WORLD COMPETITION Law and Economics Review

Transcription

WORLD COMPETITION
Law and Economics Review
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Editor José Rivas
Associate Editor
Book Review Editor
Publisher
US Review Editors
Economics Review
Editor
Elaine Davis
Valentine Korah
Simon Bellamy
Spencer Weber Waller & Maurice E. Stucke
Doris Hildebrand
Advisory Board Robert Anderson, World Trade Organization
Sir Christopher Bellamy, President, Appeals Tribunal, United Kingdom Competition
Commission
Manuel Conthe, Former Chairman of Spain’s Securities Commission
Sir David Edward, Professor, University of Edinburgh; former Judge, Court of Justice
of the European Union.
Claus-Dieter Ehlermann, Senior Counsel at Wilmer Cutler Pickering Hale & Dorr LLP
Jonathan Faull, Director General, Internal Market and Services,European Commission,
Professor of Law, Vrije Universiteit Brussels
Eleanor M. Fox, Walter J. Derenberg Professor of Trade Regulation, New York
University School of Law
Allan Fels, Professor at the Australia and New Zealand School of Government
Nicholas Forwood, Judge, General Court of the European Union
Rafael García-Valdecasas y Fernández, Former Judge, General Court of the
European Union
Francisco Enrique González Díaz, Cleary Gottlieb, Steen and Hamilton, Brussels
Barry E. Hawk, Director, Fordham Corporate Law Institute and Partner, Skadden,
Arps, Slate, Meagher & Flom LLP
Herbert Hovenkamp, Ben V. & Dorothy Willie Professor of Law and History,
University of Iowa, USA
Rafael Illescas Ortiz, Professor of Commercial Law, University Carlos III, Madrid
Frédéric Jenny, Professor of Economics at ESSEC, Chair of the OECD Competition
Committee
Valentine Korah, Emeritus Professor, University College London, Honorary Professor
of the College of Europe
Koen Lenaerts, Judge, Court of Justice of the European Union
Ignacio de León, Professor, Department of Economics, New York University
Patrick McNutt, Visiting Fellow, Manchester Business School, UK and former
Chairman, Competition Authority, Dublin and former Chairman, Jersey
Competition & Regulatory Authority, UK.
John L. Murray, Chief Justice of Ireland; former Judge, Court of Justice of the
European Union and Visiting Professor, l’Université Catholique de Louvain
David O’Keeffe, Professor, University College London and Visiting Professor, College
of Europe, Bruges
Giuseppe Tesauro, Judge, Corte Constituzionale della Repubblica italiana
Spencer Weber Waller, Professor and Director, Institute for Consumer Antitrust
Studies, Loyola University Chicago School of Law
Wouter P.J. Wils, Hearing Officer, European Commission, and Visiting Professor,
King’s College London
Editorial Board Ralf Boscheck, Marie Demetriou, Pablo Figueroa, Romain Galante, Juan Gutiérrez,
Donogh Hardiman, Benoît Keane, Pablo Muñiz, Ali Nikpay, Morten Nissen, Kletia Noti,
Laura Olza-Moreno, Dimosthenis Papakrivopoulos, Rudolph Peritz, Tom Pick,
Azza Raslan, J. Matthew Strader, Nicoleta Tuominen, Michael Weiner, Peter Whelan
All correspondence should World Competition
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ISSN 1011-4548
Mode of citation: 36 W.Comp. 4
Investigator, Prosecutor, Judge . . . and Now
Plaintiff? The Leviathanian Role of the
European Commission in the Light of
Fundamental Rights
Nils F.W. HAUGER & Christoph PALZER*
Already holding a very prominent position in competition law, in 2008 the Commission also
stepped into the arena of private enforcement. The action for damages, however, was brought
against the members of a cartel, which the Commission itself had imposed fines against,
beforehand. That raised the question of conformity with the defendants’ right to a fair trial.
Notwithstanding that the European Court of Justice (‘ECJ’) rejected the defendants’ doubts in
its judgment of 6 November 2012, this ruling clearly focusses the attention on the concentration
of powers in hand of the Commission. It therefore shall serve as a starting point for dwelling on
the adjudicatory role of the Commission or the question whether fundamental rights require
competition fines to be imposed by the Courts, respectively. In fact, much of the criticism of the
current system – though there would certainly be much to be said about issues of due process –
appears to stand and fall with the answer to that question.
1
INTRODUCTION
The elevator-cartel became known to a broad public in 2007, when its members
were imposed fines by the Commission totalling EUR 992 million.1 The
Commission had detected a vast network of anticompetitive agreements between
the four major European manufacturers of elevators and escalators, lasting from
1995 to 2004 and covering several Member States of the European Union. As a
matter of fact, the cartel directly affected several EU institutions including the
Commission. Very much in the spirit of her own agenda, to increase private
enforcement of EU competition rules,2 the Commission therefore in 2008
brought action for damages before the District Court in Brussels.
*
1
2
Ass. jur. Nils F. W. Hauger works as a lawyer. Mag. jur. Christoph Palzer is doctoral candidate and
research assistant at the chair for civil law, labour, tax and social law of the University of Bayreuth.
The authors would like to thank Mr. Matthias J. Müller, LL.M. (Duke), Attorney at Law (NY) for
his careful review of the manuscript.
Case Comp/E-1/38.823 – PO/Elevators and Escalators.
This includes both, the Council Regulation (EC) No 1/2003, OJ L 1, 4 January 2003, 1-25 and
especially the Commission’s White Paper on Damages actions for breach of the EC antitrust rules,
COM (2008) 165, final.
Nils F.W., Hauger & Palzer, Christoph. ‘Investigator, Prosecutor, Judge . . . and Now Plaintiff? The
Leviathanian Role of the European Commission in the Light of Fundamental Rights’. World Competition
36, no. 4 (2013): 565–584.
© 2013 Kluwer Law International BV, The Netherlands
566
WORLD COMPETITION
According to the former Competition Commissioner, Neelie Kroes, the
Commission wanted to be ‘leading by example’. Hence, the pressure resting on the
Commission, to finally translate words into action is palpable. Anything but a
success may send out a calamitous signal. Who other than the Commission would
be virtually predestined to defend its interests in a damages action under cartel
law? A Commission’s success additionally could provide the necessary boost to
private enforcement of competition law. In this context, the public sector affected
at hand represents a particular threat for cartel members. Neither does the financial
burden of proceedings pose a problem, nor does the public sector, given its
significant buyer power, has to fear retaliation.
However, it is not unreasonable to raise the question whether the
Commission was entitled to first, brand an action as incompatible with European
competition law, thereby exercising public authority, and second, to reap the
rewards before a civil court. Additionally, the present case acts like a magnifying
glass, focussing the attention on the concentration of powers in the hands of the
Commission, which seems to play a leviathanian role in the field of competition
law. While the ECJ only had to answer the question whether the Commission’s
role as a plaintiff was one too much (infra section 2), the present case shall
constitute the occasion to critically scrutinize the Commission’s adjudicatory
powers, as well (infra section 3).
2
THE JUDGMENT OF THE ECJ IN OTIS
In a nutshell, the Court held that the Commission was entitled to represent the
EU without having a specific mandate to do so and, so having found, a breach of
European competition law in the first instance, did not prevent the Commission to
seek compensation for the losses suffered in this respect.
