1. No category

How lenient is the European leniency system?
An overview of current (dis)incentives to blow the
whistle
Tine Carmeliet
Onder wetenschappelijke leiding van Prof. Dr. Wouter Devroe
INTRODUCTION
VICTIM OF PRIDE - These days, leniency is a cornerstone of the enforcement
policy of the European Commission and the National Competition Authorities
(“NCAs”). Almost 60 % of cartel infringements is discovered through
leniency. The efficiency and effectiveness of such system can thus hardly be
overestimated. However, due to the growing number of leniency applications,
the system is increasingly criticised, and seems to suffer from certain issues
that might function as disincentives to blow the whistle.
CHANGED REALITY- First, the current leniency system - which dates back from
2006 - was not framed to attire a large amount of leniency applicants. While
leniency should in fact speed up the decision making process of the
competition authorities, the latter are now facing a major backlog of leniency
applications. In addition to this success, the judicial landscape has changed
enormously since 2006. On one hand, we nowadays live more than ever in a
globalized world, where globalized cartels are the standard norm. Due to
Regulation 1/2003, today in at least 20 member states different leniency
systems are in play in the EU, as a consequence of which leniency suffers from
problems such as the lack of a one-stop shop or shortage of information that
can be easily uncovered, just to name a few. On the other hand, due to the
recent incorporation of the Human rights Charter (“the Charter”) and the
commitment of the EU to accede to the ECHR, more and more, a human rights
culture has arisen. The times when the role and functioning of the competition
authorities was simply criticized (“without consequences”) are past.
Nowadays, human rights issues have become of prime importance and
violations have increasingly become an internal constitutional matter of
concern.
INCENTIVES- As we come to say, for a leniency system to be effective,
everything stands or falls with incentives to reveal a cartel. Even though the
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use of the leniency system is more successful than ever before, it is doubtful
whether it will persist in the future. Indeed, at stake are two main problems
that (could) prevent undertakings from blowing the whistle. First, the leniency
system itself suffers from certain problems like the lack of harmonization,
multi-stop procedures, private enforcement issues, etc. Secondly, a furtherreaching claim goes to the foundations of the system of competition and
concerns the accumulation of functions by the European Commission. This
critique is prompted by upcoming claims of human rights violations in the
competition procedure, such as the right to a fair trial, the privilege of selfincrimination or the ne bis in idem principle. It is clear that both of these
problems are two sides of the same coin, as they both ensure that the leniency
system functions satisfactorily (if the issues are solved) or fails (disincentives).
QUESTION OF INQUIRY- In this paper, we will examine in the first part possible
current disincentives in the European Commission’s leniency regime by listing
key critiques. Secondly, an overview is given of the appraisals framed in
human rights terms. Hereby, we try to answer the question whether there is a
violation of those human rights, and whether they are of such significance as to
pose the undertakings for a more complicated prisoner’s dilemma and may
even prevent them from blowing the whistle at all. When answering those
questions, we will discuss possible solutions, changes and alternatives that
have recently been footballed around in the case law and literature.
1. INTRODUCTORY REMARKS ON THE LENIENCY
POLICY
METHODS OF CARTEL ENFORCEMENT-
Cartel enforcement is at any time in its
history one of the highest points on the agenda of the European Commission.1
In general, there are three methods to detect and enforce such cartels: i)
investigations by the competition authority ex officio, ii) investigations by a
claim or, iii) thirdly, through the application of the leniency regime.2
Nowadays, the latter method is gaining more success. Due to the secretive
nature of the cartels, their detection poses formidable challenges and these
investigations often terminate in expensive, long-lasting, yet unsuccessful
See European Commission’s Report of Competition Policy, 2008, (5-14). The expression of this
was -among others-, the creation in June 2005 within DG Comp of a Cartel Directorate
responsibility for prosecuting cartel cases and developing policy; the leniency notice of 2006; the
revised fining guidelines of 2006 and lastly the introduction of the settlement system in 2008.
2
For a complete overview of these methods and their drawbacks, see: W. WILS, “Leniency in
Antitrust enforcement: theory and practice”, World Competition 2007, 25-64. Leniency is
traditionally defined as “the granting of immunity from penalties or the reduction of penalties for
antitrust violations in exchange for cooperation with the antitrust enforcement authorities”.
1
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investigations.3 This is only one of the reasons why the European Commission
has tried to find alternatives so that people would “blow the whistle”.4
1.1. ADVANTAGES AND PITFALLS OF LENIENCY
1.1.1. General characteristics of the leniency policy
GENERAL PRINCIPLE- The leniency system instigates the well-known situation
of a “prisoner’s dilemma”. In this scenario, each player will pursue his own
individual interest, acting in a selfish manner, even when each of the
individuals would benefit from a more substantial pay-off if they would choose
to join forces collaboratively.5 According to the leniency system, only the first
party to blow the whistle will be granted full leniency, while the others will be
fined, even though some of them can enjoy a (significant) fine reduction. This
‘winner takes all’ approach incites a race, which creates tension and mistrust
amongst cartel members.6 It is thus a matter to create incentives for cartel
participants to show the infringement and break up the cartel.
INCONSISTENT LENIENCY ENFORCEMENT IN THE EU- Throughout the EU,
leniency rules are not enforced consistently. First and foremost, the European
Commission introduced the possibility of leniency by way of the Leniency
Notice, the most recent one dating back from 2006. 7 Next, as a consequence of
the decentralisation process through Regulation 1/2003, member states are able
to enforce cartel infringements and adopt their own leniency programme.8 The
difference among those leniency programmes however creates problems and
Discovering cartels is very costly: often, cartel participants use codes to conceal their companies’
names and encryption of software to protect the secrecy of emails and telephone conversations, or
even hire a consultancy firm to oversee and conceal their illicit arrangements: European
Commission decision of 24 January 2007; the Organic Peroxides European Commission Decision
of 10 December 2001; European Commission decision of 11 November 2009; R. WHISH and D.
BAILEY, Competition Law, Oxford, Oxford University Press, 2012, 513.
4
Leniency originated in the USA in 1978 and has since been updated a couple of times in order to
make it harder and more effective. See also L.O. BLANCO, EC Competition Procedure, Oxford,
Oxford University Press, 2006, 219; N. LEVY and R. O’DONOGHUE, “The EU Leniency
Programme Comes of Age”, World Competition 2004, 75-99; W. WILS, “Leniency in Antitrust
enforcement: theory and practice”, World Competition 2007, 25-64.
5
We shall see below that there are however some factors which could complicate this prisoners
dilemma and which should be taken into account (see PARA. 10).
6
S.D. HAMMOND, “When calculating the costs and benefits of applying for corporate amnesty,
how do you put a price tag on an individual’s freedom?”, March 8, 2001, 1-6; N. ZINGALES,
“European and American Leniency Programmes: two models towards convergence?”, CompLRev
2008, 5-60.
7
The first versions dated from 1996 and 2002. The goal of the newer versions was to make
leniency applications more predictable and consequently, more attractive.
8
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 (OJ L 4.1.2003), (“Regulation 1/2003”).
As we will see later, most of the member states however adopted a leniency programme more or
less based on the EU Leniency Notice; C.S. KERSE and N. KHAN, EC Antitrust Procedure,
London, Sweet and Maxwell, 2005, 64.
3
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supports disincentive initiatives. To more or less attune those programmes and
offer more productive alternatives, the EU installed the European Competition
Network.9
SCOPE OF APPLICATION- Opportunities for leniency only apply to cartel
infringements. However, in vertical relations, the European Commission has
also reduced fines substantially, on the basis of the fining guidelines, which
permit the European Commission to take account of co-operation outside the
Leniency Notice.10
ADVANTAGES- Leniency clearly has major advantages, the most considerable
one being the rather easy collection of intelligence and evidence through goaloriented inspections in premises. 11 Besides, a well-designed leniency
programme makes it very difficult for cartels to develop an organisational
structure in which they can create and maintain cartels. Leniency also
increases uncertainty and makes it more difficult for cartel participants to reach
an agreement. Lastly, leniency programmes tend to lower the costs of
adjudicating, since whistle blowers recognise the violation and accept the
penalty more easily.
1.1.2. Negative effects of the leniency policy
DETERRENCE GAP- Leniency has however some pitfalls. According to some,
the most important drawback is the lack of deterrence. Indeed, the more
leniency is granted, the less cartel infringers are deterred.12 It is argued that, to
overcome this deterrence gap, the competition authority should introduce
criminal sanctions.13 It is however evident that it is challenging to introduce a
correct level of deterrence through enforcing punishment. Hence, this gap
likely can only be overcome by increasing the level of detection rather than by
granting more leniency than is strictly necessary.14
NO EXCLUSIVE RELIANCE ON LENIENCY- Apart from the aforementioned
problems regarding this deterrence gap, it is crucial that the responsible
authorities do not exclusively rely on the leniency regulations in order to make
them operational. It is quintessential that these authorities have the necessary
9
Infra PARA. 22.
COMP/35.587-PO/VideoGames, COMP/35.706-PO/Nintendo distribution and COMP/36.321Omega/Nintendo, 2003 OJ L255/33, par. 453; T. WECK, “Antitrust infringements in the
distribution chain- When is leniency available to suppliers?”, ECLR 2010, 394-401.
11
W. WILS, “Leniency in antitrust enforcement: theory and practice”, World Competition 2007,
25-64.
12
Beside this, according to a study, only 13 % of cartels are detected, which makes the deterrence
gap even more bigger: P. BRYANT and E. ECKARD, “Price fixing: the probability of getting
caught”, The Review of Economics and Statistics 1991, 531.
13
Infra PARA. 35.
14
W. WILS, “Leniency in antitrust enforcement: theory and practice”, World Competition 2007,
25-64.
10
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level of credibility to detect and punish anti-trust violations.15 To date,
leniency is still considered to be the best of all available options, but only has a
chance to succeed if undertakings expect to be better off and benefit when
cooperating with these authorities rather than when avoiding interactions.16
This decision largely depends in the first instance on weighing off the penalty,
determined by the lack of cooperation, versus the probability of being caught. 17
OTHER PROBLEMS- In short, other pitfalls of leniency are first the negative
moral effects (the idea to infringe and not being punished), the administrative
costs to set up a leniency system and lastly according to some, the even
perverse effect which facilitates the creation and maintenance of a cartel. The
latter will however not succeed if immunity is limited to the single first
cooperating cartel participant.18
CONCLUSION- The last years, leniency has proven to be a very successful
instrument in the enforcement of cartels. However, in construing the leniency
policy, the cartel authorities must keep the negative effects in mind and try to
overcome those by positive aspects. A combination of the three enforcement
instruments is for an effective and efficient antitrust policy therefore required.
2. QUERIES OF THE LENIENCY POLICY
2.1. KEY CRITIQUES FUNCTIONING AS A DISINCENTIVE?
LENIENT LENIENCY- It has become clear that incentives to blow the whistle are
of utmost importance. Any rational cartelist will weigh the advantages and
disadvantages of blowing the whistle. The evolution and reform of the
previous leniency notices of the European Commission must be viewed in this
A recent evolution seems to point in this direction: N. KROES, “Reinforcing the fight against
cartels and developing the private enforcement damages actions; two tools for a more competitive
Europe”, SPEECH/07/128 of 8 March 2007, 4. See also: F. WIJCKMANS and F.
TUYTSCHAEVER, “Tot zover het Belgisch kartelparadijs”, RW 2008, 1178-1196. See also two
recent cartel infringement decisions ex officio: COMP/38.432, 20 November 2007 (SONY, FUJI
AND MAXWELL) and COMP/39.165, (ASAHI, SAINT-GOBAIN); W. WILS, “Leniency in antitrust
enforcement: theory and practice”, World Competition 2007, 25-64; N. ZINGALES, “European
and American Leniency Programmes: two models towards convergence?”, CompLRev 2008, 5-60.
16
W. WILS, “Leniency in antitrust enforcement: theory and practice”, World Competition 2007,
25-64.
17
It will also depend on the size of the sanctions and other costs which the undertaking or person
will have to bear as a consequence of its violation becoming established; G.S. BECKER, “Crime
and Punishment: an economic approach”, Journal of Political Economy 1968, 76 (2); P. VERMA
and P. BILLIET, “Why would cartel participants still refuse to blow the whistle under the current
EC leniency policy?”, Global antitrust Review 2009, 1-20.
18
W. WILS, “Leniency in antitrust enforcement: theory and practice”, World Competition 2007,
25-64.
15
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regard.19 As the OECD stated, “the key to an effective leniency programme is
that there should be a high degree of predictability, transparency and
certainty, together with a low burden of proof, heavy penalties and an
emphasis on priority”.20 It remains however to be seen whether the leniency
policy is sufficiently ‘lenient’.21 Today, the success of the leniency policy begs
for the question whether a leniency application provides sufficient
predictability and certainty of its outcome. 22
OVERVIEW- In the next sections, we discuss the main problems regarding the
current leniency policy, such as for instance the interaction of civil and
criminal proceedings, the involvement of different jurisdictions and even the
fear of retaliation by other cartel members. 23 All these cumbersome
considerations pose the involved parties for a more complicated prisoners
19
I. VAN BAEL and J.-F. BELLIS, Competition Law of the European Community, The Hague,
Kluwer Law International, 2005, 1125-1126; L.O. BLANCO, EC Competition Procedure, Oxford,
Oxford University Press, 2006, 219; L. RITTER and W.D. BRAUN, European Competition Law:
a practitioner’s guide, The Hague, Kluwer Law International, 2004, 1137-1138; A. RILEY,
“Cartel Whistleblowing: Toward an American Model?”, CMLR 2002, 1-38; K. V. DE ARAUJO,
P. R. PUGLIESE and A.G. CASTILLO, “European Union and Brazil: Leniency in Cartel casesachievements and shortcomings”, ECLR 2003, 463-474; N. LEVY and R. O’DONOGHUE, “The
EU Leniency Programme Comes of Age”, World Competition 2004, 75-99; S. SUURNAKKI and
M.L. TIERNO CENTELLA, D-G for competition, “European Commission adopts revised
Leniency Notice to reward companies that report hard-core cartels”, Competition Policy
Newsletter 2007, 7-15; J.S. SANDHU, “The European Commission’s Leniency Policy: a
success?”, ECLR 2007, 148-157; A. RILEY, “The modernisation of EU anti-cartel enforcement:
will the European Commission grasp the opportunity?”, ECLR 2010, 191-207.
20
OECD,
Report
on
Leniency
Programmes,
available
at
http://www.oecd.org/LongAbstract/0,3425,en_2649_40381615_2474436_119666_1_1_1,00.html
21
L.O. BLANCO, EC Competition Procedure, Oxford, Oxford University Press, 2006, 219; N.
LEVY and R. O’DONOGHUE, “The EU Leniency Programme Comes of Age”, World
Competition 2004, 75-99; A. RILEY, “Beyond leniency: enhancing enforcement in EC antitrust
law”, World Competition 2005, 377-400; J.S. SANDHU, “The European Commission’s Leniency
Policy: a success?”, ECLR 2007, 148-157; S. SUURNAKKI and M.L. TIERNO CENTELLA, DG for competition, “European Commission adopts revised Leniency Notice to reward companies
that report hard-core cartels”, Competition Policy Newsletter 2007, 7-15; N. ZINGALES,
“European and American Leniency Programmes: two models towards convergence?”, CompLRev
2008, 5-60; D. J. WALSH, “Carrots and Sticks- Leniency and fines in EC Cartel cases”, ECLR
2009, 30-35; P. BILLIET, “How lenient is the EC Leniency Policy? A matter of certainty and
predictability”, ECLR 2009, 14-21; P. VERMA and P. BILLIET, “Why would cartel participants
still refuse to blow the whistle under the current EC leniency policy?”, Global antitrust Review
2009, 1-20; A. RILEY, “The modernisation of EU anti-cartel enforcement: will the European
Commission grasp the opportunity?”, ECLR 2010, 191-207.
22
S.D. HAMMOND, “When calculating the costs and benefits of applying for corporate amnesty,
how do you put a price tag on an individual’s freedom?”, March 8, 2001, 1-6; D. S. EVANS,
“How economists can help courts design competition rules: an EU and US perspective”, World
Competition 2005, 93-99; S. SUURNAKKI and M.L. TIERNO CENTELLA, D-G for
competition, “European Commission adopts revised Leniency Notice to reward companies that
report hard-core cartels”, Competition Policy Newsletter 2007, 7-15; P. VERMA and P. BILLIET,
“Why would cartel participants still refuse to blow the whistle under the current EC leniency
policy?”, Global antitrust Review 2009, 1-20.
23
N. ZINGALES, “European and American Leniency Programmes: two models towards
convergence?”, CompLRev 2008, 5-60.
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dilemma and may even prevent the leniency applicant from blowing the
whistle at all – thereby nullifying the EU’s overall interest and stated goals.
2.1.1. Unclear conditions for a leniency application
FULL AND PARTIAL IMMUNITY- One of the main problems with the current
Leniency Notice is the fact that applicants do not and cannot know what to
expect of their leniency applications. Applicants argue that the outcome of the
process is not sufficiently predictable. This is mainly attributable to the very
broadly formulated conditions and consequently harness major discretion. The
most recent Leniency Notice has tried to clarify and reduce some of these
uncertainties, such as the type of information and evidence.24 Today, two types
of leniency are at stake. On one hand, complete immunity is granted to the
party who applies the first, while for the others, a fine reduction, called “partial
immunity”, continues to exist.25
ISSUES CONCERNING FULL IMMUNITY- Even though the Leniency Notice
provides guidelines and criteria to help applicants to provide the required
information, some uncertainties remain unsolved. First, the Leniency Notice
states that only the first applicant can and will receive full immunity. One can
however imagine a situation where several cartel participants approach the
European Commission together.26 The Leniency Notice does, however, not
provide any specifications about what should be done in such case. There is
also a genuine risk that undertakings that are queuing to confess will declare to
the European Commission that the first applicant instigated the other
participants and thereby prevent him obtaining immunity.27
SMOKING GUN EVIDENCE-– The European Commission leaves the option to
diminish the fine if the applicant provides convincing information, which is of
a “significant added value”.28 This “fall back option” encourages and fuels a
24
Commission notice on immunity from fines and reduction of fines in cartel cases, Official
Journal C 298., 8.12.2006, 17 (“Leniency Notice”); J.S. SANDHU, “The European Commission’s
Leniency Policy: a success?”, ECLR 2007, 148-157; S. SUURNAKKI and M.L. TIERNO
CENTELLA D-G for competition, “European Commission adopts revised Leniency Notice to
reward companies that report hard-core cartels”, Competition Policy Newsletter 2007, 7-15.
25
See Articles 15-18 Leniency Notice.
26
N. ZINGALES, “European and American Leniency Programmes: two models towards
convergence?”, CompLRev 2008, 5-60; P. VERMA and P. BILLIET, “Why would cartel
participants still refuse to blow the whistle under the current EC leniency policy?”, Global
antitrust Review 2009, 1-20; P. BILLIET, “How lenient is the EC Leniency Policy? A matter of
certainty and predictability”, ECLR 2009, 14-21.
27
According to the leniency notice, no leniency is possible for the so called “ringleader”, the one
who instigated the other parties. Case law reveals that this requirement is however very broadly
interpreted; article 14 Leniency Notice; L.O. BLANCO, EC Competition Procedure, Oxford,
Oxford University Press, 2006, 219.
