Competition Express 8 March Issue 40

Transcription

1 Competition Express 8 March Issue 40 A regular EU Competition law news alert service Produced by Bird & Bird, Brussels Table of Contents Antitrust Dawn raids in the flat glass and car glass industry ECJ gives interpretation on compatibility of Italian rules for access to the legal profession No legal standing for individuals with regard to Article 86 EC Merger Conditional approval of Chips acquisition by Orka Publication of three Notices regarding EU merger control State aid Commission orders recovery of 6.7 million restructuring aid granted to Chemische Werke Piesteritz Media Financing of public service broadcasters in Germany, Ireland and The Netherlands WTO A legal person cannot invoke WTO law in national proceedings Contact details Antitrust Dawn raids in the flat glass and car glass industry Several manufacturers of flat and car glass have received the visit of competition authority officials in Belgium, France, Germany, the UK, Sweden (only relating to flat glass) and Italy (only relating to car glass). In the area of flat glass, used principally for the manufacture of glass products in the building sector and in a processed form by the automotive industry, the Commission believes that the manufacturers concerned colluded to co-ordinate price increases and jointly agreed on the introduction of a so-called energy surcharge. As regards car glass, the producers are suspected of having allocated customers and agreed on supply quotas and prices. Our readers will be reminded that several Italian flat glass manufacturers and associations of manufacturers were condemned by the Commission for similar facts in 1981 (no fine) and 1988 (total fine of 13 million). [Indiana de Seze] ECJ gives interpretation on compatibility of Italian rules for access to the legal profession The ECJ has held that neither the EU competition rules (Articles 81 and 82 EC) nor the EC Treaty rules on freedom of establishment (Article 43 EC) preclude that the examination committee responsible for access to the profession of advocate is composed of five members appointed by the Minister for Justice. The case had been referred by an Italian court on preliminary ruling and concerned the refusal to admit a candidate to the oral stage of the State examination for authorisation to practise as an advocate in Italy. The candidate brought an action before the national court seeking the annulment of the decision taken against him. He claimed, inter alia,

2 that the composition of the committee, as provided for by Italian law, did not allow an impartial assessment or ensure a mechanism for proper competition in respect of access to the profession of advocate, in breach of the provisions of Articles 3(g), 28, 49 et seq., 81 and 82 EC. As regards the application of EU competition rules, the court observes that the State occupies a significant position on the five-member examination committee itself by the presence of two judges who, even if they are not hierarchically subordinate to the Minister of Justice, must none the less be regarded as an emanation of that State. In addition, the Ministry of Justice appoints the members of the examination committee, chooses the examination subjects, may annul the examination in the case of irregularities and may intervene by appointing its own representative to implement the instructions received in order to ensure that the examinations are conducted in a disciplined and orderly fashion. The supervision carried out by the State at each stage of the examination at issue in the main proceedings leads to the conclusion that it has not given up the exercise of its powers in favour of private economic operators. It must, therefore, be concluded that Articles 81 EC and 82 EC do not preclude a law such as that criticised by the applicant. As regards the rules on freedom of establishment, the court holds that, although an examination for access to the profession of advocate may indeed constitute an obstacle to the freedom of establishment, in the dispute in the main proceedings it is only the rule relating to the composition of the examination committee which is contested and not the fact that such an examination is organised. There is no evidence to suggest that such a rule constitutes a restriction on freedom of establishment, irrespective of the restriction which might result from the examination itself. In any event, participation in a State examination may be regarded as justified by an overriding requirement in the interest of the public, namely the need to assess as well as possible the aptitude and ability of persons called to practise as advocates. It is suitable for securing the attainment of that objective in that advocates have professional experience which makes them particularly qualified to assess candidates in the light of the specific requirements of their profession. The court thus held that Article 43 EC does not preclude a law on the composition of a professional examination committee such as that criticised by the applicant. Case C-250/03, Mauri, order of 17 February [Indiana de Seze] No legal standing for individuals with regard to Article 86 EC The European Court of Justice (ECJ) has ruled that the Commission is under no obligation to bring proceedings against a State measure following a complaint lodged by an individual under Article 86 EC. Consequently, the complainant has no legal standing to bring an action against the Commission's refusal to act against a Member State. Max.mobil was the second GSM network operator to appear on the Austrian market after Mobilkom Austria AG, whose shares are still held in part by the Austrian State. The former State monopoly over the entire mobile telephony sector was entrusted to Mobilkom shortly before max.mobil entered the market in In 1997, max.mobil lodged a complaint with the Commission arguing that Austria had infringed Article 86, in combination with Article 82 EC, by unlawfully conferring advantages on Mobilkom, in particular by not drawing any distinction between the amount of the concession fee charged to max.mobil and that charged to Mobilkom. With regard to public undertakings and undertakings which enjoy special or exclusive rights, Article 86 EC provides that Member States shall neither enact nor maintain in force any measure contrary to the EC Treaty rules (including Article 82 which concerns abuse of dominant position). According to Article 86(3), the Commission shall ensure the application of the provisions of Article 86 and, where necessary, address appropriate directives or decisions to Member States. The Commission, however, rejected max.mobil's complaint, and the latter brought an action before the Court of First Instance (CFI), seeking to have the rejection set aside. In January 2002, the CFI rejected the appeal on its substance. Nevertheless, it ruled that max.mobil's appeal against the Commission letter, rejecting the complaint, was admissible.

