Скачать презентацию Academy of European Law in cooperation with the Скачать презентацию Academy of European Law in cooperation with the

429ef9847a68b8c81f533bbafeb3f85f.ppt

  • Количество слайдов: 60

Academy of European Law in cooperation with the Ministry of Justice of Finldand the Academy of European Law in cooperation with the Ministry of Justice of Finldand the German Federal Ministry of Justice SEMINAR on the APPLICATION of EUROPEAN COMPETITION LAW by the NATIONAL JUDICIARY (EC Regulation 1/2003) Presentation on ‘Relevance of Article 82 EC Treaty for the National Judges’ Pierluigi Congedo, King’s College London Trier, 30 -31 March 2009 1

Outline • Introduction on Art. 82 EC • Recent developments with respect to Art. Outline • Introduction on Art. 82 EC • Recent developments with respect to Art. 82 EC: caselaw, EC Discussion Paper, EC Guidance on Art. 82 EC • EC Regulation n. 1/2003, Art. 82 EC and National Judges • Difficulties behind Art. 82 -related private actions • National experiences: the British scenario (references to Italy) • Lack of detailed national legislation and guidance • The imperative of making European Law provisions directly applicable at national level • Conclusion 2

Introduction on Article 82 EC • The Treaty provision, the EC Regulations, the Modernisation Introduction on Article 82 EC • The Treaty provision, the EC Regulations, the Modernisation EC Regulation 1/2003 • Article 82 EC Treaty, modelled on the basis of Section 2 of the Sherman Act, but with its own identity 3

US Sherman Act (1890) Section 2. Monopolizing trade a felony; penalty “Every person who US Sherman Act (1890) Section 2. Monopolizing trade a felony; penalty “Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a felony, and, on conviction thereof, shall be punished by fine not exceeding $10, 000 if a corporation, or, if any other person, $350, 000, or by imprisonment not exceeding three years, or by both said punishments, in the discretion of the court. ” • Caso Standard Oil • Caso Alcoa • Caso AT&T 4

Sherman Act • Monopolization is not per se prohibited, if reached and maintained on Sherman Act • Monopolization is not per se prohibited, if reached and maintained on the basis of merits (see Microsoft, in particular in the Netscape saga) • What is prohibited is to LEVERAGE the dominant position not only to obtain high profits, BUT also to reinforce the dominant position hindering the survaival of existing or potential competition 5

Article 82 EC We recall the fundamental provision: “ Any abuse by one or Article 82 EC We recall the fundamental provision: “ Any abuse by one or more undertakings of a dominant position within the common market or in a substantial part of it shall be prohibited as incompatible with the common market in so far as it may affect trade between Member States […] 6

Article 82 EC (follows) Such abuse may, in particular, consist in: (a) directly or Article 82 EC (follows) Such abuse may, in particular, consist in: (a) directly or indirectly imposing unfair purchase or selling prices or other unfair trading conditions; (b) limiting production, markets or technical development to the prejudice of consumers; (c) applying dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage; (d) making the conclusion of contracts subject to acceptance by the other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such contracts. 7

Recent evolution • For fifty years Art. 82 EC was applied at EU and Recent evolution • For fifty years Art. 82 EC was applied at EU and National level as a legal ground for public encorcement • Very rare cases of ‘private enforcement’ (legal actions for damages) based on Art. 81 EC and even more rare based on Art. 82 EC • EC Regulation 17/62 was the common legal basis to be followed by the Commission to deal with infringements of Art. 81 and 82 EC • ‘Revolution’ behind the EC Regulation 1/2003 8

Why EC Regulation 1/2003 (a) Decision of de-centralisation of the enforcement in a 27 Why EC Regulation 1/2003 (a) Decision of de-centralisation of the enforcement in a 27 -member States community (b) Common position of the European Commissioners (Monti and Kroes) to reinforce the deterrence of public enforcement opening to private enforcement (c) Need of clarifying the rules of the two-level enforcement (i) Commission/National Authority(ies) and (ii) National Courts 9