28
This must enable the European Commission to achieve insider knowledge of the cartel that
would allow it to better target its inspection with more precise information; S. SUURNAKKI and
M.L. TIERNO CENTELLA D-G for competition, “European Commission adopts revised
Leniency Notice to reward companies that report hard-core cartels”, Competition Policy
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race between undertakings since any changes for the next application to add
significant added value considerably diminish with every submission. 29 The
challenge is however that the European Commission does not determine
whether the evidence constitutes any significant added extra value until it
issues its final prohibition decision. 30 On top of these considerations, another
issue is that the party who applied later than the first party could still seek
leniency and even leapfrog ahead of the earlier applicant by providing
information that contains more significant and essential added value.31 Last but
not least, the problem continues to exist that a leniency applicant risks finding
himself in a very uncomfortable situation where he has disclosed participation
in a cartel to the European Commission while the latter refuses to grant
immunity.32 And, even though the applicant may withdraw the disclosed
evidence, the European Commission is still able to use its investigative powers
to obtain the necessary information.33
CONCLUSION- By introducing necessary details about the information required
for a leniency application, the European Commission has significantly
improved the consciousness of leniency applicants to consider such
applications. (Too) much discretion is nevertheless still reserved for the
European Commission, so that there is a lack of certainty for the leniency
applicants.34 Arguably, it is however this uncertainty which ensures the
Newsletter 2007, 7-15; P. VERMA and P. BILLIET, “Why would cartel participants still refuse to
blow the whistle under the current EC leniency policy?”, Global antitrust Review 2009, 1-20.
29
S. SUURNAKKI and M.L. TIERNO CENTELLA, D-G for competition, “European Commission
adopts revised Leniency Notice to reward companies that report hard-core cartels”, Competition
Policy Newsletter 2007, 7-15; J.S. SANDHU, “The European Commission’s Leniency Policy: a
success?”, ECLR 2007, 148-157; P. VERMA and P. BILLIET, “Why would cartel participants still
refuse to blow the whistle under the current EC leniency policy?”, Global antitrust Review 2009,
1-20.
30
P. BILLIET, “How lenient is the EC Leniency Policy? A matter of certainty and predictability”,
ECLR 2009, 14-21.
31
J.S. SANDHU, “The European Commission’s Leniency Policy: a success?”, ECLR 2007, 148157.
32
I. VAN BAEL and J.-F. BELLIS, Competition Law of the European Community, The Hague,
Kluwer Law International, 2005, 1125-1126; C.S. KERSE and N. KHAN, EC Antitrust
Procedure, London, Sweet and Maxwell, 2005, 64; L. RITTER and W.D. BRAUN, European
Competition Law: a practitioner’s guide, The Hague, Kluwer law International, 2004, 1137-1138;
C. BELLAMY and D. CHILD, “European community law of competition”, Oxford, Oxford
University Press, 2008, 1312-1322. On the other hand, it would be unrealistic to expect the
European Commission to adopt an “acute amnesia” attitude in respect of the evidence which it has
seen: ECJ, Case C-67/91 DIRECCION GENERAL DE DEFENSA DE LA COMPETENCIA V ASOCIACION
ESPANOLA DE BANCO PRIVADA (“Spanish Banks”) [1992], ECR I-4785.
33
I. VAN BAEL and J.-F. BELLIS, Competition Law of the European Community, The Hague,
Kluwer Law International, 2005, 1125-1126.
34
L. RITTER and W.D. BRAUN, European Competition Law: a practitioner’s guide, The Hague,
Kluwer Law International, 2004, 1137-1138; P. VERMA and P. BILLIET, “Why would cartel
participants still refuse to blow the whistle under the current EC leniency policy?”, Global
antitrust Review 2009, 1-20; S. SUURNAKKI and M.L. TIERNO CENTELLA, D-G for
competition, “European Commission adopts revised Leniency Notice to reward companies that
report hard-core cartels”, Competition Policy Newsletter 2007, 7-15; J.S. SANDHU, “The
European Commission’s Leniency Policy: a success?”, ECLR 2007, 148-157.
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effectiveness of the leniency program. Besides, it still remains to be seen
whether these unclear conditions and the discretionary procedure really
prevent an undertaking from blowing the whistle.
2.1.2. Lack of harmonisation and multi-stop leniency procedures
INSUFFICIENT HARMONISATION OF LENIENCY PROGRAMMES- Since Regulation
1/2003, many different leniency regimes exist in the EU member states and
cause on their turn problems of certainty and predictability. The fundamental
differences between these leniency regimes has a negative effect on the
efficacy of the EC leniency programme and causes countless critical issues.35
a. Lack of a ‘one-stop leniency shop’
MULTIPLE LENIENCY APPLICATIONS- The existence of multiple leniency
programmes implies that filing a leniency application in one NCA does not
count for another.36 As a result, an undertaking is advised to file at the same
time multiple leniency applications throughout the EU, which creates negative
consequences, as outlined below.37
35
D.G. GOYDER, The future of European Competition Law, Oxford, Oxford University Press,
2009, 645-666; S. BRAMMER, Cooperation between national competition agencies in the
enforcement of EC competition law, Oxford, Hart Publishing, 2009, 187-189; M. MEROLA and
D. WAELBROECK, Towards an optimal enforcement of competition rules in Europe. Time for a
review of Regulation 1/2003?, Brussels, Bruylant, 2010, 39-40; A. JONES and B. SUFFRIN, EU
Competition law, Oxford, Oxford University Press, 2011, 1159-1160; K. V. DE ARAUJO, P. R.
PUGLIESE and A.G. CASTILLO, “European Union and Brazil: Leniency in Cartel casesachievements and shortcomings”, ECLR 2003, 463-474; C. GAUER and M. JASPERS,
“Designing a European solution for a “one-stop leniency shop”, ECLR 2006, 685-692; C. GAUER
and M. JASPERS, “The European Competition Network, achievements and challenges- a case in
point: leniency”, Competition Policy Newsletter 2006, 8-11; M.J. REYNOLDS and D.G.
ANDERSON, “Immunity and Leniency in EU Cartel cases: current issues”, ECLR 2006, 82-90;
W. WILS, “Leniency in antitrust enforcement: theory and practice”, World Competition 2007, 2564; J.S. SANDHU, “The European Commission’s Leniency Policy: a success?”, ECLR 2007, 148157; N. ZINGALES, “European and American Leniency Programmes: two models towards
convergence?”, CompLRev 2008, 5-60; P. BILLIET, “How lenient is the EC Leniency Policy? A
matter of certainty and predictability”, ECLR 2009, 14-21; P. VERMA and P. BILLIET, “Why
would cartel participants still refuse to blow the whistle under the current EC leniency policy?”,
Global antitrust Review 2009, 1-20.
36
J.S. SANDHU, “The European Commission’s Leniency Policy: a success?”, ECLR 2007, 148157; W. WILS, “Leniency in antitrust enforcement: theory and practice”, World Competition
2007, 25-64.
37
The attitude of the European Commission and the member states towards this issue is moreover
not encouraging, regarding the fact that they act as a ‘confessor beware’: “file wherever you feel
need to it, it is your risk”; L.O. BLANCO, EC Competition Procedure, Oxford, Oxford University
Press, 2006, 240; L. BROKX, “A patchwork of leniency programmes”, ECLR 2001, 35-46; M.J.
REYNOLDS and D.G. ANDERSON, “Immunity and Leniency in EU Cartel cases: current
issues”, ECLR 2006, 82-90.
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a.1. Negative consequences
UNPREDICTABILITY- First and foremost, a leniency applicant cannot predict
nor foresee any response to the question of which authority will be dealing
with the cartel infringement. As a result, any rational leniency applicant
involved in a cartel covering more than just one jurisdiction, is expected to
only blow the whistle if his application does qualify for leniency under the
most restrictive leniency programme of the member states at issue. 38
Otherwise, the applicant risks that his application in a particular member state
is transferred to another member state, where leniency is not provided in the
national rules, where he is not the first to file an application or where he even
is exposed to criminal sanctions (infra par. 35).39
COSTLY AND TIME MANAGEMENT- In addition, the multiple filing procedures
are cumbersome, costly and difficult to organise in a short period of time. 40
Besides, applicants are bound by a duty of cooperation vis-à-vis these
authorities, irrespective of whether these authorities would investigate the case
in the end or not.
NE BIS IN IDEM- Last but not least, the principle of ne bis in idem does not
protect a whistle blower against other authorities or against private damages
claims after being granted immunity or being fined by the European
Commission.41
a.2. Solutions
OVERVIEW- In the literature, a number of solutions have been proposed,
ranging from a system of mutual recognition to a system that is fully or
M.J. REYNOLDS and D.G. ANDERSON, “Immunity and Leniency in EU Cartel cases: current
issues”, ECLR 2006, 82-90; L. BROKX, “A patchwork of leniency programmes”, ECLR 2001, 3546; C. GAUER and M. JASPERS, “Designing a European solution for a “one-stop leniency shop”,
ECLR 2006, 685-692.
39
I. VAN BAEL and J.-F. BELLIS, Competition Law of the European Community, The Hague,
Kluwer Law International, 2005, 560-590; A. BURNSIDE and H. CORSSLEY, “Co-operation in
competition: a new era?” European Law Review 2005, 234-258; M.J. REYNOLDS and D.G.
ANDERSON, “Immunity and Leniency in EU Cartel cases: current issues”, ECLR 2006, 82-90.
40
M. MEROLA and D. WAELBROECK, Towards an optimal enforcement of competition rules in
Europe, Brussels, Bruylant, 2010, 170-171; C. GAUER and M. JASPERS, “Designing a European
solution for a “one-stop leniency shop”, ECLR 2006, 685-692; M.J. REYNOLDS and D.G.
ANDERSON, “Immunity and Leniency in EU Cartel cases: current issues”, ECLR 2006, 82-90.
41
Infra PARA. 41; ECJ, Case 14/68 WALT WILHELM V. BUNDESKARTELLAMT [1969], ECR 1,
PARA. 1032; Opinion of A-G in BOEHRINGER VS. EUROPEAN COMMISSION, PARAS. 3-6; A.
ANDREANGELI, EU Competition enforcement and human rights, Cheltenham, Edward Elgar,
2009, 208-210; M. MEROLA and D. WAELBROECK, Towards an optimal enforcement of
competition rules in Europe. Time for a review of Regulation 1/2003?, Brussels, Bruylant, 2010,
160-161; P. VERMA and P. BILLIET, “Why would cartel participants still refuse to blow the
whistle under the current EC leniency policy?”, Global antitrust Review 2009, 1-20; P. BILLIET,
“How lenient is the EC Leniency Policy? A matter of certainty and predictability”, ECLR 2009,
14-21.
38
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partially centralised.42 However, each of these systems suffers serious
drawbacks. Therefore, it is advisable to improve the “European solution”,
which spearheads to create a European competition network (“ECN”) within
the EU.
EUROPEAN COMPETITION NETWORK- An increasing number of global cartels
implies that the supervisors must cooperate globally. 43 A competition network
was therefore established to reduce the risk that a member state starts its own
investigation concurrent with that of the European Commission. In this way,
the Network Notice provides an answer to the re-nationalization caused by
Regulation 1/2003 and ensures the communication between the NCAs. 44
EUROPEAN MODEL LENIENCY PROGRAMME- Within the ECN, the European
Model Leniency Programme was created to provide a basis for soft
harmonisation of all European leniency programmes and to convince member
states who do not yet have one, to adopt one. As such, the ECN Model
Leniency Programme is meant “to ensure that potential applicants are not
discouraged from applying as a result of the discrepancies between the
existing leniency programs within the ECN”.45 The Model Leniency
Programme is drafted as a coherent operational leniency programme with all
essential procedural and substantive requirements, which the ECN members
believe should be common in all programmes. 46
N. KROES, “the first hundred days”, 40th anniversary of the Studienvereiniging Kartellrecht
1965-2005, Speech/05/295, April 7 2005; M. MEROLA and D. WAELBROECK, Towards an
optimal enforcement of competition rules in Europe, Brussels, Bruylant, 2010, 40; C. GAUER and
M. JASPERS, “Designing a European solution for a “one-stop leniency shop”, ECLR 2006, 685692.
43
Not only the European Commission, but also the OESO and WTO have competition on their
agenda (See: OECD, “Fighting hard-core cartels, harm, effective sanctions and leniency
programmes”, 2002, 102). Outside Europe, the ICN exists, which summarises anti-cartel laws in
over 40 jurisdictions. D. ARTS and K. BOURGEOIS, “Samenwerking tussen
mededingingsautoriteiten en rechtsbescherming: enkele bedenkingen”, TBM 2006, 1-47; W.
WILS, “Leniency in antitrust enforcement: theory and practice”, World Competition 2007, 25-64.
However, also this ECN model leniency programme is subject to criticism: M. MEROLA and D.
WAELBROECK, Towards an optimal enforcement of competition rules in Europe, Brussels,
Bruylant, 2010, 175.
44
Commission Notice on cooperation within the Network of Competition Authorities, Official
Journal C.101 of 27.04.2004.
45
See
ECN
Model
Leniency Programme,
29
September
2006,
PARA.
2.
http://ec.europa.eu/competition/ecn/model_leniency_en.pdf.
46
S. BRAMMER, Cooperation between national competition agencies in the enforcement of EC
competition law, Oxford, Hart Publishing, 2009, 187-188; M. MEROLA and D. WAELBROECK,
Towards an optimal enforcement of competition rules in Europe, Brussels, Bruylant, 2010, 39-40;
H. VEDDER, “Spontaneous harmonisation of National (Competition) Laws in the Wake of the
Modernisation of EC Competition law”, CompLRev 2004, 5-21; N. LEVY and R.
O’DONOGHUE, “The EU Leniency Programme Comes of Age”, World Competition 2004, 7599; C. GAUER and M. JASPERS, “The European Competition Network, achievements and
challenges- a case in point: leniency”, Competition Policy Newsletter 2006, 8-11; C. GAUER and
M. JASPERS, “Designing a European solution for a “one-stop leniency shop”, ECLR 2006, 685692; K. DEKEYSER and M. JASPERS, “A new era of ECN Cooperation. Achievements and
challenges with special focus on work in the leniency field”, World Competition 2007, 3-24; J.S.
42
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It should be kept in mind that the Model Leniency Programme is a first step
towards a more harmonized system of leniency regimes, but that it is not a
sufficient solution to all problems that an undertaking is facing when filing
multiple leniency applications.47 The document is not legally binding and does
not create any rights or legitimate expectations for undertakings.48 Besides, the
Programme does not provide all the benefits the business world may have
hoped for, as it does not really present the desired one-stop shop and its scope
is fairly narrow.49 The ‘summary application’ in this Model Leniency
Programme should in this regard provide however more uniformity in the
current diversity.
SUMMARY APPLICATION- The main innovation of the Model Leniency
Programme is the introduction of the summary application. This application
states that, if an undertaking applies for leniency by the European
Commission, it can file summary applications, which contain only very limited
information.50 So, the summary application is a simplified application, which
contains a short description of the cartel that has been reported. The
information provided in the application is sufficient to allow the relevant NCA
to have an informed view on the case allocation. In this way, it facilitates the
lodging and processing of multiple leniency applications.
SANDHU, “The European Commission’s Leniency Policy: a success?”, ECLR 2007, 148-157; P.
VERMA and P. BILLIET, “Why would cartel participants still refuse to blow the whistle under
the current EC leniency policy?”, Global antitrust Review 2009, 1-20.
47
I. VAN BAEL and J.-F. BELLIS, Competition Law of the European Community, The Hague,
Kluwer Law International, 2005, 1144-1145; H. VEDDER, “Spontaneous harmonisation of
National (Competition) Laws in the Wake of the Modernisation of EC Competition law”,
CompLRev 2004, 5-21; D. ARTS and K. BOURGEOIS, “Samenwerking tussen
mededingingsautoriteiten en rechtsbescherming: enkele bedenkingen”, TBM 2006, 1-47; K.
DEKEYSER and M. JASPERS, “A new era of ECN Cooperation. Achievements and challenges
with special focus on work in the leniency field”, World Competition 2007, 3-24.
48
H. VEDDER, “Spontaneous harmonisation of National (Competition) Laws in the Wake of the
Modernisation of EC Competition law”, CompLRev 2004, 5-21; K. DEKEYSER and M.
JASPERS, “A new era of ECN Cooperation. Achievements and challenges with special focus on
work in the leniency field”, World Competition 2007, 3-24; P. VERMA and P. BILLIET, “Why
would cartel participants still refuse to blow the whistle under the current EC leniency policy?”,
Global antitrust Review 2009, 1-20.
49
A. ANDRENGELI, EU competition enforcement and human rights, Cheltenham, Edward Elgar,
2009, 198-200; S. BRAMMER, Cooperation between national competition agencies in the
enforcement of EC competition law, Oxford, Hart, 2009, 187-193: “a summary application is
available only in those cases where it is clear that more than three MS territories are affected and
a complete application has been lodged with the European Commission.” So there are many
situations which are not covered by the ECN model.
50
The summary application is however only possible towards NCAs who have accepted this
summary application. C. BELLAMY and D. CHILD, European Community law of competition,
Oxford, Oxford University Press, 2008, 1312-1322; K. DEKEYSER and M. JASPERS, “A new
era of ECN Cooperation. Achievements and challenges with special focus on work in the leniency
field”, World Competition 2007, 3-24.
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b. Information uncovered
OVERVIEW- Another consequence of the lack of harmonisation is the
possibility that highly secretive information provided by leniency applicants
can be uncovered in civil proceedings in the US (the so called “discovering
discovery”) or in the ECN (through the reallocation of cases or the upcoming
private enforcement within the EU).51
b.1. Discovering discovery
FORMULATION OF THE PROBLEM- At first glance, one can be surprised that
possible implications of US discovery rules for the EU Leniency Programme
are checked.52 There is however a concern that the EU leniency programme
might be undermined by potential plaintiffs in the US, who became aware of a
leniency application in Europe and might engage in a “fishing expedition”.53
As a consequence, leniency applicants may be discouraged from submitting
leniency applications because of a realistic concern that their corporate
statements may become available through US discovery procedures to US
plaintiffs aiming to recover damages.54
A. P. KOMNINOS, “Public and private antitrust enforcement in Europe: complement?
Overlap?”, December 2006, 1-26; K. DEKEYSER and M. JASPERS, “A new era of ECN
Cooperation. Achievements and challenges with special focus on work in the leniency field”,
World Competition 2007, 3-24; P. BILLIET, “How lenient is the EC Leniency Policy? A matter of
certainty and predictability”, ECLR 2009, 14-21.
52
We leave out the possibility of international agreements, namely that some member states like
the UK and Germany have concluded bilateral treaties on mutual legal assistance in criminal
matters with the US. These treaties provide for the transfer of information and evidence between
the US and those member states in criminal proceedings, see the Treaty between the government
of the United Kingdom of Great Britain and Northern Ireland and the Government of the USA
which entered into force on 2 December 1996 and the Treaty between the Federal Republic of
Germany on mutual legal assistance in criminal matters which entered into force on 3 November
2007; I. VAN BAEL and J.-F. BELLIS, Competition Law of the European Community, The
Hague, Kluwer Law International, 2005, 1147; K. NORDLANDER, “Discovering Discovery – US
discovery of EC leniency statements”, ECLR 2004, 646-659; N. LEVY and R. O’DONOGHUE,
“The EU Leniency Programme Comes of Age”, World Competition 2004, 75-99; M.J.
REYNOLDS and D.G. ANDERSON, “Immunity and Leniency in EU Cartel cases: current
issues”, ECLR 2006, 82-90; P. BILLIET, “How lenient is the EC Leniency Policy? A matter of
certainty and predictability”, ECLR 2009, 14-21; D. J. WALSH, “Carrots and Sticks- Leniency
and fines in EC Cartel cases”, ECLR 2009, 30-35; P. VERMA and P. BILLIET, “Why would
cartel participants still refuse to blow the whistle under the current EC leniency policy?”, Global
antitrust Review 2009, 1-20; A. PETRASINCU, “Discovery revisited- the impact of the US
discovery rules on the European Commission’s leniency programme”, ECLR 2011, 356-367.
