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European Competition Law Newsletter – May 2025

May 1, 2025

Table of Contents

Belgian Competition Authority Issues Fines for Category Management Agreement

On 24 April 2025, the Belgian Competition Authority (BCA) announced fines on three pharmaceutical manufacturers for what the BCA considered to be an anticompetitive category management arrangement concerning over-the-counter (OTC) medicines sold to pharmacies in Belgium.

Standard category management agreements are agreements under which a retailer entrusts a supplier, or “category captain,” with marketing a category of products. This often includes the supplier’s and its competitors’ products. The category captain will typically influence product placement, promotion and selection for a retail outlet or chain. In most cases, these agreements do not raise competition law concerns.

In the case considered by the BCA, the companies were competitors at the supply level. Their arrangement had several features the BCA considered anticompetitive. It excluded competitors’ products from the design and implementation of the planograms used for the placement of OTC medicines in pharmacies. It favoured the companies’ own products by reserving favourable shelf space. The companies also agreed to monitor the arrangement and its implementation in pharmacies. The BCA found that the objective was to share and control the placement of OTC medicines in a significant number of pharmacies in Belgium.

The BCA commented: “In setting the amount of the fine, the BCA took into account the fact that there is little precedent available on the limits imposed by competition rules on category management arrangements in Europe. Today’s decision is therefore important as it provides an example of what can go wrong with category management.”

Interestingly, one of the companies took over the OTC activities of other companies and was fined as the legal successor to those companies.

UK CMA Issues Fine for Failure to Provide Documents During Merger Control Investigation

The UK Competition and Markets Authority (CMA) considers the infringement of a company’s obligation to provide accurate and complete information during an investigation to be a serious issue. It demonstrated this on 15 April 2025 when it imposed a £25,000 fine on Keysight Technologies for failing to comply in full with a requirement to provide documents during a merger control investigation.

Keysight sought approval under UK merger control law for its proposed acquisition of Spirent Communications. In accordance with normal practice, the CMA issued a formal request requiring Keysight to produce all internal documents prepared between certain dates that discussed or analysed its offering for certain products potentially impacted by the transaction or the entry or expansion by Keysight into those product areas.

Keysight initally provided only four documents. When questioned by the CMA, Keysight provided a further seven documents. Dissatisfied, the CMA issued a second formal request that required Keysight to provide the same type and subject matter of documents as those initially required, but over a longer timeframe. Keysight provided 115 documents in response. The CMA considered that approximately 66 of those documents should have been provided in response to the initial request.

The CMA determined that the documents in question were highly pertinent to its conclusion at the end of its Phase 1 investigation that the proposed transaction raised significant competition concerns as a result of the loss of future competition in the supply of the products in questions. Keysight’s failure to comply could potentially have had an adverse impact on the CMA’s investigation, in particular its ability to obtain evidence relevant to the determination of issues being investigated.

Keysight tried to justify the failure to provide documents in response to the first notice on the basis of a narrow reading of its language. It said the words “the documents” did not oblige it to provide “all” documents falling within the description. The CMA, unsurprisingly, did not accept this explanation, commenting it “does not consider that there was any reasonable room for interpretative uncertainty [and] Keysight’s explanation for its approach appears to proceed on the mistaken premise that Keysight had discretion in choosing what documents to produce in response.”

The fine took into account aggravating factors, including the significant number of documents responsive to the first notice that were not initially provided. Further, Keysight “did not take compliance sufficiently seriously” and it “should have been obvious to Keysight and its external advisors that the original search had been inadequate.”

The £25,000 figure was at the top end of the range permitted under the legislation at the time. Under changes introduced by the Digital Markets, Competition and Consumers Act 2024, the CMA now has significantly increased fining powers in these circumstances (the equivalent fine could now be up to 1% of a company’s annual worldwide turnover).

The case shows that companies and their advisers need to take great care to comply fully with requests for documents and information during a CMA merger control or other investigation. Even if a transaction ultimately raises no substantive concerns (despite initial concerns, the acquisition was approved on the basis of the de minimis exception under UK merger control law), the CMA will likely consider noncompliance to justify a fine.