John Locke, Second Treatise on Civil Government [Chapter II, para. 11, 1690] • ‘From John Locke, Second Treatise on Civil Government [Chapter II, para. 11, 1690] • ‘From these two distinct rights (the one of punishing the crime, for restraint and preventing the like offence, which right of punishing is in everybody, the other of taking reparation, which belongs only to the injured party) comes it to pass that the magistrate, who by being magistrate hath the common right of punishing put into his hands, can often, where the public good demands not the execution of the law, remit the punishment of criminal offences by his own authority, but yet cannot remit the satisfaction due to any private man for the damage he has received. • That he who hath suffered the damage has a right to demand his own name, and he alone can remit. ’ 10

Discussion Paper (Dec. 2005) and Guidance on Art. 82 EC (Dec. 2008) • Focusing Discussion Paper (Dec. 2005) and Guidance on Art. 82 EC (Dec. 2008) • Focusing on Art. 82 EC, after the ‘Big enlargement’ and the ‘de-centralization’, the European Commission launched the so-called Discussion Paper, mainly to elaborate a common approach on the basis of the most recent case-law • As many times said by Richard Whish, the discussion paper is aimed at the creation of guidance documents which will simply clarify and list the main ECJ/Commission cases, to be considered constitutionally part of the ‘DNA’ of Art. 82 EC 11

Art. 82 EC and Discussion Paper 2005 • Definition of dominance and collective dominance Art. 82 EC and Discussion Paper 2005 • Definition of dominance and collective dominance [§ 44] “For collective dominance to exist under Article 82, two or more undertakings must, from an economic point of view, present themselves or act together on a a particular market as a collective entity – it is not required that the undertakins concerned adopt identical conduct on the market in every respsect. What matters is that they are able to adopt a common policy on the market and act to a considerable extent independently of their competitors, their customers, and also of consumers” (case-law mentioned: Compagnie Maritime Belge -1996; Irish Sugar – 1997; EMS v. Commission 1998; but, in particular, Airtours, TFI 2002) 12

Discussion paper: guidance also for the national judge • Why: see § 48, 49, Discussion paper: guidance also for the national judge • Why: see § 48, 49, 50 Discussion Paper They provide, in a smashingly clear way (and in 15 lines…), the three criteria to assess whether the Commission, the NCA, the judge are in presence of a ‘collective dominance’ situation: (i) ‘First, each undertaking must be able to monitor whether or not the other undertakings are adhering to the common policy’ 13

Other criteria • (ii) ‘Secondly, the implementation of the common policy must be sustainable Other criteria • (ii) ‘Secondly, the implementation of the common policy must be sustainable over time, which presupposes the existence of sufficient deterrent mechanisms, which are sufficiently severe to convince all the undertakings concerned that it is in their best interest to adhere to the common policy’; • (iii) ‘Finally, it must be established that competitive constraints do not jeopardise the implementation of the common strategy’ (position and strenght of the rivals; market position and strenght of the buyers; potential new entries) • Query: a new application of Nash’s ‘non-cooperative games’ theory? 14

Discussion paper and definition of Abuse Another piece of ‘guidance’ for the judges: the Discussion paper and definition of Abuse Another piece of ‘guidance’ for the judges: the definition of abuse (in exclusionary conducts) See para. 57: it expressely recalls Hoffmann La Roche (European Court of Justice Case 85/76) “[abuse is] an objective concept relating to the behaviour of an undertaking in a dominant position which is such as to influence the structure of the market where, as a result of the very presence of the undertsking in question, the degree of competition is weakened and which, throught recourse to methods different from those which condition normal competition in products or services on basis of the transaction of commerical operators, has the effect of hindering the maintenance of the degree of competition still existing in the market or the growth of that competition” 15

Another classification: price versus non-price based exclusionary conduct • Non-price based: contractual tying, single Another classification: price versus non-price based exclusionary conduct • Non-price based: contractual tying, single branding contract, ‘naked’ refusal to supply (see para 61 et s. ) • BUT, what about princing conducts? • High stand-alone prices in comparison to a bundled price for two products may ‘tie’ these two products • High rebates in change of ‘single branding’ • A new gender: the ‘constructive’ refusal to supply: I provide you with the access but to such a burdensome conditions that at the end I prefer to exit the market 16

