Compatibility of Transactional Resolutions of Antitrust Proceedings with Due Process and Fundamental Rights & Online Exhaustion of IP Rights (eBook)

Preface 6
Contents 8
List of Contributors 10
Abbreviations 12
Part I: Due Process in Antitrust Transactional Mechanisms 15
1: International Report 16
1.1 Introduction 16
1.2 Role and Benefits of Transactional Resolutions 18
1.3 Transactional Resolution of Agreements and Abuse of Dominance 21
1.3.1 Overview of Transactional Mechanisms 21
1.3.2 Discretion of Competition Authorities and/or Judges During Proceedings 23
1.3.3 Fairness, Good Faith, Legitimate Expectations, and Good Administration 24
1.3.4 Fundamental and Procedural Rights of the Parties 25
1.3.5 Fairness, Due Process, and the Transactional Resolution Process 29
1.3.5.1 Informal Investigations That Do Not Result in Binding Decisions 29
1.3.6 Formal Investigations 30
1.3.6.1 Communication of the Case Against the Company 30
1.3.6.2 Predictability and Clarity of Objections 32
1.3.6.3 Access to Evidentiary Documents and to Files 34
1.3.6.4 Form and Status of Parties´ Submissions 35
1.3.6.5 Form and Status of Admission of Facts and Infringement 35
1.3.6.6 Deadlines and Timing for Submissions 36
1.3.6.7 Burden and Standard of Proof 37
1.3.6.8 Discretion of Authorities in Pursuing Discussions Concerning Undertakings and Settlements 39
1.3.6.9 Withdrawal of Settlement Submissions and Admission of Guilt 39
1.3.6.10 Withdrawal of Undertakings 40
1.3.6.11 Right to Appeal 41
1.3.6.12 Transparency and Publicity of Transactional Resolutions 43
1.3.7 Two-Tier Systems: Approval of Transactional Resolutions by a Body Not Involved in Negotiations 44
1.3.8 Rights of Third Parties 47
1.4 Merger Control 48
1.5 Impact on Transactional Outcome and on Market Intervention 48
1.6 Conclusions 49
2: Australia 55
2.1 Overview 55
2.1.1 Immunity Policy 57
2.1.2 Reduction of the Penalty 59
2.1.3 Administrative Settlements: Undertakings 62
2.1.4 Authorisations and Notifications: Obtaining Immunity Through the ACCC 63
2.2 Nature of the Settlement and Legal Consequences for the Parties 64
2.2.1 Administrative Settlements: Undertakings 65
2.2.2 Authorisation and Notification 68
2.2.3 Incentives to Accept Transactional Resolutions and the Risk of Non-compliance 68
2.2.4 Efficiency Prompts Transactional Resolution 70
2.3 The Principle of Fairness and Related Principles and Concerns 70
2.3.1 Good Administration 71
2.3.2 Good Faith 71
2.3.3 Legitimate Expectation 71
2.4 The Principle of Proportionality 72
2.4.1 Enforceable Undertakings 73
2.5 Fundamental and Procedural Rights 74
2.5.1 Right to Trial 74
2.5.1.1 General Right 74
2.5.1.2 Right to Judicial Review 76
2.5.2 The Principle of Impartiality: Bias and Right to an Impartial Judge 77
2.5.3 Right to Equal Treatment 78
2.5.4 Ne Bis in Idem and Other Concerns 78
2.5.4.1 Collection of Evidence for Civil Litigation in Administrative Settlements 79
2.5.5 Presumption of Innocence and Acknowledgement of Guilt 80
2.5.6 Right Against Self-Incrimination 80
2.5.7 Providing Information and Protecting Confidential Information 81
2.5.7.1 The Obligation to Provide Information to Authorities 81
2.5.7.2 Without Prejudice, Confidentiality and Publicity of Transactional Solutions 82
2.5.7.3 Legal Professional Privilege 84
2.6 Merger Control 84
2.6.1 Merger Remedies v Other Remedies 86
2.6.2 Enforcement of Remedies 87
2.6.3 Third Parties 87
2.7 Conclusion and Recommendations 87
3: Austria 89
3.1 Introduction 89
3.2 Transactional Resolution of Agreements and the Abuse of Dominance 91
3.2.1 Overview of Transactional Procedures 91
3.2.2 Settlements 91
3.2.2.1 Legal Background 91
3.2.2.2 Discretion 92
3.2.2.3 Procedure in a Nutshell 92
3.2.2.4 Publication of Settlements 95
3.2.2.5 Point in Time of Settlement? 95
3.2.3 Commitments 96
3.2.4 Leniency 97
3.2.4.1 Leniency Established by Law 97
3.2.5 Leniency vs Settlements 98
3.3 Fundamental and Procedural Rights of the Parties 99
3.3.1 Right Against Self-Incrimination and Presumption of Innocence 100
3.3.2 Right of the Parties to Know the Case Against Them (Statement of Objections) 102
3.3.3 Right To Be Heard and Access to File 103
3.3.4 Right to an Equal Treatment 103
3.3.5 Right to an Impartial Judge 103
3.3.6 Right to Trial 103
3.3.7 Ne bis in idem 104
3.4 Rights of Third Parties 104
3.4.1 Right To Be Heard and Access to File 105
3.4.2 Right to Trial 106
3.4.3 Right of Equal Treatment 107
3.4.4 Other Issues and Rights 107
3.4.5 Principle of Legitimate Expectation and Good Faith 107
3.4.6 Confidentiality and Publicity of the Transactional Solutions 107
