3 EU INVESTIGATIONS
25. Competition within the European Single Market
is regulated mainly under Article 81 and 82 of the EC Treaty.
There have been several instances where the European Commission
and the European Courts have considered the arrangements for the
supply of beer between national brewers and pubcos, on the one
hand, and their respective tied tenants, on the other, under Article
81 (formerly Article 85) of the EC Treaty.[24]
The judgment of the European Court of Justice in Stergios
Dilimitis v Henninger Bräu[25]
provided a benchmark two-fold test for the courts with regard
to the application of Article 81 to the beer tie. Only if
both conditions are fulfilled cumulatively does such an agreement
fall foul of Article 81. If not, EU competition law is considered
irrelevant to the agreement in question.
26. The first condition is that of 'national market
foreclosure', which is measured by the Courts against a series
of indicators relating to the economic and legal context in which
the agreement must be assessed. These indicators are:
— the
existence of a bundle of similar tying agreements of at least
several national brewers (more specifically the number of outlets
thus tied to national brewers in relation to the number of public
houses not so tied, the duration of the commitments entered into,
the quantities of beer to which those commitments relate, and
the proportion between those quantities and the quantities sold
by free distributors);
— factors relating to opportunities for
access (the possibility to acquire an existing brewery together
with its network of retail outlets, the possibility to open new
public houses, the minimum number of houses required to have a
viable economic operation, and the presence of independent wholesalers);
and
— the conditions under which competitive
forces operate on the market (the degree of saturation of the
market, customer fidelity to existing brands, and the trends in
beer sales in the offtrade).
27. The second condition is that the agreement in
question must make a 'significant contribution' to the sealing-off
effect brought about by the totality of those agreements in their
economic and legal context. The Court gave the following criteria:
the market position of the brewery in question (market share of
the brewing group, number of outlets tied to it in relation to
the total number of premises), and the duration of the agreement.
28. Although some old lease agreements have been
found by the European Commission and Courts to breach Article
81,[26] there have been
no instances where the current arrangements underwriting pubcos'
agreements have been found to be anticompetitive.[27]
Indeed, many multiple public house owners applied for exemption
for their agreements. These so called 'block exemptions' were
granted in all cases.[28]
24 For example see European Court of First Instance,
Case T-25/99 Roberts v Commission, 5 July 2001 (OJ (C)
2001 317/24) and European Court of First Instance, Case T-231/99
Joynson v Commission, 21 March 2002 (European Court Reports,
2002, II-2085) Back
25
European Court of Justice, Case C-234/89, Delimitis v Henninger
Bräu AG, 28 February 1991 (European Court Reports 1991
I-0935) Back
26
For example see European Commission Decision 99/230/EC, Case IV/35.079/F3,
Whitbread (OJEC (L) 1999 88/26) Back
27
For example see European Court of First Instance, Case T-231/99
Joynson v Commission, 21 March 2002 (European Court Reports,
2002, II-2085) Back
28
For example see European Commission Decision 1999/474/EC, Case
IV/35.992/F3, Scottish & Newcastle, 16 June 1999 (OJEC
(L) 1999 186/28) Back
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