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Eu Exam Answer 2020
Eu Exam Answer 2020
Eu Exam Answer 2020
Enter the numbers, and sub-sections, of the questions in the order in which you
have attempted them: Question 8 and Question 2
Instructions to Candidates
1. Complete this coversheet and begin typing your answers on the page below, or,
submit the coversheet with your handwritten answers (where handwritten answers
are permitted or required as part of your online timed assessment).
2. Clearly state the question number, and any sub-sections, at the beginning of each
answer and also note them in the space provided above.
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larger.
4. Where permission has been given in advance, handwritten answers (including
diagrams or mathematical formulae) must be done on light coloured paper using
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5. Reference your diagrams in your typed answers. Label diagrams clearly.
Question 8
In advising Speedo (S), Gleamco ( G ) and Bright ( B), despite the legal team is assuring
that the deal between those party are compatible with EU, CEO has some doubts as to
whether the agreement respect EU Competition law. The aim of competition law according
to Harvard School is to prevent harm to consumer as well as competitors. The relevant
article that is in need of discussion would be Article 101 TFEU. It has to be noted that
Article 102 will not be applicable here because of the fact there is no abuse of dominant
position by S, G or B. If there is breach of Article 101, we will proceed with the relevant
exception available for the parties.
Article 101 TFEU prohibits anti-competitive collusion between undertakings which have an
anti-competitive effect. There are elements that needs to be satisfied in order to establish
and those elements are there must be an undertaking, there must be an agreement,
decision or concerted practice, it must be object or effect the prevention, restriction and
distortion of competition which must affect the trade between member state. Now, we will
consider this element one by one.
In relation to undertaking, the case of Hofner and Elser makes it clear that undertaking
must engage in an economic activity. Pavlov has defined economic activity as activity of
offering goods and services on a particular market. On the facts, all three parties are
companies active in car wash industry. This means they are undertakings because their
business is an economic activity. Note that article 101 only applicable if there is two or
more undertakings. On the facts, there is three undertakings which satisfies the
requirement.
But, we have to consider the issue of oligopoly market here because if at all there are few
main players in the industry and parallel behaviour is seen, then there is no breach of
article 101. On the facts, it was stated that S has series of agreement with B and G who
are the main competitor. This means there are also other players in the market who
provides similar service. Not only that, car wash industry is much easy to penetrate
compared to cigarette and petrol market. Therefore, we can conclude that oligopoly
argument will fail if S, G and B wish to advance it at court. To conclude, there is both
agreement and concerted practise present on the facts.
However, we may want to consider the effect of prevent, distort or restrict of competition
as well because the primary aim was to provide technological cooperation. This is to
ensure the advise given S, B and G are aware of the strict application of the element in
Competition law. The effect simply means it is not the primary purpose to hinder article
101 but the consequence of entering into such an agreement leads to breach of article
101.
In advising S, B and G, we may want to consider the case of STM and the test laid out to
see if there is effect in this agreement. One of the requirements is the position and size of
the business. We are aware that S has 40 percent of the market share in EU, while B and
G has about 40 percent share in the East European Companies. It seems to be clear that
the business provided which is in relation to car wash by the parties does relatively have a
large market share. Also, we may want to advise them as to the extent to which such an
agreement would affect. On the facts, we are clear that S, G and B wants to help each
other by sharing technology and reduce the existing number of shops to allow another
business to focus on the market. This goes to explain the effect of not having a healthy
competition between them but rather trying to monopolies a particular market together.
STM’s decision won’t apply here because of the fact that here there is no purely business
efficiency seen. Therefore, this element surely satisfied.
Finally, this agreement or concerted practise affects trade between member state without
a doubt. The STM test can be used here and the outcome would be similar as to what has
been discussed above. This agreement if effective between S, G and B will be definitely
affecting trade between member state.
Therefore, prima facie we can conclude there is breach of Article 101 and the agreement
will be void. Definitely, S, G and B would want to rely on the possible exception available
to them. There are three exception which are block exemption, individual exception and de
minimis principal.
At this juncture, we may want to state that block exemption will not apply here because the
agreement between the parties is horizontal in nature. Block exemption will be triggered
only if the agreement is vertical in nature. On the facts, we are clear that S, B and G are
competitors in the same industry which is car wash business and definitely safe to submit
block exception will not apply.