3.5 Merger Control 108
3.6 Negotiation of Remedies 109
3.6.1 Remedies Submitted in the First or Second Phase of the Procedure 109
3.6.1.1 Phase I 109
3.6.1.2 Phase II 109
3.6.2 The Authorities´ Discretion in Negotiations 109
3.6.3 The Rights of the Notifying Party and Time Constraints 110
3.6.4 The Role of Third Parties in Defining the Remedies 111
3.7 Enforcement of Remedies 111
3.7.1 Public Enforcement 112
3.7.2 Private Enforcement 113
3.8 Conclusions 113
4: Belgium 115
4.1 Introduction 115
4.2 Transactional Resolutions of Restrictive Agreements and Abuse of Dominance 116
4.2.1 Overview of Transactional Procedures 116
4.2.1.1 Settlement Procedure 117
4.2.1.2 Commitments 121
4.2.1.3 Leniency 124
4.2.2 Fundamental and Procedural Rights of the Parties 128
4.2.2.1 Right Against Self-Incrimination 128
4.2.2.2 Presumption of Innocence 130
4.2.2.3 Right of the Parties to Know the Case Against Them 132
4.2.2.4 Right To Be Heard and Access to the File 133
4.2.2.5 Right to Equal Treatment 134
4.2.2.6 Right to an Impartial Decision-Making 135
4.2.2.7 Right to Trial 135
4.2.3 Rights of Third Parties 137
4.2.3.1 Right To Be Heard and Access to File 137
4.2.3.2 Right to Trial 138
4.2.3.3 Confidentiality and Publicity of the Transactional Solutions 138
4.3 Remedies in the Framework of Merger Control 138
4.3.1 Overview of the Merger Control Procedure 138
4.3.1.1 Negotiation of Remedies 138
4.3.1.2 Enforcement of Remedies 142
4.3.2 Fundamental and Procedural Rights 144
4.3.2.1 Right To Be Heard and to Access the File 144
4.3.2.2 Right to Trial 145
4.4 Conclusion and Recommendations 146
5: Brazil 147
5.1 Introduction 147
5.2 Transactional Resolution of Agreements and the Abuse of Dominance 149
5.2.1 Overview of Transactional Procedures 149
5.2.2 Discretion of Competition Authorities and/or Judges During Proceedings 151
5.2.3 Nature of the Legal Act Concluding, Approving and/or Making the Settlement Binding 153
5.2.4 Legal Consequences for the Parties 154
5.2.5 Fundamental and Procedural Rights of the Parties 155
5.2.5.1 Right Against Self-Incrimination and Presumption of Innocence 156
5.2.5.2 Right of the Parties to Know the Case Against Them (Statement of Objections) 158
5.2.5.3 Right To Be Heard and Access to File 160
5.2.5.4 Right to an Equal Treatment 160
5.2.5.5 Right to an Impartial Judge 160
5.2.5.6 Right to Trial 160
5.2.5.7 Ne Bis in Idem 161
5.2.6 Rights of Third Parties 161
5.2.6.1 Right To Be Heard and Access to File 161
5.2.6.2 Right to Trial 161
5.2.6.3 Other Issues and Rights 161
5.3 Principle of Legitimate Expectation and of Good Faith 162
5.4 Confidentiality and Publicity of the Transactional Solutions 163
5.5 Merger Control 163
5.5.1 Negotiation of Remedies 164
5.5.2 Enforcement of Remedies 165
5.5.3 Impact on Transactional Outcome and on Market Intervention 165
5.6 Conclusion and Recommendations 165
6: Czech Republic 167
6.1 Introduction 167
6.2 Transactional Resolution of Agreements and the Abuse of Dominance 170
6.2.1 Overview of Transactional Procedures 170
6.2.1.1 Leniency 170
6.2.1.2 Settlement 172
6.2.1.3 Commitments Decisions 174
6.2.1.4 Resolution of a Case Without Commencing Proceedings 175
6.2.2 Discretion of Competition Authorities and/or Judges During Proceedings 176
6.2.3 Nature of the Legal Act Concluding, Approving and/or Making Binding the Settlement 177
6.2.4 Legal Consequences for the Parties 178
6.3 Fundamental and Procedural Rights of the Parties 179
6.3.1 Right Against Self-Incrimination and Presumption of Innocence 179
6.3.2 Right of the Parties to Know the Case Against Them (Statement of Objections) 183
6.3.3 Right To Be Heard and Access to File 184
6.3.4 Right to an Equal Treatment 186
6.3.5 Right to an Impartial Judge 187
6.3.6 Right to Trial 188
6.3.7 Ne bis in Idem 188
6.4 Rights of Third Parties 189
6.4.1 Right To Be Heard and Access to File 189
6.4.2 Right to Trial 190
6.4.3 Right of Equal Treatment 190
6.4.4 Other Issues and Rights 190
6.4.5 Principle of Legitimate Expectation and of Good Faith 191
6.4.6 Confidentiality and Publicity of the Transactional Solutions 192
6.5 Merger Control 192
6.5.1 Negotiation of Remedies 193
6.5.2 Enforcement of Remedies 194
6.6 Impact on Transactional Outcome and on Market Intervention 195
6.7 Conclusion and Recommendations 196
7: France 197
7.1 Introduction 197
7.2 Overview of the French ``Transactional´´ Procedures 199
7.2.1 Leniency Program (Procédure de clémence) 199
7.2.1.1 Scope 200
7.2.1.2 Implementation 200
7.2.1.3 Procedure 202
7.2.1.4 Fundamental and Procedural Rights of the Parties 203
7.2.1.5 Third Parties 203