53
N. LEVY and R. O’DONOGHUE, “The EU Leniency Programme Comes of Age”, World
Competition 2004, 75-99; A. BURNSIDE and H. CORSSLEY, “Co-operation in competition: a
new era?” European Law Review 2005, 234-258.
54
K. NORDLANDER, “Discovering Discovery – US discovery of EC leniency statements”, ECLR
2004, 646-659; S. SUURNAKKI and M.L. TIERNO CENTELLA D-G for competition,
“European Commission adopts revised Leniency Notice to reward companies that report hard-core
cartels”, Competition Policy Newsletter 2007, 7-15.
51
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CONCERN JUSTIFIED? - Is this apprehension justified? Recent practice indeed
fuels such concern. We must however clarify that such a scenario has not often
occurred yet and a mere fishing expedition has not been formally accepted.55
In addition, the chance of success depends on the fines of the civil liability.56
Hence discovering a discovery might be an issue of concern, although perhaps
not as much as it is often claimed to be.57
POLICY OF THE EUROPEAN COMMISSION- The European Commission has
acknowledged this possible disincentive and has promised that “everything
will be done to protect the corporate statements from discovery.” Exemplary
may be the effort of the European Commission to avoid disclosure of corporate
leniency statements by intervening in US court proceedings as amicus curiae
to contest the discoverability of such statements. 58
CONCLUSION- In short, it remains uncertain in how much US complainants can
claim rights on EU corporate leniency statements.59
SOLUTIONS- Being aware that written admissions might be discovered more
readily in civil proceedings, the European Commission has begun to accept
oral applications.60 This policy discourages attempts of private US litigants to
identify written statements provided to the European Commission by leniency
applicants.61 Oral applications offer however no absolute protection of the
55
Plaintiffs have to allege specific facts pertaining to the claimed antitrust violation. See also A.
PETRASINCU, “Discovery revisited- the impact of the US discovery rules on the European
Commission’s leniency programme”, ECLR 2011, 356-367.
56
If there are heavy fines in Europe, then it could really be an issue, otherwise not: K.
NORDLANDER, “Discovering Discovery – US discovery of EC leniency statements”, ECLR
2004, 646-659.
57
A. MCDOUGALL and A. VERZARIU, “Vitamins litigation: unavailability of exemplary
damages, restitutionary damages and account of profits in private competition law claims”, ECLR
2008, 181-184.
58
N. LEVY and R. O’DONOGHUE, “The EU Leniency Programme Comes of Age”, World
Competition 2004, 75-99; P. VERMA and P. BILLIET, “Why would cartel participants still refuse
to blow the whistle under the current EC leniency policy?”, Global antitrust Review 2009, 1-20.
59
N. LEVY and R. O’DONOGHUE, “The EU Leniency Programme Comes of Age”, World
Competition 2004, 75-99; K. NORDLANDER, “Discovering Discovery – US discovery of EC
leniency statements”, ECLR 2004, 646-659; A. MCDOUGALL and A. VERZARIU, “Vitamins
litigation: unavailability of exemplary damages, restitutionary damages and account of profits in
private competition law claims”, ECLR 2008, 181-184; P. VERMA and P. BILLIET, “Why would
cartel participants still refuse to blow the whistle under the current EC leniency policy?”, Global
antitrust Review 2009, 1-20; A. PETRASINCU, “Discovery revisited- the impact of the US
discovery rules on the European Commission’s leniency programme”, ECLR 2011, 356-367.
60
ECJ, Joined Cases T-236, 239, 244-246, 251 and 252/01, TOKAI CARBON/COMMISSION
(GRAPHITE ELECTRODES) [2004], ECR II-1181, PARAS. 112 and 457; see also the Case Citric Acid
where the European Commission awarded one of the cartel partners a fine reduction on the basis
of oral evidence; L.O. BLANCO, EC Competition Procedure, Oxford, Oxford University Press,
2006, 219.
61
L.O. BLANCO, EC Competition Procedure, Oxford, Oxford University Press, 2006, 219; N.
LEVY and R. O’DONOGHUE, “The EU Leniency Programme Comes of Age”, World
Competition 2004, 75-99; J.S. SANDHU, “The European Commission’s Leniency Policy: a
success?”, ECLR 2007, 148-157; P. VERMA and P. BILLIET, “Why would cartel participants still
476
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discovery.62 In fact, only in case an oral leniency application is not based on a
written draft prepared in advance, it will not be considered as discoverable.63
In short, two other solutions would be to rely on the international comity or the
investigatory privilege.64
b.2. Discovery in the EU: exchanging information within the ECN
FORMULATION OF THE PROBLEM- Not only discoveries made overseas, but also
discoveries within the EU create possible problems, as other cartel authorities
or private parties (infra par. 38) could obtain confidential information.65
CONSEQUENCES OF RE-ALLOCATION- The ECN allows the European
Commission to cooperate with the NCAs in order to enforce EC Competition
law as well as to promote the exchange of information (of a secretive nature)
when the case needs to be re-allocated. However, the flexible nature of case reallocation is likely to result in legal uncertainty and might threaten the
effectiveness of the rights of defence of the undertaking. 66 According to some,
the possibility for a receiving authority to use in evidence the exchanged
information is an unacceptable circumvention of procedural rights and
guarantees.67
ECN COOPERATION NOTICE- The European Commission has sought to address
these concerns by introducing the ECN Cooperation Notice.68 This Notice
refuse to blow the whistle under the current EC leniency policy?”, Global antitrust Review 2009,
1-20; A. PETRASINCU, “Discovery revisited- the impact of the US discovery rules on the
European Commission’s leniency programme”, ECLR 2011, 356-367.
62
Oral applications are only allowed in cases where “a serious risk exists that the applicant will
face civil legal actions in third-country jurisdictions that may result in the production of the
corporate statement to the European Commission in which the company describes its participation
in a cartel” (Leniency Notice 2006); L. VAN BARLINGEN, “The European Commission’s 2002
leniency notice after one year of operation”, 2003, Antitrust, Spring, at 87; M.J. REYNOLDS and
D.G. ANDERSON, “Immunity and Leniency in EU Cartel cases: current issues”, ECLR 2006, 8290.
63
A. PETRASINCU, “Discovery revisited- the impact of the US discovery rules on the European
Commission’s leniency programme”, ECLR 2011, 356-367.
64
K. NORDLANDER, “Discovering Discovery – US discovery of EC leniency statements”, ECLR
2004, 646-659; A. PETRASINCU, “Discovery revisited- the impact of the US discovery rules on
the European Commission’s leniency programme”, ECLR 2011, 356-367.
65
C. BELLAMY and D. CHILD, European Community law of competition, Oxford, Oxford
University Press, 2008, 1312-1322; W. WILS, “Powers of investigation and procedural rights and
guarantees in EU antitrust enforcement”, World Competition 2006, 3-24; P. BILLIET, “How
lenient is the EC Leniency Policy? A matter of certainty and predictability”, ECLR 2009, 14-21.
66
I. VAN BAEL and J.-F. BELLIS, Competition Law of the European Community, The Hague,
Kluwer Law International, 2005, 1144; W. WILS, “Powers of investigation and procedural rights
and guarantees in EU antitrust enforcement”, World Competition 2006, 3-24.
67
In this view, as shall be viewed below, human rights considerations play an important role. W.
WILS, “Powers of investigation and procedural rights and guarantees in EU antitrust
enforcement”, World Competition 2006, 3-24.
68
Commission Notice on cooperation within the Network of Competition Authorities, Official
Journal C.101 of 27.04.2004.
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limits the exchange of information69 and stipulates that the European
Commission may refuse to transmit information for overriding reasons relating
to the need to safeguard the interests of the Community or to avoid any
interference with its functions and independence. 70 According to WHISH,
article 12 of the Notice must be read in conjunction with article 28, which
contains provisions restricting the use or disclosure of information covered by
the obligation of professional secrecy. 71
UNRESOLVED ISSUES- The problem that undertakings can only rely on those
provisions against the European Commission continues however to exist, since
NCAs are not bound by it. Secondly, even if the information supplied to a
NCA regarding new proceedings initiated following a leniency application,
cannot be used as a basis for filing a new case in a different EU jurisdiction,
applicants are not protected from the danger of being tipped off by others, such
as complainants.72 Lastly, serious doubts concerning the possibility to
challenge allocation decisions exist. The lack of procedural harmonisation
could expose leniency applicants to a considerable legal uncertainty regarding
the extent of the procedural rights available under the applicable national law.
The possibility of challenging allocation decisions could be an initial attempt
to resolve these problems, however, it seems unlikely that this view will be
supported by the ECJ.73
c. Criminal sanctions
OVERVIEW- As we have pointed out above, cartel sanctions can vary according
to the member state concerned. While the European Commission has no
criminal sanctions in its cartel enforcement system, more and more member
states are introducing this procedure into their national legal system.74
69
See articles 26-28 of the Cooperation Notice; L.O. BLANCO, EC Competition procedure,
Oxford, Oxford University Press, 2006, 236-237; A. ANDREANGELI, EU Competition
enforcement and human rights, Cheltenham, Edward Elgar, 2009, 200-203.
70
ECJ, Case C-2/88 IMM., JJ ZWARTVELD AND OTHERS [1990], ECR 1-3365, PARAS. 17-22; ECJ,
Case C-234/89 DELIMITIS [1991], ECR I-935, PARA. 20-25, both cited in PARA. 15, footnote 37 of
European Commission Notice on the co-operation between the European Commission and the
courts of the EU member states in the application of articles 81 and 82 EC, OJ C 101. S.
BRAMMER, Cooperation between national competition agencies in the enforcement of EC
competition law, Oxford, Hart, 2009, 187-188; S. BLAKE, D-G for Competition and D.
SCHNICHELS, D-G for competition, Competition Policy Newsletter 2004, 7-13.
71
R. WHISH, Competition Law, Oxford, Oxford University Press, 2012, 295-312. The problem
however continues to exist that the community concept of “LPP” differs from that provided by
some domestic laws: A. ANDREANGELI, EU Competition enforcement and human rights,
Cheltenham, Edward Elgar, 2009, 205-206.
72
A. ANDREANGELI, EU Competition enforcement and human rights, Cheltenham, Edward
Elgar, 2009, 198-199.
73
A. ANDREANGELI, EU Competition enforcement and human rights, Cheltenham, Edward
Elgar, 2009, 214-215.
74
According to article 5 of Regulation 1/2003, each member state can choose to provide criminal
sanctions or not. The European Commission cannot impose criminal sanctions in respect of cartel
activity; N. LEVY and R. O’DONOGHUE, “The EU Leniency Programme Comes of Age”,
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CRIMINAL SANCTIONS AT MEMBER STATES’ LEVEL- Opinions concerning the
national criminal sanctions vary. Some argue that criminalisation under the
national laws may have unintended implications for the EU, namely that it
could affect the willingness of people to assist to leniency applications.75 There
is indeed a major risk that individuals cooperating under the EU leniency
programme could find themselves exposed to criminal sanctions under national
rules, e.g. after the re-allocation of case from the European Commission.76
Others think that the incentive to blow the whistle is far greater because of the
prospect of goal sentences.77 The latter are of the opinion that it should
reinforce deterrence and creates a private interest to respect the law.78 Criminal
sanctions have a “stigma effect”, which has a stronger message-sending role or
expressive function than civil or administrative enforcement.79 Lastly, if
effective deterrence should be achieved only by fining undertakings, it would
require impossible high fines. Criminal sanctions can be an answer to this
problem.80
CRIMINAL SANCTIONS AT EU LEVEL?- Nowadays, a major debate is ongoing
whether such criminal sanctions must be imposed at the Union level. 81 An
advantage of such EU harmonisation would be that, due to the existing partial
criminal enforcement, member states that have criminal sanctions play a
disproportionate role in the overall task of enforcing EU competition law. 82
World Competition 2004, 75-99; W. WILS, “Is criminalization of EU Competition law the
answer?”, World Competition 2005, 117-159.
75
K. V. DE ARAUJO, P. R. PUGLIESE and A.G. CASTILLO, “European Union and Brazil:
Leniency in Cartel cases- achievements and shortcomings”, ECLR 2003, 463-474; N. LEVY and
R. O’DONOGHUE, “The EU Leniency Programme Comes of Age”, World Competition 2004, 7599; W. WILS, “Is criminalization of EU Competition law the answer?”, World Competition 2005,
117-159; M.J. REYNOLDS and D.G. ANDERSON, “Immunity and Leniency in EU Cartel cases:
current issues”, ECLR 2006, 82-90; P. WYTINCK, “De straf(fe) tanden van het
mededingingsrecht”, TBM 2009, 1-4.
76
N. LEVY and R. O’DONOGHUE, “The EU Leniency Programme Comes of Age”, World
Competition 2004, 75-99. A solution to this problem would be that member states that have
criminal sanctions might agree not to enforce those against individuals who had assisted in a
leniency application to the European Commission or another NCA.
77
A. RILEY, “Cartel Whistleblowing: Toward an American Model?”, CMLR 2002, 1-38; P.H.
ROSOCHOWICZ, “The appropriateness of criminal sanctions in the enforcement of competition
law”, ECLR 2004, 752-757.
78
Directors are often not sufficiently deterred simply by corporate liability. P.H.
ROSOCHOWICZ, “The appropriateness of criminal sanctions in the enforcement of competition
law”, ECLR 2004, 752-757; N. ZINGALES, “European and American Leniency Programmes: two
models towards convergence?”, CompLRev 2008, 5-60.
79
W. WILS, “Is criminalization of EU Competition law the answer?”, World Competition 2005,
117-159.
80
W. WILS, “Is criminalization of EU Competition law the answer?”, World Competition 2005,
117-159.
81
Some say that for now on, as long as fines are sufficiently heavy, there is a major incentive to
blow the whistle: A. RILEY, “Cartel Whistleblowing: Toward an American Model?”, CMLR
2002, 1-38; P. WYTINCK, “De straf(fe) tanden van het mededingingsrecht”, TBM 2009, 1-4.
82
W. WILS, “Is criminalization of EU Competition law the answer?”, World Competition 2005,
117-159.
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Moreover, contrary to fines, typical criminal sanctions (like imprisonment)
cannot be “passed-on” to the consumer. One important consequence attached
to such introduction is that the EU Courts systems and structure should be
reformed. Criminal sanctions imply criminal procedural safeguards, so that the
Union must make it possible for criminal defendants to fully enjoy their
procedural safeguards.83
2.1.3. The negative consequences of private enforcement
FORMULATION OF THE PROBLEM- Besides the traditional system of public
enforcement, cartelists have to fear the damages-claims from the injured
parties for the economic loss suffered. The latter phenomenon is known as
private enforcement and is a real disincentive for cartelists to blow the
whistle.84 Until now, private enforcement has only played a marginal role in
the EU in comparison with the litigation culture in the US.85 The increasing
number of cartel cases and the reform of the civil procedural rules are however
likely to encourage and increase the number of civil damages cases.86
LEGAL BASIS- The Leniency Notice does not contain any condition of
restitution to injured parties; only nullity is inscribed.87 It goes however
P.H. ROSOCHOWICZ, “The appropriateness of criminal sanctions in the enforcement of
competition law”, ECLR 2004, 752-757; W. WILS, “Is criminalization of EU Competition law the
answer?”, World Competition 2005, 117-159; N. ZINGALES, “European and American Leniency
Programmes: two models towards convergence?”, CompLRev 2008, 5-60; W. DEVROE and N.
DELATHAUWER, “Actualia Mededingingsrecht”, in X., Recht in beweging, Antwerp, Maklu,
2011, 151-178.
84
I. VAN BAEL and J.-F. BELLIS, Competition Law of the European Community, The Hague,
Kluwer Law International, 2005, 1136-1137; L.O. BLANCO, EC Competition Procedure, Oxford,
Oxford University Press, 2006, 219; A. RILEY, “Beyond leniency: enhancing enforcement in EC
antitrust law”, World Competition 2005, 377-400; U. BOGE and K. OST, “Up and Running, or is
it? Private enforcement- the situation in Germany and Policy Perspectives”, ECLR 2006, 197-205;
P. BILLIET, “How lenient is the EC Leniency Policy? A matter of certainty and predictability”,
ECLR 2009, 14-21; T. SCHOORS, T. BAEYENS and W. DEVROE,” Schadevergoedingsacties na
kartelinbreuken”, NjW 2011, 198-213; J. STEENBERGEN, “Private enforcement. Bedenkingen na
de Competition Day”, TBM 2011, 33-36.
85
W. DEVROE and N. DELATHAUWER, “Actualia Mededingingsrecht”, in X., Recht in
beweging, Antwerp, Maklu, 2011, 151-178; D. WILSHER, “The public aspects of private
enforcement in EC law: some constitutional and administrative challenges of a damages culture”,
December 2006, 27-45; D.J. GERBER, “Private enforcement of competition law: a comparative
perspective”, 2007, 7-36; A. P. KOMNINOS, “Public and private antitrust enforcement in Europe:
complement? Overlap?”, December 2006, 1-26.
86
An evolution one cannot ignore is the rise of firms such as Cartel Damages Claims and the
arrival of Hausfeld LPP in Europe which are likely to lead the way in increasing the number of
civil plaintiff actions; D. J. WALSH, “Carrots and Sticks- Leniency and fines in EC Cartel cases”,
ECLR 2009, 30-35; A. RILEY, “The modernisation of EU anti-cartel enforcement”, ECLR 2010,
194-197; J. STEENBERGEN, “Private enforcement. Bedenkingen na de Competition Day”, TBM
2011, 33-36; W. DEVROE and N. DELATHAUWER, “Actualia Mededingingsrecht”, in X.,
Recht in beweging, Antwerp, Maklu, 2011, 151-178.
87
A. JONES and B. SUFFRIN, EU Competition law, Oxford, Oxford University Press, 2011, 801803; W. VAN GERVEN, “Substantive remedies for the private enforcement of EC Antitrust Rules
83
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without saying that according to the case law, individuals have the right to
claim damages in national courts for losses caused by violation of articles 101
and 102.88
LENIENCY CONCERNS- The consequences of private enforcement are barely
surveyable. The leniency applicants who blow the whistle first, will also be the
first to stand in front of a civil damages judge. 89 It is clear that immunity from
administrative fines cannot protect an undertaking from the civil law
consequences of its participation in an infringement of article 101, since the
former is institutionally independent from the latter.90
ATTITUDE OF MEMBER STATES AND EUROPEAN COMMISSION- How to deal with
this problem? Even though they are not obliged to do so, some countries
reckon private enforcement investigations and require that penalties imposed
on other jurisdictions must be taken into account.91 The European
Commission’s attitude towards this problem is however ambiguous. On one
hand, the European Commission is keen to encourage claims for damages in
national courts against cartel participants92, but on the other hand, the
Commission does not want that private litigations would discourage leniency
before national courts”, European Competition Law Annual 2001, 1-37; W. WILS, “Leniency in
antitrust enforcement: theory and practice”, World Competition 2007, 25-64.
88
ECJ, Case C-453/99, COURAGE AND CREHAN [2001], ECR I-6297, and Joined Cases C-295298/04, MANFREDI [2006], ECR I-6619; I. VAN BAEL and J.-F. BELLIS, Competition Law of the
European Community, The Hague, Kluwer Law International, 2005, 1136-1137; R. WHISH,
Competition Law, Oxford, Oxford University Press, 2012, 657-689; A.P. KOMNINOS, “Public
and private antitrust enforcement in Europe: complement? Overlap?”, December 2006, 1-26; W.