Pricing abuse conducts • The Discussion Paper provides with technical indications on how to Pricing abuse conducts • The Discussion Paper provides with technical indications on how to calculate and take into consideration the Average Total Costs, the Average Avoidable Costs, and the Average Variable Costs – in other way, it takes its lesson from the AKZO Chemie case, and takes its distances from the Areeda-Turner Test BUT • It also develops theory of ‘safe harbour’ 17

The ‘as efficient competitor’ • In particular, the Discussion Paper acknowledges that the dominant The ‘as efficient competitor’ • In particular, the Discussion Paper acknowledges that the dominant company conduct must be also assessed not only in consideration of the one-toone relation with an alledgedly abused competitor, but aslo having in mind another ‘as efficient’ competitor – • If another, ‘as efficient’, competitor would survive to competition, why to consider abusive a specific conduct? [see para. 66 et s. ] 18

Discussion Paper: the ‘objective necessity defence’ and the ‘efficiency defence’ • Para. 80: ‘The Discussion Paper: the ‘objective necessity defence’ and the ‘efficiency defence’ • Para. 80: ‘The dominant company may be able to show that the conduct concerned is objectively necessary…’ (i. e. safety, health of the dangerous product) – evidence must be based on ‘objective factors’ • Para. 84: Efficiency defence: • (i) that efficiencies are realised or likely to be realised as a result of the conduct concerned; • (ii) that the conduct concerned is indispensable to realise these efficiencies; • (iii) that the efficiencies benefit consumers; • (iv) that competition in respect of a substantial part of the products concerned is not eliminated 19

Another interpretative tool for judges (and NCA) • The Art. 82 EC Guidance published Another interpretative tool for judges (and NCA) • The Art. 82 EC Guidance published on 3 December 2008 [3 December 08] Com (2008) available at http: //ec. europa. eu/competition/antitrust/art 82/index. html • Great expectations for the Communication from the Commission ‘Guidance on the Commission’s Enforcement in Applying Article 82 EC Treaty to Abusive Exclusionary Conducts by Dominant Undertakings • [§ 6] It confirms that the Commission’s enforcement policy is aimed at ensuring that ‘undertakings which hold a dominant position do not exclude their rivals by other means than competing on the merits of the products or services they provide’. • 20

Commission’s Guidance (follows) – notion of dominance • Nothing new with respect to existing Commission’s Guidance (follows) – notion of dominance • Nothing new with respect to existing case-law: i. e. dominance is that power to behave to an appreciable extent independently of its competitors, its customers and ultimately of consumers [See § 10] • In other words, a synthesis of United Brands Company [case C-27/76] Michelin 2 [case C-322/81] Tetra Pack II [case T-83/91] Irish Sugar [case T-228/97] 21

Economic assessment of the dominant undertaking’s competitors and ‘the position of the customers or Economic assessment of the dominant undertaking’s competitors and ‘the position of the customers or input suppliers’ (i) A panoply of behaviours as well as the effective ‘weight’ of a minor competitor shall be taken into consideration, when assessing the dominant position of the incumbent. In regulated industries, this means that even an undertaking with a small market share but a highly innovative profile can play a key-role when assessing the impact of a foreclosing conduct. 22

REAL POSITION OF THE COMPETITOR: THE DYNAMIC PERSPECTIVE • (ii) The assessment of the REAL POSITION OF THE COMPETITOR: THE DYNAMIC PERSPECTIVE • (ii) The assessment of the real position of the competitor in the market shall be carried out having in mind a dynamic perspective, (even) in absence of the abusive conduct … i. e. possibility that the competitor would have been even more efficient in a certain period of time (because of potential network and learning effects) [§ 23] • We can see here a reference to a ‘dynamic perspective’ See Case Deutsche Telekom v Commission, 10 April 2008 (Case T-271/03) 23

The Guidance is particularly interesting for the definition of some exclusionary behaviours in particular: The Guidance is particularly interesting for the definition of some exclusionary behaviours in particular: • Tying, refusal to supply and, most importantly, MARGIN SQUEEZE • It is evident the legacy of the Microsft decision (24 March 2004) but also of the TFI judgment (17 September 2007), substantially uphelding the Commission’s position on Microsoft Margin squeeze: legacy of the recent cases Deutsche Telecom, Telefonica and previous caselaw 24