2.1 THE COMMISSION BEING THE EU’S REPRESENTATIVE
Controversial in the first place was the Commission’s competence to represent the
EU before a national court in a civil action for damages. The defendants claimed
that Article 282 of the Treaty establishing the European Community (‘TEC’)3 was
a general rule, derogated by Articles 274 and 279 TEC based on the principle lex
specialis derogat legi generali. According to the defendants’ opinion, the latter
3
The action was brought before the court prior to January first 2009, the date on which the Treaty
on the Functioning of the European Union (‘TFEU’) entered into force. In lack of a transitional
provision, the latter was not applicable. Cf. Case C-199/11, Otis, judgment of 6 Nov. 2012, nyr,
paras 31 et seq.
INVESTIGATOR, PROSECUTOR, JUDGE . . . AND NOW PLAINTIFF?
567
provisions had been implemented by the Financial Regulation (‘FR’),4 which
Articles 59 and 60 authorize each EU institution to implement its own budgetary
items. In their view, it followed from Articles 103 and 104 FR that it fell to each of
those institutions to bring action for damages.5 The Grand Chamber, however,
ruled that the Articles 274 and 279 TEC as well as the provisions of the FR,
amongst others, determined the powers of the institutions to establish and
implement the budget. By contrast, Article 282 TEC conferred legal capacity on
the Community and governed the way it is represented, inter alia, before the courts
of the Member States.6
In light of Article 282 second sentence TEC, this finding is consistent. The
competence of each institution to implement its own budgetary items differs from
the ability to represent and act on behalf of the EU. In addition, the principle lex
specialis derogat legi generali is only applicable if two provisions serve the identic
purpose, but are inconsistent with one another.7 As the regulations in dispute,
however, have different scopes and purposes, with regard to the EU’s
representation there is no regulation more specific than Article 282 TEC.
2.2
THE JUDGE WHO SUES THE CONVICT: A TRAVESTY OF LAW?
It was doubtful whether the special role the Commission held in this case as both
prosecutor of the violation of European competition law and plaintiff in the
following action before a civil court might infringe the principle nemo judex in sua
causa and the principle of equality of arms.
2.2[a] Nemo Judex In Sua Causa
According to Article 16(1) Regulation 1/2003,8 a Commission decision under
Article 101 TFEU is binding on a national court.Thus, in subsequent proceedings
for damages before national courts, the finding of an infringement of the rules on
cartels must be taken as proven. Against this background, the defendants invoked
that the Commission had acted as judge in its own case.
Having had fruitlessly brought actions for the annulment of the Commission’s
decision, the defendants kept arguing that this review of legality under Article 263
4
5
6
7
8
Council Regulation (EC, EURATOM) No 1605/2002 of 25 June 2002 on the Financial
Regulation applicable to the general budget of the European Communities.
Otis, cited supra note 3, para. 31.
Ibid. para. 32.
Cf. Opinion of Advocate General Cruz Villalón of 26 June 2012, Case C-199/11, Otis, para. 26.
Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on
competition laid down in Articles 81 and 82 of the Treaty.
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WORLD COMPETITION
TFEU was insufficient because the Commission was granted a margin of
discretion in economic matters. The ECJ countered that this margin of discretion
did not detain the EU Courts from reviewing the Commission’s interpretation of
information in respect to an economic nature. It was their duty among others, not
only to establish whether the evidence relied on was factually accurate, reliable,
and consistent but also to ascertain whether that evidence contained all the
information which must be taken into account in order to assess a complex
situation and whether it was capable of substantiating the Commission’s
conclusions drawn from it.9
With regard to the binding implication under Article 16 Regulation 1/2003
the defendants obviously tried to make a mountain out of a molehill.The purpose
of this provision is to ensure the coherent application of Union law and the
general principle of legal certainty, which otherwise would be at risk if national
courts took decisions that conflict with those taken or envisaged by the
Commission in the implementation of Union law.10 Only extending to one
finding, i.e., that a harmful event has occurred, this binding implication does not
demote the national courts to mere puppets. For a civil action for damages
additionally requires a loss and a direct link between the loss and that harmful
event to be established.11
2.2[b]
Equality of Arms
The principle of equality of arms implies that each party must be afforded a
reasonable opportunity to present its case – including its evidence – under
conditions that do not place it at a substantial disadvantage vis-à-vis its
opponent.12 Rather than constituting equality in a formal sense, this principle’s
range depends on the specific type of proceeding and the respective roles the
parties play hereinafter.13 Hence, with view to civil proceedings the Commission
must not draw on resources, other than those available to any ‘normal’ litigant.
The defendants argued that the Commission was both in a position from
which it could already direct the wording of the decision and ensure the success of
a subsequent civil action for damages, and had access to information not available
9
10
11
12
13
Otis, cited supra note 3, paras 53 et seq.
Cf. Case C-234/89, Delimitis [1991] ECR I-935, para. 47; Case C-344/98, Masterfoods [2000] ECR
I-11369, para. 60.
Ibid. para. 71. See also ECtHR, Dombo Beheer BV. v. The Netherlands, Appl. No. 14448/88, judgment
of 27 Oct. 1993, para 33; ECtHR, Ankerl v. Switzerland, Appl. No. 17748/91, judgment of 23 Oct.
1996, para. 38; ECtHR, Makhfi v. France, Appl. No. 59335/00, judgment of 19 Oct. 2004, paras 39 et
seq.
Janis, Kay and Bradley, European Human Rights Law, 3rd ed. (Oxford, 2008), p. 792.
569
to all defendants. That would place the Commission in an advantageous position
undermining the balance which should prevail between the parties to the
proceeding.
In fact, the Commission has access to confidential pieces of information.
Although Article 28(1) Regulation 1/2003 forbids any use of such information
except for the purpose for which it was acquired, i.e., for public investigations, it
appears insufficient, just to refer to the prevailing norms. That would mean to
relegate the defendants to the pious hope the Commission would avoid the
temptation of engaging in unlawful conduct. So, while there might not have been
any grounds to doubt the Commission’s response to the defendants’ allegations,14
there may still be some room for reasonable scepticism.
The decisive point is another: If information other than those contained in
the public version of the decision to impose a fine was contained in the
application, or was presented as documentary evidence, it could be both examined
and where appropriate, challenged by the defendants.15 Conversely, the balance
between the parties to the proceeding can hardly be jeopardized in favour of the
Commission without bringing pertinent pieces of information to the Court’s
attention. The need to adduce the evidence also marks the line between the
present case and others, in which the European Court of Human Rights
(‘ECtHR’) held the principle of equality of arms already to be breached when a
procedural advantage existed abstractly – irrespective of the actual exploitation of
that advantage.16 It follows from the former that a judge can only take evidence
and relevant facts into consideration as far as they are presented. Having gathered
certain information in the course of a previous investigation thus does not even
abstractly put the Commission in an advantageous position. Calling that into
question would mean accusing the national court and the Commission of
collusion.17
The ruling of the ECJ is not a big surprise. Still it clearly highlights the power
concentrated in the hands of the Commision. In this regard, the ECJ alludes that
every step of sovereign activity taken by the Commission in the field of
competition law is subject to judicial review by the Union Courts. That may be
accepted with view to the present case, in which the decisive point lay elsewhere,
14
15
16
17
Opinion of Advocate General Cruz Villalón of 26 June 2012, Case C-199/11, Otis, para. 63.
See for instance ECtHR, Borgers v. Belgium, Appl. No. 12005/86, judgment of 30 Oct. 1991, paras 27
et seq. Critical Vallery, ‘Otis: Can the Commission be a Victim in Addition to Acting as a Police
Officer, a Prosecutor and a Judge?’ (2013) JECL&P, 232-236, at 235 et seq.
To entrust a third party with the representation of the EU in parallel cases would only bring little
improvement considering the defendants’ possibility of examining and challenging any piece of
information presented to the court during civil proceedings.
