GTM

Written by Jacob B. Pankowski and Stephen C. Tupper

As a general rule, high-value government contracts in the EU must not be awarded by public authorities without first complying with the detailed EU procurement rules designed to ensure non-discriminatory access to such contracting opportunities and “value-for-money” for public authorities and, ultimately, EU taxpayers. However, due to national sensitivities in the EU Member States, the defence procurement market was traditionally largely exempt from the EU public procurement regime. That position changed in August 2011 when the EU’s newly liberalised defence procurement regime officially opened for business.

It is still too early to judge whether the reforms are having the desired effect-namely to increase the level and intensity of international competition for the EU’s estimated annual defence spend of over €170 billion. Ultimately the success of the initiative will depend on the confluence of two phenomena: (i) total commitment on the part of national contract authorities to look beyond their “national champions” to the better deals being offered by foreign suppliers; and (ii) enthusiastic engagement by foreign suppliers in the new market(s). Should either fail to materialise then the market opening will almost certainly be deemed a damp squib.
Continue Reading The UK’s Defence Department turns to the private sector

Written by Jacob B. Pankowski and Stephen C. Tupper

Two recent announcements indicate a desire by the UK’s Ministry of Defence (MOD) to rely more heavily on the private sector in the coming years — thus creating potential new markets for U.S. defense contractors.

First, on July 5, 2012, the MOD announced the creation of the “whole force concept” under which it plans to ax a substantial part of the British Army, cutting regular troop numbers from 102,000 to 82,000. In their place, support contractors would be tapped, most likely in the areas of logistics and mechanical engineering, among others. While it remains unclear when this move to incorporate more private sector contractors into the “whole force concept” will occur, major U.S. support providers are already lining up to participate.

Second, the MOD also recently announced that it is considering outsourcing its entire $22 billion annual procurement and support organization, as early as 2013. This effort would, at least, partially privatize the UK’s Defence Equipment and Support (DE&S) organization. The MOD has already selected 15 companies for market testing talks to determine the best way to implement this massive privatization. It is unclear what ultimate shape the new organization would take but this is clearly an opportunity for U.S. contractors.
Continue Reading New Opportunities for U.S. Defense Contractors as UK Looks to ‘Outsource’ Jobs to Private Sector

Written by Simon Harms and Lisa Navarro

On 15 March 2012, the UK’s Department for Business Innovation and Skills (“BIS”) announced its plans for the reform of the UK competition regime. These proposals were crystallised on 23 May 2012 in the Enterprise and Regulatory Reform Bill (the “Bill”).

The proposals set out in the Bill include amendments to the existing legal rules and certain procedures, as well as a major structural shakeup of the enforcement institutions, the Office of Fair Trading (“OFT”) and the Competition Commission (“CC”). As part of a wider rationalisation of UK governmental organisations, the OFT and CC are to be merged into a single entity, the Competition and Markets Authority (“CMA”) by April 2014.

This article highlights the main institutional and operational changes that will accompany this structural shift. It goes on to consider other key proposals contained in the Bill relating to merger control and the criminal “cartel offence”.
Continue Reading Reform of the UK competition regime

Written by Stephen C. Tupper

Last year, the European Commission (the “Commission”) announced in its first annual report on trade and investment barriers that one of the items on its “to-do” list was to find a way to eradicate trading obstacles faced by EU exporters in certain markets outside the EU, where the same obstacles were not faced by exporters located in such jurisdictions seeking access to their counterpart markets within the EU. The Commission stated at the time that it intended to take action which was “assertive” in order to have a real impact on behaviour. These “assertive” measures have now been laid out in a proposal for a Regulation which aims to encourage bilateral agreements of cooperation and reciprocity in the procurement markets between the EU and non-EU countries.
Continue Reading Commission launches ‘assertive’ campaign to open up procurement markets outside the EU

Written by Stephen C. Tupper

Thames Water has been engaged in battle with Ofwat and Independent Water Networks Limited (“IWNL”) for the right to supply the 67-acre King’s Cross redevelopment site with water and sewerage services for several years. A recent decision from the Court of Appeal has brought proceedings to an end by rejecting Thames Water’s appeal against the judicial review decision which confirmed that Ofwat was acting within its powers by granting an inset appointment to IWNL over the site.