In the ‘refusal to supply and margin squeeze’ section we find the ‘chromosomes’ of In the ‘refusal to supply and margin squeeze’ section we find the ‘chromosomes’ of the main ‘essential facilities’ ECJ cases • The judge will keep in mind the four/five main cases recalled by the Guidance 2008: • The Guidance re-assesses the fundamental principle that ‘any undertaking, whether dominant or not, should have the right to choose its trading partners and to dispose freely of its property’ IN FACT, it has in mind the following cases: • • • Cases: Joined cases C-241/91 -242/91 RTE/ITP v Commission (Magill) [§ 50] Case C-418/01 IMS Health v NDC Health [2004] [§ 35] Case T-201/04 Microsoft v Commission [§ 319, 330 -332 and 336] • (the distribution network is not considered ‘essential facility’ in Oscar Bronner) 25

In the Guidance the growing importance of two exclusionary conducts, refusal to supply and In the Guidance the growing importance of two exclusionary conducts, refusal to supply and margin squeeze, is finally underlined • Refusal to supply: • (i) refusal to supply products to existing or new customers • (ii) to license intellectual property rights [including when this is necessary to provide interface information (see judgment 17. 09. 07 Case T-201/04 Microsoft v Commission)] • (iii) refusal to grant access to an essential facility or a network [see B&I Line v Sealink Harbours and Stena Sealink 1992; Sea Containers v Stena Sealink – interim measures 1993] 26

As in the Discussion Paper, is acknowledged the existence of ‘masked’ refusals to supply As in the Discussion Paper, is acknowledged the existence of ‘masked’ refusals to supply • It is not required a plan refusal (‘no, I do not let you get in’) • The abuse might also consist in ‘constructive refusal’ • For example it can take the ‘form of unduly delaying or otherwise degrading the supply of the product [I would add ‘or the service’] or involve the imposition of unreasonable conditions in return for the supply’ [see § 78] 27

More difficult to define and assess margin squeeze Definition taken from the Guidance [para. More difficult to define and assess margin squeeze Definition taken from the Guidance [para. 80]: ‘[when] a dominant undertaking may charge a price for the product on the upstream market which, compared to the price it charges on the downstream market, does not allow even an equally efficient competitor to trade profitably in the downstream market on a lasting basis (a so-called “margin squeeze”). In margin squeeze cases the benchmark which the Commission will generally rely on to determine the costs of an equally efficient competitor are the LRAIC [Long Run Average Incremental Cost] of the downstream division of the integrated dominant undertaking’. 28

Legal grounds for National Courts to intervene on the basis of both Article 81 Legal grounds for National Courts to intervene on the basis of both Article 81 and 82 EC • General principle of direct application (‘efficacité directe’) and horizontal application of some EC Treaty provisions Case-law: • Van Gen Loos C-26/72 • Defrenne/Sabena C-43/75 • Courage/Crehan C-453/99 29

EC Regulation 1/2003 • New legal grounds for direct application of Art. 82 EC EC Regulation 1/2003 • New legal grounds for direct application of Art. 82 EC (and 81 EC of course): • Art. 3 “Relationship between Articles 81 and 82 EC and National competition law” – This article states that “where the competition authorities of Member States or national courts apply national competition law “within the meaning” of Art. 81/82 EC, they shall also apply Art. 81/82 EC” 30

EC Regulation 1/2003 (follows) • Article 6 “Power of the national courts” states: National EC Regulation 1/2003 (follows) • Article 6 “Power of the national courts” states: National Courts shall have the power to apply Articles 81 and 82 EC [Art. 15: cooperation between the Commission and the National Courts, i. e. exchange of information] 31

Reaction in Member States – The United Kingdom • UK Enterprise ACT 2002 Section Reaction in Member States – The United Kingdom • UK Enterprise ACT 2002 Section 18 “Damages” inserted Art. 47 A in the Competition Act 98 re: “Award of damages by the Tribunal” (CAT) for violation of Chapter I and II Prohibitions and Article 81 and 82 EC but … 18 32

