Noticias

The Chilean Supreme Court has upheld a decision issued by the Competition Tribunal (TDLC) in February 2024 against TWDC Enterprises 18 Corp., a Disney Group entity, for submitting misleading information during the notification of its 2018 merger with 21st Century Fox (Fox). The Supreme Court confirmed the fine of USD 2.6 million imposed on the company.

The country’s highest court affirmed the TDLC’s ruling that granted the Competition Authority’s (FNE) claim. Hence, the Supreme Court concluded that Disney violated Chilean competition law by omitting information during the transaction’s notification. The company initially claimed not to have certain documents required by law and regulation, later stating that it held only two of them, despite having at least 29 additional files that were not submitted during the notification process.

The Supreme Court determined that “when responding to the FNE’s requests for information and seeking a waiver of documentation requirements, TWDC claimed not to possess documents that were, in fact, in its possession, thereby obstructing the FNE’s investigative and analytical work.” The Court added that “the infringement stemmed from the claimant’s reluctance −or at very least, negligence− in cooperating with the administrative proceedings, having failed to submit the minimum information required for its proper conduct.”

The Acting National Economic Prosecutor, Felipe Cerda, praised the decision, emphasizing that “this is the first Supreme Court’s ruling concerning this type of infringement and represents a key milestone for the effective functioning of the merger control system entrusted to the FNE by law”.

Cerda added that, for its proper functioning, the merger system must be collaborative, a principle that applies both to the authority and to the parties notifying a transaction. He stated that the system is not designed to operate through the gradual collection of information based on partial responses. Rather, “the involved parties must fully disclose all relevant documents required by law and regulation at the time of notification to enable the FNE −within strict legal deadlines− to assess the transaction’s competitive risks.”

Disney had previously reached a settlement with the FNE in June 2021 regarding a separate accusation related to the merger. Disney admitted to failing to comply with one of the remedies imposed as a condition of the clearance decision and agreed to pay approximately USD 240,000 in fines. The remedy required Disney to send a written communication to all pay-TV distributors operating in Chile, informing them of the approved measures.

See Supreme Court Ruling.

See TDLC Judgment.

See FNE Complaint.