Background

In the UK, water and sewerage services are generally supplied by companies which have been granted regional monopolies. These incumbent companies are, for the most part, the sole providers of water and sewerage services in their designated regions (e.g. Thames Water in London). In an attempt to introduce a level of competitiveness to this market Ofwat are, in some circumstances, able to grant “inset appointments” to third parties who make an application to take over supplying a specific premises within the incumbent’s geographical region (e.g. IWNL for the King’s Cross redevelopment site).
Continue Reading The Battle of King’s Cross

Written by Ifé O. Adebajo and Lisa Navarro

In January 2012, the highly publicised bribery case against the UK construction company Mabey & Johnson Limited (“M&J“) reached a climactic conclusion. The resulting decision has sent shockwaves through the hearts and wallets of shareholders and investors with interests in entities that carry on business in the UK.

Background

In 2009, M&J pleaded guilty to corruption offences and breach of UN sanctions for making payments of over £250,000 to Saddam Hussein’s Iraqi government in order to secure bridge-building contracts. In addition to custodial sentences being imposed on the responsible directors, M&J was fined £6.6 million and a comprehensive upheaval of its anti-bribery and corruption policies followed.
Continue Reading Bribery Update – Warning bells sound for investors

Written by Lisa Navarro and Stephen C. Tupper

On 1 December 2012 the Court of Appeal (“CA“) upheld the High Court’s decision in the dispute between Wayne Rooney and his former management company, Proactive Sports Management Limited (“Proactive“). The case centred around whether or not the image rights agreement (the “Agreement“) that Wayne Rooney entered into with Proactive when he was 17 was unenforceable by reason of it being in restraint of trade. The High Court and the CA agreed that it was.

The Agreement appointed Proactive as Rooney’s sole and exclusive representative with regard to the exploitation of Rooney’s image rights. It was entered into in 2003 for a term of eight years and entitled Proactive to a 20% commission on all relevant contracts and arrangements negotiated by Proactive. As noted above, Rooney was only 17 at the time and did not take legal advice when signing up to the Agreement.
Continue Reading Rooney and restraint of trade – the doctrine is still alive and kicking

Written by Simon Harms and Stephen C. Tupper

1. Background

A significant number of countries worldwide now operate mandatory merger control regimes. Cross-border M&A activity, as a result, increasingly involves notifications in several jurisdictions. Most regimes are national in scope, however, important supranational merger control regimes exist – such as European Union (“EU”) merger control.

Whilst EU merger control operates as a “one-stop shop” for the entire EU1for transactions meeting certain thresholds, 26 of the 27 EU Member States2 operate national merger control regimes for transactions that do not. As a result, many transactions require notification to multiple merger control authorities within the EU, each subject to its own procedural and substantive rules which vary significantly from jurisdiction to jurisdiction.3
Continue Reading Streamlining multi-jurisdictional merger control in a globalised world – best practices

Written by Simon Harms and Stephen C. Tupper

In September 2011, the Court of Justice of the European Union (the “CJEU”), handed down its judgment in the latest of a series of successful challenges to the European Commission’s (the “Commission”) practice of holding parent companies jointly liable for the antitrust sins of their subsidiaries.

The basic position in EU competition law was settled in 2009 in the case of Akzo Nobel v Commission in which the CJEU held that “[…] the conduct of a subsidiary may be imputed to the parent company in particular where, although having a
separate legal personality, that subsidiary does not decide independently upon its own conduct on the market, but carries out, in all material respects, the instructions given to it by the parent company.”
Continue Reading Antitrust fines – the inevitability of parental liability revisited