7.2.1.6 Risks for the Parties 204
7.2.2 Commitment Procedure (Procédure d´engagements) 205
7.2.2.1 Scope 206
7.2.2.2 Implementation 206
7.2.2.3 Procedure, Negotiation Process 207
7.2.2.4 Effects 208
7.2.2.5 Fundamental and Procedural Rights of the Parties 209
Access to the Case File 210
Right To Be Heard 210
Presumption of Innocence 210
Right to an Impartial Judge 210
Ne Bis In Idem 210
7.2.2.6 Third Parties 211
7.2.2.7 Risks for the Parties 211
7.2.3 Settlement Procedure (Procédure de non-contestation des griefs) 211
7.2.3.1 Scope 212
7.2.3.2 Implementation 212
7.2.3.3 Procedure 212
7.2.3.4 Effects 213
7.2.3.5 Third Parties 213
7.2.3.6 Fundamental Rights 214
7.2.3.7 Risks for the Parties 214
7.2.3.8 Combination of Procedures 214
8: Germany 215
8.1 Introduction 215
8.2 Transactional Elements in Administrative Offence Proceedings 218
8.2.1 Leniency Policy 218
8.2.1.1 Legal Basis 218
8.2.2 Content and Practical Application 219
8.2.3 Compatibility with the Rule of Law 221
8.2.3.1 Scholarly Controversies 221
Competence of the FCO to Adopt and Operate a Leniency Programme 221
Rights of Defence and Procedural Rights 221
Principle of Equal Treatment and Proportionality 223
8.2.3.2 Existing Case Law 224
8.2.4 Settlements (einvernehmlicher Bußgeldbescheid) 224
8.2.5 Legal Requirements 225
8.2.6 Course of the Procedure 226
8.2.6.1 Scope of Application 227
8.2.6.2 Settlement Discussions 228
8.2.6.3 Settlement Contents 229
8.2.6.4 Conclusion and Rewards 231
8.2.7 Control and Transparency 234
8.2.8 Overall Assessment 235
8.3 (Negotiated) Agreements on the Further Course and Outcome in Criminal Proceedings 237
8.4 Settlements in Administrative Proceedings 240
8.4.1 Settlements as Part of Administrative Proceedings in General 240
8.4.2 Commitments 240
8.4.2.1 Purpose and Scope of Application 240
8.4.2.2 Procedure and Content 241
8.4.2.3 Enforcement 242
8.4.2.4 Possibilities to Rescind 243
8.4.2.5 Appeal 243
8.4.2.6 Overall Assessment 244
8.5 Transactional Resolutions vs Private Enforcement: Access to File by Third Parties 246
8.5.1 The Tension Between Transactional Resolutions and Private Enforcement in the Current Legal Framework 246
8.5.2 Access to Leniency Applications and Settlement Declarations in Current German Law 248
8.5.2.1 Direct Access to File by the Cartel Victim Pursuant to Sec. 406e of the StPO, 46(1) of the OWiG 248
8.5.2.2 Access to File by a Civil Court (Sec. 142(1), 273(2) No. 2 or 432 of the ZPO in Conjunction with Sec. 474(1) of the St... 250
8.5.3 Changes due to the Damages Directive 253
8.6 Commitments (Remedies) in Merger Control 254
8.6.1 Background and Current Legal Basis 254
8.6.2 Procedure in Case of Commitments 255
8.6.3 Possible Content 257
8.6.4 Enforcement and Appeal 259
9: Hungary 260
9.1 Introduction 260
9.2 Transactional Resolution of Agreements and the Abuse of Dominance 262
9.2.1 Overview of Transactional Procedures 262
9.2.1.1 Leniency 262
9.2.1.2 Commitments 263
9.2.1.3 Settlement 264
9.2.2 Discretion of Competition Authorities and/or Judges During Proceedings 265
9.2.3 Nature of the Legal Act Concluding, Approving, or Making Binding the Settlement 267
9.2.4 Legal Consequences for the Parties 268
9.2.5 Fundamental and Procedural Rights of the Parties 270
9.2.5.1 Right to Withdraw Declarations and the Use of Such Declarations by the HCA 270
9.2.5.2 Disclosure of Documents to Third Parties 270
9.2.5.3 Waiver of the Right to Challenge the HCA´s Decision in Case of a Settlement Procedure 271
9.2.6 Right Against Self-Incrimination and Presumption of Innocence 272
9.2.7 Right of the Parties to Know the Case Against Them (Statement of Objections) 274
9.2.8 Right To Be Heard and Access to File 276
9.2.9 Right to an Equal Treatment 277
9.2.10 Right to an Impartial Judge 278
9.2.11 Right to Trial 279
9.2.12 Ne bis in idem 280
9.3 Rights of Third Parties 283
9.3.1 Right To Be Heard and Access to File 283
9.3.2 Right to a Trial 284
9.3.3 Right of Equal Treatment 285
9.3.4 Principle of Legitimate Expectation and of Good Faith 286
9.3.5 Confidentiality and Publicity of the Transactional Solutions 287
9.4 Merger Control 287
9.4.1 Negotiation of Remedies 288
9.4.2 Enforcement of Remedies 290
9.5 Conclusion and Recommendations 291
10: Italy 293
10.1 Introduction 293
10.1.1 Transactional Institutions: General Framework 293
10.1.2 Transactional Institutions in Competition Law 295
10.1.3 Common Features and Rationale of Transactional Procedures in Competition Law 297
10.2 Transactional Resolution of Agreements and the Abuse of Dominance 297
10.2.1 Decisions with Commitments 297
