1. IPR AND CONCENTRATIONS
Jonathan D.C. Turner
Barrister, 13 Old Square Chambers

2. MAIN PROVISIONS OF EU COMPETITION LAW
Prohibition of anti-competitive agreements (TFEU Art. 101)
Prohibition of abuses of dominant position (TFEU Art. 102)
Control of concentrations (Merger Regulation 139/2004)
Control of aid to undertakings by EU member states (TFEU Arts )

3. BASIC PRINCIPLES OF EU MERGER REGULATION
Compatibility of concentration with Community dimension appraised by EU Commission
Sole criterion: whether it would significantly impede effective competition in the common market or a substantial part of it
(except that where JV has object or effect to coordinate behaviour of independent undertakings, art. 101 criteria applied to coordination)

4. DEFINITION OF CONCENTRATION
Change of control on lasting basis resulting from
merger of 2 or more previously independent undertakings or
acquisition by undertaking(s) or person controlling undertaking(s) of direct or indirect control of whole or part of another undertaking(s) or
creation of full function JV performing on lasting basis all functions of autonomous economic entity

5. CONCENTRATIONS WITH COMMUNITY DIMENSION
Community dimension defined by turnover thresholds
If yes, must be referred to Commission and must not be implemented unless approved (or deemed to be approved by lack of decision within time limit)
If no, to be assessed by national competition authorities under national law
Procedural rules implementing arts. 101, 102 inapplicable
But arts. 101, 102 may still be applicable?
Possible referral from Commission to national authorities or vice versa

6. ANCILLARY RESTRICTIONS
Restrictions integral or directly related and necessary to implementation of concentration
governed by Merger Regulation
assessed as part of concentration
covered by approval
Other restrictions entered into in conjunction with concentration
subject to arts. 101, 102
normal jurisdiction of national courts, national and EU competition authorities

7. ANCILLARY RESTRICTIONS: acquisitions
Simple or exclusive licences
may be limited to fields of use corresponding to activities transferred
need not be limited in time
cannot include limitations on place of manufacture
Limitations in licences on sales and non-competition covenants only acceptable as ancillary if
goodwill and/or knowhow transferred
< 3 years if both, < 2 years if goodwill only
geographical scope and products limited to vendor’s existing activity or advanced preparations
binding vendor, connected companies, agents only

8. ANCILLARY RESTRICTIONS: full function JVs
Simple or exclusive licences by parents to JV
can be limited to field of use corresponding to JV’s activities
can be unlimited in time (?)
Simple of exclusive licence by JV to parents
as acquisition
Licence between parents not ancillary
Non-competition covenants ancillary if
correspond to products / territories covered by JV agreement
limited to parents’ activities prior to formation of JV or new market in which JV will be active from outset

9. IS ARRANGEMENT A CONCENTRATION?
IP assets constituting a business transferred / exclusively licensed for sufficiently long period
Franchising - generally not
Outsourcing - yes if market access
Control over key technology may confer control over business
Parents’ control over technology may affect whether JV performs all functions of an autonomous entity on a lasting basis

10. APPRAISAL OF CONCENTRATION, REMEDIES
Combination of IP assets may contribute to significant impeding of effective competition
Concentration may be cleared on the basis of commitments (“remedies”) which remove competition concerns
Preference for structural remedies, particularly divestiture of existing business (including specified IP)
Divestiture of IP to credible competitor
Licensing of IP - either exclusive or open to all