The last hope for S, B and G to reply is on individual exemption. If an agreement falls
within article 101(1) TFEU, it will be void under article 101(3) TFEU this exception applies
There are four requirement which consist of 2 positive and 2 negative which has to be
satisfied by the parties. All four requirement must be satisfied because it is cumulative in
nature as evidenced in the case of Pyrm Werke. The positive requirement consists of
efficiency gain and fair share of benefit to consumer. On the facts, there seem to be
efficiency gain because now the parties are able to focus on a particular market. However,
the efficiency gain must be in relation to economic view. On the facts, there is no economic
gain seen. Also, there is no share of benefit to consumer because of the fact that G and B
agreed to close some of their shops for S to access the market. This means in that market,
the consumer is deprived from variety of choice as they zoned to only go for S’s product or
services. On the other hand, negative requirement which is indispensability of the
restriction and no elimination of competition is not set out as well as it fails. This
agreement if entered between the definitely eliminates competition. Therefore, we can
submit that individual exception will not apply to S, B and G and the agreement will not be
void under article 101(3) TFEU.
It can be concluded that breach of article 101 is clear if S, G and B enters into this
particular agreement. They will be subjected to 10% fine of annual turnover and damages.
However, we are clear that S is the one who came up with the idea of agreement like
mutual trust with G and B and we cant state that G and B were at fault. The best advise for
G and B is to seek for immunity or reduced fine from commission if they give information of
the agreement.
QUESTION 2
In relation to the given set of facts, advise has to be made on behalf of Germany as a
defence lawyer. We are clear on the facts that Bruschini(B) is not happy because of the
fact the wine from Italy cannot be sold in Germany due to the fact it failed in a test by
Germany authority. B is keen to argue that the test itself is a breach of free movement of
goods. Therefore, the burden is on B to prove that there is a breach and if there were to be
breach, emphasise will be given on justifying the measure which is the new test
proportionately to defend the case. The flow will be that B will establish breach and we wil
try not to make him establish and if he does establish breach then we will focus on
justifying the measure which is the test proportionately.
The first aspect that B will note is that whether his wine falls within the definition of goods.
In the case of Jagerskiold, ECJ defined goods as all products which have a monetary
value and which may be the object of commercial transaction. On the facts, the wine has a
tremendous monetary value and it the item of commercial transaction. Therefore, definition
of goods is satisfied.
Next, B will argue that this is a non-fiscal barrier. The simple reason being that he is not
asked to pay any tax or duties by the German authorities and the test used by Germany is
the primary concern on the given set of facts which means to say there is no room to
trigger article 28, article 30 or even article 110 of TFEU.
B will advance the point that there is a breach of Article 34 of TFEU. It states that
quantitative restriction(QR) on imports and all measures having equivalent effect(MEQR)
shall be prohibited between member state. Therefore, he will began to establish whether
the measure in question which is the test is QR or MEQR.
On the facts, according to the case of Geddo, there seem to be no restriction to the quota
of the wine. The issue here is on MEQR most likely because of the new test which is wine
magnetic resonance control. The case of Dassonville defines MEQR as all trading rules
enacted by member state which are capable of hindering, directly or indirectly, actually or
potentially, intra-Community trade . B will justify that the definition applies to the fact by
stating that the test has actually hindered his freedom to sell the wine at Germany. The
fact that the test has been the issue, B will state that this has been caught within the
definition of Dassonville itself because it has affected the wine from being sold to
Fabben(F). We may want to argue by stating the fact that this test does not caught under
the Dassonville test because it does not hinder trade at any notion. However, the fact that
B has to now reformulate the wine and make sure it satisfies the new test by German
authority, this itself is sufficient for B to argue there is a breach of article 34 TFEU as it
causes difficulties for him to comply with the test as in Italy the wine has a qualified
certificate.
Now, B will want to argue that this measure which is the test, is a distinctly applicable
MEQR. The reason being his lawyers would be aware of the fact if it is indistinctly
applicable MEQR, then we have a variety of justification that we can rely on ie Article 36
TFEU and the mandatory requirement propounded in the case of Cassis de Dijon. So, he
may want to argue this is distinctly applicable and discriminates importers such as B.
However, we may want to counter argue that by stating that this is an indistinctly
applicable measure because of the fact it is a new test and even the people who does
business of alcohol or wine will be subjected to similar test. The facts are vague as to
whether the test is applicable to only importers or for everyone. But, being a defence
lawyer of Germany in this case, evidence will be adduced at court to dictate the fact that
this test regarding the wine is subjected to everyone and not only importers such as B.