Three (alternative) conditions must be met in UK • 1. The OFT has made Three (alternative) conditions must be met in UK • 1. The OFT has made a decision that Chapter I or II or Article 81 or 82 EC has been infringed • 2. The Tribunal has made a decision • 3. The European Commission has made a decision 19 33

ENTERPRISE ACT 2002: Article 19 and consumer protection claims • Article 19 inserted also ENTERPRISE ACT 2002: Article 19 and consumer protection claims • Article 19 inserted also Article 47 B to the Competition Act 98: “A claim may be made under section 47 A by a specified body on behalf of two or more individuals who have claims under that section as consumers and in respect of the same infringement” 34

The most known case of private enforcement is about a violation of Art. 81 The most known case of private enforcement is about a violation of Art. 81 and 82 EC: Crehan/Courage Crehan was the tenant of two pubs in Staines, West London He was required to purchase a fixed minimum quantity of beer from the Brewer Courage Ltd Courage sued Crehan for £ 15, 266 unpaid deliveries of beer Crehan’s complaints: Courage sold at lower prices to other pubs, so his business failed 35

Crehan/Courage saga • In fact the private action in this case is far from Crehan/Courage saga • In fact the private action in this case is far from encouraging … long-lasting proceedings, many ‘changes of direction’ and legal uncertainty, very low amount of damages and interests acknowledged • 1 st step: The High Court, on the basis of the principle ‘in pari causa turpitudinis’, rejected the claim that Crehan had been abused and forced to be part of an illegal agreement under Art. 81 EC 36

Crehan/Courage • 2 nd step: • The Court of Appeal (of England Wales), after Crehan/Courage • 2 nd step: • The Court of Appeal (of England Wales), after preliminary ruling by the ECJ confirming that where anti-competitive conducts are ascertained (in particular Art. 81 EC), damages must be awarded, awards the damages [Case C-453/99 Courage v. Crehan [2001] ECR I (judgment of 20 September 2001; [2001] 5 C. M. L. R. 28) 37

A turning point in United Kingdom • The Court of Appeal considered that the A turning point in United Kingdom • The Court of Appeal considered that the High Court, in ignoring previous Commission decisions in ‘consimili casu’, infringed Art. 10 EC, that expressely requires the highest cooperation between national institutions and European Community entities. • The Court of Appeal awarded a nonextraordinary amount of damages: £ 131, 336 38

4 th step: the House of Lords • However, the House of Lords [Inntrepreneur 4 th step: the House of Lords • However, the House of Lords [Inntrepreneur v Crehan, 2006] on the 19 July 2006 rejected the position adopted by the Court of Appeal. • It established that the national court could not be considered itself bound by a European Commission decision, when the parties and the facts on which it is called to make a judgment are not the same… • The Court of Appeal would have been ‘unfair’ vis-à-vis Courage (Inntrepreneur) and would have infringed his right of defence. • Therefore the Court of Appeal judgment was overturned. No damages awarded. 39

Some key-facts at the end of the saga. . • June 2005: Mr Crehan Some key-facts at the end of the saga. . • June 2005: Mr Crehan faces bankruptcy and a loss of legal aid • May 2006: Spiraling costs and intervention by the Office of Fair Trading could delay the case • June 2006: The Lords refuses to hear submissions on potential damages • July 2006: The Lords overturns the Court of Appeal ruling from 2004 and finds in favor of Inntrepreneur. [source: http: //www. thepublican. com/story. asp? story. Code=52437] 40

Another private litigation based (also) on Art. 82 EC – interim measures • In Another private litigation based (also) on Art. 82 EC – interim measures • In July 2006 Adidas won the first round vis-à-vis the High Court in England, against the request of the International Tennis Federation, the Lawn Tennis Association, the All England Lawn Tennis and the Croquet Club, Tennis Australia, Fédération Française de Tennis and the US Tennis Association, to DO NOT USE the famous three strips that characterise the Adidas trade-mark/industrial design because this fact would have infringed the ‘federal regulation’ (no publicity on the clothes). • Adidas filed the request of interim relief at the High Court (otherwise would have been forced to stop playing both in England in the USA-based ‘Open’) on the basis of infringment of Art. 82 (and 81 EC) carried out by the International Tennis Federation. • The case was finally settled before the final judgment. 41

