I have just been involved in training of competition authorities organized by OECD-GVH Regional Centre for Competition in Budapest (RCC). The event was: Workshop on Intellectual Property Rights and Competition Law.

Here are my slides:

pptxIP rights and competition law

pptxThe AstraZeneca Case

The workshop way very interesting. One of the rules in the participating countries was that the authority can get a minister resigned if the minister cannot explain the reasons for an anticompetitive regulation and that individuals may be fined if the company did not know about the wrongdoing of the employee.


The Hungarian competition authority just imposed its biggest ever single case fine in history, 9.488.200.000 HUF (cca 31,6 million Euro) on 11 financial institutions. See the press release here: http://www.gvh.hu/gvh/alpha?do=2&st=2&pg=133&m5_doc=8456

Later tomorrow, after reading the decision.

The differences are striking. Will be intersting to see the reasoning:




Budapest Bank Zrt.


ca. 945.000

CIB Bank Zrt.


ca. 2.785.000

Citibank Europe plc., Hungarian branch office


ca. 2.700

Erste Bank Hungary Zrt.


ca. 5.752.300

Kereskedelmi és Hitelbank Zrt.


ca. 3.278.000

Magyar Takarékszövetkezeti Bank Zrt.


ca. 3.300

MKB Bank Zrt.


ca. 2.610.000

OTP Bank Nyrt.


ca. 13.074.700

Raiffeisen Bank Zrt.


ca. 1.945.300

UCB Ingatlanhitel Zrt.


ca. 210.700

UniCredit Bank Zrt.


ca. 1.021.000


Yesterday the Hungarian Parliament adopted an amendment to the Hungarian competition act with great majority. Final bill available here. The details here.

The amendment goes as follows:

"Article 24/A. The Government may classify a concentration of undertakings on public policy reasons - in particular for protecting employment or securing supplies - as a concentration of national importance. For such concentration there is no need to ask for the allowance of the Gazdasági Versenyhivatal according to Article 24.

Article 97 The Government is hereby authorized to classify in a regulation a concentration of undertakings as a concentration of national importance."

This fits nicely into the recent developments in Hungarian competition policy.


We will have a great conference at our Faculty. We fully recommend everyone to attend, registration if free, but limited (we received over 70 registrations within 4 days).

Some of our key speakers: actually all speakers have to be mentioned except for me, so please check the programme.

So here it is:

The Faculty of Law of the Pázmány Péter Catholic University would like to invite you to the conference on

Public Interest Litigation – Group Litigation – Comparative Perspectives

Budapest, 7-8 November 2013
Venue: Pázmány Péter Catholic University, Faculty of Law, Hall II. János Pál (2nd floor)
1088 Budapest, Szentkirályi utca 28-30.

Further information is available here: http://jak.ppke.hu/en/news/events-calendar/2013-11-07-public-interest-litigation-group-litigation-comparative-perspectives or https://jak.ppke.hu/kutatas/kutatointezetek-kutatokozpontok/tamop-kutatocsoportok/maganjogi-kutatocsoport/hirek

Registration is possible here: http://pazmanypeter.eu/PublicInterestLitigation


One of the concerns of undertakings according to survey is the reputational damage due to finding an infringement by the competition authorities. Here is a good example:



I have been lecturing at Raadboud University in Nijmegen under the framework of a great programme: Honours Academy Radboud University Nijmegen - Law Extra’ Summer School 2013.

The presentation was on fundamental rights and EU competition law. pptxSee the slides here.

Meanwhile the trend on reinterpreting the extent - standard of review in competition cases continues. The European Court of Justice delivered a judgement (actually several judgements) in  the fittings cartel case and annuled the European Commission's decision. In this judgement the language is indicating that the General Court is carrying out a full review. (European Commission v Aalberts Industries NV, Compas SA, Simplex Armaturen + Fittings GmbH & Co. KG (C-287/11 P) [2013] ECR 00000)


The EU Court of Justice confirmed in 2001 in its Courage v Crehan[1] judgment that victims of an antitrust infringement are able to claim compensation for the damage suffered relying on EU law. The design of procedural rules have been left so far to Member States subject two the principles of equivalence and effectiveness. The Commission believes that the differences in national liability regimes negatively effect both competition and the proper functioning of the common market. So it is high time to act.