10.2.1.1 General Legal Framework and Procedure 297
10.2.1.2 Decisions with Commitments: Pros and Cons 300
10.2.2 Leniency Programs 302
10.2.2.1 Legal and Procedural Framework 302
10.2.2.2 Leniency Programs: Pros and Cons 304
10.2.3 Fundamental and Procedural Rights of the Parties 305
10.2.3.1 General Procedural Issues 305
10.2.3.2 Statement of Objections 306
10.2.3.3 Right To Be Heard and Access to File 306
10.2.3.4 Right Against Self-Incrimination 307
10.2.3.5 Leniency Programs and Rights of the Parties 308
10.2.3.6 Legal Effects of Decisions Further to Transactional Procedures 308
10.2.3.7 Judicial Review 309
10.2.3.8 Noncompliance with a Decision 310
10.3 Merger Control 311
10.4 Impact on Transactional Outcome and on Market Intervention 312
10.5 Conclusions 312
11: Poland 315
11.1 Introduction 315
11.2 Transactional Resolution in Case of Agreements and the Abuse of Dominance 317
11.2.1 Overview of Transactional Procedures 317
11.2.1.1 Commitment Decisions 317
Commitment Decision vs. Admission of Guilt 318
Timing to Apply for a Commitment Decision 318
Commitment Decisions and Third Parties´ Involvement 319
Commitment Decisions and Third Parties´ Interests 319
Commitments Procedure 319
11.2.1.2 Leniency Program 320
Leniency Procedure 320
Leniency Plus Program 322
Settlement Procedure 322
11.2.1.3 Discretion of Competition Authorities During Proceedings 323
11.2.1.4 Nature of the Settlement Decision 324
11.2.2 Fundamental and Procedural Rights of the Parties 325
11.2.2.1 Right Against Self-Incrimination and Presumption of Innocence 325
Duty to Provide Information 325
Legal Professional Privilege 325
Right Against Self-Incrimination 326
11.2.2.2 Right of the Parties to Be Informed About the Case (Statement of Objections) 326
11.2.2.3 Right to Be Heard and Access to the File 327
11.2.2.4 Right to an Equal Treatment 328
11.2.2.5 Right to Trial 328
11.2.2.6 Ne Bis in Idem 329
11.2.3 Rights of Third Parties 330
11.2.3.1 Right to Be Heard and Access to the File 330
11.2.3.2 Right to Trial 330
11.2.3.3 Confidentiality and Publicity of the Transactional Solutions 330
11.3 Commitments and Merger Control 331
11.3.1 Substantive Provisions 331
11.3.2 Clearance Decision 331
11.3.3 Commitments 331
11.3.3.1 Behavioral Commitments 332
11.3.3.2 Structural Commitments 333
11.3.4 Negotiation of Remedies 333
11.3.4.1 Discussion on Commitments 333
11.3.4.2 Third Parties´ Rights 334
11.3.4.3 Appellate Rights 335
11.3.5 Enforcement of Remedies 335
11.4 Impact on Transactional Outcome and on Market Intervention 336
11.4.1 Antitrust 336
11.4.2 Mergers 337
11.5 Conclusion and Recommendations 338
12: Serbia 339
12.1 Introduction 339
12.1.1 Transactional Proceedings in Serbia 339
12.1.2 Overview of General (Nontransactional) Competition Infringement Proceedings 340
12.2 Transactional Resolution of Agreements and the Abuse of Dominance 341
12.2.1 Overview of Transactional Proceedings 341
12.2.1.1 Leniency 341
12.2.1.2 Commitment Decision 344
12.2.2 Discretion of Competition Authorities During Proceedings 344
12.2.3 Legal Nature of the Transactional Decisions 345
12.2.4 Legal Consequences for the Parties 345
12.3 Fundamental and Procedural Rights of the Parties 346
12.3.1 Right Against Self-Incrimination and Presumption of Innocence 346
12.3.2 Right of the Parties to Know the Case Against Them (Statement of Objections) 347
12.3.3 Right To Be Heard and Access to File 348
12.3.4 Right to an Impartial Judge 348
12.3.5 Right to Trial 348
12.3.6 Ne bis in idem 349
12.4 Rights of Third Parties 350
12.4.1 Right To Be Heard and Access to File 350
12.4.2 Right to Trial 350
12.4.3 Follow-on Actions 351
12.4.4 Confidentiality and Publicity of the Transactional Solutions 352
12.5 Merger Control 353
12.5.1 Negotiation of Remedies 353
12.5.2 Enforcement of Remedies 354
12.6 Impact on Transactional Outcome and on Market Intervention 355
12.7 Conclusion and Recommendations 355
13: Spain 357
13.1 Introduction 357
13.1.1 Background and Legal Basis 359
13.1.2 Benefits of Negotiated Solutions 360
13.2 Termination of Infringement Proceedings by Commitment 361
13.2.1 Overview of Settlement Procedures 361
13.2.2 Start and Timing of the Negotiation with the Authority 361
13.2.3 Discretion of the Spanish Competition Authority 362
13.2.4 Content of the Agreement 364
13.2.5 Content of the Termination Resolution 365
13.2.6 Third Parties and Termination by Commitments 365
13.2.7 Nature of the Settlement 366
13.3 Leniency and Fine Reduction Programmes 367
13.3.1 Introductory Remarks 367
13.3.2 Cooperation Duties of the Undertakings 368
