Update on the 9th ARC Revision

On 31 March 2017, the German Federal Council (Bundesrat) has voted in favour of passing the ninth amendment to the Act against Restraints of Competition (ARC) (Gesetz gegen Wettbewerbsbeschränkungen). According to the 31 March plenary report, the draft law is now about to be presented to the president for signature and will enter into force on the day subsequent to its proclamation – which may likely be the case in the course of April 2017.

On 9 March, 2017, the German Federal Parliament (Bundestag) had also passed the amendment, just one day after the committee for economy and energy had decided on the changes that will have an impact on all aspects of German antitrust law, in particular with regard to damage claims, but also regarding merger control notifications.

The reform has originally been driven by the requirement to implement the EU Damages Directive, Directive 2014/104/EU, into national law and to eliminate certain discrepancies between EU and German cartel enforcement provisions. However, the more recent debate about the amendment has mainly touched upon the amendments relating to so-called “big data” issues and challenges that come with the increased use of data in today’s economy. This includes the definition of markets without the requirement of consideration for service provides (big data and platform markets) and the implementation of a new, additional transaction-value based threshold for concentrations that may not be caught by the traditional thresholds due to the small actual size in value of the target company. These amendments are now communicated as the main driver of the changes.

As an overview, the three most significant changes the ninth amendment is about to bring along are the following:

  • new transaction-value based threshold for transactions that need to undergo review by the German Federal Cartel Office (Bundeskartellamt);
  • specification of “market power” in the context of big data and network effects in digital markets;
  • changes to rules regarding cartel damage claims in order to implement the Damages Directive.

Newly included as a result of the committee consultations are now certain rights of the Bundeskartellamt based on consumer protection laws: When the new law becomes applicable, the Bundeskartellamt will also be empowered to carry out sector inquiries based on possible infringements of consumer protection laws; in addition, the Bundeskartellamt will be entitled to participate in civil law proceedings relating to consumer protection laws as an amicus curiae.

Another change worth mentioning are certain procedural amendments to the ministerial approval, which are intended to streamline the process of obtaining exceptional approval for transactions prohibited by the Bundeskartellamt.

 

*This article was first published in Kluwer Competition Law Blog. Click here to read the full article.

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