Report from the Commission to the Council and the European Parliament on the application of the agreements between the European Communities and the Government of the United States of America and the Government of Canada regarding the application of their competition laws 1 January 2000 to 31 December 2000
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REPORT FROM THE COMMISSION TO THE COUNCIL AND THE EUROPEAN PARLIAMENT on the application of the agreements between the European Communities and the Government of the United States of America and the Government of Canada regarding the application of their competition laws 1 January 2000 to 31 December 2000
1. UNITED STATES
On 23.09.1991 the Commission concluded an Agreement with the Government of the United States of America regarding the application of their competition laws  (the "1991 Agreement"), the aim of which is to promote co-operation between the competition authorities. By a joint decision of the Council and the Commission on 10.04.1995  the Agreement was approved and declared applicable.
 Agreement between the Government of the United States of America and the Commission of the European Communities regarding the application of their competition laws (OJ L 95, 27.4.1995, pp. 47 and 50)
 See OJ L 95, 27.4.1995, pp.45 and 46.
On 04.06.1998 another agreement, which strengthens the positive comity provisions of the 1991 Agreement, entered into force  (the "1998 Agreement"), after having been approved by a joint decision of the Council and the Commission of 29.05.1998.
 Agreement between the European Communities and the Government of the United States of America on the application of positive comity principles in the enforcement of their competition laws, OJ L 173, 18.6.1998, pp. 26-31.
On 08.10.1996 the Commission adopted the first report on the application of the 1991 Agreement for the period of 10.04.1995 to 30.06.1996 . The second report completes the 1996 calendar year, covering the period of 01.07.1996 to 31.12.1996 . The third report covers the whole calendar year 1997 , the fourth the year 1998  and the fifth the year 1999 . The current report concerns the calendar year from the 01.01.2000 to 31.12.2000. This report should be read in conjunction with the first report which sets out in detail the benefits, but also the limitations of this kind of co-operation.
 Com(96) 479 final, see XXVIth Report on Competition Policy, pp. 299-311.
 Com(97) 346 final, see XXVIth Report on Competition Policy, pp. 312-318.
 Com(98) 510 final, see XXVIIth Report on Competition Policy, pp. 317-327.
 Com(1999) 439 final, see XXVIIIth Report on Competition Policy, pp. 313-328.
 Com(2000) 618 final, see XXIXth Report on Competition Policy, pp. 319-332.
In summary, the 1991 Agreement provides for:
- notification of cases being handled by the competition authorities of one Party, to the extent that these cases concern the important interests of the other Party (Article II), and exchange of information on general matters relating to the implementation of the competition rules (Article III);
- co-operation and co-ordination of the actions of both Parties' competition authorities (Article IV);
- a "traditional comity" procedure by virtue of which each Party undertakes to take into account the important interests of the other Party when it takes measures to enforce its competition rules (Article VI);
- a "positive comity" procedure by virtue of which either Party can invite the other Party to take, on the basis of the latter's legislation, appropriate measures regarding anti-competitive behaviour implemented on its territory and which affects the important interests of the requesting Party (Article V).
In addition, the 1991 Agreement makes it clear that none of its provisions may be interpreted in a manner which is inconsistent with legislation in force in the European Union and the United States of America (Article IX). In particular, the competition authorities remain bound by their internal rules regarding the protection of the confidentiality of information gathered by them during their respective investigations (Article VIII).
The 1998 Agreement clarifies both the mechanics of the positive comity co-operation instrument, and the circumstances in which it can be availed of. In particular, it describes the conditions under which the requesting Party should normally suspend its own enforcement actions and make a referral.
1.2. EU/US co-operation in individual cases during 2000
Co-operation between the Commission, on the one hand, and the Antitrust Division of the United States Department of Justice (DoJ) and the US Federal Trade Commission (FTC), on the other, further intensified during the course of the year 2000. Indeed, contact between Commission officials and their counterparts at the two US agencies is showing a marked increase in frequency. These contacts range from detailed case-related discussions to more general, sometimes theoretical, competition policy-related matters. High-level meetings and contacts also occur with reasonable frequency. The co-operation continues to be of considerable mutual benefit to both sides, in terms of enhancing our respective enforcement activity, avoiding unnecessary conflicts or inconsistencies between those enforcement activities, and in terms of better understanding each other's competition policy regimes.
