Legal Market Overview
Competition law enforcement at both EU and national member state level continues to give lawyers in Belgium food for thought on how best to assist clients with their most demanding commercial, legal and regulatory issues.
In September 2019, Margrethe Vestager was reappointed for a second term as EU competition commissioner. Vestager is well known for having launched antitrust investigations against blue-chip technology companies, which had seen the likes of Apple and Google being hit by huge fines. State aid cases involving tax issues had also been another area of focus during her first term. In addition to retaining her existing role, Vestager also now has a broader mandate as Executive Vice President, which sees her play a key role in coordinating European policy on the digital economy. Vestager’s dual roles are a reflection that the digital economy will continue to drive the European Commission (EC)’s competition agenda.
Continuing the theme, the EC recently opened an antitrust investigation into Amazon’s alleged anti-competitive conduct over the use of sensitive data from independent retailers using its platform. The life sciences and pharmaceutical sector also remains a hotbed of activity for competition lawyers in Belgium, with the EC and national competition authorities across Europe pursuing cases involving allegations of excessive pricing, pay-for-delay agreements and objectionable life cycle management, among other issues.
Elsewhere, in the merger control arena, the (politically-sensitive) proposed rail merger between Germany’s Siemens and French company Alstom was blocked by the EC on the grounds of concerns about the impact of the deal on competition in the signalling systems and very high-speed train markets. Had the merger been cleared, it would have led to the creation of a single European champion in the rail industry; there had been a debate as to whether or not one was needed to compete with Chinese company CRRC, which is the world’s largest rolling stock manufacturer.
In another notable matter, the EC imposed interim measures on Broadcom in the TV and modern chipset markets; this was the first time in 18 years that the EC had announced the imposition of interim measures in a competition investigation. With investigations often taking a considerable period of time before decisions are announced, it is thought that interim measures will be used more frequently to address urgent competition concerns, particularly in fast-evolving sectors.
On the employment law side, a standout theme is the upcoming social elections, which will be held in May 2020 and in which employees elect company-level representatives for a four-year term. In light of this, firms report a significant uptick in instructions from clients seeking advice on companies’ preparations for these elections.
Following its implementation in May 2018, the General Data Protection Regulation (GDPR) remains a prominent source of work for law firms, as companies continue to seek assistance with ongoing data protection compliance issues. On the IP and IT front, cybersecurity continues to be a key area of instruction, with e-privacy work featuring prominently.
In the corporate space, firms continue to be engaged with advice around the new Belgian Companies Code which came into force for new and existing companies on 1 May 2019 and 1 January 2020 respectively, with existing companies and associations having until 1 January 2024 to update their articles of association. M&A activity continues to be steady, with continued investment from international and local private equity funds maintaining high prices and making for more competitive auction processes. Firms have also noted an increase in the popularity of utilising transaction insurance in M&A. This has been particularly true of private equity firms in exits and divestments.
Brussels is a key hub of life sciences activity and the setting for some of the largest transactions in the market, including the $5.1bn research and development collaboration between Gilead Sciences and Galapagos. Recent trends in this space include the continued advancement and development of med-tech solutions, as well as an increased focus on cannabis for medical use. Similarly, the technology sector in Belgium remains strong and growing, with initiatives in the start-up and scale-up community accelerating innovation. Notably in this sector, 2019 saw data intelligence company Collibra become the first Belgian start-up to receive unicorn status, being valued in excess of $1bn.
In the energy sector, phasing out of nuclear reactors continues, as does the pressure from commentators who claim that Belgium’s aim of ceasing the use of nuclear power in 2025 remains optimistic – if not unrealistic. With resulting fears of power shortages looming, firms continue to be particularly active in projects for investment in gas-fired power generation and the construction of offshore and onshore wind farms. Regulatory experts have also been busy advising clients on the implementation of the EC’s Winter Package in Belgium, which includes measures of addressing energy efficiency, renewables and tackling energy poverty.