13.3.3 Fundamental and Procedural Rights of Leniency Applicants 369
13.3.4 Rights of the Undertakings and CNMC Powers of Investigation 370
13.3.5 Legal Privilege 371
13.3.6 Protection of Confidentiality and Disclosure Rules 371
13.4 Conclusions 372
Appendix 1: Procedures Finalised by a Commitment Decision 373
Appendix 2: Decisions Where the Leniency Programme Has Been Applied 374
14: Sweden 375
14.1 Introduction 375
14.2 Transactional Resolutions of Agreements and the Abuse of Dominance 376
14.2.1 Commitments 377
14.2.2 Leniency 379
14.2.2.1 Immunity from Fines 379
14.2.2.2 Reduction of Fines 380
14.2.3 Settlements 380
14.2.4 Fundamental and Procedural Rights of the Parties 382
14.2.4.1 The Administrative Procedure Act 384
14.2.4.2 Right Against Self-Incrimination and Presumption of Innocence 385
14.2.4.3 Right to Be Heard and Access to the File 386
14.2.4.4 Right to an Impartial Judge 387
14.2.4.5 Right to a Trial 387
14.2.4.6 Ne Bis In Idem 387
14.2.5 Rights of Third Parties 388
14.2.5.1 Right to Be Heard and Access to the File 388
14.2.5.2 Right to Trial 389
14.2.5.3 Principle of Legitimate Expectations and of Good Faith 389
14.2.5.4 Confidentiality and Publicity of the Transactional Resolutions 389
14.3 Merger Control 389
14.3.1 Negotiation of Remedies 390
14.4 Impact on Transactional Outcome and on Market Intervention 391
14.5 Conclusions and Recommendations 391
15: Switzerland 394
15.1 Introduction 394
15.2 Transactional Resolutions 395
15.2.1 Overview of Transactional Proceedings 395
15.2.1.1 Commitments During the Preliminary Investigation (Article 26 CartA) 396
15.2.1.2 Amicable Settlements During Formal Investigations (Article 29 CartA) 396
15.2.1.3 Leniency Program 397
15.2.2 Discretionary Power of Competition Authorities 399
15.2.2.1 Practical Approach 399
15.2.3 Nature of the Legal Act Concluding, Approving, and Making Binding the Settlement 400
15.2.3.1 Legal Consequences for the Parties 401
15.2.4 Fundamental and Procedural Rights of the Parties 401
15.2.4.1 Procedure 401
15.2.4.2 Considerations When Entering into an Amicable Settlement or Making Use of the Leniency Program 402
15.2.4.3 Right Against Self-incrimination and Presumption of Innocence 403
15.2.4.4 Right To Be Heard and Access to the File 404
15.2.4.5 Right to Equal Treatment 405
15.2.4.6 Right to an Impartial Judge 405
15.2.4.7 Right to Trial 406
15.3 Merger Control 406
16: United Kingdom 407
16.1 Introduction 407
16.2 CA98 Investigations 410
16.2.1 Informal Resolution 411
16.2.2 Commitments 411
16.2.3 Settlement Procedure 414
16.2.4 Leniency Programme 423
16.3 Merger Control 425
16.3.1 Phase 1 426
16.3.2 Phase 2 427
16.4 Market Studies and Investigations 429
16.4.1 Market Studies 429
16.4.2 Market Investigations 432
16.4.3 Conclusion 433
17: United States of America 435
17.1 Introduction and Executive Summary 435
17.2 The Constitutional Role and Powers of the Executive Branches in the United States and Its American States as They Pertain... 437
17.3 Civil and Criminal Settlements Not Only Allow the Executive in the United States to Achieve Important Goals But Also Play... 441
17.4 Criminal and Civil Investigatory and Trial Processes in the United States, Including the Right of Access of Defendants an... 446
17.5 Criminal Settlements 449
17.6 Civil Conduct Settlements Involving the United States Department of Justice 451
17.7 Civil Conduct Settlements Involving the United States Federal Trade Commission 453
17.8 Non-Parens Patriae Civil Antitrust Settlements Involving the American States 456
17.9 Parens Patriae Settlements Involving the American States 457
17.10 Extraterritorial Reach of American Antitrust Settlements 460
17.11 Recommendations of U.S. Group on a Question A Regarding Antitrust Settlements 461
Part II: Online Exhaustion of IP Rights 463
18: International Report 464
18.1 Foreword 464
18.2 Introduction 464
18.3 Background 465
18.3.1 The Extraordinary Diffusion of the Internet 465
18.3.2 The Internet as the Flywheel of E-Commerce 466
18.3.3 Dematerialization and Entertainment Industries 466
18.3.4 Dematerialization of Distribution Channels 466
18.3.5 The Increasing Importance of IP 466
18.3.6 The Increasing Importance of Copyright 466
18.4 The Exhaustion Principle: From Parallel Import to Exhaustion 467
18.4.1 The Exhaustion Principle as We Know It 467
18.4.2 The Exhaustion in the Case Law of the Court of Justice 467
18.4.3 Parallel Import 468
18.4.4 The EU Theory of Exhaustion 468
18.5 The Principle of Exhaustion in the EU Member States and Outside the European Union 469
18.5.1 The Principle of Exhaustion in the National Law of the EU Member States 469