Case British Horseracing Board [BHB] v. Attheraces – 2 February 2007 • Another Art. Case British Horseracing Board [BHB] v. Attheraces – 2 February 2007 • Another Art. 82 EC (and Chapter II Prohibition)-based case At. The. Races provides foreign bookmakers with both the broadcasting service of horses races AND with the data with respect to the races of British horses. At. The. Races sues BHB (the British Horseracing Board) on the basis of Art. 82 EC with respect to the excessive prices paid for BHB’s data and refusal to supply. The High Court acknowledged that BHB had abused of its dominant position, forcing At. The. Race to pay excessive prices and carrying out ‘refusal to supply’ activity. 42

However, the Court of Appeal quashed the HC judgment • The Court of Appeal However, the Court of Appeal quashed the HC judgment • The Court of Appeal considered that the price paid for the aggregated data was not excessive. • Extremely important judgment in UK because the court defined what should be considered ‘excessive’ in a Chapter II / Art. 82 EC litigation and on the concept of ‘essential facilities’ 43

Findings of the Court of Appeal in At. The. Races case (2007) – the Findings of the Court of Appeal in At. The. Races case (2007) – the BHB could still exploit the information commercially, even without the added protection of IP rights – The BHB could impose contractual restrictions on third parties, who acquired the information, for use in a particular way – BHB could also take into account the economic benefit Attheraces derived from the data, when setting its prices • • (in 2005 the ECJ in a preliminary ruling in the case William Hill v. BHB had ascertained that the BHB data, non aggregated, were not an ‘essential facility’: “In a judgment which appeared to reverse the fortunes of BHB, the ECJ underlined the requirement that, in order to qualify for protection, there had to be substantial investment in the database itself. Resources spent in creating the data in the database could not be taken into account. Thus, the owner had to show that he had spent significant investment on the right sort of activities, i. e. obtaining, verifying or presenting contents, before the database right would attach to the database. The ECJ went one step further and also said at the end of its first ruling that “the resources used to draw up a list of horses in a race and to carry out checks in that connection, do not constitute investment in the obtaining and verification of the contents of the database in which that list appears”. http: //www. twobirds. com/English/News/Articles/Pages/The_end_of_the_race_for_The_BHB. aspx) 44

Other recent cases in UK of damages actions under Section 47 A of CA Other recent cases in UK of damages actions under Section 47 A of CA 98 The Competition Appeal Tribunal has recently dealt with relatively numerous cases (in comparison with other European courts), mostly based on Art. 81 EC infringments: i. e. • Case 1077/5/7/07 Emerson Electric Co and others v Morgan Crucible Company plc and others (case based on the European Commission’s decision in Electrical and Mechanical Carbon and Graphite Products cartel COMP/38359) – judgments on 17. 10. 07, 28. 04. 08; judgment on costs 17. 10. 08 • Case 1078/7/07 The Consumers Association v JJB Sports Plc (action for damages on the basis of OFT, CAT and Court of Appeal decisions in Football Replica Kit. Settled (withdrawn on 14. 01. 08 – still on going for the costs) 45

An Art. 82 EC private litigation in UK: Case 1105/5/7/08 Freightliner Ltd and others An Art. 82 EC private litigation in UK: Case 1105/5/7/08 Freightliner Ltd and others v English Welsh & Scottish Railways Ltd • • • Action for damages arising from a decision of the ORR (Office of Rail Regulation) of 19 December 2006 finding that EWS had abused of its dominant position. The case was withdrawn from the Court on 28 January 2009 (probably settled) Parties: - English Welsh and Scottish Railway Limited (EWS) is the largest freight operator in the UK, operating approximately 8, 000 rail freight services each week. - Freightliner Heavy Haul (Freightliner) is a bulk rail freight operator. In early 2001, Freightliner entered the market for coal haulage by rail through a contractual relationship with ECSL. At that time Freightliner became EWS's only direct competitor in the market for coal haulage by rail in the UK. The ORR (also) found that EWS had abused its dominant position through predatory pricing in respect of prices offered to London Electricity Group and UK Coal. EWS had offered London Electricity Group and UK Coal prices that were substantially below its average total cost for the flows in question. Important note: the UK OFT has published a discussion paper on Private Actions in Competition Law, 18. 04. 07 – and recommendations in November 2007 46