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WORLD COMPETITION
anyway, but it might not in general. In fact, a closer look reveals that the scope of
judicial review is not beyond doubt.
3
CRITICAL REVIEW OF THE ALLOCATION OF
RESPONSIBILITIES UNDER REGULATION 1/2003
‘When he rises up, the mighty are terrified; they retreat before his thrashing.’ (Job
41:25). In light of the Commission’s multiple roles, a comparison with this biblical
description of the ancient Leviathan seems not too far-fetched. Although the
separation of powers is one of the fundamental principles of the rule of law, the
combination of powers does not similarly raise concerns in each of the given areas.
It is to the Union’s unique structure that a classical separation of powers in terms
of Montesquieu is not suitable. Instead, a system of ‘institutional balance’ has been
established,18 which, however, ultimately pursues the same purpose.19 While the
comparably prominent position of the Commission in the legislative process seems
acceptable in the light of the above and, in a way, only reflects the experience
made on national level that the executive generally is the starting point of
law-making, it is in particular the culmination of powers as prosecutor and judge
within the field of competition law enforcement that gives cause for an alternative
systemic direction.
3.1 COMPETITION PROCEEDINGS AS ‘NORMAL’ ADMINISTRATIVE PROCEEDINGS?
Competition proceedings hold a hybrid status; such proceedings may end with
mere administrative decisions as well as sanctions like periodic penalty payments or
fines. The Commission itself understands competition law proceedings as being
administrative in nature.20 That corresponds with the classification both by Union
law21 and by the European Courts.22 In various aspects competition law
proceedings differ from other administrative proceedings, though.23 Antitrust fines
under Article 23(2) Regulation 1/2003 have a highly restricting effect, even
18
19
20
21
22
23
Fritzsche, ‘Discretion, Scope of Judicial Review and Institutional Balance in European Law’ (2010)
47 CML Rev., 361-403, at 385 et seq. with further references.
Instructive Jaqué, ‘The principle of Institutional balance’ (2004) 41 CML Rev., 383-391.
See Lowe, ‘Cartels, Fines and Due Process’ (2009) Global Competition Policy, 1-7, at 5, available
online at: http://www.cba.org/cba/cle/PDF/COMP09_Calvino_article.pdf.
Art. 23(5) Reg. 1/2003.
Case C-266/06 P, Evonik/Degussa, judgment of 22 May 2008, nyr (available online at: http://
curia.europa.eu), para. 38; Case C-210/00, Käserei Champignon [2002] ECR I-6453, para. 41; Case
T-15/99, Brugg Rohrsysteme [2002] ECR II-1613, para. 109; Joined Cases T-213/95 and T-18/96,
Stichting Certificatie Kraanverhuurbedrijf [1997] ECR II-1739, para. 56; Case T-83/91, Tetra Pak
International [1994] ECR II-755, para. 235.
Cf. MacGregor and Gecic, ‘Due Process in EU Competition Cases Following the Introduction of
the New Best Practices Guidelines on Antitrust Proceedings’ (2012) JECL&P, 425-438, at 426.
571
capable of jeopardizing the economic existence of the addressee.24 Different from
other, so to say, normal administrative proceedings, however, fundamental rights are
safeguarded both in various Articles of the Regulation 1/200325 and the case law
of the European Courts,26 recognizing fundamental rights as an integral part of
the general principles of European law. Hereby, the ECtHR shall have ‘special
significance’.27 It follows from all of the foregoing that, while being called
administrative, cartel fines are implicitly recognized as, though not criminal strictu
sensu, but of quasi-criminal nature.28
According to Article 6(1) ECtHR,29 in the criminal context, the right to a
fair trial requires any judgment to be given by an independent and impartial
tribunal established by law.30 While the ECJ, against constant criticism regarding
the lack of separation of powers,31 has always held the Commission’s hybrid
24
25
26
27
28
29
30
31
Cf. Kienapfel and Wils, ‘Inability to pay – First cases and practical experience’ (2010) Competition
Policy Newsletter, No. 3, 3-7.
See Wils, ‘EU Antitrust Enforcement Powers and Procedural Rights and Guarantees: The Interplay
between EU Law, National Law, the Charter of Fundamental Rights of the EU and the European
Convention On Human Rights’ (2011) World Competition, 189-213, at 197 et seq. and especially
with regard to information-gathering id., ‘Powers of Investigation and Procedural Rights and
Guarantees in Antitrust Enforcement: The Interplay between European and National Legislation and
Case-law’ (2006) World Competition, 3-24, at. 14 et seq.
Case C-199/92 P, Hüls [1999] ECR I-4287, para. 149; Case C-235/92 P, Montecatini [1999] ECR
I-4539, para. 176. To the aspect that effective protection demands violations of the guarantees
provided to be effectively sanctioned see Opinion of Advocate General Kokott of 14 April 2011,
Case C-109/10 P, Solvay, paras 170 and 335.
Jaeger, ‘Standard of Review in Competition Cases: Can the General Court Increase Coherence in
the European Union Judicial System?’, in Baumé, Elferink, Phoa and Thiaville (Eds.), Today’s
Multi-layered Legal Order: Current Issues and Perspecitves (Zutphen, 2011), 115-140, at 132 with further
references; Peretz, Ward and Kreisberger, in Bellamy and Child (Eds.), European Community Law of
Competition, 6th ed. (Oxford, 2008), para. 13.026; Vesterdorf, ‘The EC Competition Law Policy on
Fines’, in Monti, v. u. z. Liechtenstein,Vesterdorf, Westbrook and Wildhaber (Eds.), Economic Law and
Justice in Times of Globalisation (Baden-Baden, 2007), 671-690, at 673.
Explicitly Opinion of Advocate General Vesterdorf of 10 July 1991, Case T-7/89, Hercules Chemicals
[1991], II-869, I. A. 3.; Opinion of Advocate General Colomer of 11 February 2003, Case C-217/00
P, Aalborg Portland, para. 29.
Since Art. 47 of the Charter doesn’t require any judgment to be given by a tribunal but only
provides for an effective remedy before a tribunal and thus falls short of the standard as set out in
Art. 6(1) ECtHR, the latter is not superseded in that respect. But see Case C-389/10 P, KME,
judgment of 8 Dec. 2011, nyr, para. 119 with further references; Otis, cited supra note 3, para. 47.
ECtHR, Jussila v. Finland, Appl. No. 73053/01, judgment of 23 Nov. 2006, para. 40. v. Dijk, v. Hoof,
v. Rijn and Zwaak, Theory and Practice of the European Convention on Human Rights, 4th ed.
(Antwerpen, 2006), p. 563. Differently Waelbroeck and Fosselard, ‘Should the Decision-Making
Power in EC Antitrust Procedures be left to an Independent Judge? – The Impact of the European
Convention of Human Rights on EC Antitrust Procedures, in Barav and Wyatt (Eds.), Yearbook of
European Law 1994 (Oxford, 1995), 111-142, at 125 et seq.
Bronckers and Vallery, ‘No Longer Presumed Guilty? The Impact of Fundamental Rights on Certain
Dogmas on EU Competition Law’ (2011) World Competition, 535-570, at 537; Riley, ‘The
modernization of EU anti-cartel enforcement: Will the Commission grasp the opportunity?’ (2010)
ECL Rev., 191-207, at 197; Waelbroeck and Fosselard, supra note 30, 111, at 114 et seq. Regarding
the psychological biases that may invade decision-making Wils, ‘The Combination of the
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WORLD COMPETITION
character to be compliant with Article 6 ECtHR,32 the latest developments with a
view to the revaluation of fundamental rights in the EU leave room for a
re-assessment of that question.