1.2.1. Merger cases
During 2000, an unprecedentedly large number of proposed operations were scrutinised simultaneously on both sides of the Atlantic. With regard to the investigation of these proposed mergers, staff-level contacts between DG Competition's Merger Task Force, on the one hand, and the US DoJ and FTC, on the other, take place virtually on a daily basis. Of course co-operation is most effective where the parties involved agree to permit the EU and US authorities to share the information they provide, by means of a waiver of their confidentiality rights, and this now frequently occurs.
Transatlantic co-operation during 2000 was particularly intensive with regard to the big "new economy" and multimedia merger cases, notably in the AOL/Time Warner, Time Warner/EMI and MCI WorldCom/Sprint merger cases. Having obtained waivers from the merging parties, assessment of much of the substance of the cases was carried out in close co-operation between the agencies. Representatives from the DoJ (MCI WorldCom/Sprint)and the FTC (AOL/Time Warner, Time Warner/EMI) attended the oral hearings of the parties intending to merge, and there were regular telephone calls, e-mails, exchanges of documents, and other contacts between the case teams.
In the AOL/Time Warner and Time Warner/EMI cases, discussion between staff on both sides focused most closely on the assessment of the effects that the proposed transactions would be likely to have on competition in the music markets (e.g. recorded music, music publishing and on-line distribution through Internet). Ultimately, in the light of the objections advanced by the Commission to the proposed transaction, the Time Warner/EMI deal was terminated and the parties withdrew their notification; the Commission gave its conditional approval to the AOL/Time Warner merger, subject to the exit of the German media group Bertelsmann from joint ventures with AOL.
In MCI WorldCom/Sprint, the Commission quickly reached the conclusion that this proposed merger between two US telecommunications companies would have worldwide effects. The Internet is global in nature; Internet access and service providers, Internet content providers, end-customers, all demand universal connectivity to the worldwide web. The Commission had found already in 1998, when it investigated the merger between WorldCom and MCI, that there is a global market for top-level (universal) Internet connectivity and that the impact of this merger between these two US companies affected not only US consumers but also inter alia European Union consumers. In MCI WorldCom/Sprint, the Commission again found that one of the relevant markets was the top-level Internet connectivity market. MCI WorldCom/Sprint was the first merger involving a US company to be prohibited by the Commission.
There was also close co-operation between the Commission and FTC in relation to the Boeing/Hughes merger. In the end, the Commission cleared the merger after an in-depth investigation and after the parties' offer of undertakings which dismissed its earlier concerns that the operation might lead to the creation or the strengthening of a dominant position on GEO satellites and launch services markets.
The Commission co-operated closely with the FTC in the treatment of the AstraZeneca/Novartis merger case, in particular so to a find a common solution to the problems identified in the markets for cereal fungicides and maize herbicides. Co-operation proved particularly useful for both authorities because they had been offered the same commitment in order to solve competition concerns on different regional markets. In this particular case of world-wide divestitures of both Novartis' strobilurin business and AstraZenaca's acetochlor products, co-operation between the authorities was needed to ensure that the final commitments accepted were not contradictory and that the buyer would be acceptable to both authorities. In fact, in view of the FTC's request to have a "buyer upfront" for these businesses before approving the deal, the parties had already started to implement the commitment of looking for a buyer before the commitment could be finally accepted by the Commission.
In the Alcoa/Reynolds merger case, the case teams on both sides of the Atlantic (Commission and DoJ) worked closely together; indeed, there was also cooperation between the Commission and the Canadian and Australian competition authorities. Representatives of the US and Canadian authorities participated in the oral hearing of the merging parties. The merger was ultimately cleared by the Commission subject to significant divestitures.
1.2.2. Non-merger cases
During the course of the year, there has been an increased level of contact between the Commission and the US antitrust agencies in non-merger cases generally. Regarding the so-called B2B market place "Covisint" (a supplier exchange set up by six major manufacturers of automobile spare parts), for example, the Commission had a number of informal exchanges of view with the FTC case team investigating the same venture.
