Public antitrust enforcement- Procedure and Standards of Judicial Review in EU Competition Law EU Antitrust Law 27-28 September 2018, Zadar Croatia Dubravka Aksamovic

Judicial review in Competition cases - Proceedings before the General Court A/ Procedural Issues Procedure before the GC and the Court B/ Admissibility of annulment actions What acts can be challenged? Reasons for an appeal before the GC Who can bring an action and time limits for lodging a claim What the applicant is required to do in the context of legal challenge? C/ Substantive standard of judicial review in competition cases Evidences before the EU Court „Control of legality” v. unlimited control What needs to be proven?

1. Getting to the point: Public enforcement a/ Parties to the proceedings: X Undertakings: BROAD CONCEPT IN EU LAW – undertaking explained Prosecuted by the Commission because they entered into: prohibited agreement (cartel) or abused dominant position or failed to notify concentration( merger) EU Commission Broad powers in competition cases Conduct investigation Decides on infringement Conduct proceedings against undertakings Decides on fine,decides on immunity

System of legal protection in EU competition cases Legal remedies against Commission’s decision The Court 2nd instance Court The General Court 1st instance Court Undertakings Appeals Against GC decisions Appeal to EU Commission

A/Procedure before the GC Rules of Procedure of the GC 2015 Three types of actions: Direct actions Proceedings relating to intellectual property rights Appeals against decisions of the Civil Services Tribunal Procedrue before the GC is written and oral Case starts: a/ by lodging claim b/reply by the Commission c/ two rounds of pleadings d/ deliberation fo judgement/decision Submissions are made in any EU official language; Parties must be represented by lawyers

B/Admissibility of annulment actions What Commmission’s acts can be challenged? Any Commission decisions intended to produce legal effects and bring a distinct change in the legal position of the claimant. ( Article 230 of the TFEU). Example: decision establishing the existence of an infringement/ decision declaring that no infringement has been committed act by the Commission by which it terminates an investigation decision on fines decision imposing remedies QUESTION: Does the oral statement made by the Competition Commissioner’s spokesman constituted a decision. X IN CASE Air France v. Commission the spokesman had declared that the proposed acquisition od Dan Air by British Airways did not need to be notified under EU merger rules. The CFI held that the oral statement produced legal effects and that the action was therefore admissible). What Commission’s acts cannot be challenged? Preliminary steps towards a final decision are not a decision and cannot be challenged (STATEMENTS OF OBJECTIONS) HOWEVER: Some decisions taken during procedure can be challenged; Order to undertakings to produce information; denying access to the case file; requiring the disclosure of documents

B/Admissibility of annulment actions Reasons for an appeal before the GC Article 263 of the TFEU Lack of competence Infringement of an essential procedural requirements Infringement of the Treaties or any rule of law relating to their application Misuse of powers by the Commission (Microsoft v. Commission T- 201/04)

B/ Admissibility of annulment actions Who can bring an action? a/ addressees of the Commission decisions in cartel cases, cases of abuse of dominant position and in merger cases) b/ third parties have standing if they can show that the decision is of direct and individual concern to them (How to interpret individual concern?) PARTIES WHO DID NOT PARTICIPATED IN COMMISSIONS INVESTIGATION usually do not have standing!! What time limits apply? As a general rule, a claim must be lodged within two months and ten days- starting from: 1/ for addressees -starting from the day when the addressee is notified of the decision 2/ for third parties from the day when the decision is published in the OJ (if the decision is published) if not the time limits run from when the third party acquired actual knowledge of the decision.

A/ Admissibility of annulment actions What the applicant is required to do in the context of legal challenge To identify precisely elements of contested decision To formulate grounds for challenge ( Art. 263 of the TFEU) To demonstrate that its objections are well founded To adduce evidences that support claim

New facts and evidences before the GC An applicant must set out in its appeal all pleas in law and identify all available evidences. In later stage new please in law and new evidences will be allowed only if they were unknown to it at time it lodged the appeal. Generally, GC is willing to hear fresh evidence in litigation (Comparison with the national system of judicial reveiw) Acceptable evidences: ORAL v. WRITTEN EVIDENCES expert statements witness statements employees statements economic evidences

