European antitrust agencies have been swift to respond to the crisis triggered by the Coronavirus (COVID-19). The European Commission (the Commission) and national antitrust agencies published a number of communications over the last days and weeks regarding the continued operation of merger control proceedings and their vigilance around business practices that could infringe EU antitrust rules particularly in the current crisis. At EU level, there has also been a specific focus on State aid, given the need for major bail-out packages from governments across the EU. Our executive summary provides a high-level overview of the current landscape regarding each of these topics. Additional details are set out further below. 

Impact on merger control proceedings and timelines

• The Commission has requested companies to refrain to the extent possible from submitting EU merger control filings for the moment. A number of national agencies have made similar announcements, asking businesses for example to delay merger control notifications of non-urgent transactions.  
• The timelines of ongoing proceedings may also be impacted. The Commission, for example, could avail itself of various tools to delay the review process of transactions that have already been notified. 
• Spain has taken measures to restrict acquisitions in strategic industries by investors from outside the European Economic Area (EU, Norway, Iceland and Liechtenstein). 
• Businesses planning transactions that require merger control filings in Europe should carefully consider the appropriate timing of such notifications. Depending on the urgency of the project, it may be advisable in some cases to prepare the filings but to postpone their actual submission.

Agencies remain vigilant in respect of anticompetitive business practices, in particular excessive price hikes

• National antitrust agencies across Europe have provided guidance or issued warnings to companies to remind them to avoid, especially in the current circumstances, engaging in conduct that could potentially fall foul of EU antitrust rules that prohibit anticompetitive agreements or abusive conduct by dominant firms.
• In particular, several agencies have stated that they are monitoring and are ready to intervene, if necessary, against excessive price hikes related to, for example, essential products that are currently in high demand, such as hygiene products or protective medical equipment (some have already launched investigations). Similarly, agencies have cautioned businesses against engaging in cartel conduct or resale price maintenance. Authorities are also focusing on misleading claims, for example regarding the efficacy of products under consumer protection rules.
• Businesses should not believe that they will be ‘forgiven’ for anticompetitive conduct in the current circumstances – in fact, antitrust agencies are at a heightened state of alert. Companies should therefore carefully review the compliance of their business practices with EU antitrust rules, in particular as regards pricing practices.    

Guidance on EU State aid enforcement in record time

• The Commission has been assisting national governments in their efforts to mitigate the economic consequences of the current COVID-19 crisis. As EU Member States are preparing to roll out measures worth billions in support of sectors and companies that are struggling due to the huge economic fall-out of COVID-19, the Commission has provided guidance in record time on the legal framework under which it will assess such measures from an EU State aid perspective. 
• Given the extraordinary circumstances associated with the pandemic, the Commission has highlighted its willingness to use the maximum flexibility permitted under EU State aid rules to approve aid. In addition, it has signalled that it stands ready to act very fast and work with governments to ensure that State aid requiring prior notification can be approved and put in place in a timely manner, as demonstrated by a first clearance decision adopted within 24 hours of the notification. 
• Nevertheless, this speed and flexibility should not lead to the belief that the Commission will turn a blind eye to State support or waive through such aid merely because it is linked to COVID-19. The Commission is expected to remain vigilant with a view to ascertaining, in particular, that aid is effective and proportionate, and does not lead to undue distortions between Member States which undermine the EU Internal Market. 
• It is therefore crucial that businesses which benefit from State aid measures review them carefully to ensure that such measures comply with EU State aid rules with a view to avoiding any challenges or even potential reimbursement obligations further down the road. 

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The Baker Botts Brussels Antitrust & Competition Law team is continuing to monitor, on a daily basis, European antitrust developments relevant to our clients.  We will provide further guidance to our clients as major developments occur. If you have any questions on these or other developments, please contact any member of Baker Botts’ Antitrust & Competition Law practice team.

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