VAN GERVEN, “Substantive remedies for the private enforcement of EC Antitrust Rules before
national courts”, European Competition Law Annual 2001, 1-37; C.A. JONES, “Private antitrust
enforcement in Europe: A policy analysis and reality check”, World Competition 2004, 13-24; D.
J. WALSH, “Carrots and Sticks- Leniency and fines in EC Cartel cases”, ECLR 2009, 30-35.
89
A. P. KOMNINOS, “Public and private antitrust enforcement in Europe: complement?
Overlap?”, December 2006; T. SCHOORS, T. BAEYENS and W. DEVROE,
“Schadevergoedingsacties na kartelinbreuken”, NjW 2011, 198-213.
90
See European Commission Notice on Immunity from Fines and Reduction of Fines in Cartel
cases, OJ 2002, C45/3; A. P. KOMNINOS, “Public and private antitrust enforcement in Europe:
complement? Overlap?”, December 2006, 1-26; D. WILSHER, “The public aspects of private
enforcement in EC law: some constitutional and administrative challenges of a damages culture”,
Comp.Law.Rev. 2006, 27-45; W. WILS, “Lenieny in antitrust enforcement: theory and practice”,
World Competition 2007, 25-64; J. BOOT, “Privaatrecht & Boete. Over double damages bij
privaatrechtelijke handhaving van mededinging”, Ars Aequi 2008, 200-208.
91
For example, the UK expressly requires that penalties imposed in other jurisdictions are to be
taken into account. (see Case Walt Wilhelm v. Bundeskartellamt [1969] ECR 1, 14).
92
The European Commission regards private action damages for loss as an integral part of
enforcement of competition law in EC (see competition notice on cooperation par. 40 and the
European Commission White Paper on damages (COM) 2008, 165). You see this also in
documents: P. VERMA and P. BILLIET, “Why would cartel participants still refuse to blow the
whistle under the current EC leniency policy?”, Global antitrust Review 2009, 1-20; W. DEVROE
and N. DELATHAUWER, “Actualia Mededingingsrecht”, in X., Recht in beweging, Antwerp,
Maklu, 2011, 151-178.
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applicants.93 Therefore, the Cooperation Notice stipulates that the European
Commission will only transmit such information to national courts when the
leniency applicant has given his consent.94 Today, there are however cases in
which the European Courts did not follow this Cooperation Notice. 95 The
access of private litigants to the file of leniency applicants shall have to be
clarified in the future, hopefully leading to a regulation. Thus, the European
Commission seems to be confronted with a challenging problem, not easily
solved. An ideal system of antitrust enforcement should combine public and
private enforcement, since they are complementary and both necessary for the
whole competition law enforcement to be effective.96
SOLUTIONS- The European Commission’s Green Paper proposes some
solutions, like e.g. to lessen the possibility to the civil liability of a leniency
applicant.97
CONCLUSION- To date, cartel infringements are enforced primarily by
traditional public enforcement bodies. However, it goes without saying that
private enforcement is gaining popularity. Indeed, recent development of the
legal instruments and attempts of the European Commission to harmonize the
national procedural liability systems in order to encourage civil damages
illustrates this popularity.98 Regarding the leniency issue, a nearly unsolvable
problem exists: the more vigorously private enforcement is encouraged, the
93
European Commission Green Paper, Damages actions for breach of the EC antitrust rules and
European Commission Staff Working Paper, annex to the Green Paper, December 19, 2005, COM
2005, 672. It is clear that private enforcement discourages leniency applicants, maybe not yet now,
but it will certainly do so in the future. A. JONES and B. SUFFRIN, EU Competition law, Oxford,
Oxford University Press, 2011, 1127; P. VERMA and P. BILLIET, “Why would cartel
participants still refuse to blow the whistle under the current EC leniency policy?”, Global
antitrust Review 2009, 1-20.
94
See European Commission Notice on co-operation between the European Commission and the
Courts of the EU member states in the application of articles 81 an 82 EC, OJ 2004, C101/54,
PARa. 26.
95
ECJ, Case C-360/09, Pfleiderer [2011], nyr; ECJ, Case C-536/11, Donau Chemie and Others,
[2012], pending.
96
C.A. JONES, “Private antitrust enforcement in Europe: a policy analysis and reality check”,
World Competition 2004, 13-24; A. P. KOMNINOS, “Public and private antitrust enforcement in
Europe: complement? Overlap?”, December 2006, 1-26; U. BOGE and K. OST, “Up and
Running, or is it? Private enforcement- the situation in Germany and Policy Perspectives”, ECLR
2006, 197-205; J. STEENBERGEN, “Private enforcement. Bedenkingen na de Competition Day”,
TBM 2011, 33-36; W. DEVROE and N. DELATHAUWER, “Actualia Mededingingsrecht”, in X.,
Recht in beweging, Antwerp, Maklu, 2011, 151-178; T. SCHOORS, T. BAEYENS and W.
DEVROE, “Schadevergoedingsacties na kartelinbreuken”, NjW 2011, 198-213.
97
The Green paper gives two possible options: on the one hand Option 29, which consists in the
claim of a rebate on any damages claim facing him, in return for helping claimants bring damages
claims against all cartel members. On the other hand option 30 proposes to remove joint and
several liability for the successful leniency applicant and limit his liability to the share of the harm
corresponding to his share in the cartelised market. (See Green Paper, Damages actions for breach
of the EC antitrust rules, COM(2005) 672, 19.12.2005).
98
T. SCHOORS, T. BAEYENS and W. DEVROE, “Schadevergoedingsacties na kartelinbreuken”,
NjW 2011, 198-213; J. STEENBERGEN, “Private enforcement. Bedenkingen na de Competition
day”, TBM 2011, 33-36.
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less willingly leniency applicants will be prepared to blow the whistle.
Contrary to the lack of a one-stop shop or the broad discretion for the
European Commission, the fear of private enforcement certainly is a major
disincentive in the decision to file a leniency application.
2.1.4. Pitfalls of the marker system
PREDICTABILITY OF THE OUTCOME- A final aspect of the leniency notice that
raises serious frustrations concerning legal certainty and predictability is the
marker system. This is rather remarkable since the European Commission
introduced the marker system especially to create more predictability. Because
of this marker system, leniency applicants are aware of their position with
respect to other applicants and can have firm expectations of the outcome of
the leniency application.99 The marker system introduces also an additional
incentive to blow the whistle. Indeed, if the applicant learns that he is the first,
he will likely continue his application. However, if he is no longer the first,
then the marker system creates an incentive to try and secure the next available
benefit under the leniency policy.100
DELAY- A marker offers the possibility for an immunity applicant to obtain a
delay.101 The applicant is then in the position to perfect his application so that
inspections under article 20 of Regulation 1/2003 can be performed within a
short period of time.102
WIDE DISCRETION- The main difficulty is however that the European
Commission reserves discretion as to whether or not to grant the marker. This
introduces uncertainty into the leniency process and reduces the predictability
J.S. SANDHU, “The European Commission’s Leniency Policy: a success?”, ECLR 2007, 148157; P. VERMA and P. BILLIET, “Why would cartel participants still refuse to blow the whistle
under the current EC leniency policy?”, Global antitrust Review 2009, 1-20.
100
J.S. SANDHU, “The European Commission’s Leniency Policy: a success?”, ECLR 2007, 148157; P. VERMA and P. BILLIET, “Why would cartel participants still refuse to blow the whistle
under the current EC leniency policy?”, Global antitrust Review 2009, 1-20.
101
M.J. REYNOLDS and D.G. ANDERSON, “Immunity and Leniency in EU Cartel cases: current
issues”, ECLR 2006, 82-90; S. SUURNAKKI and M.L. TIERNO CENTELLA D-G for
competition, “European Commission adopts revised Leniency Notice to reward companies that
report hard-core cartels”, Competition Policy Newsletter 2007, 7-15; P. VERMA and P. BILLIET,
“Why would cartel participants still refuse to blow the whistle under the current EC leniency
policy?”, Global antitrust Review 2009, 1-20.
102
S. SUURNAKKI and M.L. TIERNO CENTELLA D-G for competition, “European
Commission adopts revised Leniency Notice to reward companies that report hard-core cartels”,
Competition Policy Newsletter 2007, 7-15. The advantage of this system is that it takes into
account the practicalities of both the gathering documents in a large undertaking and the amount of
time that is required to complete this exercise even for a undertaking who is eager to seek
leniency: M.J. REYNOLDS and D.G. ANDERSON, “Immunity and Leniency in EU Cartel cases:
current issues”, ECLR 2006, 82-90; J.S. SANDHU, “The European Commission’s Leniency
Policy: a success?”, ECLR 2007, 148-157.
99
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of the outcome.103 There have been requests from the legal community to
install an automatic marker system and to extend it to applicants who apply for
a reduction of a fine. The European Commission replied however that: “the
interest is not in the race to simply get a place in the queue, but the overall
purpose is to enhance actual cartel reporting and destabilising”.
CONCLUSION- The marker system is the archetype of proof of an initiative
from the European Commission to introduce more predictability in its process.
Nevertheless, this initiative partly failed because of the opposed interests of the
European Commission and the leniency applicants. While the leniency
applicants require a clear and transparent procedure without discretion, the
European Commission is availed with a less predictable procedure, since it
enlarges the efficiency of the leniency system.
J.S. SANDHU, “The European Commission’s Leniency Policy: a success?”, ECLR 2007, 148157; S. SUURNAKKI and M.L. TIERNO CENTELLA, D-G for competition, “European
Commission adopts revised Leniency Notice to reward companies that report hard-core cartels”,
Competition Policy Newsletter 2007, 7-15; P. BILLIET, “How lenient is the EC Leniency Policy?
A matter of certainty and predictability”, ECLR 2009, 14-21; P. VERMA and P. BILLIET, “Why
would cartel participants still refuse to blow the whistle under the current EC leniency policy?”,
Global antitrust Review 2009, 1-20.
103
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2.2. HUMAN RIGHTS CONSIDERATIONS IN THE LENIENCY POLICY
2.2.1. Recent evolutions
COMBINATION OF FUNCTIONS- As explained above, the leniency system can
only function properly if enough incentives are provided to blow the whistle.
Nowadays, it is argued that the current leniency system is facing problems
resulting from its enormous success as well as from the changing
environment104. The most important critique about the leniency system has
however not yet been discussed, namely, the precise functions and powers of
the European Commission. In the antitrust procedure, the European
Commission combines investigative and prosecutorial powers with
adjudicative functions, while nearly no independent judicial oversight is
present (infra par. 98). In contrast to the pitfalls discussed above - dealing
primarily with issues regarding the leniency notice itself - the lack of
independent judicial oversight requires a more in-depth analysis of not only the
leniency system, but also of the position and function of the competition
authorities in general. Since a couple of years, a general feeling of an unfair
and inadequate administrative procedure by the European Commission is
expressed in terms of human rights violations, e.g. the rights of defence of the
cartelists.105
HUMAN RIGHTS IN COMPETITION PROCEDURE- Even though the competition
authorities have been granted far-reaching competences for the detection and
punishment of antitrust infringements, the power of those authorities has
always been limited by general principles of human rights.106 However, the
authorities often succeeded in avoiding an in-depth analysis of the alleged
human rights claims, either by relying on procedural and formal aspects
104
E.g. the decentralisation process, the upcoming of private enforcement, the incorporation of the
Charter of Fundamental Rights etc.
105
A. ADREANGELI, EU competition enforcement and human rights, Cheltenham, Edward Elgar,
2009, 2-12.
106
Thus for the past decades, the ECJ and the CFI took into account the case law of the European
Court of Human Rights: K. LENAERTS and J. VANHAMME, “Procedural rights of private
parties in the community administrative process”, CMLR 1997, 531-569; L. ORTEGA,
“Fundamental rights in the European Constitution”, Kluwer Law International, European public
law, 2005, 363-373. However, as some say, the court did create space to steer a different course
than the ECtHR might have done, especially in competition law, where the ECtHR only had few
occasions to pronounce itself: M. BRONCKERS and A. VALLERY, “No longer presumed guilty?
The impact of fundamental rights on certain dogmas of EU competition law”, World Competition
2011, 535-570.
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specific to the case, or by referring to constitutional traditions common to the
member states and international human rights treaties.107
RECENT DEVELOPMENTS- Two recent developments have brought these human
rights considerations more under the attention than ever before and could make
a swift end to this case-by-case analysis of the compatibility of human rights
with the competition procedure.
SUCCESS- First, the enormous success of the leniency policy and the fining
policy contributes to the sensitivity regarding the human rights. The fact that
the European Commission and competition authorities received recently more
investigative and decision-making powers108 also contributes to the fact that
more interference with human rights can arise.109
LISBON TREATY- Secondly, the entry into force of the Treaty of Lisbon
reinforces the EU’s adherence to fundamental rights 110, by stipulating in article
6(1) TEU that the Charter of Human Rights shall be incorporated by the
treaties and accordingly shall have the same legal value. 111 A second
107
ECJ, Case C-411/04 P MANNESMANNRÖHREN-WERKE AG V COMMISSION [2007], ECR I-965,
where the CFI said: “it had no jurisdiction to apply the convention when reviewing an
investigation under competition law, inasmuch as the convention as such is not part of community
law”. See also the cases concerning ne bis in idem: ECJ, Case 11/70 INTERNATIONALE
HANDELSGESELLSCHAFT [1970], ECR 1125, PARA. 4; ECJ, Case 4/73 NOLD V COMMISSION
[1974], ECR 491, PARA. 13; ECJ, Case T-223/00 KYOWA HAKKO KOGYO AND KYOWA HAKKO
EUROPE V EUROPEAN COMMISSION [2003], nyr and ECJ, Case T-224/00 ARCHER DANIELS
MIDLAND COMPANY AND ARCHER DANIELS MIDLAND INGREDIENTS LTD V COMMISSION [2003],
ECR II-2597; A. ADREANGELI, EU competition enforcement and human rights, Cheltenham,
Edward Elgar, 2009, 7-8; W.WILS, “La comptabilité des procedures communautaires en matière
de concurrence avec la convention Européenne des droits de l’homme”, 1996, 329-354; E. M.
AMEYE, “The interplay between human rights and competition law in the EU”, ECLR 2004, 332341; S. DOUGLAS-SCOTT, “A tale of two courts: Luxembourg, Strasbourg and the growing
European human rights acquis”, CMLR 2006, 629-665; V.O. BENJAMIN, “The application of EC
competition law and the European Convention on Human Rights”, ECLR 2006, 693-699; J.
CALLEWAERT, “The European Convention on human rights and European Union law: a long
way to harmony”, EHRLR 2009, 768-781; W. WEISS, “Human rights and EU antitrust
enforcement: new from Lisbon”, ECLR 2011, 186-194.
108
See Regulation 1/2003: some powers have been extended, new ones have been introduced like
the power to take statements (Art. 19), the power to inspect non-business premises (Art. 21) and
the power to seal business premises (art. 20). A. ADREANGELI, EU competition enforcement and
human rights, Cheltenham, Edward Elgar, 2009, 2.
109
European Commission Staff working paper accompanying the report on the functioning of
regulation 1/2003, SEC 2009, 574 et seq.; W. WEISS, “Human rights in the EU: rethinking the
role of the European Convention on Human Rights after Lisbon”, European Constitutional Law
Review 2011, 64-95.
110
E. M. AMEYE, “The interplay between human rights and competition law in the EU”, ECLR
2004, 332-341; M. BRONCKERS and A. VALLERY, “No longer presumed guilty? The impact of
fundamental rights on certain dogmas of EU competition law”, World Competition 2011, 535-570;
W. WEISS, “Human rights and EU antitrust enforcement: new from Lisbon”, ECLR 2011, 186194.
111
Article 52 (3) of the Charter: “in so far as this Charter contains rights which correspond to
rights guaranteed by the Convention, the meaning and scope of those Charter rights shall be the
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improvement is the EU’s commitment to become party to the European
Convention of Human rights. 112
MORE HUMAN RIGHTS CLAIMS IN THE FUTURE?- As already mentioned above,
no incremental change is likely to occur, and human rights always have been
part of the acquis communautaire.113 Nevertheless, some share the opinion that
those developments will make human rights more enforceable than ever
before,114 since there would be a greater potential for interference with the
human rights of persons affected by antitrust procedures.115 As a consequence
of the recent developments, any clash with human rights is no longer a mere
issue of international responsibility of the EU member states, but becomes an
internal constitutional issue after the Lisbon Treaty.116 In short, the case law of
the ECtHR will become more binding and the European courts shall have to
take into account the high standards of the ECtHR, which maybe will require
some changes in the case law of the ECJ, General Courts and the European
Commission’s practice. 117
2.2.2. Applicability of human rights in leniency procedures
WHICH HUMAN RIGHTS?- Since human rights claims in the competition
procedure are likely to occur more frequently in the (near) future, one should
same”; L. ORTEGA, “Fundamental rights in the European Constitution”, European public law,
Kluwer Law International, 2005, 363-373.
112
See article 6
§2
TEU. For
a
recent update about the accession:
https://wcd.coe.int//ViewDoc.jsp?Ref=PR545%282010%29&Language=lanEnglish&Ver=original
&BackColorInternet=F5CA75&BackColorIntranet=F5CA75&BackColorLogged=A9BACE.
113
Recent case law points in this direction. In both the cases ELF AQUITAINE and COMAP V
EUROPEAN COMMISSION, the ECJ stated that no new human rights framework exists since the
incorporation of the Charter. (General Court, Case T-299/08 ELF AQUITAINE/COMMISSION [2011],
ECR 2011, PARA. 173; ECJ, Case C-290/11 P COMAP V EUROPEAN COMMISSION [2012], nyr.)
114
Even though the Charter codifies procedural guarantees that already existed in case law, the
framework of human rights is now completely changed, so that the case law of the ECJ needs to be
reviewed: A. ADREANGELI, EU competition enforcement and human rights, Cheltenham,
Edward Elgar, 2009, 8; E. M. AMEYE, “The interplay between human rights and competition law
in the EU”, ECLR 2004, 332-341; M. BRONCKERS and A. VALLERY, “No longer presumed
guilty? The impact of fundamental rights on certain dogmas of EU competition law”, World
Competition 2011, 535-570; W. WEISS, “Human rights in the EU: rethinking the role of the
European Convention on Human Rights after Lisbon”, European Constitutional Law Review 2011,
64-95.
115
E. M. AMEYE, “The interplay between human rights and competition law in the EU”, ECLR
2004, 332-341; V O. BENJAMIN, “The application of EC competition law and the European
Convention on Human Rights”, ECLR 2006, 693-699; W. WEISS, “Human rights and EU antitrust
enforcement: new from Lisbon”, ECLR 2011, 186-194.
116
W. WEISS, “Human rights in the EU: rethinking the role of the European Convention on
Human Rights after Lisbon”, European Constitutional Law Review 2011, 64-95.
117
S. DOUGLAS-SCOTT, “A tale of two courts: Luxembourg, Strasbourg and the growing
European human rights acquis”, CMLR 2006, 629-665; J. CALLEWAERT, “The European
Convention on human rights and European Union law: a long way to harmony”, EHRLR 2009,
768-781; W. WEISS, “Human rights and EU antitrust enforcement: new from Lisbon”, ECLR
2011, 186-194; W. WEISS, “Human rights in the EU: rethinking the role of the European
Convention on Human Rights after Lisbon”, European Constitutional Law Review 2011, 64-95.