With regard to cartel investigations, inter-agency contacts are less frequent. This is explained by the fact that we are not, under our current co-operation arrangements, able to exchange confidential information in the absence of express waivers from the source of any information in the agencies' possession. That having been said, co-operation between the EU and US in cartel matters has improved markedly over the past year; indeed, contacts between the relevant sections of the Commission and the DoJ have become commonplace.
1.3. Administrative Arrangements on Attendance (AAA)
The Commission adopted on March 31, 1999 a text setting forth administrative arrangements between the competition authorities of the European Communities and of the United States concerning reciprocal attendance at certain stages of the procedures in individual cases involving the application of their respective competition rules . These arrangements were concluded in the framework of the agreements between the European Communities and the government of the United States concerning enforcement of their competition rules, and in particular the provisions regarding co-ordination of enforcement activities.
 Bulletin EU 3-1999, Competition (18/43); 1999 Report COM(2000) 618 final, p. 5.
The new administrative arrangements were formally invoked for the first time in December 1999, when representatives of the US FTC attended the Commission's oral hearing in the BOC/Air Liquide merger case. In 2000, representatives from both the US DoJ and FTC attended several oral hearings (TimeWarner/EMI, AOL/TimeWarner, WorldCom MCI/Sprint, Alcoa/Reynolds), whereas a Commission official attended for the first time a "pitch meeting" between the DoJ and the merging parties during the course of the year (WorldCom MCI/Sprint).
1.4. EU/US Mergers Working Group
Following the annual bilateral meeting between the Commission (DG Competition), the FTC and the DoJ, held in Brussels on October 5 1999, it was agreed that a new EU/US Working Group on intensified transatlantic antitrust co-operation should be set up.
It was felt that, while EU/US cooperation in merger cases is very successful, there is still scope for improvement, particularly in view of the current merger wave and the exponential increase in large-scale cross-border transactions. In the longer term, the Working Group could be further mandated to study other competition issues of common concern.
To date, the working group has been focusing its energies on the first topic (remedies). During the course of last year (2000), there were extensive tri-partite (Commission/DoJ/FTC) discussions, including a meeting and a number of tele/video-conferences. The deliberations have been mutually beneficial to all three authorities, and were particularly helpful to the Commission in its preparation of the recently adopted Notice on Commitments in Merger cases ).
 Commission Notice on remedies acceptable under Council Regulation (EEC) No 4064/89 and under Commission Regulation (EC) No 447/98, OJ C 68, 2.3.2001. pp. 3-11.
1.5. Positive Comity
The positive comity instrument provided for in Article V of the 1991 Agreement  was invoked, for the first, and so far only, time by the US DoJ in 1997. The DoJ had requested that the Commission investigate under the EU competition rules possible anticompetitive conduct by four European carriers (Air France, SAS, Lufthansa and Iberia) that owned or were affiliated with the Amadeus Computer Reservation System (CRS) in Europe. Sabre, a CRS at the time owned by American Airlines, had complained to the US DoJ about the allegedly exclusionary behaviour of these Amadeus owners and affiliates. Following the DoJ request, the Commission launched an investigation and, in 1999, issued a statement of objections against Air France, on the basis of a small number of the original allegations. The investigation was concluded successfully in July 2000 , after Air France agreed to a code of good behaviour offering SABRE equivalent terms to those offered to its partly owned CRS Amadeus, as well as to other CRSs. Sabre had also previously reached similar agreements with SAS and Lufthansa.
 The request was made prior to the conclusion of the 1998 EU/US Positive Comity Agreement.
 See Commission Press Release IP/00/835, 25.7.2000.
Innovative co-operation of this kind heralds the possibility of sensible burden-sharing between agencies located in different parts of the world. Positive comity, in particular, allows a possible competition problem to be dealt with by the agency best-placed, notably in terms of fact-finding or the possible imposition of sanctions, to do so.
1.6. High-level contacts
There were numerous high-level bilateral contacts between the Commission and the relevant US authorities during the course of 2000: Commissioner Monti paid a first, extensive official visit to Washington as Competition Commissioner in June, and used the occasion to meet inter alia with key members of the Administration and Congress figures; the annual Commission/US DoJ/US FTC bilateral meeting was held in Washington in July; meetings also took place during the course of the year between the Commission and the US Department of Transportation, the US Federal Communications Commission and the US Federal Maritime Commission (all of which US authorities have some responsibility for the management of competition policy issues in their respective sectors).
