Bird & Bird partner and associate Federico Marini Balestra and Lucia Antonazzi have analysed the annulment of the €10.9m (£9.4m/$11.3m) fine given to CTS Eventim-owned TicketOne by the Italian Competition Authority (ICA) in 2021.
In October, the Italian Supreme Administrative Court ( ‘Consiglio di Stato’ in Italian or CDS) affirmed the Lazio Regional Administrative Tribunal/Court (Tar Lazio) judgement, which annulled the ICA’s decision to impose a €10.9m fine on live event ticketing company, CTS Eventim-owned TicketOne, for abuse of a dominant position in the ticket sales market in Italy.
TicketOne was initially fined in January 2021, before this was annulled earlier this year.
The partners explained that according to the ICA, CTS Eventim and TicketOne deployed a strategy which included exclusive agreements with main national event promoters; imposition of exclusivity clauses on local event promoters; agreements with smaller, local ticketing operators to sell tickets through TicketOne’s system; boycotting of competitors; and acquiring four of the main national event promoters.
In this judgement, the CDS agreed that the acquisitions and related exclusivity clauses may be justifiable and did not necessarily result in unlawful restriction.
The CDS found that the ICA had failed to examine the applicants’ defence sufficiently, surrounding the existence of a lawful purpose pursued by the acquisitions. The plan behind the acquisitions was to offer an integrated service to artists ranging from organisation to promotion and ticketing of live events.
According to the CDS, the acquisitions were aimed at mitigating the expansion of Live Nation and Ticketmaster, which had started to ramp up its ticketing activities in Italy, expanding its presence from the event promotion sector. The ICA’s lack of enquiry surrounded the effects of the contested conduct in the live event promotion market rather than the ticketing market.
The CDS believed that these acquisitions were in pursuit of a new business model and necessary to resist the market entry of Ticketmaster. Therefore, the CDS felt that the ICA should have further investigated the defence put forward by CTS Eventim and TicketOne, particularly around the acquisitions in relation to the entry of a main competitor into the market.
Balestra and Antonazzi also noted: “The CDS further stressed that the ICA should also have looked at the live event promotion market, bearing in mind that the settled EU case law has repeatedly stated that dominant companies may defend themselves against their competitors, but must do so by means of ‘normal’ competition, i.e. competition based on the merits.”
However, the CDS did feel that retaliatory conduct and boycotts against other operators may constitute abuses of dominance and that this required further investigations by the ICA.
“Finally, the CDS did not accept the position of TAR Lazio with regard to the interaction between the EU Merger Regulation and Articles 101 and 102 TFEU,” added Balestra and Antonazzi.
The full judgement is available here (Italian).