Hickson International plc/Angus Fine Chemicals Ltd [1994] IECA 353 (7th September, 1994)

Hickson International plc/Angus Fine Chemicals Ltd [1994] IECA 353 (7th September, 1994)

The Authority held that the acquisition itself did not offend Section 4(1) as it did not have the object or effect of restricting competition. The amended non-compete and confidentiality clauses, as limited in time and scope, were necessary to protect technical know-how and goodwill and did not prevent the vendor from re-entering the market after four years. Restrictions relating to customer-supplied know-how were legitimate. The exclusive supply agreement for nitromethane was not found to have an appreciable effect on competition given the global nature of the market and the specific circumstances. Accordingly, the arrangements as amended did not offend Section 4(1).

Citation
[1994] IECA 353
Parties
Acquirer: Hickson International plc; Vendor: ANGUS Chemical Company; Target: Angus Fine Chemicals Ltd (AFCL)
Jurisdiction
Ireland
Procedural Posture
Competition Authority Notification/review / Final Decision
Outcome
Certificate and licence granted for the notified arrangements as amended.
Legal Topics
Merger Control, Non Compete Clauses, Know How Licensing, Supply Agreements, Confidentiality Obligations
Competition Law Commercial Law Merger Control Non Compete Clauses Know How Licensing Supply Agreements Confidentiality Obligations

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Parties

Hickson International plc

Acquirer

ANGUS Chemical Company

Vendor

Angus Fine Chemicals Ltd (AFCL)

Target

Procedural Posture

Competition Authority Notification/review / Final Decision

Legal Issues

  1. 1 Whether the notified acquisition and related agreements offend Section 4(1) of the Competition Act 1991 by preventing, restricting, or distorting competition.
  2. 2 Whether the non-compete and confidentiality clauses are anti-competitive or justified as ancillary restraints.
  3. 3 Whether the exclusive supply agreement for nitromethane restricts competition.

Ratio Decidendi

The Authority held that the acquisition itself did not offend Section 4(1) as it did not have the object or effect of restricting competition. The amended non-compete and confidentiality clauses, as limited in time and scope, were necessary to protect technical know-how and goodwill and did not prevent the vendor from re-entering the market after four years. Restrictions relating to customer-supplied know-how were legitimate. The exclusive supply agreement for nitromethane was not found to have an appreciable effect on competition given the global nature of the market and the specific circumstances. Accordingly, the arrangements as amended did not offend Section 4(1).

Court Disposition

Certificate and licence granted for the notified arrangements as amended.

Orders

  • The notified arrangements, as amended by the Supplemental Agreement of 1 September 1994, are granted a certificate and licence under Section 4 of the Competition Act 1991.