3.2
LEAVE THE JUDGING TO A JUDGE: FINES IMPOSED IN THE COURSE OF
6(1) ECTHR?
ADMINISTRATIVE PROCEDURES AS A VIOLATION OF ARTICLE
Only recently,33 however, the ECJ’s position was basically confirmed by the
ECtHR in Menarini.34 Although the ECtHR’s ruling did not have European
antitrust law as subject, its findings may well apply accordingly: Italian antitrust law,
sedes materiae of Menarini, is extensively modelled on EU law principles.35 The
Strasbourg judges therein classified cartel fines as ‘criminal’ in the context of
Article 6 ECtHR,36 but did not consider their imposition by an administrative
body in the first instance a violation of the same Article, provided it was subject to
full judicial review.37 The ECtHR concluded that the court must have ‘the power
to quash in all respects, on question of fact and law, the challenged decision’.38
This actually seems to be already established in the Court’s case law,39
according to which Article 6 ECtHR does not impose an obligation to refer
32
33
34
35
36
37
38
39
Investigative and Prosecutorial Function and the Adjudicative Function in EC Antitrust
Enforcement: A Legal and Economic Analysis’ (2004) World Competition, 201-224, at 212 et seq.
In earlier decisions, the ECJ found that Art. 6(1) ECtHR was inapplicable, for the Commision did
not qualify as an independent and impartial tribunal (see Joined Cases 209 until 215 and 218/78,
van Landewyck [1980] ECR 3125 para. 81; Joined Cases 100 to 103/80, Musique Diffusion Française
[1983] ECR 1825, para. 7). While that view was rather absurd, the ECJ had already recognized that
respect for fundamental rights formed an integral part of the general principles of law it was
appointed to protect.
In ECtHR, Stenuit v. France, Appl. No. 11598/85, judgment of 27 Feb. 1992, concerning a fine
imposed for bid-ridding, the case was stroke out of the list after the matter had been resolved
unanimously.
ECtHR, A. Menarini Diagnostics S.R.L. v. Italy, Appl. No. 43509/08, judgment of 27 Sep. 2011.
Bronckers and Vallery, supra note 31, 535, at 541.
Even before the present ruling was passed, that view was largely agreed upon in legal literature, see
Slater, Thomas and Walebroeck, ‘Competition Law Proceedings before the European Commission
and the Right to a Fair Trial: No Need for Reform?’ (2008) GCLC Working Paper No. 4, 1-47, at
7 et seq.; Wils, ‘The Increased Level of EU Antitrust Fines, Judicial Review and the ECHR’ (2010)
World Competition, 5-29, at 12 et seq.
A. Menarini Diagnostics S.R.L. v. Italy, cited supra note 34, paras 58 et seq. Cf. Opinion of Advocate
General Sharpston of 10 February 2011, Case C-272/99 P, KME, para. 67; Opinion of Advocate
General Mengozzi of 17 February 2011, Case C-521/09 P, Elf Aquitaine, para. 31; Opinion of
Advocate General Kokott of 14 April 2011, Case C-109/10 P, Solvay, para. 256.
A. Menarini Diagnostics S.R.L. v. Italy, cited supra note 34, para. 59.
See inter alia ECtHR, Le Compte et al. v. Belgium, Appl. No. 6878/75, judgment of 23 June 1981,
para. 51; ECtHR, Öztürk v. Germany, Appl. No. 8544/79, judgment of 21 Feb. 1984, paras 53 et seq.;
ECtHR, Lutz v. Germany, Appl. No. 9912/82, judgment of 25 Aug. 1987, para. 57; ECtHR, Fischer v.
Austria, Appl. No. 16922/90, judgment of 26 April 1995, para. 28; ECtHR, Schmautzer et al. v. Austria,
Appl. No. 15523/89, judgment of 23 Oct. 1995, para. 34; ECtHR, Malige v. France, Appl. No.
573
disputes mentioned therein to a procedure, which is carried out before a tribunal
in the sense of Article 6 ECtHR at each stage of the proceedings. This view is
rooted in the ECtHR’s expansive interpretation of the notion of ‘criminal’ as set
out in the so called Engel criteria.40 The starting point is, quite rightly, the need to
define the material scope of Article 6 ECtHR autonomously, in order to prevent
the domestic law-maker from disposing of the scope and thus the guarantees
afforded by the ECtHR at its own discretion.41 Thereby, the ECtHR inter alia
includes administrative sanctions within the scope of Article 6 ECtHR,
considering even relatively minor financial penalties sufficient where they clearly
have a punitive and deterrent purpose.42
Given the fact that procedural rights may not be safeguarded to an equal
extent in all Contracting States, a broad approach towards the scope of Article 6
ECtHR may be quite understandable.43 Yet, there are fundamental reservations
against the ECtHR’s approach to dissolve the tension between its ‘broad approach’
and the rigour of the guarantees set forth therein by differentiating internally. In
fact, the Court splits Article 6 ECtHR up into a traditional or natural sphere of
application, the ‘hard core of criminal law’, where reducing the requirements of
Article 6(1) ECtHR seems inappropriate and an outer sphere where it does not.44
The wording of Article 6 ECtHR does not provide a point of reference for an
internal differentiation, though.45 Furthermore, the characteristic of criminal
sanctions lies precisely in the strict formality of the guarantees provided, leaving no
room for a balance as regards efficiency of the administrative policy concerned.46
40
41
42
43
44
45
46
27812/95, judgment of 23 Sep. 1998, para. 45; ECtHR, Riepan v. Austria, Appl. No. 35115/97,
judgment of 14 Nov. 2000, para. 39; ECtHR, Baischer v. Austria, Appl. No. 32381/96, judgment of 20
December 2001, para. 23.
ECtHR of 8 June 1976, Case No. 5100/71 et al., Engel et al. v. Netherlands, para. 82.
Ibid. para. 81; Öztürk v. Germany, cited supra note 39, para. 49. Therefore, the classification as set out
in Art. 23(5) TFEU is of no relevance.
Öztürk v. Germany, cited supra note 39, para. 53; ECtHR, Lauko v. Slovakia, Appl. No. 26138/95,
judgment of 2 Sep. 1991, para. 58; ECtHR, Janosevic v. Sweden, Appl. No. 34619/97, judgment of 23
July 2002, para. 68.
See also ECtHR, Delcourt v. Belgium, Appl. No. 2689/65, judgment of 17. Jan. 1970, para. 25.
Inter alia ECtHR, De Cubber v. Belgium, Appl. No. 9186/80, judgment of 26 Oct. 1984, para. 32;
Riepan v. Austria, cited supra note 39, para. 39 et seq.; ECtHR, Hüsein Turan v. Turkey, Appl.
No. 11529/02, judgment of 4 March 2008, para. 32; Jussila v. Finland, cited supra note 30, para. 43;
ECtHR, Kammerer v. Austria, Appl. No. 32435/06,judgment of 12 May 2010, paras 26 et seq.;
ECtHR, Suhadolc v. Slovenia, Appl. No. 57655/08, judgment of 17 May 2011, The Law A. 2. (a).
The fact that the ECtHR held in Menarini that the imposition of cartel fines by an administrative
body in the first instance did not violate Article 6 ECHR provided the decision was subject to full
judicial review, indicates that the court sticks to the differentiation between the hard core of
criminal law and its periphery without saying so expressis verbis. Doubting, yet without referring to
the question whether a first judicial instance was required, Morgan de Rivery, Lagathu and
Chassaing, ‘EU Competition Fines and Fundamental Rights: Correcting the Imbalance’ (2012) ELR,
190-206, at 191 et seq.