18.5.2 The Principle of Exhaustion in the Case Law of the EU Member States 472
18.5.3 A First Conclusion: The Principle of Exhaustion as a General Principle of EU Industrial Property Laws 473
18.5.4 The Community ``Non-exhaustion´´ Principle 473
18.5.5 The Exhaustion Principle in EU Law (Regulations, Directives, and Conventions) 473
18.5.6 The Exhaustion Principle in International Conventions with the Purpose of Favoring International Trade 474
18.5.7 The Exhaustion Principle in Copyright Law 474
18.5.8 The Exhaustion Principle in Extracommunity Countries 475
18.5.8.1 Statutes 475
18.5.8.2 Case Law 476
18.6 The Oracle Case 478
18.6.1 The Facts 478
18.6.2 The European Court Decision 478
18.6.3 The Effects of the Oracle Decision. The Restrictive Construction 480
18.7 Beyond the Oracle Case 480
18.7.1 The Particular Nature of the ``Exhausted´´ Good and the Increasing Importance of Electronic Commerce 480
18.7.2 Exhaustion and Corpus Mysticum 481
18.7.3 Exhaustion: Material Goods and ``Dematerialized´´ Goods 482
18.7.4 Beyond the Oracle. To Delete the ``Original´´ 483
18.7.5 After Oracle. A French Case 483
18.7.6 After Oracle. Nintendo 484
18.7.7 Towards a Conclusion. Software Is a Subject Matter Protected by Copyright or Not? 485
18.8 Law in the Cyberspace and the Exhaustion Principle 486
18.8.1 Going to the Merits. Doing Business in the Cyberspace 486
18.8.2 ``Traditional Industry´´/``Online Industry´´ 486
18.8.3 The Increasing Relevance of Online Industry: Some Data 487
18.8.4 The Regulation of E-Commerce 488
18.8.5 A Sale in the Cyberspace 490
18.8.6 The Developing of a ``Secondary Market´´ for Digital Goods 490
18.8.7 No ``Secondary Market´´ for Digital Goods in the US According to the District Court for the Southern District of New Yo... 491
18.8.8 Future Developments in Exhaustion: Cloud Computing, Streaming, and Other ``Modernities´´ 492
18.9 Online Infringement of Intellectual Property Rights 492
18.9.1 Online Infringement of Intellectual Property Rights: National Answers on the Merits 492
18.9.2 National Laws and Online Infringements 493
18.9.3 Enforcing a Decision Against a Foreign Infringer 494
18.10 Conclusion and LIDC Resolution 495
18.10.1 Conclusion 495
18.10.2 LIDC Resolution 496
19: Austria 498
19.1 Exhaustion of IP Rights 498
19.1.1 Exhaustion of Copyright in Austria 498
19.1.2 Exhaustion of Trademark Right in Austria 499
19.1.3 Exhaustion of Design Rights in Austria 501
19.1.4 Exhaustion of Patent Rights in Austria 502
19.1.5 Exhaustion of Plant Variety Rights in Austria 502
19.1.6 Does the ``General Principle of Exhaustion Within the EU´´ Exist in Austria 503
19.2 Exhaustion of IP Rights in Austria-And Possible Influence by EU (Case) Law 503
19.3 ``Traditional Industry´´/``On-Line Industry´´ in Austria-And Exhaustion of IP Rights 504
19.3.1 Factual Background 504
19.3.2 Overview of ``E-Commerce Law´´ in Austria 505
19.3.3 Exhaustion of IP Rights and Austrian ``On-Line Industry´´ 506
19.4 IP Rights and ``On-Line Industry´´: Infringement and Remedies in Austria 508
19.5 Exhaustion of IP Rights in Austria and Whether It Undermines Protection or Leads to Unjustified Advantages 511
19.6 Conclusions and Recommendations 512
20: Belgium 514
20.1 Introduction 514
20.2 The Principle of Exhaustion According to Belgian and European Law 515
20.2.1 Notion 515
20.2.2 The Legal Framework in Belgium and the European Economic Area 516
20.3 Background of and Limitations to the Principle of Exhaustion 518
20.3.1 A Balance Between Free Movement of Goods and Intellectual Property Rights 518
20.3.2 Consensus Regarding the Traditional Industry: The Principle of Exhaustion Is Limited to the Distribution of Goods by Me... 519
20.3.2.1 Exclusion of Services 520
20.3.2.2 The Sale of an Identical Copy on a Tangible Support 521
An Identical Copy 521
A Sale 522
By Means of a Tangible Support 523
20.4 UsedSoft v Oracle: The Beginning of Digital Exhaustion 525
20.4.1 Facts 525
20.4.2 The Decision of the Court 526
20.4.2.1 A License Agreement Can Constitute a ``Sale,´´ and a Sale Can Relate to a Tangible as Well as to an Intangible Good 526
20.4.2.2 Exhaustion of the Right of Communication to the Public But Not of the Right of Reproduction 528
20.4.2.3 The Second Acquirer Is a ``Lawful Acquirer´´ and Therefore Allowed to Use the Copy of the Computer Program 528
20.4.3 The Post UsedSoft Period: Perhaps an Isolated Case, Limited to Computer Programs 529
20.4.3.1 The Recent Nintendo v PC Box Decision 529
20.4.3.2 The Present Legal Framework Is Not Adapted to an Extension to Other Works 530