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assess which human rights could be at stake. Therefore it is important to
investigate whether the procedure of the competition authorities for the
purposes of the ECHR is criminal.118 Depending on the answer of this
question, certain procedural guarantees circumscribed in the ECHR will or will
not be applicable.119 Since undertakings will only protest against the procedure
of the European Commission when they are fined, our attention goes to the
nature of those fines: are they penal or not? As no clear-cut answer is
available, we list the different views in the literature and case law.
ARTICLE 23 (5) REGULATION 1/2003– Regard must first be given to the
Regulation itself. Article 23 (5) of the Regulation 1/2003 stipulates that fines
are not of a penal nature. However, this argument is not decisive since the term
“criminal” in article 6 ECHR is interpreted autonomously. 120
ECTHR- Secondly, the ECtHR stipulates 3 criteria to assess whether the
procedure involves a criminal prosecution in the meaning of article 6 ECHR.
These criteria are the so-called “Engel criteria”, developed by the ECtHR in its
earlier case law.121
HARD CORE CRIMINAL OR PERIPHERY?- The application of these criteria to the
antitrust fining procedures leads to the conclusion that these procedures are
“criminal” within the meaning of article 6 ECHR. The reasons heretofore are
the nature of the offence, the stigma attached to it, and both the severity and
the deterrent character of the fines. 122 The fact that it is of a penal nature is thus
no news.
118
A. ADREANGELI, EU competition enforcement and human rights, Cheltenham, Edward Elgar,
2009, 6-16; W. WILS, “The combination of the investigative and prosecutorial function and the
adjudicative function in EC antitrust enforcement: a legal and economic analysis”, World
competition 2004, 201-224.
119
These are the presumption of innocence (6, lid 2), the rights of defence (6, lid 3), requirement of
legality (7) and ne bis in idem (Protocol nr. 7, art. 4). See also the Charter of fundamental rights,
articles respective 48, 49 and 50. Article 47 Charter however does not make a distinction between
criminal and non-criminal proceedings. A. RILEY, “The modernisation of EU anti-cartel
enforcement”, ECLR 2010, 190-207.
120
See ECtHR 8 June 1976, ENGEL AND OTHERS/NETHERLANDS, http://www.echr.coe.int:“the
national designation of criminal is not decisive and cannot so far fear of circumvention of the
Convention standards set out in article 6.”; A. RILEY, “The modernisation of EU anti-cartel
enforcement”, ECLR 2010, 190-207; W. WILS, “The increased level of EU antitrust fines, judicial
review and the ECHR”, World Competition 2010, 5-29; W. WEISS, “Human rights and EU
antitrust enforcement: new from Lisbon”, ECLR 2011, 186-194.
121
ECtHR 8 June 1976, ENGEL AND OTHERS/NETHERLANDS, http://www.echr.coe.int; ECtHR 23
July 2002, JANOSEVIC V SWEDEN, par. 67 http://www.echr.coe.int:“Those have to be regarded as
alternative, not cumulative conditions”. (The three criteria are: does the domestic law treat the
contested charges or penalties as criminal law; is the nature of the offence of general concern and
application; does the charge imposed operate as punishment and/or deterrent or more like
pecuniary compensation for damage caused?)
122
Commision’s Guidelines on the method of setting fines, OJ 2006 C 210/2, par. 4, 30, 37; W.
WILS, “La comptabilité des procedures communautaires en matière de concurrence avec la
convention Européenne des droits de l’homme”, 1996, 329-354; A. RILEY, “The modernisation of
EU anti-cartel enforcement”, ECLR 2010, 190-207; W. WEISS, “Human rights and EU antitrust
enforcement: new from Lisbon”, ECLR 2011, 186-194.
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Another issue remains however unclear. Does competition law belong to the
core criminal law or is there a so-called “periphery”? In JUSSILA, the Court
made a distinction between the “core criminal law” and “the periphery”.123 The
ECtHR stated that “the guarantees of article 6 may not apply with full
stringency to cases that are deemed criminal within the autonomous meaning
of the ECtHR, but that do not carry the same degree of stigma as hard core
criminal cases”.124 The consequences are important. Indeed, when criminal
penalties in competition cases are not considered to be within the “core
criminal law”, they could be imposed by a body such as the European
Commission, which combines investigative and decision-making powers.125
From this judgement, it has therefore been deduced that EU competition law
belongs to the periphery of criminal law.126 However, this has not remained
unchallenged, since the cited judgement concerned a tax rectification, which
has obviously not the same financial implications and ‘stigma’ consequences
as the finding of a competition violation. 127
ADVOCATE-GENERALS ECJ- As regards the ECJ, a few conclusions of the
Advocate-Generals (“A-Gs”) are quite interesting and even point to opposite
directions. Some A-Gs tend to leave the question open128, however A-G
SHARPSTON and A-G KOKOTT argue respectively in the CASES
123
E.g. the competition law, fiscal law and customs duties. The latter does not have the same
stringent formula: ECtHR 23 November 2006, JUSSILA/FINLAND, nr. 73053/01, par. 43,
http://www.echr.coe.int; ECtHR 27 September 2011, MENARINI DIAGNOSTICS/ITALY, par. 58-59,
http://www.echr.coe.int.
124
ECtHR 23 November 2006, JUSSILA/FINLAND, par. 43, http://www.echr.coe.int.
125
This is however solely on the condition that they can be reviewed by a judicial authority within
the meaning of article 6: ECtHR 23 November 2006, JUSSILA/FINLAND, nr. 73053/01, PAR. 43,
http://www.echr.coe.int; ECtHR 27 September 2011, MENARINI DIAGNOSTICS/ITALY, PAR. 58-59,
http://www.echr.coe.int; AG MENGOZZi in his opninion of 17 February 2011 in case C-521/09 P,
ELF AQUITAINE par. 31 and 36; W.WILS, “La comptabilité des procedures communautaires en
matière de concurrence avec la convention Européenne des droits de l’homme”, World
Competition 1996, 329-354; W. WILS, “The combination of the investigative and prosecutorial
function and the adjudicative function in EC antitrust enforcement: a legal and economic
analysis”, World competition 2004, 201-224; W. WILS, “Is criminalization of EU Competition
law the answer?”, World Competition 2005, 117-159; W. WILS, “The increased level of EU
antitrust fines, judicial review and the European convention on human rights”, World competition
2010, 14-15.
126
W.WILS, “La comptabilité des procedures communautaires en matière de concurrence avec la
convention Européenne des droits de l’homme”, 1996, 329-354; W. WILS, “Is criminalization of
EU Competition law the answer?”, World Competition 2005, 117-159; J. BOOT, “Privaatrecht &
Boete. Over double damages bij privaatrechtelijke handhaving van mededinging”, Ars Aequi 2008,
200-208; W. WILS, “The increased level of EU antitrust fines, judicial review and the European
convention on human rights”, World competition 2010, 14-15; T. WECK, “Antitrust infringements
in the distribution chain- When is leniency available to suppliers?”, ECLR 2010, 394-401; M.
BRONCKERS and A. VALLERY, “No longer presumed guilty? The impact of fundamental rights
on certain dogmas of EU competition law”, World Competition 2011, 535-570.
127
M. BRONCKERS and A. VALLERY, “No longer presumed guilty? The impact of fundamental
rights on certain dogmas of EU competition law”, World Competition 2011, 535-570.
128
A-G MAZAK in the CASE LAFARGE/EUROPEAN COMMISSION (ECJ, C-413/08 P, nyr, PARA.107)
and A-G BOT in the CASE ARCELOR MITTAL (ECJ, Case C-216//09 P ARCELOR MITTAL, nyr, PAR.
41 ff. ).
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KME/EUROPEAN COMMISSION C-272/09129 and SOLVAY/EUROPEAN
COMMISSION C-109/10130 that EU competition law proceedings are covered by
article 6 ECHR, but do not belong to the hard core of criminal law. The
General Court also concluded in its recent SCHINDLER JUDGEMENT that
competition law belongs to the periphery of article 6 ECHR.131 It is however
true that both the A-Gs and the General Court did not elaborate on any other
elements of EU competition law such as the level of the fines, the severity of
the sanctions, or compared their findings to the JUSSILA judgement.
NATIONAL COMPETITION LAWS- In a couple of cases concerning national
competition procedures, the ECtHR too was not persistent with the distinction
made in JUSSILA. First, in the FORTUM CASE, the ECtHR decided that the
competition law was fully covered by article 6 and that the right to a fair trial
had been violated.132 In another case, the ECtHR pointed in the other direction
and decided that the competition law was not covered by article 6, mostly
because of the particular characteristics of the law at issue.133 It took only until
the recent MENARINI judgment in which the ECtHR clarified that a national
competition authority which itself does not function in conformity with the
requirements of article 6 ECHR, could impose a fine of a penal nature, on the
condition that afterwards the possibility of full judicial review was
guaranteed.134 The ECJ seemed to have been listening to this judgement. 135
CONCLUSION- In short, it is clear that the competition sanctions are of a
criminal nature. The recent MENARINI judgement concerning a national
competition procedure, however of a broader relevance, has clarified that the
current institutional framework of most competition authorities is compatible
with article 6 ECHR, if full judicial review of the authorities’ decision is
possible.136 Whether this is the case, shall be examined below (infra par. 98).
129
See par. 64-67 of the judgment.
See par. 256 of the judgement.
131
General Court, Case T-138/07 SCHINDLER HOLDING LTD AND OTHERS V EUROPEAN
COMMISSION [2011], nyr, PARAS. 51-59.
132
ECtHR 15 October 2003, CASE FORTUM CORPORATION V FINLAND, http://www.echr.coe.int.
133
ECtHR 3 June 2004, NESTE V. RUSSIA, http://www.echr.coe.int.
134
What is meant with “full judicial review” is however still unclear (see infra 98). Since Italian
competition law was modelled on EU competition law, the outcome of this case has important
implications for EU competition law as well. ECtHR 27 September 2011, MENARINI
DIAGNOSTICS/ITALY, par. 58-59, http://www.echr.coe.int; M. BRONCKERS and A. VALLERY,
“No longer presumed guilty? The impact of fundamental rights on certain dogmas of EU
competition law”, World Competition 2011, 535-570; M. BRONCKERS and A. VALLERY,
“Business as usual after Menarini?”, mLex Magazine 2012, 1-5.
135
ECJ, Case C-272/09 P, KME, [2011], nyr.
136
Recent judgments seem to confirm this line of reasoning. ECJ, Case C-272/09 P, KME, [2011],
nyr; Case C-386/10, CHALKOR, [2011], nyr; ECtHR 18 April 2012, POSTON NORGE AS,
http://www.echr.coe.int.
130
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2.2.3. Successful claims of violations of human rights
EXTENSION TO UNDERTAKINGS- It remains to be determined whether this
improved “habitat” for human rights will pave a way for competition law
defences in court. Will these commitments of the EU lead to incompatibilities
with the procedures of the European Commission and NCAs? Some are
convinced that this is the case, as a result of which human rights will become
more enforceable in competition procedures. 137 Others are however of the
opinion that human rights issues in competition cases have always existed and
hence that nothing will change.138 It is indeed true that the ECHR as human
rights catalogue was primarily designed as a means to protect natural persons
from arbitrary or excessive exercise of state power. 139 To consider whether the
procedure is compatible with article 6 (implying that these human rights can be
extended to legal persons), we need not only to consider the rights granted to
the judicial review during the administrative procedure but, as mentioned
above, also the rights of the undertakings during the judicial review before the
General Court and the ECJ.140 In the next sections, we provide an overview of
those rights that already have been (successfully) invoked by undertakings in a
leniency procedure.
a. Right to a fair trial
OVERVIEW- The first and most comprehensive right in the competition law
discussion is the right to a fair trial, listed in article 6 ECHR.141
E. M. AMEYE, “The interplay between human rights and competition law in the EU”, ECLR
2004, 332-341; A. RILEY, “The modernisation of EU anti-cartel enforcement: will the European
Commission grasp the opportunity?”, ECLR 2010, 191-207.
138
General Court, Case T-299/08 ELF AQUITAINE/COMMISSION [2011], ECR 2011, PARA. 173; A.
ADREANGELI, EU competition enforcement and human rights, Cheltenham, Edward Elgar,
2009, 3-4; F. MONTAG, “The case for a radical reform of the infringement procedure under
Regulation 17”, ECLR 1996, 428; H. WINKCLER, “Some comments on procedures and remedies
under EC merger control rules: something rotten in the kingdom of EC merger control?”, World
Competition 2003, 219; M. BRONCKERS and A. VALLERY, “No longer presumed guilty? The
impact of fundamental rights on certain dogmas of EU competition law”, World Competition
2011, 535-570. See e.g. in the late 1970’s companies challenged EU competition law decisions
because of the European Commission combined the functions of prosecutor, judge, .. At that time,
the ECJ dismissed these arguments as being irrelevant, pointing that the European Commission
could not be described as a tribunal within the meaning of article 6: ECJ, Joined Cases 209-215
and 218/78 FEDETAB [1980], ECR 3125-3248, PARA. 79-81.
139
M. EMBERLAND, The human rights of companies. Exploring the structure of ECHR
protection, Oxford, Oxford University Press, 2005, 52.
140
A. ADREANGELI, EU competition enforcement and human rights, Cheltenham, Edward Elgar,
2009, 3-10.
141
The right to a fair trial consists of many aspects, like the right to be judges within reasonable
time, the presumption of innocence etc., which will be discussed below. The ECJ has confirmed
the applicability of this article: ECJ, Case C-185/95 P BAUSTAHLGEWEBE [1998], ECR I-8417,
PARAS 26–54; ECJ, Case C-235/92 P MONTECATINI/COMMISSION [1990], ECR I-4539, PARA. 137.
137
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a.1. Reasonable time requirement
CONTENT OF THE RIGHT- According to article 6, “everyone has right (…) to be
judged within a reasonable time”. The importance of this requirement in
competition matters can hardly be overrated.142 Long-lasting investigations and
decisions of cartel infringements are more frequently the rule rather than the
exception. The requirement of reasonable time occurs in two stages of the
proceedings. On one hand, the administrative proceeding before the European
Commission (the investigation) may not take too long. 143 On the other hand,
the procedure before the General Court and the ECJ may not exceed a
reasonable time.144
APPLICATION IN LENIENCY CONTEXT- A recent example of the applicability of
this right in the leniency context can be found in the so-called “BEER-CARTEL
145
CASE”.
Due to the lengthy investigation146, the European Commission
recognised on its own motion that the procedure took (too) long and reduced
the fine.147
PECULIARITIES- The cited cases show that a reasonable time claim can
sometimes lead to significant fine reductions. In a leniency context too, one
can imagine that reasonable time plays an important role. There are however
some odd peculiarities when the reasonable time requirement is surpassed. If
an undertaking claims compensation because of a determination by the ECJ
that the investigation by the European Commission exceeded the reasonable
time, the claim shall be addressed to the EU (obviously not against its organs).
The competent judge to decide about this case shall be the General Court. The
defence of the EU shall in all probability however be looked after by, indeed,
the European Commission. This shows that the guarantees to be judged by an
independent judge are not totally watertight.
142
P. VAN NUFFEL, "De handhaving van het Europees mededingingsrecht in het licht van de
mensenrechten" in X. (ed.), Recht in beweging, 19de VRG-alumnidag 2012, Antwerp, Maklu,
2012, 361-364; E.M. AMEYE, “The interplay between human rights and competition law in the
EU”, ECLR 2004, 332-341.
143
ECJ, Case C-105/04 P, NEDERLANDSE FEDERATIEVE VERENIGING VOOR DE GROOTHANDEL OP
ELEKTRONISCH GEBIED/EUROPEAN COMMISSION, nyr, 35-62.
144
ECJ, Case C-185/95 P BAUSTAHLGEWEBE [1998], ECR I-8417, PARAS 26–54; ECJ, Case C254/99 P LIMBURGSE VINYL MAATSCHAPPIJ NV (LVM) [2002], ECR I-8375 ; ECJ, Joined cases
C-341/06 P and C-342/06 P, CHRONOPOST [2008], nyr, PAR. 44-60; ECJ, Case C-385/07 P, DER
GRUNE PUNKT- DUALES SYSTEM DEUTSCHLAND/EUROPEAN COMMISSION [2009], nyr, PAR. 177188.
145
Case COMP 37.766, (BEER CARTEL CASE): a cartel between Inbev, Heineken, Bavaria and
Gross. Inbev blows the whistle and gets away with it.
146
For an accurate explanation on the case, see: F. WIJCKMANS and F. TUYTSCHAEVER, “Tot
zover het Belgisch kartelparadijs”, RW 2008, 1178-1196.
147
Which was however not accepted by the undertakings, so they went to the General Court for a
more substantial fine reduction.
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a.2. Independent and impartial judge
CONTENT OF THE RIGHT- Next, article 6 requires that the case shall be judged
by “an independent and impartial judge.” The fact that the European
Commission combines the functions of legislator, prosecutor, judge and jury
has already been criticized since many years.148 It is correct that such a
situation increases the risk of a prosecutorial bias and that this does not exist in
a system where the antitrust enforcement authority prosecutes before an
independent court.149 However, as has been pointed out above, as long as full
judicial review is available, there is no incompatibility with article 6 ECHR.
SOLUTIONS- In the literature, there are however a couple of solutions are
proposed in order to make the procedure more conform with article 6. 150
TRANSFER OF DECISION MAKING POWERS- First, a transfer of the decision
making power of the European Commission to the community courts has been
suggested.151 This comes down to the creation of a separate procedure for
cartel cases with an independent tribunal presided by a judicial panel. 152 This
reassessment can have advantages for the European Commission: it allows the
cartel cases to be dispatched more rapidly, increases the incentive to settle, the
European Commission reduces its workload, there are fewer legal challenges,
etc.153 It has been discussed whether such a transfer requires a modification of
the EC Treaties.154 In any case, this reform is far-reaching in all its aspects.
INTERNAL CHECKS AND BALANCES- Some argue that a lot can be achieved by
enhancing the procedure of the European Commission through improving the
148
Currently, the case of the so-called ELEVATORS-CARTEL is pending before the Court of Appeal
of Brussels in a damages procedure, where the European Commission claims compensation. A
preliminary question to the ECJ is asked whether the Commission can be both prosecutor (in
original procedure) and victim (in subsequent damages procedure) in the same case. See:
http://ec.europa.eu/comm/competition/antitrust/cases/decisions/38823/en.pdf
149
“A certain prosecutorial bias can flow from the entrusting to a single set of persons the
functions of investigation, prosecution and adjudication. The fusion of the investigative and the
decision-making functions is incompatible with notion of an independent and impartial tribunal
established by law”: W. WILS, “The combination of the investigative and prosecutorial function
and the adjudicative function in EC antitrust enforcement: a legal and economic analysis”, World
Competition 2004, 201-224. The European Commission has always defended herself by saying
that they “are forced to play on one string than what others can play in several strings”, and finds
that they are doing actually well: O. GUERSENT, European Commission, “The EU Model of
Administrative enforcement against global cartels: evolving to meet challenges”, 2006, 1-5.
150
S. FORRESTER, “The process in EC competition cases: a distinguished institution with flawed
procedures”, European law Review 2009, 1-30.
151
A. ANDREANGELI, EU Competition enforcement and human rights, Cheltenham, Edward
Elgar, 2008, 230-256.
152
A. RILEY, “The modernisation of EU anti-cartel enforcement: will the European Commission
grasp the opportunity?”, ECLR 2010, 191-207.
153
A. RILEY, “The modernisation of EU anti-cartel enforcement: will the European Commission
grasp the opportunity?”, ECLR 2010, 191-207.
154
W. WILS, “The combination of the investigative and prosecutorial function and the adjudicative
function in EC antitrust enforcement: a legal and economic analysis”, World Competition 2004,
201-224.
