendly and transparent service’s conditions, within one month from the commencement of the operations, CAI shall set up a free telephone line, a specific information area on its website, and a mobile phone message service aimed at managing service problems and providing passengers with real time charge of managing the business of the debtor and formulating a plan of reorganization to be approved by the Government. Remarkably, prior to the reform, the aforesaid special proceedings were only available to companies pursuing a reorganization plan aimed at restructuring the company as a going concern. Now the reorganization plan entails the divestiture of the debtor’s assets to third party purchasers, whether as a whole or as one or more lines of business. 370 The provision applies to concentrations that do not fall within the exclusive jurisdiction of the European Commission under the EC Merger Regulation. 371 Compagnia Aerea Italiana/Alitalia Linee Aeree Italiane-Airone, 3 Dec. 2008, n. C9812, Bulletin 46/2008. 105
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Mario Siragusa - Matteo Beretta - M
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(c) Cooperation with Other Competit
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D. Unfair Practices and Other Prohi
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I. INTRODUCTION A. General Comparis
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1. Main Legislative Reforms On Marc
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In 2006, the Italian Parliament str
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domestic law. Moreover, pursuant to
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government retains some residual po
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Judiciary Council (Consiglio Superi
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February 25, 2000 (Decree No. 67/20
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3. Extent to Which Courts Have Embr
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(c) Agreements, Decisions, and Conc
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Authority’s assessment is not lim
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Supreme Administrative Court entire
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managers were acquitted. The compan
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justified by the possibility that i
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The Competition Authority condemns
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Inaz Paghe Srl, a supplier of softw
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concentration. However, the Supreme
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customer lists and price lists were
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(iii) Cooperation between the Europ
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As of January 30, 2009, the Competi
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(ii) The Criteria Used to Determine
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of the conduct itself. The Court or
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Though the Competition Law has been
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extent that, although legally indep
Page 53 and 54: B. Mergers and Acquisitions 1. Tran
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Page 61 and 62: Given the alternative nature of the
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Page 69 and 70: The acquisition by API-Anonima Petr
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Page 75 and 76: (ii) Phase II After opening the in-
Page 77 and 78: Pursuant to Section 19(1) of the Co
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Page 87 and 88: In Pierburg/Magneti Marelli, 314 fo
Page 89 and 90: electricity sales market. In reject
Page 91 and 92: in Airtours. 324 Based on the above
Page 93 and 94: might be exerted by other operators
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Page 97 and 98: or reducing its actual turnover. In
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Page 109 and 110: Once the Competition Authority has
Page 111 and 112: Further, when a vendor cannot decli
Page 113 and 114: Finally, conduct by a dominant firm
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Page 117 and 118: dello Stato 423 and Infocamere/Cerv
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Page 127 and 128: granted to travel agents for reachi
Page 129 and 130: (h) Remedies/Sanctions A 2005 judgm
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Page 137 and 138: (b) Formal & Informal Consultation
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2. Independence of the Judiciary Th
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judicial protection. Therefore, per
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with the power to impose ex officio
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fixing agreement may be found liabl
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collectively refused to supply it w
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Clauses of an agreement that consti
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The Competition Authority was a fou
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