BCA applies Towercast case law for the second time – this time based on Art. 101
On 22 January, the Belgian Competition Authority (“BCA”) opened proceedings based on Art. 101 TFEU applying the Towercast case law of the Court of Justice of the European Union against Dossche Mills and Ceres, the two largest producers and suppliers of flour to artisan bakeries in Belgium.
The parties had signed an agreement according to which Dossche Mills would acquire the commercial activities in the artisan bakery segment of Ceres. According to the BCA’s press release, the transaction was not notifiable to the BCA, as it did not meet the turnover thresholds.
However, the BCA takes the view that the planned merger may constitute an anti-competitive agreement pursuant to Art. 101 para. 1 TFEU based on serious indications that the transaction would lead to a significant restriction in competition on the market.
The decision to open proceedings is remarkable, since it is, according to our information, only the second time since the Towercast judgment that a national competition authority in Europe has applied Art. 101 TFEU to a transaction that is non-notifiable under merger control rules. (Last year, the French Competition Authority applied Art. 101 on mergers in the meat-cutting sector that were below the domestic notification thresholds.)
The BCA’s intervention should be seen as a reminder for companies to be aware that transactions falling below turnover thresholds may still be scrutinised by competition authorities under Art. 101 and 102 TFEU, as recently confirmed in Towercast (C-449/21), including in cases in which the competition authority (the BCA in this case) does not have formal call-in powers.
However, it is important to note that there were exceptional circumstances in this case. In fact, Dossche Mills and Ceres had previously attempted to merge their entire respective businesses but withdrew their related merger control notification only after the BCA voiced serious competition concerns about the admissibility of the transaction. In addition, the parties had previously infringed Art. 101 TFEU by exchanging sensitive competitive information with each other and other players, some of which had been acquired by Dossche Mills in the meantime.
Finally, as in the previous Belgian Towercast precedent (EDPnet), the BCA intervened before the transaction closed, alleviating any concern that non-notifiable mergers could be called into question several years after implementation.
For more information, please contact Romain Alderweireldt and Kirsten Baubkus-Gérard.