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internal checks and balances of the administrative proceedings. It has thus
been proposed to redesign the DG Competition by separating the investigative
from the decision-making phase of proceedings. In particular, this comes down
to the adoption of measures of internal reorganisation of DG competition: to
separate the two phases of the investigation and to adopt a final decision in
order to entrust each stage to a different unit within the Directorate.155
CONCLUSION- The requirement of an independent and impartial judge is vital
for every constitutional state. However, in practice it seems that this principle
is currently not being applied. The European Commission combines all
functions and sometimes seems to be judge and party, as occurred in one
particular case. While no claims on this ground have been won yet, if the EC
procedures will be scrutinised by the ECtHR through the lens of the ECHR
jurisprudence, it will be challenging not to draw the conclusion that the current
procedure violates article 6.
a.3. Presumption of innocence
APPLICABILITY- Another claim arising from article 6 is the breach of the
presumption of innocence by the European Commission. The presumption of
innocence is recognised as a general principle of law, so it is in any case
applicable in the area of competition.156
PRESUMPTIONS IN COMPETITION CASES- In the investigation of cartel
infringements, the European Commission uses many presumptions, for
instance the presumption of parental liability for the conduct of subsidiaries, to
draw interference from certain facts. 157 Because companies try to keep their
secrets as much as possible, and the competition authority is only in rare cases
100% certain of an infringement, the use of such presumptions is vital.
Nowadays, these presumptions are challenged, particularly in view of the
155
A. ANDREANGELI, EU Competition enforcement and human rights, Cheltenham, Edward
Elgar, 2008, 230-256.
156
ECJ, Case C-199/92 P HÜLS AG V. COMMISSION, NYR, PARAS. 149-50; ECJ, Case C-235/92 P
MONTECATINI/COMMISSION [1990], ECR I-4539, PARA. 137; General Court, Case T-474/04
PERGAN HILFSSTOFFE FÜR INDUSTRIELLE PROZESSE/EUROPEAN COMMISSION [2007], ECR II04225, PARAS. 76-81. In MONTECATINI, The ECJ acknowledged the fact that the presumption of
innocence, as guaranteed in article 6 par. 2 applies to EU antitrust enforcement since an
undertaking investigated is comparable to a person charged with a criminal offence. M.
BRONCKERS and A. VALLERY, “No longer presumed guilty? The impact of fundamental rights
on certain dogmas of EU competition law”, World Competition 2011, 535-570.
157
This is also reflected in articles 20-22 of Regulation 1/2003.
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presumption of innocence. The ECJ has been considering these challenges158,
however, successful pleas have been rare so far.159
PRESUMPTION PARENTAL LIABILITY- One of the presumptions often used by
the European Commission is the presumption of parental liability. When a
parent company holds 100% of the shares of a subsidiary and the latter has
infringed the competition law, the European Commission can draw the
rebuttable presumption that the parent did exercise decisive influence.
This presumption of parental liability is nowadays challenged in light of the
presumption of innocence. 160 One could wonder whether this presumption of
innocence is really necessary in a debate about human rights in competition
procedures.161 Yet, some entertain the opinion that the presumption is an
essential procedural guarantee in the competition procedure. According to the
supporters, one corporate entity cannot be punished for the conduct engaged
by another separate corporate entity. 162
TENDENCY- In any case, recent judgements illustrate the tendency of the
European courts to quash the European Commission’s application of parental
liability presumption.163 These judgements give accordingly more space for
A.L. SIBONY and E. BARBIER DE LA SERRE, “Charge de la preuve et théorie du controle en
droit communautaire de la concurrence: pour un changement de perspective”, Revue trimestrielle
Droit Europeen 2007, 205 220 and 225; M. BRONCKERS and A. VALLERY, “No longer
presumed guilty? The impact of fundamental rights on certain dogmas of EU competition law”,
World Competition 2011, 535-570.
159
In almost all cases, the EU dismissed the claims of presumption of innocence, except but one:
ECJ, Case T-62/98 VOLKSWAGEN V COMMISSION [2000], ECR II-2707, PARA. 281. In the
Volkswagen Case, the General Court decided that the European Commission infringed the
presumption of innocence. However, the court denied Volkswagens request for annulment of the
decision because Volkswagen had not proven that the College of European Commissioners would
have decided differently had there not been any infringement.
160
This presumption was endorsed in Akzo Nobel judgement of 2009 and confirmed in the case of
Arcelor Mittal, dating from March 2011. See ECJ, Case T-125/03 AKZO NOBEL CHEMICALS AND
AKCROS V COMMISSION [2009], nyr and ECJ, Case C-201/09 P ARCELOR MITTAL LUXEMBOURG
SA V EUROPEAN COMMISSION [2011], nyr.
161
AG KOKKOT is of the opinion that the presumption is not of a vital importance in the Akzo
Nobel case and in the CASE OOMS. According to the ECJ: “the presumption of innocence no longer
comes into play, as the infringement has been proven as a matter of competition law”.
162
M. BRONCKERS and A. VALLERY, “No longer presumed guilty? The impact of fundamental
rights on certain dogmas of EU competition law”, World Competition 2011, 535-570. Some argue
that the corporate veil can only be pierced in the presence of particular circumstances like the
intensive involvement of the parent in the subsidiary’s business. They refer hereby to the national
laws of the member states, which are not so far-reaching. In ELF AQUITAINE, the General Court
replied to this by pointing out that there is no relevance for national law because they did not
represent the proper legal framework and that the EU competition law was different: General
Court, Case T-299/08 ELF AQUITAINE/COMMISSION [2011], ECR 2011, PARA. 173.
163
ECJ, Case T-196/06 EDISON [2011], nyr, PARA. 60-90 (the European Commission had not
propely examined the appellant’s rebuttals against this presumption); ECJ, Case T—234/07
KONINKLIJKE GROLSCH NV [2011], nyr, PARAS. 84-92; General Court, Case T-299/08 ELF
AQUITAINE/COMMISSION [2011], ECR 2011, PARAS. 159-168; Case COMP 37.766 (BEERCARTEL); M. BRONCKERS and A. VALLERY, “No longer presumed guilty? The impact of
fundamental rights on certain dogmas of EU competition law”, World Competition 2011, 535-570.
158
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rebuttals by the defendants. In the leniency context, no human rights claims
concerning the breach of the presumption of innocence are present, however,
theoretically it is possible that such claims occur in the future.
REMAINING PROBLEMS- Some important questions continue to exist. One of
them is that the European Court maintains the viewpoint that, as long as the
European Commission proposes better explanations when rejecting rebuttals to
the parental liability rule, it could conceivably meet the criticisms of the EU
courts in recent judgements. Better would be to do something about the content
of the presumptions, and introduce for instance a requirement to show that the
parent has had a decisive influence on the subsidiary. 164
a.4. Privilege of non-incrimination
CONTENT- Closely connected with the presumption of innocence is the
privilege of non-incrimination; the fairness of the proceedings requires that
information is protected against forced disclosure by the competition officials
during the preliminary investigations. 165 The privilege consequently guarantees
the right to control the provision of information about ourselves.
EXTENSION TO LEGAL PERSONS?- Some aspects of this principle do not seem
entirely suitable to apply to legal persons. Even in small undertakings, the link
between the undertakings’ “personality” and the issues raised in favour of the
privacy argument are difficult to support.166 However, in light of the concept of
the rule of law at the basis of a democratic society, the principle can by virtue
of its objective nature, be extended to corporate entities.167
EVOLUTION CASE LAW- The principle has undergone major changes in the case
law. It evolved from a general principle of law, providing that the rights of
defence were not damaged168, to the existence of an essential element of the
M. BRONCKERS and A. VALLERY, “No longer presumed guilty? The impact of fundamental
rights on certain dogmas of EU competition law”, World Competition 2011, 535-570.
165
ECJ, Case 374/87 ORKEM V COMMISSION [1989], ECR 3283, PARAS. 28-34; A.
ANDREANGELI, EU Competition enforcement and human rights, Cheltenham, Edward Elgar,
2008, 124-128; A. MACCULLOCH, “The privilege against self-incrimination in competition
investigations: theoretical foundations and practical implications”, Legal Studies 2006, 211-237.
166
A. ANDREANGELI, EU Competition enforcement and human rights, Cheltenham, Edward
Elgar, 2008, 127-128; A. MACCULLOCH, “The privilege against self-incrimination in
competition investigations: theoretical foundations and practical implications”, Legal Studies
2006, 211-237.
167
M. EMBERLAND, The human rights of companies. Exploring the structure of ECHR
protection, Oxford, Oxford University Press, 2005, 42; A. ANDREANGELI, EU Competition
enforcement and human rights, Cheltenham, Edward Elgar, 2008, 128-130; A. MACCULLOCH,
“The privilege against self-incrimination in competition investigations: theoretical foundations and
practical implications”, Legal Studies 2006, 211-237.
168
ECJ, Case 374/87 ORKEM V COMMISSION [1989], ECR 3283, PARAS. 28-34: the ECJ was
unwilling to read the right against self-incrimination into article 6. It made a distinction between 2
164
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right to a fair trial.169 Striking is however that the ECJ and the ECtHR have a
partially different opinion about the scope of the principle.
The ECtHR defines it as an enforceable right, while the ECJ’s recent
judgements show that it is more difficult to rely on the principle. 170 According
to the latter, one must be able to prove evidence of coercion on the part of the
European Commission (potentially self-incriminating questions are not
sufficient), and an actual interference with the fair legal process must be
established. They must prove that the illegality of the decision requesting
incriminating information was affected by the lawfulness of the final
decision.171
Even though the ECJ formally states that it takes into account the
developments of the ECtHR and that it wants to be in conformity with the
ECtHR172, it seems in the end unwilling to be bound by its case law. 173 We can
sorts of facts: not allowed were questions where the European Commission was essentially
seeking an acknowledgement of Orkems participation in an infringing agreement. Questions
relating to the purpose were consequently not allowed, factual questions on the contrary were
admitted. See par. 34 of judgement: “although the European Commission was entitled to force the
investigated undertakings to disclose information and provide documents concerning facts that
may be known to them, even though evidence so gathered may be used to establish the existence of
an antitrust infringement, it could not by means of an article 11 decision undermine the
undertakings rights of defence.” P.R. WILLIS, “You have the right to remain silent…”, or do you?
The Privilege against self-incrimination following Mannesmannröhren-Werke and other recent
decisions”, ECLR 2001, 313-321; V.O. BENJAMIN, “The application of EC Competition Law
and the European Convention on Human Rights”, ECLR 2006, 693-699.
169
ECtHR 25 February 1993, FUNKE V FRANCE, http://www.echr.coe.int: the ECtHR
acknowledged the existence of a right to silence and not to contribute to incriminate oneself as part
of the fair procedure in article 6. P.R. WILLIS, “You have the right to remain silent…”, or do
you? The Privilege against self-incrimination following Mannesmannröhren-Werke and other
recent decision”, ECLR 2001, 313-321; A. MACCULLOCH, “The privilege against selfincrimination in competition investigations: theoretical foundations and practical implications”,
Legal Studies 2006, 211-237.) The judgement got much critique and it seemed to be decided in
that way because of the particular facts of the case. In subsequent decisions, the court appears to
move away from such a broad position: ECtHR 17 December 1996, SAUNDERS V UNITED
KINGDOM, http://www.echr.coe.int. The judgement is ‘wider’ than in Orkem and permits a person
to decline to provide not only directly incriminating information, but also exculpatory remarks and
factual information; V.O. BENJAMIN, “The application of EC Competition Law and the
European Convention on Human Rights”, ECLR 2006, 693-699.
170
ECJ, Case C-411/04 P MANNESMANNRÖHREN-WERKE AG V COMMISSION [2007], ECR I-965.
A. ANDREANGELI, EU Competition enforcement and human rights, Cheltenham, Edward Elgar,
2008, 128-130; P.R. WILLIS, “You have the right to remain silent…”, or do you? The Privilege
against self-incrimination following Mannesmannröhren-Werke and other recent decisions”,
ECLR 2001, 313-321; P. VAN NUFFEL, "De handhaving van het Europees mededingingsrecht in
het licht van de mensenrechten" in X. (ed.), Recht in beweging, 19de VRG-alumnidag 2012,
Antwerp, Maklu, 2012, 361-364. In ECJ, Case C-238/99 LVM NV AND OTHERS V COMMISSION
[2002], ECR I-8375, PARAS. 275-282, the ECJ decided that the applicant must provide the exercise
of coercion against the suspect in order to obtain information from him and secondly prove the
establishment of the existence of an actual interference with the right which they define.
171
ECJ, Case C-411/04 P MANNESMANNRÖHREN-WERKE AG V COMMISSION [2007], ECR I-965,
PARA. 77.
172
ECJ, Case C-238/99 LVM NV AND OTHERS V COMMISSION [2002], ECR I-8375, PARAS. 275282: “the ECJ has to take into account developments of case law of ECtHR”. However, it did not
find it necessary to decide in this case whether Orkem is still good law. W. WILS, “Self-
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thus conclude that the principle against self-incrimination is now an
established principle inherent to the concept of a fair trial, however there are
still significant doubts regarding its scope.174
LENIENCY CONTEXT- It is generally accepted that a leniency application does
not raise any objection to the privilege against self-incrimination as recognised
in the case law of the ECtHR.175 It is stated that “persons are always free to
incriminate themselves if in doing so they are exercising their own will”. 176
This vision has been confirmed in the recent CASE OF THYSSEN KRUPP
STAINLESS, where the ECJ underlined that a leniency programme does not
entail any coercion vis-à-vis undertakings to admit the suspected
infringement.177 Moreover, there seems to be no problem with the legal
professional privilege, while “the principle of confidentiality does not prevent
a lawyer’s client from disclosing the written communications between them if
it considers that it is in his interest to do so”.178 It thus appears that a claim of a
leniency applicant based on the privilege against self-incrimination will at
present not succeed.
a.5. Requirement of Article 6(3)
OVERVIEW- Lastly, Article 6(3) contains certain rights which are in this
discussion important as well, such as the right of defence179, the right to be
heard180, the right to be represented by a lawyer and the right to summon
witnesses.181
incrimination in EC antitrust Enforcement: A legal and economic analysis”, World Competition
2003, 567-588.
173
This can however change in near future given recent incorporation of the Charter and the
accession to the ECHR: W. WILS, “Self-incrimination in EC antitrust Enforcement: A legal and
economic analysis”, World Competition 2003, 567-588.
174
W.WILS, “La comptabilité des procedures communautaires en matière de concurrence avec la
convention Européenne des droits de l’homme”, 1996, 329-354; V.O. BENJAMIN, “The
application of EC Competition Law and the European Convention on Human Rights”, ECLR
2006, 693-699.
175
W. WILS, “Self-incrimination in EC antitrust Enforcement: A legal and economic analysis”,
World Competition 2003, 567-588.
176
See Concurring Opinion of Jude Walsh in SAUNDERS V UK (ECtHR 17 December 1996,
SAUNDERS V UNITED KINGDOM, http://www.echr.coe.int.)
177
ECJ, Case T-24/07 THYSSENKRUPP STAINLESS V COMMISSION [2009], ECR II-2309, PARA. 5253.
178
ECJ, Case 155/79 AM & S EUROPE V COMMISSION [1982] ECR 1575, PARA. 28.
179
This is a very broad concept, and entails the right to be heard, the right of access to file etc. ECJ,
Case 85/76 HOFFMANN-LA ROCHE/EUROPEAN COMMISSION [1979], ECR 461, PARA. 9; ECJ, Case
17/74 TRANSOCEAN MARINE PAINT/EUROPEAN COMMISSION [1970], ECR 1987 point 15; ECJ,
Case T-30/91 SOLVAY SA V EUROPEAN COMMISSION [1995], ECR II-1775, PARA. 105; A.
ANDREANGELI, EU Competition enforcement and human rights, Cheltenham, Edward Elgar,
2008, 128-130; P. VAN NUFFEL, "De handhaving van het Europees mededingingsrecht in het
licht van de mensenrechten" in X. (ed.), Recht in beweging, 19de VRG-alumnidag 2012, Antwerp,
Maklu, 2012, 361-364.
180
One must be able to participate meaningfully in the procedure by presenting facts, evidence and
arguments in his defence. The notification of objections raised by the European Commission is in
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RIGHT TO HAVE ACCESS TO FILE- The right to have access to the European
Commission’s file ensures that the investigated parties are acquainted with the
information at the onset of the allegations against them and that they are able
to contest them. The right has become more established in the case law 182 as
well as in secondary legislation183. It is clear that this right must be offered
during the administrative proceedings and that it cannot be rectified at a later
stage and certainly not during the judicial proceedings before the General
Court.184 If this right is hampered, one can claim annulment of the final
decision.185 Whether this will succeed depends on the extent to which the
ability of the undertakings to defend themselves in the proceedings is
significantly affected by the lack of access to the relevant evidence in the
circumstances of each case.186
ECJ VS. ECTHR- The opposite view of the ECtHR and the ECJ concerning the
right to access is questionable. The ECtHR has favoured a broad reading,
which also includes the right to seek judicial scrutiny of decisions impinging
upon the right to obtain the disclosure of evidence, while the ECJ denied that
the decisions of the Hearing Officer could be challenged immediately before
the General Court. Recent case law of the ECJ therefore casts doubt on the
overall fairness of the administrative stage of the proceedings before the
European Commission.187
this view an indispensable condition for the exercise of right to be heard. See A.
ANDREANGELI, EU Competition enforcement and human rights, Cheltenham, Edward Elgar,
2008, 128-150.
181
ECJ, Case C-211/00 P, C-213/00 P, C-217–219/00 P AALBORG PORTLAND EA V COMMISSION
[2004], ECR I-123, PARA. 200; ECJ, Case C-189/02 P DANSK RORINDUSTRI AND OTHERS V
COMMISSION [2005], ECR, PARAS. 68-75.
182
ECJ, Case T-7/89 HERCULES CHEMICALS NC V EUROPEAN COMMISSION [1991], ECR II-1711,
PARA. 54; ECJ, Case T-30/91 SOLVAY SA V EUROPEAN COMMISSION [1995], ECR II-1775, PARA.
105.
183
Article 7(1) of the 2004 implementing regulation; article 7(1) European Commission Regulation
No 773/2004 of 7 April 2004 relating to the conduct of proceedings by the European Commission
pursuant to articles 81 and 82 of the EC Treaty, 2004, OJ L123/18. See also the European
Commission Notice on the rules for access to the Commission file in cases pursuant to articles 81
and 82 of the EC treaty, articles 53, 54 and 57 of the EEA Agreement and Council Regulation
(EC) No 139/2004, Official Journal C 325, 22.12.2005, 7-15,, par. 29-32.
184
ECJ, Case 85/76 HOFFMANN-LA ROCHE/EUROPEAN COMMISSION [1979], ECR 461, PARA. 15;
ECJ, Case T-30/91 SOLVAY SA V EUROPEAN COMMISSION [1995], ECR II-1775, PARA. 98.
185
ECJ, Joined Cases T-10-12/92 and T-15/92 SA CIMENTERIES CBR AND OTHERS V COMMISSION
[1992], ECR II- 2667, PARA. 38.
186
ECJ, Case T-30/91 SOLVAY SA V EUROPEAN COMMISSION [1995], ECR II-1775, PARA. 105;
C.S. KERSE and N. KHAN, EC Antitrust Procedure, London, Sweet and Maxwell, 2005, 225.
187
ECJ, Case T-216/01 R REISEBANK V COMMISSION [2001], ECR II-3481, PARA. 52; A.