CMA Provides Guidance on Environmental Sustainability Agreement

In 2023, the CMA published guidance on the application of UK competition law to environmental sustainability agreements between actual and potential competitors (Green Agreements Guidance). The guidance indicated the CMA will operate an open-door policy whereby businesses considering entering into an environmental sustainability agreement can approach the CMA for informal guidance on their proposed agreement if there is uncertainty on the application of the guidance. The guidance also indicates the CMA does not expect to take enforcement action against environmental sustainability agreements that correspond to the principles set out in it.

On 31 March 2025, the CMA published informal guidance provided to Builders Merchants Federation (BMF), a trade association that represents the interests of merchants and their suppliers of building materials and services in the UK and Ireland.

The request from BMF related to a proposal recommending that the industry use a single provider of supply chain assurance services to administer a standard environmental, social and governance (ESG) platform. BMF would select Verisio to provide the single preferred platform initially, and a competitive process will determine future providers on an ongoing basis at regular intervals.

The stated objective of the proposal was to make it easier for merchants to assess the impact of their supply chains by providing ESG information on a consistent basis and for suppliers to improve their processes and policies. BMF considered the single preferred platform would help suppliers avoid having to devote resources into providing information on their supply chains to multiple merchants and assurance providers. BMF indicated it would work with Verisio to develop a standard ESG questionnaire, with input from members and non-members, to test that it genuinely represented their needs. This questionnaire would be made available to the wider industry, including other supply chain assurance providers.  

BMF approached the CMA in the early stages of developing the proposal to help assess any potential competition law risks prior to implementation. This resulted in changes to the proposal. The CMA conducted a “light-touch” assessment taking into account BMF’s own analysis of the procompetitive aspects of the arrangement. Based on that analysis, the CMA determined that it is plausible to believe the single preferred platform, initially provided by Verisio, could generate benefits for suppliers and merchants and their customers, as well as climate change benefits for UK consumers. These benefits could offset any potential harm that might arise from the single preferred platform. The CMA would accordingly not expect to take enforcement action against the proposal under UK competition law.    

As with previous cases in which informal guidance has been provided, the arrangement was not likely to raise significant concerns and does not seem likely to make a material contribution to environmental sustainability generally or the fight against climate change in particular (the intention behind the Green Agreements Guidance). However, it does provide useful insight into how the CMA analyses agreements of this nature.

CMA Publishes Guidance as New UK Consumer Protection Regime Comes Into Force

On 6 April 2025, significant changes to the UK consumer protection regime were introduced as relevant provisions of the Digital Markets, Competition and Consumers Act 2024 (DMCC Act) came into force.

Under the consumer protection reforms, the CMA now has the power directly to enforce the law in the UK and sanction breaches. Previously, the CMA could only accept undertakings from a company under investigation or apply to court to seek an enforcement order. Both processes have proven to be slow, unwieldy and of limited practical effect.

The CMA indicated it will initially target behaviour that is particularly harmful to consumers and represents clear infringements of the law, such as:

  • Aggressive sales practices that prey on consumers in vulnerable positions
  • Fees that are hidden until late in the buying process
  • Information given to consumers that is objectively false
  • Unfair and unbalanced contract terms
  • Behaviour with which the CMA has already put down a clear marker through previous enforcement work, such as drip pricing and fake reviews

To assist businesses and advisers as the regime starts, the CMA published a range of new guidance documents.

The CMA is apparently already working on cases. Companies can expect to see direct CMA enforcement of consumer protection law in the UK operating in a similar way to its existing, robust action against competition law infringements across numerous industries.

Businesses active in the UK that are directly or indirectly consumer-facing should consider the impact of the DMCC Act and review their internal consumer protection law compliance policies, including manuals and training.

Additional EU and UK competition law news coverage can be found on McGuireWoods’ Insights page. McGuireWoods also publishes legal alerts on U.S. antitrust developments and numerous other topics.

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