ECJ upholds Marine Harvest gun-jumping judgment
This article is part of the March/April 2020 edition of our competition law newsletter, focusing on some recent key developments.
On 4 March 2020, the European Court of Justice ("ECJ") dismissed the appeal made by Norwegian seafood company Marine Harvest against a 2017 ruling of the General Court ("GC") confirming the European Commission ("Commission") 2014 decision fining Norwegian seafood company Marine Harvest for putting into effect its acquisition of salmon producer Morpol before getting the Commission's approval.
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Background
In a previous edition of the Ashurst Newsletter, we explained that Marine Harvest – now called Mowi - acquired its rival Morpol in three stages through the acquisition of:
- a 48.5% shareholding in December 2012;
- a 38.6% of the remaining shares in March 2013; and
- the remaining shares in November 2013.
The acquisitions were, however, not formally notified to the Commission until August 2013.
In July 2014, the Commission decided that the 2012 acquisition had already conferred Marine Harvest de facto control of Morpol. It therefore concluded that Marine Harvest had breached the EU Merger Regulation by implementing the acquisition without prior notification and consequently imposed two fines of EUR 10 million each, one for failure to notify and the other for gun-jumping.
In October 2017, the GC confirmed the Commission's decision, in particular that the Commission was right in imposing two distinct fines in its decision as Marine Harvest had breached both its filing and standstill obligations. This judgment was appealed before the ECJ.
The ECJ's judgment
In March 2020, the ECJ upheld the GC's ruling that Marine Harvest was properly fined both for failure to notify and for carrying out the concentration before the Commission had cleared the acquisition.
It thus considered that the GC was right to rule that the Commission could distinguish between situations in which the undertaking complies with the notification obligation but infringes the standstill obligation, and situations in which that undertaking infringes both those obligations. Concluding otherwise would render some of the Commission's enforcement powers under the EU Merger Regulation "redundant".
This ruling was adopted despite the contrary Opinion of AG Evgeni Tanchev which concluded that when a merger is implemented before it is notified and before it is approved, the infringement of one provision should "subsume" the other such that half of Marine Harvest's EUR 20 million fine should be annulled.
With thanks to Schéhérazade Oozeerally of Ashurst for her contribution.
Contents
- EU guidance on Covid-19 coordination and the return of the "comfort letter"
- Exceptional derogation from EU competition rules for milk, flowers and potatoes
- Foreign takeovers the subject of new EU guidelines
- EU State aid rules in times of Covid-19 crisis
- Commission announces new Industrial Strategy for a successful European digital and green transition
- ECJ upholds Marine Harvest gun-jumping judgment
- TIM/Vodafone/INWIT JV: insight into the future of 5G roll-out
- Budapest Bank - ECJ confirms strict approach to "by object" infringements
- Record French fine €1.24b for Apple and two wholesalers
- Rail Cartel II: Further landmark cartel damages decision by German Federal Court
- Follow-on action developments in Italy
- Spanish weather radar cartel sanctioned
- Supermarkets, hospitals, ferry services and dairy sector receive rare exclusion orders to permit Covid-19 coordination
- Court of Appeal dismisses Network Rail's appeal in landmark judgment
- Budget 2020 and CMA Annual Plan: ambitions for UK competition law
- A high price to pay? CMA must reconsider Pfizer/Flynn case
- CMA about to deliver first Covid-19 merger control decision?
- Temporary changes to Australia's foreign investment review framework
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