On June 11, 2013 the EU Commission published a proposal for a directive on how damages claims under EU antitrust rules can be brought.[2] The suggested measures feature expanded access to evidence for claimants, rules on limitation periods, rules confirming the respondent’s ability to claim the passing-on defence and rules on the quantification of harm.

The directive covers both to individual and collective actions the latter being currently available in only about half of the EU Member States.

The proposal does not require Member States to introduce collective damages actions in the competition field. The Commission adopted a non-binding recommendation encouraging Member States to set up collective redress mechanisms for victims of violations of EU law in general, including the antitrust rules.

The third element of the package is another soft law instrument, this time a communication on the quantification of antitrust harm supplemented by a detailed practical guide.[3] Thereby an explanation is given about the strenghts and weaknesses of various methods and techniques available for judges to quantify harm.

Alexander Italianer, director general for competition, recalled that only 25% of the antitrust infringements found by the Commission have been followed by civil claims over the past eight years, most of them were brought in the UK, Germany and the Netherlands where procedures are perceived to be more favorable.[4] He emphasized that the aim is (i) to remove existing barriers to effective redress for victims of antitrust infringements and (ii) to regulate the interaction between public and private enforcement of EU antitrust rules, in particularly to protect the effectiveness of EU and national leniency programs.[5]

Following discussions in the EU Parliament and the Council, Member States will have two years to implement the final directive in their legal systems.

It is worth recalling that the draft directive has been proceeded by an eight year long debate.


  1. For the 2005 Green Paper see (link http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2005:0672:FIN:EN:PDF
  2. For the 2008 White Paper see: (link http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2008:0165:FIN:EN:PDF)

Building blocks of the proposal

The principle of full compensation. Cartel members are liable to pay not only the actual damage caused, but also the profits lost and appropriate interest from the time the damage occurred. This is in line with the case-law of the ECJ and the tradition of most European states.

Presumption of harm. Quantifying harm is a very fact intensive and costly process. Once adopted and implemented, the EU rules will assume that a cartel caused damages in the form of a relative price increase. It will be for the cartel members to rebut this presumption. This rule applies only to naked secret cartels and not to the broader set of competition law infringements.

Consensual dispute resolution. The draft directive encourages parties to agree on compensating the harm through consensual dispute resolution mechanisms, like out-of-court settlement, arbitration and mediation.

Disclosure. In order to remedy information asymmetry problems a claimant may obtain a court order for the disclosure of evidence that is in the hands of other parties or third parties if the claimant can show that the evidence is relevant to substantiate its claim. It is for the judge to ensure that disclosure orders are proportionate and that confidential information is protected. Plaintiffs may request the disclosure of “categories of evidence” that they have to define as precisely and narrowly as they can “on the basis of reasonably available facts”.

Protection of leniency applicants. Leniency statements and other submissions prepared by the company during the competition law procedure admitting guilt should not be used in  civil actions against the companies who made them. Other documents, like responses to information requests, the statement of objections can be relied upon once the competition authority has closed its proceedings. Pre-existing information is also discoverable.

Decision of NCAs binds courts. Parties will not be able to re-litigate the substantive question of antitrust liability in the context of an action for damages. The recital of the draft directive extends this also to the reasoning part of infringement decisions adopted by national competition authorities. EU Commission decisions are also binding on national courts, but this is regulated by the general procedural regulation No. 1/2003.[6]

Limitation periods. The draft directive envisages a minimum of five years plaintiffs should have to bring a claim, starting from the moment when the plaintiff realized that she had suffered harm. There will be detailed rules on when and how the limitation period should be suspended.

