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EU and Competition Law News - Competition Law and Policy 2nd Quarter 2020 

by Ricardo Oliveira, Sara Estima Martins

Published: September, 2020

Submission: October, 2020


I. Portuguese Competition Authority

Portuguese Competition Authority publishes final version of its analysis of loyalty policies in telecommunication contracts

In April 2020, the Portuguese Competition Authority (PCA) published the final version of its report on "Loyalty policies in telecommunication services". Among its recommendations to the legislator and regulator of the sector, the PCA advocates that consumers should be able to terminate a contract, by phone or online, with the same ease and simplicity with which they can subscribe to a service. This possibility is especially important in the context of the current pandemic in which telecommunications services are critical for a large part of the Portuguese population.

The PCA is of the opinion that current loyalty policies reduce the share of consumers who are available to switch their telecommunications operator, thus wea kening incentives to competition. This is aggravated by the general practice of renewing these clauses and by other factors such as the complexity of the contract termination process or the lack of transparency in the information communicated.

Portuguese Competition Authority warns associations of the need to comply with competition rules in the context of the Covid-19 pandemic

On 21 May 2020, the Portuguese Competition Authority (PCA) issued guidelines to the ANF (National Association of Pharmacies), APB (Portuguese Association of Banks) and ASFAC (Association of Specialised Credit Institutions), reaff irming the need for compliance with competition rules in the current scenario of the Covid-19 pandemic.

The PCA's guidelines for the APB and ASFAC were based on the adoption of a moratorium to protect credit contracts in the context of the pandemic. In the PCA's view, these two associations should refrain from promoting exchanges of information between members that are not strictly necessary to define the credit moratorium rules to be applied. The guidance given to the NFA was based on a proposal regarding the maximum margin to be applied in the sale of individual products for protection against the pandemic.

The PCA also stated that it is available to provide informal guidance to companies that need to adopt forms of cooperation between each other. It also stated that any such measures will always have to be temporary and proportional to the issues that companies may face.

Portuguese Competition Authority imposes suspension of no-poach agreement as an interim measure

According to the PCA, it was necessary to take this interim measure while the investigation into the LPFP is ongoing, given the serious potential impact of this practice on competition rules.

The PCA argues these horizontal agreements, in which companies refrain from hiring workers from other companies, constitute severe restrictions of competition.

Portuguese Competition Authority accuses supermarket chains and Bimbo Donuts of illegal practice to the detriment of the consumer

On 24 June 2020, the Portuguese Competition Author it y (PCA) issued a Statement of Objections accusing three food distribution groups (Modelo Continente, Pingo Doce and Auchan) and Bimbo Donuts of an allegedly illegal practice involving the latter’s food products. The PCA concluded that there is evidence that these distribution companies used their commercial relationship with supplier Bimbo Donuts to align the retail prices of these products, to the detriment of consumers. The companies targeted by the decision will now have the opportunity to exercise their right of defence.

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