ANDREANGELI, EU Competition enforcement and human rights, Cheltenham, Edward Elgar,
2008, 62-90; W. WILS, “La comptabilité des procedures communautaires en matière de
concurrence avec la convention Européenne des droits de l’homme”, 1996, 329-354.
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b. The principle of ne bis in idem
RELEVANCE- Two items make the claims of the breach of ne bis in idem
nowadays extremely relevant. On one hand, the case law of the ECJ and
ECtHR about this principle is in constant development, while on the other
hand, most cartels are nowadays transnational or at least worldwide, which
clarifies that ne bis in idem issues occur more frequently.
SOURCES- Article 4 of the Seventh Protocol by the ECHR lays down the
principle and prohibits the repetition of criminal proceedings, which have been
concluded by a final acquittal or conviction.188 However, since the time of
incorporation of the Charter, article 50 of the Charter is relevant and binding as
well. The non-criminal or criminal nature of the competition law does not pose
a hurdle to rely on this principle in competition cases. 189 However, until now,
no one has won a case on the basis of ne bis in idem.
SITUATIONS- Indeed, due to the worldwide nature of cartels, one can easily
imagine that both the USA and EU impose sanctions for the same cartel. Is this
prohibited in the light of the principle of ne bis in idem? Does this principle
prevent that within the EU, two cartel authorities impose sanctions for the
same infringement or that a NCA starts an investigation in parallel with the
one of the European Commission?
CONDITIONS- To examine whether the above mentioned cases are prohibited or
not, one has to consider the conditions of the ne bis in idem principle.190 First
of all, the facts need to be identical. Second, the infringer needs to be the same.
Last, the protected right must be similar.191 Strikingly, there is incoherence in
the case law of the ECtHR.192 In domains other than competition matters, the
ECtHR requests that for the first condition, one has to take the entirety of
188
Even though not all member states did ratify the Protocol, the principle is recognised by the ECJ
as a general principle of EU law: ECJ, Case 7/72 BOEHRINGER MANNHEIM GMBH V. COMMISSION
[1972], ECR 1281; ECJ, Case C-254/99 P LIMBURGSE VINYL MAATSCHAPPIJ NV (LVM) [2002],
ECR I-8375.
189
S. BRAMMER, Cooperation between national competition agencies in the enforcement of EC
competition law, Oxford, Hart, 2009, 197-210; E. M. AMEYE, “The interplay between human
rights and competition law in the EU”, ECLR 2004, 332-341.
190
The ECJ stipulates in its case law that 3 elements are required: ECJ, Case C-254/99 P
LIMBURGSE VINYL MAATSCHAPPIJ NV (LVM) [2002], ECR I-8375; ECJ, Case C-211/00 P, C213/00 P, C-217–219/00 P AALBORG PORTLAND EA V COMMISSION [2004], ECR I-123, PARA.
200; Opinion of A-G KOKOTT in Toshiba Corporation Case, available at
http://curia.europa.eu/juris/celex.jsf?celex=62010CC0017&lang1=en&type=NOT&ancre.
191
The protection of free competition in Europe is another “protected right” than the protection of
free competition in a member state.
192
Opinion of A-G KOKOTT in Toshiba Corporation Case; P. VAN NUFFEL, "De handhaving van
het Europees mededingingsrecht in het licht van de mensenrechten" in X. (ed.), Recht in beweging,
19de VRG-alumnidag 2012, Antwerp, Maklu, 2012, 361-364; N. NEAGU, “The “Ne bis in idem”
principle in the case law of the European Court of Justice. The “idem” issue”, Lex et Scientia
International Journal 2011, 34-54.
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factual circumstances into consideration193, while in competition matters, this
first condition is interpreted differently. Consequently, in the former scenario,
one does not need to examine the qualification of the fine but only the existing
behaviour, as a result of which the combination of a penal sanction and an
administrative fine will be less likely to be imposed together.
OUTSIDE EU- Consequently, the European Commission can impose a fine to
an undertaking for an infringement for which it is already fined in a country
outside the EU, as the protected right is different.194
INSIDE EU- A similar situation exists when there is a ne bis in idem issue
within the EU.195 In the CASE WILHELM VS. BUNDESKARTELLAMT, double
prosecutions for the same infringement occurred, one by the European
Commission and another by a NCA. The ECJ stipulated that this did not
violate the ne bis in idem principle, given the fact that the scope of the
European and national regulatory provisions were different. 196
TOSHIBA CASE- A confirmation of this viewpoint can be found in the recent
proceedings of the Toshiba case. The question that needed to be answered was
“how many competition authorities in Europe could deal with one and the
same cartel and impose penalties on the participating undertakings?”197
Here, the ECJ decided that the European Commission could fine an
infringement, even if the NCA did already fine the undertaking for the same
infringement a couple of months before accession of the Czech Republic to the
EU.198 According to the ECJ, in order to assess the first condition, one needs to
consider the time period, but also the territory of the member states. Before
193
ECtHR 10 February 2009, ZOLUTKHIN V RUSSIA, http://www.echr.coe.int.
ECJ, Case C-289/04 P, SHOWA DENKO V. COMMISSION [2006], ECR I-5859, PARAS. 50-63;
ECJ, Case C-301/04 P, SGL CARBON [2006], ECR I-5915, PARAS. 26-38.
195
However, it is true that a “real” horizontal case of parallel enforcement and sanction has yet to
reach Luxembourg.
196
ECJ, Case 14/68 WALT WILHELM V. BUNDESKARTELLAMT [1969], ECR 1, PARA. 1032; J.
VERVAELE, “Multilevel and multiple punishment in Europe. The ne bis in idem principle and the
protection of human rights in Europe’s area of freedom, security and justice”, in Multilevel
Governance in Enforcement and Adjudication, Antwerp, Intersentia, 2006, 1-24. In the present
circumstances, this situation might no longer persist, because article 50 of the Charter clearly
states that the EU should be considered as one territory.
197
Opinion A-G KOKOTT in Toshiba Corporation case.
198
ECJ, Case C-17/10 TOSHIBA CORPORATION AND OTHERS V ÚŘAD PRO OCHRANU HOSPODÁŘSKÉ
SOUTĚŽE, nyr; Opinion A-G KOKOTT: “However desirable a uniform and efficient interpretation
and application of competition law within the European Union may be, EU law and therefore
Regulation 1/2003 was not applicable in the Czech Republic prior to May 1, 2004: it is a question
of compliance with “the rule of law”. (…) Since the CCA limited its decision to anticompetitive
effects pre-dating May 1, 2004, there was “no risk of any conflict of competence between the
Commission and the [CCA] and no need to avoid a conflict of findings as between Article [101
TFUE] and national competition law” in this case.” It is however doubtful why Regulation 1/2003
was not applicable, since it can either be regarded as “procedural” or the general principle of
Union law requires that the most advantageous regulation must be retroactively granted to the
accused.
194
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2004, the Czech Republic was not a member of the EU. With judgements like
these, we seem to be far removed from a successful claim on the basis of the
ne bis in idem principle.
LENIENCY- The principle of ne bis in idem only applies if an authority has
issued a final infringement decision, which means that it must be res judicata
or that no other ordinary remedies are available.199 An example hereof can be
found in a recent judgement where the European Commission had started an
investigation, but a NCA accorded conditional immunity to the undertaking
concerned on the basis of their leniency programme.200 Consequently,
whistleblowers are not protected against other authorities or private damages
claims after being granted immunity or fined by the European Commission.
SOLUTIONS- Even if two consecutive sanctions are formally possible, one can
assume that a general requirement of “justice” demands that any previous
punitive decision must be taken into account in determining a sanction. That
explains why the European Commission inscribed article 13 in Regulation
1/2003.201 Another initiative involves the best practices on cooperation, after
which authorities can suspend or terminate their proceedings. 202 It is however
obvious that no formal obligation exists, and that nowadays double damages
remain possible and so far have even not been challenged once successfully.
c. Right to private and family life
92. RELEVANCE- At first glance, one can wonder why the right to private and
family life, described in article 8 ECHR, is important in the discussion of
human rights for undertakings. However, due to the increased powers of the
European Commission to carry out inspections at business premises and even
at private homes, the question has been raised whether this is compatible with
article 8.203 Nowadays, undertakings are increasingly fighting back against this
power.204
E. M. AMEYE, “The interplay between human rights and competition law in the EU”, ECLR
2004, 332-341.
200
General Court, Case C-516/11 P LIFTEN, ASCENSEURS AND OTHERS V EUROPEAN COMMISSION
[2011], nyr, PARA. 158.
201
It is however not a prohibition. See article 13 par. 2: “Where a competition authority of a
member state or the Commission has received a complaint against an agreement, decision of an
association or practice which has already been dealt with by another competition authority, it may
reject it”; E. M. AMEYE, “The interplay between human rights and competition law in the EU”,
ECLR 2004, 332-341.
202
J. VERVAELE, “Multilevel and multiple punishment in Europe. The ne bis in idem principle
and the protection of human rights in Europe’s area of freedom, security and justice”, in Multilevel
Governance in Enforcement and Adjudication, Antwerp, Intersentia, 2006, 1-24.
203
European Commission Press release IP/08/108: “Antitrust: European Commission imposes
EUR 38 million fine on E.ON for breach of a seal during an inspection”, January 30, 2008,
available at http://europa.eu/rapid/pressReleasesAction.do?reference=IP/08/108; M. MESSINA,
“The protection of the right to private life, home and correspondence v the efficient enforcement
of competition law: is a new EC competition court the right way forward?”, European
199
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APPLICABILITY OF ARTICLE 8- In COLAS EST205, the ECtHR accepted that
article 8 can be extended to legal persons, even if this does not necessarily
mean that this right has the same content as for natural persons.206 Just as is the
case with self-incrimination, a discrepancy exists between the case law of the
ECtHR and the ECJ. The ECJ clearly stated in its earlier case law that
premises do not fall under article 8. 207 In more recent case law, it is accepted
though that it is necessary to consider the POST-HOECHST ECtHR
developments.208Again, similar to ORKEM, the ECJ used other criteria so that
any intervention by public authorities in the private activities or premises could
happen.209 So, here again, the court is unwilling to render its analysis in terms
of human rights but is achieving a similar result as when it would have taken
the human rights in consideration.210
DAWN RAID POWERS- Article 8(2) ECHR stipulates that an interference with
this right is allowed by a public authority on the conditions that it is in
accordance with the law, pursues a legitimate aim and is necessary for the
Competition Journal 2007, 185-214; P. BERGHE and A. DAWES, “Little pig, little pig, let me
come in”: an evaluation of the European Commission’s powers of inspection in Competition
cases”, ECLR 2009, 407-423; J.M. BATTISTA and C.
ROQUES, “les inspections communautaires en matière de concurrence”, Revue Lamy de la
Concurrence, 2008, 136.
204
ECJ, Case 136/79 NATIONAL PANASONIC [1980], ECR 2033; ECJ, Joined Cases 46/87 and
227/88 HOECHST AG V COMMISSION [1989], ECR I-2859; ECtHR 16 December 1992, NIEMIETZ V
GERMANY, http://www.echr.coe.int; General Court, Case T-533/08 TELEKOMINIKACJA POLSKA V
EUROPEAN COMMISSION OF THE EUROPEAN COMMUNITIES [2010], nyr; O.B. VINCENTS, "The
Application of EC Competition Law and the European Convention on Human Rights" ECLR 2006,
693; P. BERGHE and A. DAWES, “Little pig, little pig, let me come in”: an evaluation of the
European Commission’s powers of inspection in Competition cases”, ECLR 2009, 407-423.
205
ECtHR 16 April 2002, COLAS EST AND OTHERS V FRANCE, http://www.echr.coe.int.
206
Two judgements before were the (immediate) cause to this: ECtHR 30 March 1989, CHAPPELL
V UK, http://www.echr.coe.int; ECtHR 16 December 1992, NIEMIETZ V GERMANY,
http://www.echr.coe.int: “private life and home in article 8 also include certain professional and
business activities or premises”; H.R. KRANENBORG, “Art. 8 EVRM en de
verificatiebevoegdheden van de Commissie. Colas Est en Roquette Frères.”, SEW 2003, 49-51.
207
ECJ, Joined Cases 46/87 and 227/88 HOECHST AG V COMMISSION [1989], ECR I-2859. This
judgement was only a few months later than Chappell; P. VAN NUFFEL, "De handhaving van het
Europees mededingingsrecht in het licht van de mensenrechten" in X. (ed.), Recht in beweging,
19de VRG-alumnidag 2012, Antwerp, Maklu, 2012, 361-364; H.R. KRANENBORG, “Art. 8
EVRM en de verificatiebevoegdheden van de Commissie. Colas Est en Roquette Frères.”, SEW
2003, 49-51.
208
ECJ, Case C-441/05 ROQUETTE FRERES [2007], ECR I-1993.
209
A. JONES and B. SUFFRIN, EU Competition law, Oxford, Oxford University Press, 2011,
1077; H.R. KRANENBORG, “Art. 8 EVRM en de verificatiebevoegdheden van de Commissie.
Colas Est en Roquette Frères.”, SEW 2003, 49-51.
210
But this pattern of deciding human rights claims in other terms was broken by A-G MISCHO’S
analysis in ROQUETTE FRERES, who stated that right to private and family life could apply to legal
persons. The ECJ however did not follow this reasoning. H.R. KRANENBORG, “Art. 8 EVRM en
de verificatiebevoegdheden van de Commissie. Colas Est en Roquette Frères.”, SEW 2003, 49-51;
O.B. VINCENTS, "The Application of EC Competition Law and the European Convention on
Human Rights" ECLR 2006, 693.
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democratic society.211 According to the ECJ, dawn raids have a legal basis, so
they satisfy those requirements.212 It is however not always clear whether the
inspections can be proven to be “necessary in a democratic society”.213
Besides, the control of the requirement that the search is proportionate is often
doubtful. In many cases, the control confines itself to verify whether the dawn
raid is arbitrary, excessive or disproportionate. 214 Only manifestly
disproportionate requests can be denied by national courts. 215
SECTOR INQUIRIES- Article 17 (1) of Regulation 1/2003 empowers the
European Commission to inquiry a whole sector.216 Such inquiry is obviously
different from individual inquiries: they are not based on specific evidence of
wrongdoing, but are rather only the starting point of a broad inquiry. 217 In
order for an investigation to be lawful, the European Commission must be able
to show that it is in possession of information and evidence providing
reasonable ground for suspecting an infringement of the competition rules by
the undertaking concerned.218 Some authors are however of the opinion that
such an inquiry is a large scale fishing expedition.219
E. M. AMEYE, “The interplay between human rights and competition law in the EU”, ECLR
2004, 332-34; M. MESSINA, “The protection of the right to private life, home and
correspondence v the efficient enforcement of competition law: is a new EC competition court the
right way forward?”, European Competition Journal 2007, 185-214.
212
C.S. KERSE and N. KHAN, EC Antitrust Procedure, London, Sweet and Maxwell, 2005, 167;
O.B. VINCENTS, "The Application of EC Competition Law and the European Convention on
Human Rights" ECLR 2006, 693.
213
M. MESSINA, “The protection of the right to private life, home and correspondence v the
efficient enforcement of competition law: is a new EC competition court the right way forward?”,
European Competition Journal 2007, 185-214.
214
The control is thus very limited: E. M. AMEYE, “The interplay between human rights and
competition law in the EU”, ECLR 2004, 332-34. In practice the CFI tends to apply great
deference to the European Commission’s findings and to grant the European Commission a
significant margin of discretion: ECJ, Case 42/84 REMIA BV V EUROPEAN COMMISSION [1985],
ECR 2545; ECJ, Case 142/84 BRITISH AMERICAN TOBACCO V EUROPEAN COMMISSION [1987],
ECR 4487; ECJ, Case T-17/93 MATRA HACHETTE S.A. V. EUROPEAN COMMISSION [1994], ECR
II-595; P. BERGHE and A. DAWES, “Little pig, little pig, let me come in”: an evaluation of the
European Commission’s powers of inspection in Competition cases”, ECLR 2009, 407-423.
215
This is reflected in article 20 (8) of Regulation 1/2003; ECJ, Case C-441/05 ROQUETTE FRÈRES
[2007], ECR I-1993, PARA. 50; E. M. AMEYE, “The interplay between human rights and
competition law in the EU”, ECLR 2004, 332-34; P. BERGHE and A. DAWES, “Little pig, little
pig, let me come in”: an evaluation of the European Commission’s powers of inspection in
Competition cases”, ECLR 2009, 407-423.
216
The European Commission has recently re-emphasised its power to carry out inspections to
obtain information during sector inquiries: Staff working paper on regulation 1/2003 SEC (2009)
574 final, PARA. 69.
217
See Introductory Remarks at press conference held in Brussels on January 16, 2008.
218
In CRISPOLTONI, three criteria are listed which the competition authority must fulfil. First, the
objectives of the measure need to be proportional. Second, the means need to be suitable and
necessary for the achievement of the objectives legitimately pursued by the measure and lastly the
requirement that the measure does not impose an excessive burden on the individual. ECJ, Case C368/89 CRISPOLTONI [1991], ECR I-3695; H. ANDERSSON and E. LEGNERFALT, “Dawn raids
in sector inquiries- fishing expeditions in disguise”, ECLR 2008, 439-445.
219
H. ANDERSSON and E. LEGNERFALT, “Dawn raids in sector inquiries- fishing expeditions
in disguise”, ECLR 2008, 439-445.
211
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96. CRITICAL HUMAN RIGHTS ISSUES- Some argue that the means adopted for
the goal are not necessary.220 A request for information could arguably achieve
the same result without imposing an excessive burden on the undertaking.221
Indeed, the third condition also causes problems, namely, the dawn raids have
negative effect on all companies within the sector. Another problem is that the
review of the legality of a dawn raid is very limited. It is impossible to obtain a
decision ordering the European Commission to stop investigations, when
considering that the handling time for the General Court to grant interim relief
is only a few days.222 Also, it may very well be that the suspected undertaking
applies for leniency voluntarily, but cannot claim that the European
Commission has unlawfully obtained the evidence. Another possible scenario
is that another alleged member has submitted documents under the leniency
notice that are incriminating a competitor. So the unlawfully raided
undertaking will be subject to even more legal uncertainty. 223
LEGAL PROFESSIONAL PRIVILEGE- Another aspect inextricably bound with
dawn raids is the problem of the legal privilege. Some documents are
privileged and cannot be examined by competition authorities when executing
a dawn raid. This legal privilege has been discussed extensively in the case law
and literature.224 In a leniency context, it is stated that the legal professional
privilege does not stand in the way of lawyer-client communications in the
framework of leniency, since “the principle of confidentiality does not prevent
a lawyer’s client from disclosing the written communications between them if
it considers that it is in his interest to do so”.225
d. Principle of legality
OVERVIEW- Article 7 of the ECHR stipulates that “no one shall be held guilty
of any criminal offence which did not constitute a criminal offence under
national law”. From this, the principle of legality and legal certainty are
deduced. The last issue indeed concerns those aspects, which are more
worrisome than the “due process” elements such as the privilege of self220
There is always a risk that companies within a targeted sector are engaging in some kind of
unlawful behaviour and are inclined to withhold or destroy any relevant proof.
221
H. ANDERSSON and E. LEGNERFALT, “Dawn raids in sector inquiries- fishing expeditions
in disguise”, ECLR 2008, 439-445.
222
H. ANDERSSON and E. LEGNERFALT, “Dawn raids in sector inquiries- fishing expeditions
in disguise”, ECLR 2008, 439-445.
223
H. ANDERSSON and E. LEGNERFALT, “Dawn raids in sector inquiries- fishing expeditions
in disguise”, ECLR 2008, 439-445.