Limited passing-on defense. In line with continental civil law traditions, infringers may invoke the passing-on defense, i.e. that their direct customers offset at least a part of the overcharge resulting from the infringement by raising the prices they charged to their own customers. However, this defense will be unavailable if it is ‘legally impossible’ for the persons to whom the overcharge is passed on to bring a claim for damages.

Favoring leniency applicants. As a rule, cartel members are jointly and severally liable for the entire harm caused by their collusive behavior. That means that the damaged party may seek the whole amount of her damage from just only one of the cartel members (i.e. from that company who is established in the same country). However, leniency applicants with full immunity will only be liable for harm to their own direct or indirect customers. There is one exception though: they remain fully liable if the injured parties were not able to obtain full compensation from the other infringers.

No mandatory collective actions. Unlike the 2008 White Paper, the proposal does not include rules on collective redress (i.e. representative actions or class actions). The Commission opted for a more general applicable to breaches of all EU legislation (especially consumer protection regulations). Furthermore, this horizontal approach is not a hard one:


  • a non-binding recommendation has been issued. The recommendation sets out non-binding
  • principles which recommend that some form of collective redress should be available in all EU Member States.

Quick evaluation from a Member State perspective

Some of the envisaged rules consolidate existing rules of procedure, others, like those on U.S. type discovery represent a real novelty for traditional continental legal systems.

Hungary has already put in place procedural rules to encourage private enforcement of Hungarian and EU competition rules in 2009.


  1. Decisions of the Hungarian Competition Authority bind civil courts.[7]
  2.   he leniency applicant receiving immunity from fines benefits from a rule that allows to refuse to pay damages as long as the claim can be recovered from any other member of the cartel.[8]
  3. Going much further than the Commission’s position, there is a rule in the competition act providing for a kind of damage assumption of 10% for cartel cases that can be of course rebutted by the respondent (and the plaintiff can also claim more).[9]

According to my best knowledge, however, there have been no successful trials yet awarding damages for the infringement of competition rules.[10] In the follow-on construction cartel cases the court held for example that instead of the State should have been the plaintiff and not the municipality of Budapest directly involved in the bid-rigging case.





[1] C-453/99 Courage v. Crehan, judgment of the Court of 20 September 2001; 2001 ECR I-06297.


[3] In the first point of  the communication from the Commission notes two types of harms caused by competition law infringements: harm to the economy as a whole and hampering the functioning of the internal market. There is nothing expressly said about short or long term consumer welfare issues.

[5] In the seminal Pfleiderer judgment the Court stressed the need for balancing, on the one hand, the interest of victims of a competition law infringement to have access to crucial evidence and, on the other hand, the interest of maintaining the effectiveness of public enforcement of the competition rules, including the leniency programC-360/09 Pfeiderer AG v. Bundeskartellamt, judgment of the Court (Grand Chamber) of 14 June 2011; (2011) ECR I-05161

[6] According to Article 16 (1) of the Regulation „When national courts rule on agreements, decisions or practices under Article 81 or Article 82 of the Treaty which are already the subject of a Commission decision, they cannot take decisions running counter to the decision adopted by the Commission. They must also avoid giving decisions which would conflict with a decision contemplated by the Commission in proceedings it has initiated.”

[7] Although the Supreme Court has ruled recently that this should be interpreted narrowly to apply only in cases where the civil court suspended her procedure seeking an amicus curiae opinion from the authority, there are legislative works underway to amend and make the language of the act more clear. See Pál Szilágyi, The Watermelone Omen, in Competition Policy International: https://www.competitionpolicyinternational.com/hungarian-competition-law-policy-the-watermelon-omen-3/

[8] Furhermore, Section 88/D of the Act No. LVII provides that lawsuits filed to enforce claims against the leniency applicant shall be stayed until the date on which the judgment made in the administrative lawsuit initiated upon request for a review of the decision of the Hungarian Competition Authority establishing an infringement becomes legally binding

[9] Section 88/C does not directly refer to the size of the damage but refers only to a presumed 10 per cent increase in prices.