Cf. the partly dissenting Opinion of Judge Loucaides joined by Judges Zupančič and Spielmann of
23 November 2006, Case No. 73053/01, Jussila v. Finland.
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On the contrary, the ECtHR considerably relativizes its own autonomous
standard, paving a way for the Contracting States to water down those
safeguards by choosing disciplinary proceedings instead of classical legal
proceedings.47 Therefore, from a legal dogmatic point of view, the only place for a
restriction of the guarantees set forth in Article 6 ECtHR would be the vague
legal concept of ‘criminal charge’ – you can’t have your cake and eat it too!
Moreover, it is in itself inconsistent, to formalistically draw a line between the
hard core of criminal law and its periphery,48 instead of sticking to the grounds
underlying a restriction in regard of the guarantees enshrined in Article 6 ECtHR.
In other words, if one differentiates internally for reasons of efficiency and
flexibility, then one needed to ask on a case-to-case basis whether applying the
criminal-head guarantees with their full stringency would hamper a sound
administration of justice or, conversely, run counter the public administration’s
need for procedural efficiency.That may certainly be the case with respect to mass
administration or minor offences, respectively. However, cartel fines, the amount of
which can turn out exorbitantly,49 differ significantly from these fields of
application. With regard to the considerable economic harm it causes,
anticompetitive behaviour is correctly regarded as a serious offence in an open
market economy to which the EU is committed.50
In the light of the foregoing, the grounds claimed to demand a restriction of
Article 6 ECtHR in terms of legal consequences do not take root with respect to
antitrust law.51 If, however, one strictly follows the Menarini ruling, still the
question whether having fining decisions taken by the Commission in first
instance was compliant with Article 6(1) ECtHR will depend on the European
Courts’ practice satisfying the ECtHR’s call for full jurisdiction.
It is unclear, though, whether the ECtHR requires full judicial review in a
literal sense or whether there remains some room for administrative discretion. On
the one hand, the dissenting opinion of Judge Pinto de Albuquerque, stating that the
review of the courts of a penal sanction would have to be exhaustive, covering all
legal and factual aspects of the case,52 suggests that the majority of the Strasbourg
judges does not have serious reservation against a margin of administrative
47
48
49
50
51
52
Riley, supra note 31, 191, at 199.
As case law shows, there has never been a contradiction to the domestic classification, when the
ECtHR considered an offence to belong to ‘the hard core of criminal law’.
The record presently is at EUR 1.47 billion, imposed on the so called cathode ray tubes-cartel,
s. Commission, Press Release of 5 December 2012, IP/12/1317.
Cf. Art. 119(1) TFEU.
In the opposite sense, following the Menarini ruling, however, recently case C-501/11P, Schindler,
judgment of 18 Jul. 2013, nyr, paras 32 et seq.
Dissenting Opinion of Judge Pinto de Albuquerque of 27 September 2011, Case No. 43509/08,
Menarini Diagnostics S.R.L. v. Italy, paras 5 et seq.
575
discretion and a limitation of judicial review to certain categories of errors.53 On
the other hand, the Italian court had not only carefully examined the merits of all
factual and legal pleas raised by the applicants but also the more technical
evaluations,54 typically subject to administrative freedom of assessment. From both
a systematic and a teleological point of view, a literal understanding of full judicial
review is more convincing.55 ‘Criminal’ fines imposed by administrative agencies
already pose an exemption to the rule, which therefore needs to be safeguarded
closely for the sake of the indispensable minimum standard regarding proceedings
laid down in Article 6(1) ECtHR.
3.3 FULL JURISDICTION REGARDING FINING DECISIONS IN THEORY AND
PRACTISE
The unlimited jurisdiction with respect to fines, Article 261 TFEU in conjunction
with Article 31 Regulation 1/2003, is ancillary to the power to review the legality
of Commission decisions pursuant to Article 263 TFEU. Thereby, the GC,
referring to the ne ultra petita principle56 only examines the grounds brought
forward by the applicant:57 It is to him both to raise pleas and to adduce
supporting evidence.58 It is beyond doubt that the scope of judicial review is
influenced by whether the court explores the facts at issue beyond the material
submitted by the parties on its own initiative. The court can only assess factual
considerations if it is aware of them. However, the choice of an adversary system
over an inquisitorial one is subject to the assessment prerogative of the legislator.
While Article 261 TFEU expressly provides for full jurisdiction, Article 263
TFEU is silent on the question of the extent of the Courts’ jurisdiction. It can at
53
54
55
56
57
58
Cf. further Waelbroeck and Fosselard, supra note 30, 111, at 129 et seq.
Morgan de Rivery, Lagathu and Chassaing, supra note 45, 190, at 194; Schweitzer, ‘Judicial Review
in EU Competition Law’, in Geradin and Lianos (Eds.), Handbook on European Competition Law –
Enforcement and Procedure (forthcoming), 1-42, at 25 et seq., available online at: http://papers.ssrn.
com/sol3/papers.cfm?abstract_id=2129147.
Likewise Andreangeli, ‘Toward an EU Competition Court: ‘Article-6-Proofing’ Antitrust Proceedings
before the Commission’ (2007) World Competition, 595-622, at 612. For a different view Castillo de
la Torre, ‘Evidence, Proof and Judicial Review in Cartel Cases’ (2009) World Competition, 505-578,
at 575. ECtHR, Sigma Radio Television Ltd. v. Cyprus, Appl. No. 32181/04 and 35122/05, judgment
of 21 July 2011, para. 153 does not contradict this interpretation for it addresses ‘administrative law
appeals’. Yet, for the purposes of the ECtHR, the review of antitrust fines does not belong to the
sphere of administrative law.
The situation is different with regard to any lack of jurisdiction or questions of procedural propriety.
KME, cited supra note 29, para. 131.
Cf. Case T-30/91, Solvay [1995] ECR II-1775, para. 98.
KME, cited supra note 29, para. 131. Exceptional Case T-43/92, Dunlop [1994] ECR II-441, para.
157: While the applicant had only claimed the date retained by the Commission for the beginning
of the infringement to be incorrect, the GC also determined that the Commission had erroneously
determined the date of the end of the infringement.
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WORLD COMPETITION
least be interfered from Article 261 TFEU, by a process of e contrario reasoning,
however, that Article 263 TFEU leaves room for a certain scope of
decision-making powers in favour of the institutions of the Union.59 The same
follows from Article 19(1) TEU, according to which the European judicature ‘shall
ensure that in the interpretation and application of the Treaties the law is
observed’. Hence, it maintains the view that the other institutions of the Union or
the authorities and courts of the Member States, respectively are called to interpret
and apply Union law in the first place and that it is upon the EU Courts to ensure
the law being observed on that occasion. Yet, the EU institutions’ scope of
decision-making powers is bounded by the principle of effective judicial
protection. Oscillating between these two poles – administrative freedom and
effective judicial protection – judicial practice has always had the tendency to
accord a rather generous margin of appreciation, alternately labelled as ‘margin of
assessment’ or ‘margin of discretion’,60 to the Commission and thereby to limit its
own scope of control.61
Surprisingly in the light of the normative differentiation, such a judicial
restraint has widely been recognized with respect to the jurisdiction under Article
31 Regulation 1/2003, as well.62 Before determining whether that is justified, it is
helpful to consider the scope of judicial review of Commission decisions
containing an injunction to terminate an infringement of competition rules under
Article 263 TFEU. By comparison, this may provide important insights for the
proper understanding of Article 261 TFEU or Article 31 Regulation 1/2003,
respectively.
3.3[a] Judicial Restraint: Not Only Limited to But Also Within the Field of Application
of Article 263 TFEU
Judicial restraint goes way back into European competition law’s history.63 First
limited to ‘complex evaluations on economic matters’ and repeated in numerous
59
60
61
62
63
Fritzsche, supra note 18, 361, at 366.
