European Commission market tests proposed commitments by Rio Tinto Alcan in aluminum smelting markets

On 10 August 2012, the European Commission invited interested parties to comment on the proposed commitments by Rio Tinto Alcan (“Alcan”) in the aluminum smelting market. According to the notice published by the Commission, last 11 July 2012, the Commission adopted a preliminary assessment concerning Alcan’s allegedly anticompetitive practice of contractually tying its leading Aluminum Pechiney (“AP”) aluminum smelting technology to aluminum smelter equipment it supplies, namely pot tending assemblies (“PTAs”), which the Commission considers to be in breach of Article 101 of the Treaty on the Functioning of the European Union (“TFEU”).

According to the Commission’s preliminary assessment, Alcan may have a dominant position on the relevant market for the licensing of aluminum smelting technology and its contractual practice may lead to higher prices, hamper innovation and shut out competitors from the market for PTAs.

To address these concerns, Alcan has offered to modify its AP technology transfer agreements so as to enable the licensees of the AP aluminum smelting technology to choose any supplier whose PTAs meet certain technical specifications. If the market test confirms that the proposed commitments remedy the competition concerns, the Commission may make the commitments legally binding on Rio Tinto Alcan. [Gabriele Accardo]