Another UK case of private litigation based on art. 82 EC • British Leyland Another UK case of private litigation based on art. 82 EC • British Leyland Motor Corporation v T. I. Silencers Limited [1981] 2 C. M. L. R. – based on both Art. 81 and 82 EC British Leyland (dominant) v. T. I. Silencers (abused) – at stake a problem with royalties over copyright detained by BL – T. I. did want to pay those royalties Interesting because the Court of Appeal also concluded that the judgment did not have to address the implications of claims to damages in those circumstances because it proceeded on the basis that a co-contractor could not recover damages for the consequences of a breach of Art. 81 (1) (position reversed by the ECJ in Courage v Crehan) 47

Case-law on Art. 82 (or Art. 82 -related) and National courts in other jurisdictions Case-law on Art. 82 (or Art. 82 -related) and National courts in other jurisdictions • Difficult to find a more-representative member State for private actions based (also) on Art. 82 EC than United Kingdom • In Italy, the most known case is Manfredi, a lawsuit triggered by Mr. Manfredi in a local lower court to be reimboursed of the extra-money paid to his insurer as a consequence of Art. 81 -based conducts, a follow-on claim based on the famous Car Insurance cartel decided by the Italian Competition Authority in July 2000. • In fact, can not be considered an Art. 82 EC case… 48

ECJ in the Manfredi case (2006) • However, the ECJ ruling given in July ECJ in the Manfredi case (2006) • However, the ECJ ruling given in July 2006 is important because clarified the possibility to claim damages at national level for Art. 81 and 82 EC infringement. • “The Court ruled inter alia that article 81 EC must be interpreted as meaning that any individual can rely on the invalidity of an anticompetitive agreement and, where there is a causal relationship between the latter and the harm suffered, claim compensation for that harm. In the absence of Community rules governing the matter, it is for the domestic legal system of each Member State to prescribe the detailed rules governing the exercise of that right, provided that the principles of equivalence and effectiveness are observed” • [see http: //www. concurrences. com/rubrique. php 3? id_rubrique=662&lang=en] 49

Manfredi (follows) • Ruling on a reference from an Italian court, the ECJ has Manfredi (follows) • Ruling on a reference from an Italian court, the ECJ has confirmed that it must be open to any individual to seek damages for loss caused by a contract or by conduct liable to restrict or distort competition. Otherwise the effectiveness of Article 81 and 82 EC would be put at risk. The court stresses, however, that there must be a causal relationship between the harm and the agreement or practice prohibited by Article 81 EC. 50

Final remarks on actions based on the violation of Art. 82 EC in national Final remarks on actions based on the violation of Art. 82 EC in national courts • Many questions arising from the direct application in the national courts are the same in presence of damages claimed on the basis of Art. 81 AND/OR Art. 82 EC • One of the main questions is the ‘burden of proof’: is it possible to rely exclusively on the basis of the administrative (Commission/NCA) decision? • One of the key factor of success is the fact that the plaintiff may rely on the proofs already gathered by the administrative bodies. Clear rules should be adopted by single member states 51

Another key-point: what is the legal value of an administrative decision for the court? Another key-point: what is the legal value of an administrative decision for the court? • The Commission (see White Paper 2008) actually asks the Courts to take into consideraion those decisions [§ 2. 3]: • “Whenever the European Commission finds a breach of Article 81 or Art. 82 EC, victims of the infringement can, by virtue of established case law and Art. 16(1) of EC Reg. 1/2003, rely on this decision as BINDING PROOF in civil proceedings for damages” (see UK EA 02!) – other States should adopt the same criterion 52

The White Paper and Art. 82 EC • If the White Paper will have The White Paper and Art. 82 EC • If the White Paper will have full application in the Member States, it will be sufficient for the company that has suffered an abuse to rely on the decision to get compensation for the damages: National courts that have to rule in actions for damages on practices under art. 81 and 82 EC on which an NCA has already given a final decision, or on which a review court has given a final judgment (upholding the NCA decision), cannot take decisions running counter to any such decision or ruling 53