The distinction between a margin of appreciation with regard to the application of open legal terms to a
concrete fact pattern and a margin of discretion with regard to the legal consequences,as known in German
public law,isn’t reflected on the European level.See Fritzsche,supra note 18,361,at 364.
In contrast from the perspective of German law Bornkamm, ‘Richterliche Kontrolle von
Entscheidungen im deutschen und europäischen Kartellverwaltungsverfahren’ (2010) ZWeR, 34-52,
at 36 et seq.
See for instance Case T-150/89, Martinelli [1995] ECR II-1165, para. 59; Case T-49/95, Van Megen
Sports [1996] ECR II-1799, para. 53; Case T-229/94, Deutsche Bahn [1997] ECR II-1689, para. 127;
Joined Cases C-189/02 P, C-202/02 P, C-205/02 P to C-208/02 P and C-213/02 P, Dansk
Rørindustri [2005] ECR I-5425, para. 241; Case C-328/05 P, SGL Carbon [2007] ECR I-3921, para.
43; Case T-141/08, E.ON Energie [2010] II-5761, para. 287; Case T-186/06, Solvay [2011] ECR
II-2839, para. 255.
Joined cases 56 and 58-64, Consten and Grundig [1966] ECR 299, 347.
577
decisions,64 it has later been extended to complex technical issues.65 Yet, as
indicated, the mere finding of a margin of appreciation does not disclose as to
what extent judicial review shall be refrained. Traditionally, the Courts confine
themselves to examining whether the Commission’s findings contained a manifest
error or constituted a misuse of powers.66 Besides, the Luxembourg judges verify
whether the relevant procedural rules have been complied with and if the
statement of reasons is held in a clear and unequivocal fashion as to enable
the persons concerned to ascertain the reasons for the measure and to enable
the competent Court to exercise its power of review.67 The latter has always been
the main playing field for judicial review in the context of an administrative scope
of appreciation, i.e., the control of procedural and formal requirements.
As much as the idea of legal protection by means of procedure is justified,
judicial protection must necessarily remain insufficient if the judicial eye is blind to
matters of substance or, in other words, if the requirements placed upon the
establishment of a manifest error are excessively high. While economic theories
have always been ‘unavoidable companions’68 of European competition law, it was
not before the last decade that the latter has featured a distinct shift towards an
even greater consideration of economic aspects. This, however, argues against a
broad judicial deference towards the Commission’s expertise in economic matters
unless one is prepared for the growing importance of complex economic
assessments to turn the guarantee of judicial protection into some kind of toothless
64
65
66
67
68
Bailey, ‘Scope of Judicial Review under Article 81 EC’ (2004) 41 CML Rev., 1327-1360, at 1341 et
seq.; Jaeger, ‘The Standard of Review in Competition Cases involving complex economic
assessments: towards the marginalisation of the Marginal Review’ (2011) JECL&P, 295-314, at 297 et
seq.; Forrester, ‘Deference to public authority: A judicial equivalent of cupressus leylandii’, in
Studienvereinigung Kartellrecht e.V. (Ed.), Kartellrecht in Theorie und Praxis (Munich, 2012), 181-194,
at 187, speaks of ‘a sort of judicial mantra’; Morgan de Rivery, Lagathu and Chassaing, supra note 45,
190, at 195 et seq. each with references. Differentiating Einarsson, ‘EC Competition Law and the
Right to a Fair Trial’, in Eeckhout and Tridimas (Eds.), Yearbook of European Law 2006 (Oxford,
2007), 555-614, at 601 et seq. For a different view Pohlmann, ‘Verfahrensrecht für ein
ökonomisiertes Kartellrecht: Der Beurteilungsspielraum der Kommission’, in Bechtold, Jickeli and
Rohe (Eds.), Recht, Ordnung und Wettbewerb (Baden-Baden, 2011), 471-487, at 474 et seq.
See for instance Case T-201/04 Microsoft v. Commission [2007] ECR II-3601, para. 88.
Fundamental Case 42/84, Remia [1985] 2545, para. 34. Actually, hereby the ECJ implicitly has
continued what used to be laid down in Art. 33(1) of the Treaty establishing the European Coal and
Steel Community. This provided that ‘[…] the Court may not review the conclusions of the High
Authority, drawn from economic facts and circumstances, which formed the basis of such decisions
or recommendations, except where the High Authority is alleged to have abused its powers or to
have clearly misinterpreted the provisions of the Treaty or of a rule of law relating to its application.’
According to settled case law the individual circumstances are decisive for the content and scope of
the obligation to state reasons. Individual measures, especially burdensome ones require a more
precise justification, although it shall not be necessary for the reasoning to go into all the relevant
facts and points of law, Case T-279/02, Degussa v. Commission [2006] ECR II-897, para. 192.
Lowe, ‘Competition Policy as an Instrument of Global Governance’, in Monti, v. u. z. Liechtenstein,
Vesterdorf, Westbrook and Wildhaber (Eds.), Economic Law and Justice in Times of Globalisation
(Baden-Baden, 2007), 489-501, at 492; also Jaeger, supra note 64, 295, at 308.
578
WORLD COMPETITION
tiger.69 Competition law is intentionally characterized by a low regulatory density.
This openness can and should serve as a ‘transmission belt’ for the translation of
economic theory into the language of law.70 In this regard the EU Courts are not
only called upon to give substance to the law but also to consistently develop it, in
order to ensure its equal application.71
Actually, the EU Courts, so it seems, have been readjusting the balance
between judicial protection and administrative freedom lately. Most recently in
Otis the ECJ repeated its formula, first established in a merger case72 and
occasionally reiterated,73 that the existence of a margin of discretion with regard
to economic matters:
does not mean that the EU Courts must refrain from reviewing the Commission’s
interpretation of information of an economic nature. Those Courts must […] also
ascertain whether [the] evidence [relied on] contains all the information which must be
taken into account in order to assess a complex situation and whether it is capable of
substantiating the conclusions drawn from it.74
Though continuously being referred to by the EU Courts, the Commission’s
margin of appreciation in fact seems to have denatured to a matter of rhetoric.75
Nevertheless, the EU Courts are not authorized to substitute their own
economic assessment for that of the Commission.76 Consequently, there is still a
margin of appreciation, however limited to the choice between different
appropriate economic methods77 or to the basic approach in assessing a complex
economic matter,78 respectively. That rightly follows from the division of powers
69
70
71
72
73
74
75
76
77
78
Morgan de Rivery, Lagathu and Chassaing, supra note 45, 190, at 196. Differently Bailey, supra note
64, 1327, at 1358.
Schweitzer, supra note 54, 1, at 15.
Bailey, supra note 64, 1327, at 1337.
Case C-12/03 P, Tetra Laval [2005] ECR I-987, para. 39. In substance already Case T-342/99,
Airtours v. Commission [2002] ECR II-2585; Case T-310/01, Schneider Electric [2002] ECR II-4071;
Case T-80/02, Tetra Laval [2002] ECR II-4519.
Case C-525/04 P, Spain v. Lenzing [2007] ECR I-9947, paras 56 et seq.; Case C-386/10 P, Chalkor,
judgment of 8 Dec. 2011, nyr, para. 54; KME, cited supra note 29, para. 129.
Schweitzer, supra note 54, 1, at 19. This result does not contradict the wording of Art. 263 AEUV.
One has to distinguish the question of jurisdiction, which is limited to the grounds exhaustively
listed in the named provision from the scope of judicial review, which demands a balance between
administrative balance and effective judicial protection. But see MacGregor and Gecic, supra note 23,
425, at 431.