1.7. Statistical information
a) Number of cases notified by the Commission and by the US authorities
There was a total of 104 notifications made by the Commission during the period between 1 January 2000 and 31 December 2000. The cases are divided into merger and non-merger cases and are listed in Annex 1.
The Commission received a total of 58 notifications from the US authorities during the same period. 32 were received from the DoJ and 26 from the FTC. A list of these cases is found in Annex 2, again broken down into merger and non-merger cases.
Merger cases made up the majority of all notifications in both directions. There were 85 merger notifications made by the Commission and 49 by the US authorities.
The figures given represent the number of cases in which one (or more) notifications took place and not the total number of individual notifications. Under Article II of the Agreement, notifications may be made at various stages of the procedure and so more than one notification may be made concerning the same case.
Table 1 sets out in figures the number of cases notified under the 1991 EC/US Agreement during the period from 1 January 2000 to 31 December 2000. Table 2 sets out in figures the number of cases notified since 23 September 1991.
b) Notifications by the Commission to Member States
The text of the interpretative letter sent by the European Communities to the US as well as the Statement on Transparency made by the Commission to the Council on 10 April 1995, provides that the Commission, after notice to the US Competition authorities, will inform the Member State or Member States, whose interests are affected, of the notifications sent to it by the US antitrust authorities. Thus, when notifications are received from the US authorities, they are forwarded immediately to the relevant sections in D-G Competition and at the same time copies are sent to the Member States, if any, whose interests are affected. Equally, at the same time that D-G Competition makes notifications to the US authorities, copies are sent to the Member State(s) whose interests are affected.
In most instances, the US authorities also notify the Member States directly, under the OECD Recommendation . During the period under review 45 cases were notified to the United Kingdom, 30 to Germany, 19 to France, 12 each to the Netherlands and to Sweden, 6 to Spain, 4 each to Belgium, Finland and Italy, 3 to Ireland, and 2 each to Austria, Denmark and Luxembourg.
 Revised recommendation of the OECD Council concerning cooperation between Member countries on anti-competitive practices affecting international trade, adopted 27/28 July 1995.
2000 witnessed a further intensification of EU/US co-operation in competition matters. In relation to the treatment of cross-border merger cases in particular, this co-operation has been very close and fruitful; it has facilitated a growing convergence in the respective EU and US approaches toward the assessment of the likely anti-competitive effects engendered by such operations. The authorities on the two sides of the Atlantic are also taking increasingly convergent approaches to the identification and implementation of remedies, and to post-merger remedy compliance monitoring.
During the course of the year, the EU and US authorities have moreover further strengthened their contacts with respect to the investigation of non-merger competition issues, and with respect to the combatting of global cartels in particular. The Commission, DoJ and FTC also continue to maintain an ongoing dialogue on general competition policy/enforcement issues of common concern.
The EU/Canada Competition Co-operation Agreement is designed to facilitate increased co-operation between the European Communities and Canada with respect to the enforcement of their respective competition rules. The agreement was signed at the EU/Canada Summit in Bonn on 17 June 1999 and entered into force at signature.
In substance, the Agreement provides for: (i) the reciprocal notification of cases under investigation by either authority, where they may affect the important interests of the other party; (ii) the possibility of co-ordination by the two authorities of their enforcement activities, as well as of rendering assistance to each other; (iii) the possibility for one party to request the other to take enforcement action (positive comity), and for one party to take into account the important interests of the other party in the course of its enforcement activities (traditional comity); and (iv) the exchange of information between the parties, while not affecting either party's confidentiality obligations with respect to such information. Essentially, it is very similar to the one entered into between the EU and US in 1991.
a) Number of cases notified by the Commission and by the Canadian authorities
Notifications were made by the Commission in four cases during the period between 17 June 1999 and December 1999, and nine notifications in the year 2000. The Commission received notifications from the Canadian Competition Bureau (CCB) in three cases in 1999 and in ten in 2000.
In tendency, notifications by the Commission concerning merger cases are increasing more rapidly than for other antitrust cases. This reflects the procedure under the Merger Regulation whereby, on receipt of a notification, the Commission publishes a notice of the fact of the notification in the Official Journal. Main sectors of co-operation were: airlines, aluminium, integrated electronics, telecom networks, TV cable and content, transportation.