Relation between White Paper on damages actions, EC Reg. 1/2003, and Art. 82 Discussion Relation between White Paper on damages actions, EC Reg. 1/2003, and Art. 82 Discussion Paper/Guidance • If the ‘guidance’ provided by the White Paper 08 will be followed by the single member States, and pieces of legislation will be adopted in line with that document, the national judges will be not required to carry out their own assessment of the abusive conducts (in line with the Guidance and the Discussion Paper) 54

Article 82 EC is not only the basis for damages: also nullity of the Article 82 EC is not only the basis for damages: also nullity of the contract • Art. 82 EC most evident application in front to national Courts, when and whether any single member State will adopt detailed legislation and guidance to apply it at horizontal level, is to claim damages • What about declaration that a contract is ‘void and unenforceable’? (see English Wales & Scottish Railway Limited v. E. ON. UK plc [2007] EWHC 599) 55

Initiative of the single national Courts to carry out its own proceedings on the Initiative of the single national Courts to carry out its own proceedings on the basis of art. 81 and 82 EC infringements • The case-law we have tackled above is based on ‘follow-on’ claims, based on previous decisions made by the Commission or the NCA This is, i. e. , what is established by the UK Enterprise Act 02 However, theoretically, on the basis of Reg. 1/2003, single Courts could make the decision of carrying out the case without a previous decision (‘stand alon’ cases) (i. e. collective actions) Crucial role of national legislation In Italy Bersani Law, introducing the collective actions for infringement of Art. 81 (and 82) and national equivalent provisions, is at present on hold … (next date: 1 st July 2009) 56

An old principle, which pretends to be clarified • ‘In the absence of Community An old principle, which pretends to be clarified • ‘In the absence of Community rules on this subject, it is for the domestic legal system of each Member State to designate the courts having jurisdiction and to determine the procedural conditions governing actions at law intended to ensure the protection of rights which citizens have from the direct effect of Community law…’ [Case 33/76, Rewe-Zentral Finanz v. Landswirtschaftskammer fur das Saarland [1976]’ 57

The principle of effectiveness of European Law is at stake. Conclusion. • One of The principle of effectiveness of European Law is at stake. Conclusion. • One of the oldest principle of European Law is here at stake • ‘The full effectiveness of Community law would be unpaired if individuals were unable to obtain redress when their rights were infringed by a breach of Community Law’ • [Brasserie du Pecheur, C-46 and 48/93] • EC Regulation 1/2003 may change things in future, but it is a slow process. The former monopoly of application of Art. 81(3) by the Commission represented for long time a limit for national enforcement, and for the development of a ‘litigation culture’ based on Art. 81 and 82 EC 58

However things may change … • Crucial will be to introduce, perhaps, a substantial However things may change … • Crucial will be to introduce, perhaps, a substantial (financial) interest in acting in national Courts • In the US 90% of antitrust cases are dealt with private litigation: treble damages may be awarded • Clear rules on how national rules on damages and injuctions should be adopted • Need to clarify the burden of proof to show the causal link between antitrust infringments and actual damage suffered • Need to further clarify how much the judge should rely on the Commission documents and decisions, or whether the judge could rely on further documents provided by the party, or can make their decisions independently • See Commission Notice [point B] on the Handling of Complaint by the Commission under Art. 81 and 82 EC [2004] OJ C 101/65 for further clarification 59

Readings • Basedow, J. Private Enforcement of EC Competition Law (Kluwer, 2007) • Jones Readings • Basedow, J. Private Enforcement of EC Competition Law (Kluwer, 2007) • Jones A. Restitution and European Community Law (LLP, 2000) • Smith, M, Competition Law: Enforcement and Procedure (Butterworths, 2001) • Whish, R. , in Lonbay, J. Frontiers of Competition Law (Wiley, 1994) • Wils, W. , Principles of European Antitrust Enforcement (Hart Publishing, 2005) Chap. 4 • Comments are welcome to: Pierluigi. [email protected] AC. UK 60