Case C-323/00 P, DSG Dradenauer Stahlgesellschaft [2002] ECR I-3919, para. 43; Spain v. Lenzing,
cited supra note 73, para. 57.
An example might be the choice of the so called ‘as-efficient-competitor-test’, representing one way
to demonstrate anti-competitive market foreclosure effects of loyalty rebates. Cf. Pohlmann, supra
note 64, 471, at 479 et seq.
Legal, ‘Standards of proof and standards of judicial review in EU competition law’, in Hawk (Ed.),
Annual Proceedings of the Fordham Corporate Law Institute, International Antitrust Law & Policy 2005
(New York, 2006), 107-116, at 114 et seq.; Schweitzer, supra note 54, 1, at 19; for reasons of
procedural economy also Pohlmann, supra note 64, 471, at 486 et seq.
579
set out in the Treaties, limiting the remedies that are available to the Courts:
According to Article 264 TFEU, the Courts may only declare the act concerned to
be (partially)79 void if an action for annulment is well founded.
3.3[b]
Full and Comprehensive Review of the Amount of Fines on the Other Hand
Article 31 Regulation 1/2003, on the other hand, stipulates that:
the Court of Justice shall have unlimited jurisdiction to review decisions whereby the
Commission has fixed a fine or periodic penalty payment. It may cancel, reduce or
increase the fine or periodic payment imposed.
One should think that this meant nothing less than the GC being empowered to
review the amount of a fine fully and comprehensively at any occasion it is
challenged by an applicant.80 In fact, claims seeking a reduction in the amount of
the fine do turn out successful now and then – however, in essence, for purely
factual reasons.81
It is a cantus firmus of the Courts that the fines are an instrument of the
Commission’s competition policy, for which reason it is allowed a margin of
discretion when fixing their amount in order that it may best direct undertakings
towards compliance with the competition rules.82 Given the sparse requirements
set forth in Article 23 Regulation 1/2003, it is in fact hardly deniable that the
Commission must dispose of a margin of discretion when assessing the factors
defining the duration and gravity of the offence.83 Yet, by adopting Fining
Guidelines the Commission itself has limited its discretion to a certain extent.84
At the same time, the GC has regularly confined itself in checking consistency
with the Fining Guidelines.85 Choosing to follow an existing calculation method
79
80
81
82
83
84
85
See inter alia Case C-41/94, Germany v. Commission [1996] ECR I-4733, para. 143; Joined Cases
C-68/94 and C-30/95, France et al. v. Commission [1998] ECR I-1375, para. 256; Case C-29/99,
Commission v. Council [2002] ECR I-11221, paras 45 et seq.; Case C-239/01, Germany v. Commission
[2003] ECR I-10333, para. 33.
Regarding the question whether the unlimited jurisdiction demands unlawfulness or at least an
irregularity or any other objective flaw of the challenged decision with regard to the underlying
violation of competition rules see Arbault and Sakkers, in Faull and Nikpay (Eds.), The EC Law of
Competition, 2nd ed. (Oxford, 2007), paras 8.848 et seq.; Einarsson, supra note 64, 555, at 590 et seq.;
Jaeger, supra note 27, 115, at 136 et seq.; Vesterdorf, supra note 27, 671, at 679 et seq. each with
references.
Cf. recently for example Case T-208/06, Quinn Barlo et al., judgment of 30 Nov. 2011, nyr, paras
173 et seq.; Case T-53/06, UPM-Kymmene, judgment of 6 March 2012, nyr, paras 97 et seq.; Case
T-360/09, E.ON/GDF, judgment of 29 June 2012, nyr, paras 297 et seq.
Cf. the references supra note 62.
See inter alia C-289/04 P, Showa Denko [2006] ECR I-5859, para. 36.
Dansk Rørindustri, cited supra note 62, paras 209 et seq.; Case C-397/03 P, Archer Daniels Midland
[2006] ECR I-4429, para. 91; Chalkor, cited supra note 73, para. 60.
Forrester, supra note 64, 181, at 189 et seq.; Gerard, ‘EU Antitrust Enforcement in 2025: ‘Why Wait?
Full Appellate Jurisdiction, Now’’ (2010) CPI Antitrust, Journal, No. 1, 2-9, at 5; Nicolic, ‘Full
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WORLD COMPETITION
was equally supposed to be the expression of the Court’s unlimited jurisdiction.86
The central arguments proposed for this approach are legal certainty and
transparency: By desisting from substituting its own assessment to determine a new
amount of the fine, the GC, by means of the Guidelines, allowed the parties to
know the rules of the game.87 Yet, imposing fines is not a matter of pure
mathematics. As for any decision which depends largely on circumstances of the
individual case, the exact outcome of a decision imposing fines is neither
predictable88 nor was that even intended: fines shall not become a calculation
factor in business decisions. On the contrary, a certain degree of flexibility is
inevitable in order to do justice to the individual case.That, however, does not call
for judicial restraint but rather the opposite. For the greater administrative powers
are thought to be, the more strict judicial review needs to be to create a
counter-balance.89 The principle of legal certainty, thus cannot, in any event, be
the motive to water down the order envisaged by the legislator under Article 261
TFEU or Article 31 Regulation 1/2003, respectively. To put it differently,
the Commission may well be granted a margin of discretion in fitting the fine to
the type and duration of the infringement, the individual conduct, as well as the
characteristics of the undertakings concerned,90 but that discretion, according to
the letter of the law, is subject to full and comprehensive judicial review.91
Meanwhile the ECJ has reacted to the ECtHR’s ruling in Menarini and held
on several occasions that:
the Courts cannot use the Commission’s margin of discretion – either as regards the
choice of factors taken into account in the application of the criteria mentioned in the
Guidelines or as regards the assessment of those factors – as a basis for dispensing with the
conduct of an in-depth review of the law and of the facts.92
Compared with Article 263 TFEU, the judicial capacity under Article 261 TFEU is
extended in two respects: First, as regards the power of review, including both a
86
87
88
89
90
91
92
Judicial Review of Antitrust Cases after KME: A New Formula of Review?’ (2012) ECL Rev.,
583-588, at 586 each with further references.
Jaeger, supra note 27, 115, at 130.
Ibid. at 122. To that effect see also Archer Daniels Midland, cited supra note 84, para. 93; Evonik/
Degussa, cited supra note 22, para. 54.
Forrester, ‘Due process in EC competition cases: A distinguished institution with flawed procedures’
(2009) ELRev., 817-843, at 832 speaks of a process described as ‘alchemy’, thereby referring to
Philip Lowe. For a different view Case T-400/09, Ecka Granulate, judgment of 12 Dec. 2012, nyr,
para. 32.
Schwarze, ‘Judicial review of European Administrative procedure’ (2004) Law and Contemporary
Problems, 85-105, at 105.
Chalkor, cited supra note 73, paras 56 et seq. with further references.
Wils, ‘Discretion and Prioritisation in Public Antitrust Enforcement, in Particular EU Antitrust
Enforcement’ (2011) World Competition, 353-382, at 372.
Chalkor, cited supra note 73, para. 62; KME, cited supra note 29, para. 129; Otis, cited supra note 3,
para. 61; Schindler, cited supra note 51, para. 155; Also E.ON/GDF, cited supra note 81, para. 298. See
also EFTA Court, Posten Norge, Case E-15/10, judgment of 18 April 2012, paras 100 et seq.