[10] For a recent summary see Pál Szilágyi: Private enforcement of competition law and stand-alone actions in Hungary, in E.C.L.R. forthcoming (presenting both the statutory background of private anti-trust litigation in Hungary and the practice of the courts).


1. Introduction

On 19 December last year, the Hungarian Competition Authority (GVH) has put an end to a long investigation into a possible cartel infringement of the competition law by Hungarian sugar producers.[1] The investigation started after a leniency application by the Nordzucker Group, the parent company of leading Hungarian sugar producers and distributors that time, Matra Cukor and Eurosugar. The alleged infringement also concerned the two other main sugar producers in Hungary, Südzucker (including Magyar Cukor and Agrana) and Eastern Sugar.

2. Description of the case

The investigation lasted from April 2009 to December last year and involved dawn-raids of the alleged cartel members.

According to the GVH, its investigation did not bring to light sufficient evidence for the existence of a cartel. In the published case summary, the GVH also refers to legislative developments as one of the reasons to put an end to the investigation: the Hungarian parliament has recently passed a law that, under specific conditions, allows the Minister of Rural Development to permit producer cartels in the agricultural sector.[2]

The summary of the case indicates that the GVH found evidence showing that representatives of the sugar producers had regular meetings and exchanged recent sales data.[3] The GVH found, however, that the information exchange between the parties did not amount to a restriction of competition between them.

An important element of the Hungarian sugar market is the use of tender procedures by larger customers. The GVH, amongst others, named Coca-Cola Pepsi, Nestle – customers buying sugar for own production; and Tesco, Plus, Penny Market as retailers.

Apparently the GVH did assess the development of prices and found that the prices of the sugar producers “moved together in the investigated period”[4] (but this, according to the GVH, may have been due to the the special regulated environment in the sugar market).

3. Comment

The conclusions of the GVH are surprising, at least on the basis of the publicly available information.

  • First, the Hungarian sugar market has several characteristics that would facilitate collusion.[5] Sugar is a homogeneous product and there were only a few producers active in the market during the period investigated. From 2003 to 2007 there were five manufacturers and distributors owned by three company groups: Magyar Cukor and Agrana (the latter active until 2005) owned by the Südzucker Group, Matra Cukor and Eurosugar owned by the Nordzucker Group and Eastern Sugar. From the end of 2007 to April 2009 there were only two company groups (Magyar Cukor and the Nordzucker Group) active in the Hungarian market, Eastern Sugar left the Hungarian market. In both periods the manufacturers accounted for 80% of Hungarian sugar production. There was no other manufacturer active in the market (import accounted for 5-20% of the volumes in the investigated period).
  • Second, absent evidence of legitimate purposes of the meetings of the representatives and the exchange of information between them, the meetings and the exchange of information appear highly suspicious.
  • Third, the fact that sugar markets are conducive to cartel behaviour is evident from past cartel cases: in 1975 the Commission found a sugar cartel functioning in multiple EU-countries[6]; in 1998 the Spanish Competition Authority revealed a sugar cartel at work in Spain during 1995-1996[7]; the Commission imposed fines on the cartel members of the British Sugar case[8]. But most relevant to the Hungarian case, the Austrian Competition Authority revealed that there was a cartel operating from 2004 to 2008 involving Austrian sugar manufacturers.[9] One of the cartel members in the Austrian case is Südzucker – a company also investigated by the GVH.

One would have expected therefore that the GVH would not only have used the investigation to assess the documents seized during the dawn-raids, but would also have undertaken an economic assessment of the market.

Considering the importance of tender procedures, it would have been particularly relevant for the GVH to investigate potential bid-rigging between the producers. The information exchange for which the GVH did find evidence may have been used in order for the cartel to monitor the behaviour of the members. According to the GVH however, there was no evidence of bid rigging because most of the large customers buy from multiple producers. This does not however prove the absence of bid-rigging and hence does not prove the absence of a cartel. In order to establish this, the GVH should have undertaken a careful assessment of the relevant tender procedures and the bids of the individual sugar producers.