Many of the cases notified during the period under review are still open, particularly matters falling under Articles 81 and 82 of the EC Treaty and, therefore, it is not possible to discuss them in detail or to mention them by name, save where they have already been the subject of a Commission statement or notice.
At the same time, merger cases, which gave rise to notifications and co-operation under the Agreement, are now mostly closed because of the strict deadlines applied under the Merger Regulation  and these can therefore be discussed in this report.
 Council Regulation (EEC) No. 4064/89 of 21 December 1989 on the control of concentrations between undertakings, OJ L 395, 30.12.1989, p. 1; as corrected in OJ L 257, 21.9.1990, p.13 and as amended by Council Regulation (EC) No 1310/97 of 30 June 1997.
In addition, the confidentiality surrounding Canadian procedures, and the obligation of confidentiality to which the European Communities are subject by virtue of Article X of the Agreement, has meant that even where the European Commission has completed its investigation and closed cases, references to specific cases which are still being pursued by the Canadian authorities, or are otherwise covered by confidentiality requirements, have had to be limited.
b) Notifications by the Commission to Member States and third countries
All notifications received by the Canadian Competition Bureau are copied to the Member State(s) whose interests might be affected, at the same time as they are forwarded to the relevant units of DG Competition. Equally, at the same time that DG Competition makes notifications to the Canadian Competition Bureau, copies are sent to the Member State(s) whose interests are affected. During the period under review 6 cases were notified to Germany, 5 to France, 2 each to the United Kingdom and to Denmark and 1 each to the Netherlands, and to Belgium.
Our experience of co-operation with our Canadian counterparts has been very positive. The nature of co-operation depends on the individual case, and can relate to such matters as simple enquiries regarding the timing of procedures or to co-ordination of the proposed remedy in a case.
The day-to-day co-operation between DG Competition and the Canadian Competition Bureau is rather smooth. The co-operation is similar to the one under the EC-US Co-operation Agreement, but on a smaller scale. Frequent contacts are established on merger investigations, the Canadian side has participated in a number of oral hearings. This will be reprociated when the EC will have an active interest to follow proceedings in Canada. It is noteworthy that trilateral teleconferences/meetings (EC/US/ Canada) have taken place in the Dow Chemical/Union Carbide case and in the Alcoa/Reynolds merger case.
2.4. Some Cases
The first notification received from Canada in 2000 concerned the proposed acquisition of Union Carbide Corporation by Dow Chemical which was already under review in co-operation with the US authorities. All the other notifications received during 2000 concerned cartel investigations.
From our part, particular attention should be paid to our close co-operation with the Canadian authorities in the Vivendi/Canal+/Seagram case. After a market investigation, the Commission found out that three markets would be affected by this merger, namely pay-TV, the emerging pan-European market for portals and the emerging market for on-line-music. The merger was finally cleared subject to Vivendi's undertaking to divest its stake in British pay-TV BSkyB and to give rival pay-TV operators access to Universal's films.
The Agreement has lead to a much closer relationship between the Commission and the Canadian Competition Bureau, as well as to a greater understanding of each other's competition policy. An increasing number of cases are being examined by both competition authorities, and there is consequently a growing recognition of the importance, on the hand, of avoiding conflicting decisions and, on the other, of co-ordinating enforcement activities to the extent that this is considered mutually beneficial by both parties.
NOTIFICATIONS BY THE EUROPEAN COMMISSION TO THE US AUTHORITIES 01.01.2000 - 31.12.2000
Non-merger cases :
 Due to confidentiality requirements or to protect the secrecy of ongoing investigations, this list names only those investigations or cases which have been made public.
NOTIFICATIONS BY THE US AUTHORITIES TO THE EUROPEAN COMMISSION - 01.01.2000 - 31.12.2000
Merger cases 
 Due to the confidentiality requirements, this list names only those investigations or cases which have been made public.