3 Although it was successful on the merits, the Commission appealed against the CFI's ruling on admissibility. In the Commission's view, its decision rejecting max.mobil's complaint could not be subject to judicial review. In its ruling of 22 February 2005, the ECJ recognised that individuals may, in certain circumstances, be entitled to bring an action for annulment against a decision which the Commission addresses to a Member State on the basis of Article 86(3) EC if the conditions laid down in the fourth paragraph of Article 230 EC are satisfied. However, the ECJ found that it follows from the wording of Article 86(3) and from the scheme of that Article as a whole that the Commission is under no obligation to bring proceedings within the terms of Article 86, as individuals cannot require the Commission to take a position in a specific sense. The fact that max.mobil has a direct and individual interest in annulment of the Commission's decision to refuse to act on its complaint does not confer on it a right to challenge that decision. The letter by which the Commission informed max.mobil that it did not intend to bring proceedings against Austria did not produce binding legal effects, and, therefore, does not constitute a challengeable legal measure capable of being the subject of an action for annulment. The ECJ emphasised that there is no general principle of EC law which requires that an individual must be recognised as having standing before the EC Courts to challenge a refusal by the Commission to bring proceedings against a Member State on the basis of Article 86(3). The ECJ therefore set aside the CFI's judgment. Case C-141/02 P, Commission v max.mobil, judgment of 22 February [Filip Ragolle] Merger Conditional approval of Chips acquisition by Orka The proposed acquisition by Norway s Orkla (branded consumer goods) of Finnish food company Chips has been conditionally cleared by the Commission. The Commission was concerned that the combination of the merging parties activities would upset the Finnish market for sales of frozen pizzas to the retail sector. In order to allay this concern, Orkla offered to terminate the existing distribution agreement between Chips and a Swedish company, Gunnar Dafgard, which accounts for all of Chips sales of frozen pizza in Finland. Gunnar Dafgard is at the same time a competitor, selling Billy s pizzas. The Commission considers these commitments sufficient to remove its concerns, as they ensure that the Billy s pizza brand will henceforth be managed and distributed independently from the merged businesses, thus allowing for additional competition in the market. [Wilko van Weert] Publication of three Notices regarding EU merger control Three Commission Notices relating to the implementation of the new merger control regulation have been published in the Official Journal of the EU: Commission Notice on Case Referral in respect of concentrations Commission Notice on restrictions directly related and necessary to concentrations Commission Notice on a simplified procedure for treatment of certain concentrations under Council Regulation (EC) No 139/2004 The text of these notices had already been published in English on the website of the Directorate General for Competition for consultation purposes (see CompEx Issue No. 23); they are now available in all the languages of the EU at the following address: [Indiana de Seze] State aid Commission orders recovery of 6.7 million restructuring aid granted to Chemische Werke Piesteritz Germany has been ordered to recover 6.7 million restructuring aid paid in 1997 and 1998 to Chemische Werke Piesteritz (CWP), a producer of phosphates and phosphoric acid situated in the Land of Sachsen-Anhalt.