581
legality review and a review of the fine’s expedience and fairness and secondly, as
regards the power to decide. In the words of the ECJ:
that jurisdiction empowers the Courts, in addition to carrying out a mere review of the
lawfulness of the penalty, to substitute their own appraisal for the Commission’s and,
consequently, to cancel, reduce or increase the fine or penalty payment imposed.93
Even though already set out in Article 31 Regulation 1/2003, this dictum may
represent a paradigm shift. If taken seriously, the review of the Commission’s
assessments must amount to more than their understanding and a review of their
plausibility.94 The legal framework, including the Fining Guidelines, only provides
for rudimentary criteria and remains entirely silent on their weighting and thus
enables the Commission to justify virtually any amount of fines, which it considers
appropriate. Mirror-inverted, a review in the former sense thus demands the Court
to assess the relevant factors on its own and hence to take a primary decision – not
to be confused, however, with a review of the Court’s own motion.95
The latter directly leads to the procedural dimension of the present issue. As
fiercely as procedural propriety of the administrative proceedings is reviewed by
the Courts, much lesser weight seems to be put on their own procedure, largely
depending on written submissions, yet, limited to a few pages.96 The oral hearing
is usually relatively brief, often lasting less than a day.97 Despite being provided for
by the Courts’ Rules of Procedure, the possibility to endeavour a hearing of
evidence is typically ignored. Instead the Commission’s factual findings serve as a
basis.98 This rather general observation is of particular interest with regard to
interrogations of witnesses or leniency applicants. As a matter of fact, leniency
programmes have proven to be the competition authorities’ most important tool of
investigation.99 Correspondingly, corporate leniency statements play a central role
in the process of clarifying the matter. Approved by the Commission, leniency
applicants often prefer oral statements in order to avoid discovery in US
93
94
95
96
97
98
99
Chalkor, cited supra note 73, para. 63; KME, cited supra note 29, para. 130; Otis, cited supra note 3,
para. 62; obviously still sceptical, however BGH, Case No. KRB 20/12, judgment of 26 Feb. 2013,
para. 52.
A corresponding appeal was rejected on formal grounds in Case C-264/11, Kaimer, judgment of 19
July 2012, nyr, para. 61. Cf. Einarsson, supra note 64, 555, at 589; Jones and Sufrin, EU Competition
Law, 4th ed. (Oxford, 2011), at 1146;Vesterdorf, supra note 27, 671, at 678.
KME, cited supra note 29, paras 131 et seq.
Morgan de Rivery, Lagathu and Chassaing, supra note 45, 190, at 197.
Peretz, Ward and Kreisberger, supra note 27, para. 13.231.
Marsden, ‘Checks and balances: EU competition law and the rule of law’ (2009) CLI, 24-28, at 27 et
seq.; Schweitzer, supra note 54, 1, at 8 with further references. It is to stress out that the Court
referred to external expertise only twice, Joined Cases C-89, 104, 114, 116, 117 and 125 to 129/85
Wood Pulp [1988] ECR 5193 paras 31 et seq. and paras 121 et seq.; Case C-48/69, Dyestuffs [1972]
ECR 619.
Germont and Andresen, in Amato and Ehlermann (Eds.), EC Competition Law (Oregon, 2007), at
689.
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litigation.100 Thus, statements given by individuals are at the very centre of the
fact-finding. These individuals, however, might have an interest to trivialize their
own role in the cartel or, conversely, to emphasize the role of the other cartel
members, respectively.
One may well argue that those corporate statements are rarely the only pieces
of evidence on which a Commission decision is based.101 Still, it cannot be
excluded that those statements will show effects on the amount of the fine. At the
same time, it is easily conceivable that there is a difference between a statement
made towards a lawyer in the ‘cosiness’ of the own office or a testimony given in
court. Hence, there is a visible need both for the Court to form its own opinion
concerning the witness’ credibility, instead of relating to written protocols only102
and for the defendant to cast doubt upon a witness in cross-examination as
provided for in Article 6(3) lit. d ECtHR.There may be no absolute right to hear
witnesses103 but it does not follow conversely that hearing witnesses was
practically dispensable. Admittedly, one has to give credit to the GC that per dato
complainants have rarely requested to examine or have examined witnesses against
them.With some cases pending before the ECtHR, however, the development on
this matter has yet not been completed.
4
CONCLUDING REMARKS
In emphasizing that the review provided for by the Treaties involved both the law
and the facts and meant that the Courts have the power to assess the evidence, to
annul the contested decision and to alter the amount of a fine,104 the ECJ
perfectly mirrored the conditions provided for by Menarini.105
Yet, a certain degree of scepticism seems to be warranted both with a view to
how closely the GC will review factual and legal assessments made by the
Commission as well as to the procedural arrangement.106 Also, there is now a
paradoxical situation: If the GC takes its jurisdiction with regard to the review of
the amount of fines as seriously, as forseen in Article 31 Regulation 1/2003, it will
need to review factual and legal assessments made by the Commission to the
extent that it can substitute its own assessment for that of the Commission. Thus,
100
101
102
103
104
105
106
D. Schroeder and S. Heinz, ‘Requests for Leniency in the EU: Experience and Legal Puzzles’, in
Cseres, Schinkel and Vogelaar (Eds.), Criminalization of Competition Law Enforcement (Cheltenham,
2006), 161-175, at 166.
See to that effect Kaimer, cited supra note 101, para. 44.
That was the case in GC of 3 March 2011, Case T-110/07, Siemens [2011] ECR II-477.
Dansk Rørindustri, cited supra note 62, paras 70 et seq.
KME, cited supra note 29, para. 133.
Nicolic, supra note 85, 583, at 587.
Cf. Opinion of Advocate General Wathelet of 26 Sep. 2013, case C-295/12P, Telefónica, paras 129,
143 and 172 et seq.
583
the GC would de facto evolve to a Court of Appeal, really deserving its name,
proceeding to its own assessment of the facts gathered by the Commission in the
course of its investigation.107 Then, however, the power to impose fines might as
well be conferred upon the GC.108 Hence, the paradox lies in being closer to, but
at the same time, with any (political) pressure gone, further away from the ideal
than ever before. Only such an institutional set-up would truely meet the
requirements under Article 6(1) ECtHR. It would also take adequate account of
the radical change competition law enforcement has gone through in Europe
throughout the last few decades.
Changing the focus from the institutional set-up of public enforcement of
competition law to its private counterpart, the main proceedings before the
District Court in Brussels will constitute the acid test for the Commission’s
endeavours to promote private enforcement of competition law. In this particular
case, at least calculating the harm suffered contains one particular relief: For the
aggrieved party, i.e., the EU, is a public end buyer, the passing-on defence is not an
obstacle.The outcome of the proceedings will be interesting to see. Its importance
cannot be overestimated.
107
108
Arbault and Sakkers, supra note 80, para. 8.854; Gerard, supra note 85, 2, at 8.
Cf. already for example Montag, ‘The Case for a Reform of Regulation 17/62: Problems and
Possible Solutions from a Practioner’s Point of View’ (1998) Fordham International Law Journal,
819-852, at 849 et seq.; Schwarze, ‘20 Jahre Gericht erster Instanz in Luxemburg – Der Zugang zur
Justiz’ (2009) EuR, 717-727, at 727; Ibid. ‘Rechtsstaatliche Defizite des europäischen
Kartellbußgeldverfahrens’ (2009) WuW, 6-12, at 11; Waelbroeck and Fosselard, supra note 30, 111, at
141. Dismissively Wils, supra note 31, 201, at 221 et seq. For further proposals, see Lianos and
Andreangeli, ‘The Competition Law System and the Union’s Norms’, in Fox and Trebilcock (Eds.),
The Design of Competition Law Institutions (Oxford, 2013), 384–442, at 436 et seq.

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