Judgment of the Tribunal on an application by Tobii AB (publ) (“Tobii”) for a review under s.120 of the Enterprise Act 2002 of the decision of the Competition and Markets Authority (“CMA”) in its Final Report dated 15 August 2019 that the completed acquisition by Tobii of the entire issued share capital of Smartbox Assistive Technologies Limited and Sensory Software International Limited resulted or may be expected to result in a substantial lessening of competition (“SLC”) due to horizontal unilateral effects, vertical input foreclosure effects and/or vertical customer foreclosure effects.
Tobii sought an order quashing the CMA’s decision on five grounds:
Ground 1: that the CMA breached its duty of procedural fairness by refusing to disclose relevant evidence which formed the basis of the CMA’s findings;
Ground 2: that the CMA’s SLC finding was not supported by relevant, reliable and sufficient evidence due to material errors in the CMA’s collection of evidence;
Ground 3: that the CMA failed to properly define the relevant market for augmentative and assistive communication (“AAC”) solutions;
Ground 4: that the CMA’s finding of an SLC as a result of horizontal unilateral effects was not supported by relevant, reliable and sufficient evidence; and/or
Ground 5: that the CMA’s finding of an SLC as a result of vertical input foreclosure effects and/or vertical customer foreclosure effects was based on an error of law and not supported by the evidence.
For the reasons given in the Judgment, the Tribunal unanimously dismissed Grounds 1 to 5, save that, in relation to Ground 5, the Tribunal quashed the CMA’s decision to the extent that the CMA found the merged entity had the ability and incentive to foreclose its rivals by increasing the wholesale price of the Grid software and the merged entity had the incentive to foreclose its rivals by reducing the extent to which the Grid software supported rival dedicated AAC hardware.