4 The Commission found that a number of measures designed to aid the restructuring of CWP constituted unlawful subsidies and should be recovered. This decision followed a ruling of the CFI in 2001 which annulled the original Commission decision approving the aid package. The case had been brought by a competitor of CWP, Prayon-Rupel, who was able to demonstrate that the restructuring plan was not feasible. Restructuring aid is allowed only when it can be demonstrated that a sound restructuring plan exists which should allow the company to regain its viability and competitiveness after the restructuring period. On re-evaluating the restructuring plan for CWP, the Commission found that it was incomplete and that it could therefore not result in the company's return to long-term viability. The decision was further reinforced by the fact that the plan, which originally was to run until 2000, has still not yet been fully implemented. [Filip Ragolle] Media Financing of public service broadcasters in Germany, Ireland and The Netherlands The Commission has requested Germany, Ireland and The Netherlands to clarify the role and the financing of public service broadcasters (PSBs). Based on allegations from several complainants, the Commission s first analysis is that the current financing system in these Member States may infringe the EU State aid rules. Those Member States have thus been asked to show whether State financing of public service broadcasting may be justified in accordance with the Altmark judgment criteria. In particular, they must: 1. Set out in a formal act a clear remit for public service broadcasting. The Member State has to define in a clear manner the tasks which the public broadcaster has to fulfil. The Commission checks only whether the definition is not manifestly wrong. Online information activities may be included. However, the scope of such online activities and whether they are financed by public funds should be determined not by the public broadcasters themselves but by the Member States concerned to ensure that only those services are included which serve the same democratic, social and cultural needs of society as traditional broadcasting. By contrast, e-commerce and the sale of advertising space should not be included in public service activities. These are commercial activities which cannot be funded with public money. 2. Ensure independent national monitoring of the fulfilment of the PSB remit. 3. Ensure that the funding of the PSBs is proportionate. State financing must not exceed the costs of the public service. The costs of the public service need to be determined, based on separate accounts. State aid rules do not prohibit PSBs from undertaking commercial activities inasmuch as these commercial activities do not benefit from any State support and that PSBs carry out commercial activities according to market conditions. In the next few months the three Member States will have the opportunity to comment on these preliminary views and discuss which changes could allow the Commission to close the case. Similar action was taken by the Commission against France, Italy, Spain and Portugal in The Commission concluded that the yearly financing schemes of the public broadcasters had to be amended so as to ensure compliance with the same fundamental principles. These four Member States have already adopted or proposed to adopt the above-mentioned measures. [Indiana de Seze] WTO A legal person cannot invoke WTO law in national proceedings The European Court of Justice ("ECJ") has ruled that a legal person cannot plead the incompatibility of EC legislation with WTO law before a national court. This principle is not altered by the fact that the WTO's Dispute Settlement Body (DSB) has confirmed the incompatibility.

5 Van Parys NV, a company established in Belgium, has imported bananas into the EU from Ecuador for more than 20 years. In 1998 and 1999 the relevant Belgian authority refused to grant import licences to Van Parys for the full quantity applied for. Those refusals were based on the EU regulations governing imports of bananas. Van Parys challenged those decisions before the Belgian Council of State, arguing that the EU Regulations in question are incompatible with WTO law (this had been confirmed by the WTO DSB). In response to the Belgian Council of State's request for a preliminary ruling, the ECJ examined whether the WTO Agreements give EU nationals a right to rely on those provisions in legal proceedings challenging the validity of EU legislation. The ECJ recalled that the WTO Agreements are not, in principle, among the rules which the court must take into account when reviewing the legality of EU measures. It is only where the EU has intended to implement a particular obligation assumed in the context of the WTO, or where a Community measure refers expressly to particular WTO provisions, that it is for the court to review the legality of a Community measure in the light of the WTO rules. These conditions were not fulfilled in the present case. The ECJ, therefore, concluded that Van Parys could not rely on the fact that the Community legislation in question is incompatible with WTO law. Case C-377/02, Van Parys NV v. Belgisch Interventie- en Restitutiebureau, judgment of 1 March [Filip Ragolle] Contact Details Wilko van Weert competition.express@twobirds.com Bird & Bird Avenue d'auderghem B-1040 Brussels Belgium Tel: Fax: Please note that the content of this document is for information only. This document is not intended as a basis for decisions in specific cases and professional advice should always be sought before acting. Items may be reproduced with attribution of the sources.