Also the fact that prices have moved together over time does not disprove the cartel. Prices are likely to move together over time both in a competitive market and in a market that is cartelised.

A meaningful pricing analysis should have compared the alleged cartel period with the period before or after in order to find indications for the absence or the presence of a cartel. Moreover, the information apparently exchanged included volume data, which may hint at an enforcement mechanism for market sharing and/or bid rigging rather than price fixing. It would therefore have been useful if the GVH would also have undertaken an assessment of the development of market shares over time. In a market characterised by tenders, one would typically expect market shares to be volatile (depending on the size of the tenders).

The assessment of the GVH hence does not seem to be conclusive and shows a lack of economics in the assessment, even though the evidence of the meetings and the exchange of information would have warranted a thorough investigation (indeed, the European Commission has imposed fines for information exchanges that appear less far reaching than the one found by the GVH[10]).

The reference in the summary of the case provided by the GVH to legislation allowing for cartels in the agricultural sector under certain conditions does not help to convince that the Hungarian sugar producers did not operate a cartel. The GVH might argue that the legislation is to be applied to ongoing cases. However, it is clear from the decision that the Authority’s conclusions are based on the evidences found (and not found) during the investigation.

To be clear, there may well be a legitimate lack of evidence and indeed, a cartel may indeed not have existed, but the information available on the case does not indicate that the GVH has done enough to be sure of its conclusions.

Akos Reger, RBB Economics

[1] GVH decision no Vj/050-226/2009.

[2] CLXXVI / 2012

[3] See e.g. para 106 of the decision

[4] Idem, para 116

[5] On coordinated effects see e.g. The Economics of Tacit Collusion (IDEI Working Paper) by Ivaldi et. al. prepared for the European Commission.

[6] 73/109/EEC

[7] Case no 426/98 of the Spanish Competition Authority.

[8] 1999/210/EC

[9] BWB/K-191 Zuckerkartell.

[10] E.g. British Sugar case (1999/210/EC)


I am not really a guy who frequently gives interviews, so this invitation surprised me, but I was delighted to have the opportunity.

My article was published in CPI here. A free version is available at SSRN here.

The follow-up interview at CPI is available here.


The 20th St.Gallen International Competition Law Forum ICF will be held on April 4th and 5th 2013. Once more, it will feature a thrilling selection of hot topics in current competition law issues and some of the most distinguished speakers in the field, including Joaquín Almunia (Vice-President of the EU Commission and Commissioner for Competition), Andreas Mundt (President of the German Competition Authority) and William Kovacic (Former Commissioner of the U.S. Federal Trade Commission ). Taking place in one of Switzerland’s most beautiful cities, the St.Gallen ICF gives you the opportunity to meet, discuss and mingle with fellow competition lawyers and leading competition law experts from all over the world. Further information including a detailed programme are available on the conference website:http://www.sg-icf.ch/.

Topics: Current issues and developments in competition law
Date: April 4th and 5th 2013
Location: St.Gallen, Switzerland
Registration: Registration is now open on our website (


I am not sure all the books out in the space are intended to be there, but most of them are easy to find, so I suppose they are. Below you can find a list of full-text books about antitrust I found while browsing. (Please let me know if some links go down or are illegal.)

W. C. Wells, Antitrust and the formation of the postwar world, (New York ; Chichester: Columbia University Press, 2002) (last checked: 25. November 2012.)

D. T. Armentano and D. T. Armentano, Antitrust : the case for repeal, Rev. 2nd (Auburn, Ala.: Mises, 1999) (last checked: 25. November 2012.)

In Hungarian:

BOYTHA GYÖRGYNÉ – TÓTH TIHAMÉR (szerk.): Versenyjog. PPKE JÁK: Budapest, 2010.

