Short Reads

Trade and Industry Appeals annuls fine imposed on real estate traders

Trade and Industry Appeals annuls fine imposed on real estate traders

Trade and Industry Appeals annuls fine imposed on real estate traders

01.08.2017 NL law

On 3 July 2017, the Dutch Trade and Industry Appeals Tribunal (CBb) annulled the fines imposed on real estate traders active on the market for the sale of houses under execution.

In 2011 and 2013 the Dutch Authority for Consumers and Market (ACM) imposed fines on the real estate traders for their involvement in a system of illicit cartel agreements [see our October 2013 Newsletter]. These decisions were mostly upheld by the District Court of Rotterdam in 2014 and 2016 [see our January 2015 Newsletter]. However, the appeal before the CBb led to an annulment of the fine as the CBb found that the ACM had failed to provide evidence of a single and continuous infringement.

The ACM found that 83 real estate traders participated in a single and continuous infringement concerning the sale of houses at execution auctions. According to the ACM, the real estate traders had the common goal to lower the prices at the official auctions.

These auctions had two phases. The first phase was an ascending price auction, after  which the price for the second phase would be determined by the highest bid (the entry price). The second phase was a descending price auction, which would start with a price above the entry price, while the entry price itself served as a price floor. To incentivize bidding during the first phase, the highest bidder would receive 1% of the entry price. According to the ACM the real estate traders would collude during the first and second phase to lower the price. The ACM submitted evidence showing that after the official auctions, the real estate traders would sometimes organize secret follow-up auctions amongst themselves. The winner of the secret auction would then compensate the other participants.

The CBb agreed that where follow-up auctions were held, the real estate traders' conduct was anti-competitive. However, the ACM only proved this for 215 of 2,328 auctions under investigation. Auctions that were not followed by a subsequent auction could not – according to the CBb – be considered to be part of a single and continuous infringement. For these auctions the ACM failed to prove that the conduct of the real estate traders was intended to lower the price at the official auctions. Alternative explanations were available and could not be dismissed without further investigation according to the CBb. As regards the 215 auctions that were deemed to be anticompetitive, the CBb found that the ACM could not establish a single and continuous infringement without an additional analysis by, as this finding (including the duration, scope and number of involved traders) had previously been based on the total number of 2,328 auctions.

Under Dutch law, the CBb has a discretionary power to refer cases back to the ACM, allowing it to review and amend the deficiencies in its decisions. However, in this case, it refused to do so due to the fundamental nature of the defects found in the evidence. Moreover, if a single and continuous infringement could be established based on the existing evidence, the CBb ruled any new decision would fundamentally alter the scope of the infringement as defined in the decisions subject to appeal. The CBb also considered that the ACM had sufficient opportunities to remedy the defects of its analysis, as the ACM's appeal advisory committee found, on two occasions, that the underlying evidence was insufficient. Finally, the CBb considered that any further analysis would require a substantial amount of time, which would negatively impact the addressee's right to a fair trial within a reasonable time.

This article was published in the Competition Law Newsletter of August 2017. Other articles in this newsletter:

1. Court of Justice dismisses Toshiba's appeal against the gas-insulated switchgear fine
2. Recent enforcement action demonstrates an increasing focus on compliance with procedural EU merger rules
3. District Court of Rotterdam upheld ACM's decision to clear lottery merger
4. ACM closes probe into Fox over live-soccer TV rights due to lack of evidence of consumer harm
5. District Court of The Hague rules on ACM's powers to select and inspect digital data

Team

Related news

20.09.2022 EU law
Launch of Metaverse blog series

Articles - Stibbe launches a new blog series focusing on the legal challenges of the Metaverse. In our upcoming blog posts, we will discuss the legal challenges of NFTs, crypto-assets, Metaverse platforms, crypto exchanges, DAO, and many more.

Read more

28.07.2022 NL law
Zuiver commercieel belang ook gerechtvaardigd belang: Raad van State laat zich er niet over uit

Short Reads - Op 27 juli 2022 heeft de Raad van State bevestigd dat de Autoriteit Persoonsgegevens onterecht een boete van € 575.000 aan VoetbalTV heeft opgelegd. De hoop bestond dat de Afdeling antwoord zou geven op de vraag of de AP terecht of onterecht meent dat een zuiver commercieel belang géén gerechtvaardigd belang kan zijn in de zin van de Algemene Verordening Gegevensbescherming. Het antwoord op deze vraag blijft echter uit.  

Read more

03.08.2022 EU law
Gotta catch ‘em all? Upward referral of ‘killer acquisitions’ upheld

Short Reads - Companies involved in intended or completed M&A transactions falling below EU and national merger notification thresholds should beware that their deals may still catch the European Commission’s eye. The General Court has upheld the Commission’s decision to accept a national referral request regarding Illumina’s acquisition of Grail: a transaction not triggering any of the notification thresholds within the EEA.

Read more

28.07.2022 NL law
Purely commercial interest also a legitimate interest? Council of State leaves the question unanswered.

Short Reads - On 27 July 2022, the Council of State confirmed that the Dutch Data Protection Authority wrongly imposed a €575,000 fine on VoetbalTV. But the Council did not answer the question whether the AP rightly or wrongly believes that a purely commercial interest cannot be a legitimate interest within the meaning of the General Data Protection Regulation.

Read more

06.07.2022 NL law
Highest Dutch court: the postman may still ring twice?

Short Reads - The Dutch Minister of Economic Affairs and Climate Policy was wrong to unblock the ACM’s prohibited merger between postal operators PostNL and Sandd on grounds of public interest. According to the Trade and Industry Appeals Tribunal (CBb), the Minister cannot substitute the ACM’s assessment for its own when considering public interest reasons. Since the Minister did do so in this particular case, the CBb annulled the Minister’s merger clearance.

Read more