Therefore, court may able to favour argument stated by us and it is now classified as an
indistinctly applicable MEQR. We can’t deny but to admit that there are some famous
category noted by academics as to example of indistinctly applicable MEQR. The most
appropriate to this facts would be on content, ingredient, and process restriction seen in
cases such as Cassis and Commission v Italy ( RedBull ) which we may want to note to
the court to further strengthen the argument noting that this falls within the ambit of
indistinctly applicable MEQR.
Despite some level of argument stated as a defence lawyer, B will no doubt has the upper
hand to establish breach. However, we may want to justify the breach and state the test is
proportionate to try win the case.
Since we have persuaded the court and stated it is an indistinctly applicable MEQR, now
we have both statutory derogation and also the case law derogation seen in the case of
Cassis de Dijon in our favour. Now, we may want to argue on the Article 36 derogation.
The grounds that are available under article 26 is public morality, public policy, public
security and protection of health of human. On the facts, we may want to pick public policy
and public health to argue justify that the test was valid and does not in any way
discourage the movement of wine into Germany.
First and foremost, we may want to state that adding water to the wine goes on to state it
is against the policy of Germany in relation to alcohol where they prefer it to be original
and raw. However, this argument may fail because Commision v Italy stated that this
public policy ground is difficult to be establish and it cannot be used for economic reason.
On the facts, since to a certain level the wine would be considered as economic reasoning,
public policy argument will fail.
However, we have also the protection of the health of the human aspect which is more
appropriate to argue on the facts. The case of Rosengren stated that this exception ranks
the highest among all exception and in the case of Commission v France ( RedBull ), it
was stated that courts are sympathetic towards this exception. We may want to strongly
argue that this goes against the protection of health because people in Germany are used
to drink alcohol and wine on a certain percentage and originality. However, B will argue
using the case of re Import of Poultry Meat to state there is no genuine risk to the health
and the test is a mere barrier towards restriction of trade. B will strengthen the argument
stating that there was already test conducted in Italy and the wine has a qualified
certificate. Now, the burden is on us to show that the test by Italian research laboratory is
insufficient. We may want to argue the point that this is a new test and it able to detect the
adding of water meanwhile the test used in Italy may lack this requirement. Not only that,
since the fact the wine is imported to another country, most likely the laboratory was bribed
by B or they were flexible to approve the wine to have qualified certificate. It is argued on
the basis that the test by German authorities are more sensitive where it detect the water
added to the wine which may not be detected by the test done by the Italian laboratories.
In Sandoz, despite the product was lawful sold but despite lacked scientific evidence,
member state able to justify. Not only that, member state can decide their level of
protection which is appropriate to their country but it is subjected to proportionality. On the
facts, despite it is approved in Italy we are not aware as to if there is proper scientific
research done behind the approval of the wine to be having a qualified certificate. We
have to now adduce evidence at court saying that the test done in Italy lacks scientific
element and we are allowed to go on with a new test which ensures the safety of the
people’s health.
We also want to rely on the mandatory requirement stated in the case of Cassis de Dijon
which is non exhaustive. The argument here would be protection of culture seen in
Cinetheque. The reason being as we are all aware Germany is known for festivals such as
October Fest which involves drinking of beer. They have the culture of drinking alcohol and
wine and a frequent basis as that’s how they are since the beginning. Therefore, by adding
water to the wine, the taste may not be as pure as what Germany people usually drink and
this may cause not only some level of protection of culture but also health issue depends
on the sensitivity of people’s body in Germany. Therefore, this is a strong reason to state
that the test is justified and nothing B could argue much about the justification.
However, B will definitely argue that the measure taken by Germany authority to use a
new test is not proportionate. In the case of Scotch Whiskey v Association, it was stated
that the test for proportionality is appropriateness and necessity. Definitely, we would want
to argue is it appropriate because of the fact it is not a law by Germany but rather a test
which ensures that the wine has the quality to be sold to the consumer. The purpose of the
test is to ensure quality and not to restrict trade. German authority encourage alcohols and
wines to be imported to their country because they consume it often than most other
country. Just because they consume often, that doesn’t mean they don’t expect the
quality. Definitely, the quality is always being demanded by them. Therefore, it is
necessary and suitable for such a test to be in place. The fact it is a new test and
unfortunately B was subjected to it is not to be argued in relation to proportionality.
Therefore, we can submit that the new test “ wine magnetic resonance control “ is justified
proportionately and B has no choice but to comply with the test to import their wine to
Germany.