MISKOLCZI BODNÁR PÉTER – SÁNDOR ISTVÁN: A magyar fogyasztóvédelmi jog szabályozása. Budapest: Protestáns Jogi Oktatásért Alapítvány, 2009.

Herbert Hovenkamp -The Antitrust Enterprise_ Principle and Execution (2008)


Advocate General JÄÄSKINEN analysed in the case C-138/11 Compass-Datenbank GmbH v Republik Österreich, whether, the Austrian State is acting as an ‘undertaking’ in the sense of Article 102 TFEU by prohibiting both re-use of data contained on its public register of businesses (‘the undertakings register’) and the commercialisation of this data to create a more comprehensive business information service.

The AG looked at three different issues, whether these are economic activities or not:

(i) storing in a database (the undertakings register) information provided by businesses on the basis of statutory reporting obligations;

(ii) allowing inspection and/or printouts to be made of the undertakings register in return for payment; and

(iii) prohibiting re-utilisation of the information contained in the undertakings register.

The AG noted that at present there is no evidence to the effect that the statutory court fee alone or together with the remuneration charged by the billing agencies would exceed the administrative cost of providing a copy of documents or particulars recorded in the undertakings register in the sense of Article 3(3) of Directive 68/151. If it were, the pricing system applied by Austria could be challenged in national courts or, at a general level, in infringement proceedings under Article 258 TFEU.

Even if allowing inspection and/or printouts of the undertakings register were considered to be an economic activity, it would be indivisible from the functions of collecting the data. Economic and public activities will be severable if the economic activity is not closely linked to the public activity, and the relationship between the two is merely indirect.

According to the AG the company register is connected to the utilization of public power and is not an economic activity, even if the data is provided for renumeration to third parties.


The Competition Law Research Centre with the support of the European Commission is organising a training for national judges: Advanced training of national judges in EU competition law.

The training is going to take place in Budapest between 7 to 9 of June 2012 with leading national and European experts from academia and practice.

Judges who are interested can register at the following site: judges.versenyjog.com  

For judges in the CEE region and Greece participation is free and we cover all travel and accommodation costs and also provide for catering. For judges in other countries participation is free, but all other costs have to be borne by them.


About three weeks ago the Hungarian Metropolitan Tribunal obliged the Hungarian Competition Authority (Gazdasági Versenyhivatal (GVH)) to re-evaluate a merger decision. The interesting part comes here: the GVH decided that it has no jurisdiction since the concentration meets the EU thresholds in the Merger Regulation. Therefore it has terminated the procedure. The parties turned to the Metropolitan Tribunal and argued that the concentration is not a full-function joint venture so the European Commission has no jurisdiction, but according to Hungarian national rules it must be notified to the GVH.

The GVH turned to the European Commission whether the concentration has a Community dimension or not (the GVH thinks according to the order of the court that it has), and the court used this opportunity to oblige the authority to re-initiate the procedure, stay it and wait for the answer of the European Commission.

The funny(?) part of the situation is that non full-function joint ventures don't have to be notified in Hungary to the GVH or in the EU to the European Commission. If it is a full-function joint venture than the GVH is by law not allowed to re-initiate the procedure, since the merger regulation prevents it from doing so (lack of jurisdiction - exclusive jurisdiction). If it is not a full-function joint venture, than the GVH shall not start according to the competition act a merger procedure and reconsider the situation, since it is not a concentration under Hungarian law. But in this case it must start a procedure according to Article 11 of the Hungarian Competition Act (or even under Article 101 TFEU). I can not see how this might be good for the clients of the law firm which asked the Metropolitan Court to order the GVH to re-examine the concentration. (I also wonder why the undertakings used the merger notification form to notify a transaction which is not a concentration according to them...)

Here is the original judgement.

pdfHere is a draft translation by me.


I was trying to confirm my registration to the conference organised by the European Commission, but the website is gone. Anonymous might be behind this? Update: It’s back again. (23:57) Update: It might have been a hacker attack... See.

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