20.5 Intellectual Property Rights and Online Industry: Infringement and Remedies 533
20.6 Conclusion 535
21: Brazil 540
21.1 Exhaustion of IP Rights 540
21.2 ``Traditional Industry´´/``On Line Industry´´ 541
21.3 Exhaustion of IP Rights in ``On Line Industry´´ 542
21.4 IP Rights and Online Industry: Infringement and Remedies 543
21.5 Conclusion 544
22: Bulgaria 545
22.1 Exhaustion of IP Rights 545
22.1.1 General Notes 545
22.1.2 Exhaustion of Copyright and Related Rights 546
22.1.3 Exhaustion of Industrial Property Rights 547
22.1.4 Bulgarian Court Practice on Exhaustion of IP Rights 548
22.1.4.1 Exhaustion of Copyright and Related Rights 548
22.1.4.2 Exhaustion of Industrial Property Rights 549
22.2 ``Traditional Industry´´/``On-Line Industry´´ 550
22.3 Exhaustion of IP Rights in the ``On-Line Industry´´ 551
22.3.1 Bulgarian Court Practice on Exhaustion of IP Rights in the ``On-Line Industry´´ 551
22.3.2 Article 18a, para. 3 of the LCRR in the Light of the Case UsedSoft GmbH v Oracle International Corp. 551
22.3.3 Contractual Restriction of the Usage of Works 552
22.4 IP Rights and On-Line Industry: Infringement and Remedies 553
22.4.1 Single Concept of Infringement of IP Rights 553
22.4.2 Remedies Available in Case of an ``On-Line Infringement´´ 553
22.4.3 Preliminary (Interim) Proceedings with Respect to IP Infringements 554
22.5 Conclusion and Recommendations 555
23: Czech Republic 556
23.1 Author´s Act No. 121/2000 Coll. 556
23.2 The Trademark Act 559
23.3 European Perspective 560
24: France 563
24.1 Introduction 563
24.2 Application of the Principle of Exhaustion of IP Rights to the ``Traditional Industry´´ 564
24.2.1 Conditions 564
24.2.1.1 First Introduction on the Market Within the European Economic Area Territory 564
24.2.1.2 Consent of the Holder to the Introduction on the Market 565
24.2.2 Limits 567
24.2.2.1 Inherent Limits to Trademark Law 567
24.2.2.2 Inherent Limits to Copyright and Related Rights 568
24.3 Application of the Principle of Exhaustion of IP Rights to the ``Online Industry´´ 569
24.3.1 Tangible Good 569
24.3.1.1 Identical Application 569
24.3.1.2 Specific Case of Software 569
24.3.2 Intangible Good 570
24.3.2.1 Impulse by the Court of Justice 571
24.3.2.2 French Application 571
24.3.2.3 Issues and Perspectives 572
24.4 Concept of E-Commerce 573
24.4.1 Definition of E-Commerce 573
24.4.1.1 European Definition 573
24.4.1.2 French Definition 574
24.4.2 New Types of E-Commerce and Their Integration on the DSM 574
24.4.2.1 New Types of E-commerce 574
24.4.2.2 The Digital Single Market 575
24.4.3 Contracts Concluded by Electronic Means 575
24.4.3.1 The Consent of the Online Consumer 575
24.4.3.2 Protection of the Online Consumer 576
24.4.4 Towards a Digital Commercial Establishment 577
24.5 Online Infringements to Copyright 577
24.5.1 New Types of Online Intellectual Property Infringements 578
24.5.1.1 Illicit Reservation of Domain Names 578
24.5.1.2 Illegal Downloads 578
24.5.1.3 Illicit Sales on an Internet Platform 579
24.5.2 The Particularity of the Online Intermediaries´ Liability 579
24.5.3 Adaptation of the Legal Proceeding for Counterfeit to Online Infringements 580
24.5.4 Competent Jurisdiction and Applicable Law to a Trademark Infringement 581
24.6 Conclusion 581
25: Germany 583
25.1 The Principle of Exhaustion of IP Rights and Copyrights in German Law 583
25.1.1 General Thoughts 583
25.1.2 Copyright Law 584
25.1.2.1 Section 17(2) Copyright Act 584
25.1.2.2 Section 69c no. 3 Sentence 2 Copyright Act 585
25.1.3 Patent Law 586
25.1.4 Trademark Law 586
25.1.5 Design Law 588
25.2 ``Traditional Industry´´ Versus ``Online Industry´´ 588
25.3 The Principle of Exhaustion in the Online Industry 590
25.3.1 Introduction 590
25.3.2 The Principle of Exhaustion with Regard to Immaterial Goods 590
25.3.2.1 Analogous Application of Section 69c no. 3 Sentence 2 Copyright Act 591
25.3.2.2 Exception to the Restricted Act of Reproduction Pursuant to Section 69d(1) Copyright Act 592
25.3.2.3 Key Points Regarding CJEU UsedSoft 593
25.3.2.4 Conclusions from CJEU UsedSoft and the Subsequent Decision of the BGH 595
25.3.2.5 Splitting Up Client-Server Licences Respectively Volume Licences 597
Problem Identification 597
Findings from CJEU UsedSoft and Client-Server Licences 597
Volume Licences 598
25.3.2.6 Issues in Relation to Maintenance Agreements 599
25.3.2.7 The Significance of Technical Measures 600
25.3.3 Application of the Principle of Exhaustion to Other Digital Goods 602
25.4 Infringement and Remedies 605
25.5 Conclusion and Recommendations 607
26: Hungary 609