224
ECJ, Case 155/79 AM & S EUROPE V COMMISSION [1982], ECR 1575, PARA. 28; ECJ, Case T125/03 AKZO NOBEL CHEMICALS AND AKCROS V COMMISSION [2009], nyr; W. WILS, “Powers of
investigation and procedural rights and guarantees in EU antitrust enforcement”, World
Competition 2006, 3-24; P. BERGHE and A. DAWES, “Little pig, little pig, let me come in”: an
evaluation of the European Commission’s powers of inspection in Competition cases”, ECLR
2009, 407-423.
225
ECJ, Case 155/79 AM & S EUROPE V COMMISSION [1982], ECR 1575, PARA. 28.
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incrimination. They go to the roots of unfairness in the basic structure of EU
antitrust enforcement.226 While the European Commission both investigates
and judges, the European judiciary restricts itself to a “light” review.227 As the
fines imposed by the European Commission have reached unprecedented
heights, so has the degree of attention for the question whether the fining
procedure of the European Commission and the judicial review exercised by
the EU courts measure up to these requirements. 228 At stake are two main
critiques: on the one hand the requirement for procedural fairness, on the other
hand the matter of decisions about the fining.229
d.1. Procedural fairness
JUDICIAL REVIEW- As stated above, it is probable that EU competition law (and
its fining policy) does belong to the periphery of hard-core criminal law. The
recent increase in the level of fines imposed by the European Commission
does however not call into question their classification as being outside the
hard core of criminal law. 230 The question should rather be: what does a less
stringent application of those criminal guarantees mean?231 Although the
ECtHR has so far provided only limited guidance,232 the JANOSEVIC
JUDGEMENT clarifies that the fines do not have to be imposed by a judicial
body on the condition that a judicial body afterwards can have a full review of
the legality.233 As a consequence, not only the European Commission’s
position regarding the questions of law, but also the European Commission’s
EDITORIAL COMMENTS, “Towards a more judicial approach? EU antitrust fines under the
scrutiny of fundamental rights”, CMLR 2011, 1405-1416.
227
E. M. AMEYE, “The interplay between human rights and competition law in the EU”, ECLR
2004, 338; EDITORIAL COMMENTS, “Towards a more judicial approach? EU antitrust fines under
the scrutiny of fundamental rights”, CMLR 2011, 1405-1416.
228
F. WIJCKMANS and F. TUYTSCHAEVER, “Tot zover het Belgisch kartelparadijs”, RW
2008, 1178-1196; W. WILS, “The increased level of EU antitrust fines, judicial review and the
ECHR”, World Competition 2010, 5-29; EDITORIAL COMMENTS, “Towards a more judicial
approach? EU antitrust fines under the scrutiny of fundamental rights”, CMLR 2011, 1405-1416;
W. DEVROE and N. DELATHAUWER, “Actualia Mededingingsrecht”, in X., Recht in
beweging, Antwerp, Maklu, 2011, 151-178.
229
L.O. BLANCO, EC Competition Procedure, Oxford, Oxford University Press, 2006, 241-243.
230
ECtHR 24 February 1994, BENDENOUN V FRANCE, PARA. 46-47, “even if penalties are large
ones, or “very substantial”; W. WILS, “The increased level of EU antitrust fines, judicial review
and the ECHR”, World Competition 2010, 5-29; EDITORIAL COMMENTS, “Towards a more judicial
approach? EU antitrust fines under the scrutiny of fundamental rights”, CMLR 2011, 1405-1416.
231
General Court, Case T-99/04 AC-TREUHAND V EUROPEAN COMMISSION [2008], ECR II-1501,
PARA. 113; W. WILS, “The increased level of EU antitrust fines, judicial review and the ECHR”,
World Competition 2010, 5-29.
232
EDITORIAL COMMENTS, “Towards a more judicial approach? EU antitrust fines under the
scrutiny of fundamental rights”, CMLR 2011, 1405-1416; W. WILS, “The increased level of EU
antitrust fines, judicial review and the ECHR”, World Competition 2010, 5-29.
233
ECtHR 23 July 2002, JANOSEVIC V SWEDEN, par. 82 http://www.echr.coe.int about the
definition of “full jurisdiction”; EDITORIAL COMMENTS, “Towards a more judicial approach? EU
antitrust fines under the scrutiny of fundamental rights”, CMLR 2011, 1405-1416. This also means
that the ECtHR does not require several layers of full judicial review, it must only be possible to
bring the case before “a” judicial body.
226
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findings of facts as well as the legal assessment of those facts are open to the
General Court’s scrutiny.234
POWERS- Competition law is generally seen as the “laboratory type” of judicial
protection of European law. At first sight, the system of EU antitrust fines
seems to fit the requirements.235 According to article 263 TFEU, the General
Court can examine the legality of each decision, and can for instance instigate
a full examination of the findings in a contested decision about the imputation
of the infringement of undertakings on whom the fines are imposed. This
implies that it can also judge whether the European Commission has
adequately argued it’s decision and whether the European Commission has
complied with the general principles of law. However, a more in-depth
analysis raises questions about how the General Court performed its judicial
review.236
MARGIN OF APPRECIATION DOCTRINE- The first problem is that in general, the
General Court limits its review to “checking whether the relevant rules on
procedure and on stating reasons have been complied with, whether the facts
have been accurately stated and whether there has been any manifest error of
assessment or a misuse of powers.”237 In light of article 6, one can wonder
whether the requirement of “full jurisdiction” allows a margin of appreciation
towards the European Commission, even though the Commission is not a
judicial body.238 It is indeed true that a judicial review by an independent and
impartial tribunal is only meaningful if it purges all traces of partiality from the
decision under review, including a prosecutorial bias of the body that made the
decision.239 In the PIONEER JUDGEMENT, it became clear that the ECJ has been
unwilling to limit or reduce the broad discretion enjoyed by the European
Commission.240 The General Court also appears to be hesitant to reduce the
wide discretion of the European Commission with respect to fines and
W. WILS, “The increased level of EU antitrust fines, judicial review and the ECHR”, World
Competition 2010, 5-29.
235
Once the European Commission has made a fining decision, an action for annulment may be
brought against it before the General Court. Article 261 TFEU and 31 Regulation 1/2003 stipulate
that jurisdiction is unlimited with regard to the fine (meaning that there is a possibility to cancel,
reduce or increase its amount). So now the General Court has jurisdiction to review the European
Commission’s fining decisions in every respect and the means to exercise this jurisdiction, it does
not matter that, in cases of further appeal, the ECJ merely examines questions of law.
236
EDITORIAL COMMENTS, “Towards a more judicial approach? EU antitrust fines under the
scrutiny of fundamental rights”, CMLR 2011, 1405-1416.
237
ECJ, Case T-201/04 MICROSOFT CORP V COMMISSION [2007], ECR II-3601, PARA. 87.
238
A contrario to the recent Sigma Radio judgement, where in non-criminal disputes the ECtRH
has accepted certain limitations: ECtHR 21 July 2011, SIGMA RADIO TELEVISION LTD. V CYPRUS,
PARAS. 156-157, http://www.echr.coe.int.
239
CFI, T-230/00 DAESANG AND SEWON EUROPE V COMMISSION [2003], ECR II-2733, 38; ECJ,
Case C-289/04 P, SHOWA DENKO V. COMMISSION [2006], ECR I-5859, PARAS. 50-63; ECJ, Case
C-3/06 P GROUPE DANONE V COMMISSION [2007], ECR I-1331, PARA. 37; Editorial comments,
“Towards a more judicial approach? EU antitrust fines under the scrutiny of fundamental rights”,
CMLR 2011, 1405-1416.
240
ECJ, Case 102/80, PIONEER ELECTRONIC, nyr.
234
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mitigating circumstances.241 However, according to some, article 261 TFEU
fills this gap, by stating that the General Court can assess the appropriateness
of the amount of the fine.242 When resetting the amount of the fine in the
exercise of this unlimited jurisdiction, the General Court is in no way bound by
the European Commission’s guidelines.243
INTENSITY OF THE REVIEW- A second problem concerns the intensity of the
review. According to the JANOSEVIC JUDGEMENT, the judicial body must have
full jurisdiction in order to examine all aspects of the matters before them”.244
The examination is therefore not restricted to issues of law, but may also be
extended to factual issues, including an assessment of the evidence.245 As to
the scope of the judicial review, there can be no restrictions regarding the types
of issues related to the contested decision, which the reviewing court can
examine. The requirements for the “intensity” of judicial review remain
however less clearly defined. We can thus only guess that the judicial review
needs to be fully intensive, excluding insufficient standards of review whereby
for instance only manifest errors would be corrected.246
OWN PARAMETERS?- Questions have been raised whether article 6 is in
accordance with procedures of the General Court when it fails to develop its
own parameters for setting the fines (which is possible because of unlimited
jurisdiction under article 261 TFEU) and has mostly restricted its efforts to a
legality review, examining the accordance of the fine at issue with the
European Commission’s methodology.247 This question has been raised in the
KME JUDGEMENT.248 A-G SHARPSTON was however of the opinion that the
parties should need such an assessment. Nothing in the case law of ECtHR
suggests that a judicial review should go beyond the pleas raised by the parties.
The court must review all pleas, factual and legal, that are raised by the
241
ECJ, Case T-7/89 HERCULES CHEMICALS NC V EUROPEAN COMMISSION [1991], ECR II-1711,
54; I. VAN BAEL, “Fining à la carte: the lottery of EU competition law”, ECLR 1999, 237243.
242
Case T-327/94 SCA HOLDING LTD V EC COMMISSION [1998], ECR II-1373 PARA. 55.
243
Opinion of AG JACOBS of 15 December 2005 in Case C-167/04 P JCB SERVICE V EUROPEAN
COMMISSION [2006], ECR I-8935, PARA. 141; ECJ, Joined Cases T-101/05 and T-111/05 BASF
AND UCB V COMMISSION [2007], ECR II-4949, PARA. 47. In practice it is however different: the
court resets the amount of the fine in accordance with the methodology which European
Commission has used for setting the initial fine, thus reducing the fine proportionally to the
reduced duration, or applying correctly the European Commission’s guidelines. (W. WILS, “The
increased level of EU antitrust fines, judicial review and the ECHR”, World Competition 2010, 529.)
244
ECtHR 23 July 2002, JANOSEVIC V SWEDEN, par. 86 http://www.echr.coe.int.
245
W. WILS, “The increased level of EU antitrust fines, judicial review and the ECHR”, World
Competition 2010, 5-29.
246
W. WILS, “The increased level of EU antitrust fines, judicial review and the ECHR”, World
Competition 2010, 5-29.
247
EDITORIAL COMMENTS, “Towards a more judicial approach? EU antitrust fines under the
scrutiny of fundamental rights”, CMLR 2011, 1405-1416.
248
ECJ, Case T-127/04 KME GERMANY AG AND OTHER V EUROPEAN COMMISSION [2009], ECR
II-1167.
PARA.
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affected party, but nothing suggests that it requires the reviewing court to raise
any pleas on its own motion.249
d.2. Legal certainty as regards the substantive dimension of the fining
decisions
PREDICTABILITY VS. MARGIN OF DISCRETION- Closely connected with the due
process issues is the criticism concerning the decisions about the amount of the
fining. Undertakings claim that the legal basis for fining does not respond to
the general principles of legal certainty and predictability.250 It is correct that
the European Commission has a margin of discretion when fixing fines,
including a “particularly wide discretion as regards the choice of factors to be
taken into account for the purposes of determining the amount of the fines and
a discretion to raise the general level of fines so as to reinforce their deterrent
effect”.251 The amount of the fines, their addressees and infringements for
which they are imposed should be predictable.252 How foreseeable should the
amount of the fines be? Some say that the fines should be clearly
predictable,253 while others warn against the risk of excessive foreseeability, as
it could lead to under-deterrence in some instances and disproportionately high
fines in other cases.254 Moreover, the differentiation of penalties depending on
the role played by the cartel infringements individually offers the advantage of
raising the costs of creating and maintaining cartels.
SOURCES- In the EU, legislative parameters for such a determination are
scarce. Only article 23 of the Regulation 1/2003 and articles 101 and 102
TFEU define that the European Commission may impose fines to a maximum
of 10% of the annual turnover.255 Furthermore, Regulation 1/2003 does not
W. WILS, “The increased level of EU antitrust fines, judicial review and the ECHR”, World
Competition 2010, 5-29.
250
ECJ, Case T-297/02 EVONIK DEGUSSA GMBH V EUROPEAN COMMISSION [2006], ECR II-897,
PARA. 38; ECJ, Case C-413/08, LAFARGE SA/COMMISSION [2010], nyr, 94-95; ECJ, Case C352/09 THYSSENKRUPP NIROSTA GMBH V EUROPEAN COMMISSION [2011], PARAS. 80-83.
251
CFI, T-230/00 DAESANG AND SEWON EUROPE V COMMISSION [2003], ECR II-2733, 38;
ECJ, Case C-289/04 P, SHOWA DENKO V. COMMISSION [2006], ECR I-5859, PARAS. 36;
ECJ, Case C-3/06 P GROUPE DANONE V COMMISSION [2007], ECR I-1331, PARA. 37.
252
EDITORIAL COMMENTS, “Towards a more judicial approach? EU antitrust fines under the
scrutiny of fundamental rights”, CMLR 2011, 1405-1416.
253
ECJ, Case T-224/00 ARCHER DANIELS MIDLAND COMPANY AND ARCHER DANIELS MIDLAND
INGREDIENTS LTD V COMMISSION [2003], ECR II-2597, PAR. 49; ECJ, Case T-297/02 EVONIK
DEGUSSA GMBH V EUROPEAN COMMISSION [2006], ECR II-897, PARAS. 38; S. BRAMMER,
Cooperation between national competition agencies in the enforcement of EC competition law,
Oxford, Hart Publishing, 2009, 197; I. VAN BAEL, “Fining à la carte: the lottery of EU
competition law”, ECLR 1999, 237-243.
254
Opinion of JUDGE VESTERDORF, AG in Case T-1/89, RHONE-POULENC V EUROPEAN
COMMISSION (POLYPROPYLENE) [1991], ECR II-869; W. WILS, “The European Commission’s
2006 guidelines on antitrust fines: a legal and economic analysis”, World Competition 2007, 197229.
255
W. WILS, “The increased level of EU antitrust fines, judicial review and the ECHR”, World
Competition 2010, 5-29.
249
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impose any obligation on the Commission to publish further guidance on the
amount or method of setting fines.256 This was confirmed in the DEGUSSA
judgement.257 Nonetheless, the European Commission introduced guidelines to
enhance the transparency with regard to the amount of the fine. 258 As a
consequence, an individual must be in a position to know which acts or
omissions will make him criminally liable. A certain degree of discretion is
however inevitable, given the diversity of cases and the wide range of factors
relevant for setting optimal fines.259
JUDICIAL REVIEW-
Even though the European Commission introduced these
guidelines, some argue that an unlimited review by the General Court may
cause problems. An outstanding question is whether such a review by the
General Court is compatible with the demands of legal certainty and protection
of legitimate expectations, when considering that the EU courts have the
freedom to deviate from the guidelines, instead of restricting themselves to a
judicial review of their legality?260 By resetting the fines, the General Court
seems to follow its own agenda. In the SIEMENS ÖSTERREICH CASE, the court
has shown willingness to allow a closer scrutiny of the conditions of the
fines.261 The best solution thus seems to be a consistent case law that
authoritatively adds clarity and precision to the legislative parameters for the
setting of fines.
CONCLUSION- While the European Courts are convinced that sufficient judicial
review is available262, practice reveals that the judicial control is not as
thorough and independent as it should be. Some state that a more intensive
judicial review would imply less effective enforcement because the European
Commission may lose its zeal. We think however that this is not the case and
W. WILS, “The European Commission’s 2006 guidelines on antitrust fines: a legal and
economic analysis”, World Competition 2007, 197-229;
257
ECJ, Case T-297/02 EVONIK DEGUSSA GMBH V EUROPEAN COMMISSION [2006], ECR II-897,
PARAS. 74-83. (According to the ECJ and the General Court is article 23 (2-3) sufficiently clear
and precise to satisfy these requirements.
258
These guidelines can be useful in ensuring respect for the principle of equal treatment and make
it easier for the European Commission to follow a consistent fining policy and resist pressure for
unjustified treatment in individual cases. W. WILS, “The European Commission’s 2006
guidelines on antitrust fines: a legal and economic analysis”, World Competition 2007, 197-229;
EDITORIAL COMMENTS, “Towards a more judicial approach? EU antitrust fines under the scrutiny
of fundamental rights”, CMLR 2011, 1405-1416.
259
ECJ, Joined Cases 100-103/80 MUSIQUE DIFFUSION FRANÇAISE V COMMISSION [1983], ECR
1835, PARAS. 105-106; W. WILS, “The European Commission’s 2006 guidelines on antitrust
fines: a legal and economic analysis”, World Competition 2007, 197-229.
260
EDITORIAL COMMENTS, “Towards a more judicial approach? EU antitrust fines under the
scrutiny of fundamental rights”, CMLR 2011, 1405-1416.
261
ECJ, Cases T-122/07 to T-124/07 SIEMENS AG ÖSTERREICH AND OTHERS V COMMISSION
[2004], ECR I-123, PARA. 153-4:“Penalties must be specific to the offender and to the offence
concerned, the amount each undertaking is required to bear in relation to the other joint and
several debtors must be discernible from the European Commission’s decision, those amounts
must reflect the weighting of the individual shares of the joint liability”.
262
See e.g. the recent MENARINI judgement, supra PARA. 58.
256
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that a certain degree of independence from judicial review should be an
indispensable part of such a framework. 263 We thus conclude that an
unrestricted judicial review will not lead to less but rather to higher quality
enforcement.
CONCLUDING OBSERVATIONS
SUCCESS OF THE LENIENCY SYSTEM- It has become clear that leniency is a
cornerstone in the enforcement policy of the competition authorities. The fact
that cartels are difficult to uncover without leniency, and that it is possible to
obtain rather easily secretive information through leniency are strong assets of
the leniency system. However, the formidable success of this system is also
confronted with drawbacks.
HUMAN RIGHTS CLAIMS- This paper reveals that critiques on the leniency
system are increasingly framed in human rights terms. However, an overview
of these allegedly violated human rights indicates that those violations, if there
are any, are more common to the competition field in general than to the
leniency procedure. To date, successful claims are rare and do not pose such
problems. It also remains to be seen whether they will be of significance in the
future. Exemplary hereby are the recent judgments of both the ECtHR and the
ECJ that the administrative enforcement authorities do fulfil the requirements
of article 6 ECHR when full judicial review afterwards is guaranteed.
DISINCENTIVES - Nevertheless, it is true indeed that, due to the changes in the
judicial landscape, an increasing number of disincentives is present in the
leniency procedure. Practice reveals however that, even though some of them
might become a real problem, like eg. the fear for private damages claims, they
are to date not preventing undertakings from blowing the whistle. In the
decision to apply for leniency, even though it is unpredictable and to a certain
extent unfair, or to not apply and get fined, the first option still seems to have
the upper hand.
CONTRADICTION- In the end, the issues the leniency system is struggling with,
like eg. the claims of the lack of clarity and predictability are a perfect example
of the key contradiction in the leniency system. The more lenient the leniency
policy is, the less effective it will be as an enforcement tool. The long and
short of it is that it all adds up in developing a better balance between
263
Exemplary in this point is the evolution in judicial control in the merger control, where a
tightening of the judicial screws did not jeopardize the European Commission’s work but instead
provided an incentive for the European Commission to take measures so that it ultimately
produced even better results.
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implementing an operational and effective leniency system and blowing the
whistle by introducing near-sufficient legal certainty and predictability.
512
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