01 Carnival Corp/NCL Holding ASA
02 Chemdal Corp & Chemdal Asia/BASF
03 Transportacion Maritima Mexicana/Stolt-Nielsen Transportation Group (JV)
04 American Home Products Corp/Warner-Lambert Co
05 Deere/Metso & Timberjack & Marsta
06 Dairy Farmers/SODIAAL North America Corp
07 Valmet Corp & Groupe Laperriere and Verreault Inc/Beloit Corp
08 Time Warner Inc/EMI Group plc
09 Alcoa Inc/Reynolds Metals Co
10 Novartis AG/Astra Zeneca plc
11 Boeing Co/Hughes Electronics Corp
12 PE Corp/Third Wave Technologies Inc
13 Lafarge SA/Blue Circle Industries plc
14 Carson Inc/L'Oreal
15 Glaxo Wellcome/SmithKline Beecham
16 Warner Lambert/Pfizer Inc
17 Newbridge Networks Corp/Alcatel
18 Lernout & Hauspie Speech products nv/Dragon Systems Inc
19 Charter plc/Lincoln Electric Holdings Inc
20 National Tobacco Co/Swedich Match
21 Williams plc/Assa Abloy AB
22 AOL/America on Line Inc
23 Lockheed Martin Corp/BAE Systems plc
24 Schlumberger Ltd/Baker Hughes Inc
25 Covisint/General Motors/Ford Motor/Daimler Chrysler/Nissan Motor/Renault/ Oracle/Commerce One (JV)
26 Wesley Jessen VisionCare Inc/Novartis
27 CRH plc & Hanson plc/Pioneer Roofing Tile Inc (JV)
28 BASF/Shell Petroleum NV (JV)
29 Hannaford Bros Supermarkets Co/Food Lion Inc
30 Svedala Industri AB/Metso Oyj
31 Voicestream Wireless Corp/Deutsche Telekom
32 Renault/ Aktiebolaget Volvo
33 Delta Air Lines/Air France
34 Atecs Mannesmann AG/Siemens AG & Robert Bosch GmbH
35 Mallinckrodt Inc/Tyco International Ltd
36 BAE Systems plc/Lockheed Martin Corp
37 Svedala Industri AB/Metso Oyj
38 British Aviation Insurance Group Ltd (BAIG)/Associated Aviation Underwriters
39 Pillsbury Co/Diageo plc/General Mills Inc
40 Svedala Industri AB/Metso Oyj
41 Lesaffre/Red Star Yeast & Products Division of Universal Foods Corp
42 ASM Lithography NV/Silicon Valley Group Inc
43 Egide SA/Industrial Growth Partners/Electronic Protection Products
44 Quantum Corp/Maxtor Corp
45 Reed Elsevier Inc/Harcourt General Inc
46 Electronic foreign exchange (JV)
47 Krupp Werner & Pfleiderer/Georg Fisher & Westdeutsche Landesbank Girozentral
48 Pitt-des-Moines/Chicago Bridge & Iron Co
49 Harcourt/Thomson Corp
Non-merger cases 
 Due to the confidentiality requirements, this list names only those investigations or cases which have been made public.
01 Dywidag-Systems International USA Inc
02 Smith International/Schlumberger Ltd
03 Charge Carbone of America Industries Corp
05 International vitamin cartels
07 Sotheby's Holdings Inc
NOTIFICATIONS BY THE EUROPEAN COMMISSION TO THE CANADIAN AUTHORITIES 01.01.2000 - 31.12.2000
01 Case No. COMP/M.1841 - CELESTICA/IBM
02 Case No. COMP/JV.46 - Callahan Invest/Kabel Nordrhein-Westfalen
03 Case No. COMP/M.1908 - Alcatel/Newbridge Networks
04 Case No. COMP/M.1968 - Solectron/Nortel
05 Case No. COMP/M.2050 - Vivendi/Canal+/Seagram
06 Case No. COMP/M.2050 - Vivendi/Canal+/Seagram (re-notification)
07 Case No. COMP/M.2139 - Bombardier/Adtranz
08 Case No. COMP/M.2217 - CELECTICA/NEC TECHNOLOGIES UK
09 Case No. COMP/JV.50 -Callahan Invest/Kabel Baden-Württemberg
NOTIFICATIONS BY THE CANADIAN AUTHORITIES TO THE EUROPEAN COMMISSION - 01.01.2000 - 31.12.2000
Since the 10 notified cases are still ongoing and conducted in private under the Competition Act, they cannot be specifically mentioned.