26.1 Introduction 609
26.1.1 Exhaustion of IP Rights 609
26.1.2 IP Rights Are Subject to the Principle of Exhaustion 610
26.1.3 Leading Cases 611
26.1.4 Limits of the Principle of Exhaustion of IP Rights 611
26.1.5 Influence of EU Principles 612
26.2 ``Traditional Industry´´ Versus ``On-Line Industry´´ 612
26.2.1 Definition of ``On-Line Industry´´ 612
26.2.2 No Particular Regulation of the ``On-Line Industry´´ 613
26.3 Exhaustion of IP Rights in the ``On-Line Industry´´ 613
26.3.1 Case Law 613
26.3.1.1 Decision Nr. 512/B/2004 (Constitutional Court of Hungary) 613
26.3.1.2 Case Nr 8.Pf.20.136/2009/5. (Metropolitan Court of Appeal) 614
26.3.1.3 Case Nr 8.Pf.21.210/2010/5. (Metropolitan Court of Appeal) 614
26.3.2 Application of the ``Principle of Exhaustion of IP Rights´´ in ``Traditional Industry´´ Versus ``On-Line Industry´´ 614
26.3.2.1 Case Nr 8.Pf.20.229/2011/4. (Metropolitan Court of Appeal) 615
26.3.2.2 Case Nr 8.Pf.21.062/2008/4. (Metropolitan Court of Appeal) 615
26.3.3 Influence of the EU Case Law 615
26.3.4 Enforceability of Contractual Restrictions 616
26.4 IP Rights and Online industry: Infringements and Remedies 616
26.4.1 Concept ``On-Line Infringement´´ of IP Rights 616
26.4.2 Interim Proceedings 617
26.4.3 Implementation Difficulties 618
26.5 Conclusion and Recommendations 618
27: Italy 620
27.1 Overall Principle 620
27.2 Conditions 621
27.2.1 Placing on the Market 621
27.2.2 Consent 622
27.3 Limits to the Exhaustion Principle 623
27.4 ``Traditional Industry´´/``Online Industry´´ 625
27.5 Exhaustion of IP Rights in the ``Online Industry´´ 626
27.5.1 The Online Exhaustion of Intellectual Property Rights 626
27.5.2 The Online Exhaustion of Copyrighted Works 628
27.6 Infringement 629
27.6.1 Online Infringements of Intellectual Property Rights 629
27.6.2 Online Infringements of Copyrights 632
27.7 Conclusion and Recommendations 633
28: Switzerland 635
28.1 Introduction 635
28.2 Exhaustion of IP Rights in the Brick-and-Mortar World 637
28.2.1 Principle of Exhaustion Across IP Rights 637
28.2.2 Some Policy Considerations 639
28.2.2.1 Interests of IP Owners and End Users 639
28.2.2.2 Attention Paid to Foreign Standards 640
28.3 Exhaustion of Copyright in the Online Industry 640
28.3.1 Preliminary Observations 640
28.3.2 Is the Distribution Right Really at Stake? 641
28.3.2.1 Conundrum: The Distribution Medium 641
Opposing Positions in the Swiss Literature 641
A Look at EU Law 643
Personal Opinion 644
28.3.2.2 Concept of Transfer: A Relatively Broad Interpretation 645
28.3.3 Reproduction Right: No Self-Standing Issue 646
28.3.4 Taking into Account the (Dis)similarity of the Physical and Online Transfers 647
28.3.4.1 Economic Similarity: An Argument for Exhaustion 647
28.3.4.2 Grounds for Rejection 648
Absence of Loophole in Swiss Law 648
Technological Differences 649
Need to Preserve a Level Playing Field 650
28.3.4.3 Lessons from Nintendo and UsedSoft? 651
28.4 Exhaustion of Other IP Rights in the Online Industry 651
28.5 Contracting Around Exhaustion 652
28.5.1 Intellectual Property and Contract Laws 652
28.5.2 Competition Law 653
28.5.2.1 Material Scope 653
28.5.2.2 Unlawful Agreements 654
28.5.2.3 Abuse of a Dominant Position 655
28.6 Some (Practical) Considerations Relating to Remedies 656
28.7 Conclusion 657
29: United Kingdom 659
29.1 Introduction 659
29.2 From Implied Licence to Exhaustion 661
29.2.1 The English Courts´ Historical Approach 661
29.2.2 Exhaustion 662
29.3 Application of Exhaustion Principles to an Online World 664
29.4 Limiting the IP Holder´s Control over Secondary and Subsequent Dealings 668
29.4.1 Essential Subject Matter 668
29.5 Temporary Copying Exception 671
29.6 Making Available to the ``Same Public´´ 673
29.7 Retransmission as a New ``Making Available´´ 673
29.8 ``Traditional Industry´´/``On Line Industry´´ 674
29.9 Exhaustion of IP Rights in ``On Line Industry´´ 674
29.9.1 Online ``Exhaustion of IP Rights´´ Cases 674
29.9.2 ``Traditional Industry´´ vs ``On-Line Industry´´ 674
29.9.3 Local Application of Usedsoft 675
29.9.4 Read Across of Usedsoft to Non-software Works 675
29.9.5 Contractual Enforceability 675
29.9.6 Kirtsaeng and Monsanto 676
29.9.7 Evidence That ``On-Line Industry´´ Practices Are Impacted 676
29.10 IP Rights and Online Industry: Infringement and Remedies 676
29.10.1 Online Infringement 676
29.10.2 Digital Platform Infringement 677
29.10.3 Remedies for Online Infringement 677
29.10.4 Effectiveness of Remedies for Online Infringement 677
29.10.5 Preliminary Injunctions 677
29.11 Challenges in Execution 678
29.12 Conclusion 679
Annex 680