In Airtours v. Commission, Schneider Electric v. Commission, Impala v In Airtours v. Commission, Schneider Electric v. Commission, Impala v. Commission and other cases GC overturned the Commission’s decision. In all three cases GC carefully analyzed reasoning of, and evidence relied on by the Commission and found that they did not meet the required standard for supporting the Commission’s conclusion. With regard to examination and assesment of evidences The Court requires production of „convincing evidences” Reliable evidences Ex post drafted evidences will have lesser probative value Evidences that cannot be used by the Commission or the Court: Documents that were not submitted to the Commission during investigation and that the Commission could not have taken into account cannot be relied on. Unlawfullly obtained evidences Documents that did not fall within the scope of inspection

Assessment of Commission’s „complex economic evaluations” Is the GC entitled to re- examine economic analysis provided by the Commission? What is the role complex economic evaluations in overall assessment of infringement in abuse of dominant position case/in cartel case? General view taken by the Court: Commission’s margin of discretion In Consten and Grunding the Court specified that „ a judicial review of the Commission’s complex evaluations of economic matters should entail examination of the relevance of facts and of their legal consequences which the Commission deduces therefrom”

C/ Substantive standard of judicial review in competition cases Questions: 1/ What kind of review the does the General Court conduct in competition cases against the Commission’s decisions? 2/ Should the GC only check whether the Commission acted within it’s competence OR should it conduct de novo analysis?

Two types of judicial control in competition cases LIMITED REVIEW „control of legality” FULL REVIEW - unlimited review The GC has unlimited jurisdiction regarding fines Art. 31 of Regulation No 1/2003 The GC conducts „control of legality when it decides on the existence on an infringements Art. 263 TFEU: „ The Court of Justice shall review the legality of ....”

CONTROL OF LEGALITY: LIMITED REVIEW Limited review means that the Court will not reconsider decision by starting an assessment from the beginning. The Court will review: „ the accuracy, sufficiency of the facts and their relevance”; „ the process of assesment by the Commission” and whether the „outcome is supported by record”. „ Review should be deep but not too deep”

SCOPE OF JUDICIAL REVIEW The GC focus on following: Whether the decision is based on a correct interpretation of the law Whether the facts were correctly established and supported by adequate evidences Whether the Commission committed a manifest error in appraisal Whether the decision is properly reasoned Whether the procedural rights were observed

FULL REVIEW: GC decisions on fines Fines: policy and trends: 1994- 2005 3.76 bn Euros 2005- 2017 18. 50 bn Euros In 2016 average fine imposed amounted to 266. 2 m per fined undertakings Undertakings show great incentive to appeal Commission decision GC powers regarding fines: Reduce fine Increase fine Cancel fine Success ratio: 1/3 of applicants before the GC achieve some reduction of the fine imposed by the Commission The most successful appeal arguments: miscalculation of fine due to misapplication of Commission’s guidelines on fines

Duration of the proceedings before the GC and delivery of judgement GC convene in the form of chambers of three judges (regular composition), five judges (extended composition) or thirteen judges (Grand Chamber) Following the hearing, on the same day, judges deliberate and bring judgement Average duration of the proceedings before the GC is 46. 6 months There is no strict time – limits for delivery of judgement Costs: there are no court fees for appeals to either GC or The Court The Court applies the „loser pay” principle; defeated party bears all costs

Legal remedies against the General Court’s judgement Appeal to The Court is limited to the points of law only. Separate set of procedural rules apply: Rules of procedure of the European Court of Justice (2012) Time-limits for making an appeal: two months from the delivery of judgement of the GC + 10 day on account of distance Procedure: written and oral with only one exchange of pleadings between parties ( i.e. a reply to the response submitted by an appellant and a rejoinder submitted by a defendant) Following the oral hearing the judges deliberate and decide on judgement (parties can give up oral procedure)

Winning and losing arguments before the Court The most successful appeal arguments before the GC: Miscalculation of fine Miscalculation of the infringement concerning duration Miscalculation of the applicable Leniency Notice Failure to state reasons Unsuccessful appeal arguments: Regarding to parental liability Inability to pay Fairness of proceedings Mitigating circumstances

Thank you!