European Competition Law provides a wide-ranging review of the European rules relating to competition: restrictive agreements, abuse of a dominant position, impact of intellectual property rights, procedure, merger control, State aid.

European Competition Law

On 20 October 2011, the Commission published a Guidance on Best Practices applicable to proceedings in matters relating to restrictive agreements and abuse of dominant position , which covers neither State aid, nor cases dealt with in the context of leniency procedures . The Best Practices reflect the Commission's point of view taking account of its experience in the application of Regulation No 1 …

Best Practices

One of the tasks of the Union is to ensure that competition is not distorted to the detriment of the public interest, individual undertakings or the consumer . To achieve this objective, the EU authorities have developed a series of procedural rules, the purpose of which are to ensure the efficient application of competition legislation and the applicable sanctions in the event of the violation of those rules. The Treaty of Rome only laid down the rules of implementation of the Article 101 and 102 prohibitions for a transitional period.

Article 87 of the Treaty of Rome provided:

"Within three years of the entry into force of this Treaty the Council shall, acting unanimously on a proposal from the Commission and after consulting the European Parliament, adopt any appropriate regulations or directives to give effect to the principles set out in Articles 85 and 86 [articles renumbered, now Articles 101 and 102].

If such provisions have not been adopted within the period mentioned, they shall be laid down by the Council, acting by a qualified majority on a proposal from the Commission and after consulting the European Parliament.

The regulations or directives referred to in paragraph 1 shall be designed, in particular:

(a) to ensure compliance with the prohibitions laid down in Article 85(1) and in Article 86 by making provision for fines and periodic penalty payments;

(b) to lay down detailed rules for the application of Article 85(3), taking into account the need to ensure effective supervision on the one hand and to simplify administration to the greatest possible extent on the other;

(c) to define, if need be, in the various branches of the economy, the scope of the provisions of Articles 85 and 86;

(d) to define the respective functions of the Commission and of the Court of Justice in applying the provisions laid down in this paragraph;

(e) to determine the relationship between national laws and the provisions contained in this Section or adopted pursuant to this Article" .

According to the wording of the provision, the establishment of the necessary rules for implementation of the principles laid down by Articles 101 and 102 TFEU is a matter for the Council, which, acting on a proposal by the Commission, adopted Regulation No 17/62 entitled First Regulation implementing Articles 85 and 86 of the Treaty [now Articles 101 and 102] on 6 February 1962. The regulation fulfilled the objectives set out to a large extent and formed the general framework for the rules of competition procedure. It was repealed and replaced by Regulation No 1/2003 which came into force on 1 May 2004.

See Protocol on the Internal Market and Competition.

Article 103 partly includes the provisions of the former Article 87:

"1. The appropriate regulations or directives to give effect to the principles set out in Articles 101 and 102 shall be laid down by the Council, on a proposal from the Commission and after consulting the European Parliament.

2. The regulations or directives referred to in paragraph 1 shall be designed in particular:

(a) to ensure compliance with the prohibitions laid down in Article 101(1) and in Article 102 by making provision for fines and periodic penalty payments;

(b) to lay down detailed rules for the application of Article 101(3), taking into account the need to ensure effective supervision on the one hand, and to simplify administration to the greatest possible extent on the other;

(c) to define, if need be, in the various branches of the economy, the scope of the provisions of Articles 101 and 102;

(d) to define the respective functions of the Commission and of the Court of Justice of the European Union in applying the provisions laid down in this paragraph;

(e) to determine the relationship between national laws and the provisions contained in this section or adopted pursuant to this article."

Treaty of Rome

According to Article 1 of Regulation No 17, “Without prejudice to Articles 6, 7 and 23 of this Regulation, agreements, decisions and concerted practices of the kind described in Article 85(1) [now 101(1))] of the Treaty and the abuse of a dominant position in the market, within the meaning of Article 86 of the Treaty [now 102], shall be prohibited, no prior decision to that effect being required”. This provision established the principle of immediate and direct effect of Articles 101 and 102  and met with the objective laid down in Article 3(j) of the Treaty of ensuring the effective respect of the prohibitions set out in Article 101 and 102.

Regulation No 17 set out the rules of procedure enabling the implementation of the competition rules. This procedure involved two successive but distinct phases. The first phase consisted of a preliminary investigation which was designed to allow the Commission to gather the necessary information and documentation to establish the existence of the infringement. If the evidence warranted it, the Commission sent the undertaking a Statement of Objections, which led to the second phase; Regulation No 2842/98 of 22 December 1998 which governed the initiation of the adversarial administrative procedure, after the previous regulation, No 99/63 of 25 July 1963, had been repealed. At the end of the procedure the Commission would address an order to the parties to cease the infringing behavior or would impose a fine.

The regulation also clarified the Commission's role in the application of Articles 101 and 102 and determined the relationship between national and EU law.

The system set up under Regulation No 17 was designed for a Community composed of six Member States at a time when the control of competition was new to both the Member States and to the businesses operating within them. A system of centralized control was needed as a number of the Member States had no competition authority to apply Articles 101 and 102. The regulation therefore gave exclusive jurisdiction to the Commission for the awarding of an exemption under Article 101(3) TFEU. The EU authorities were thus able to develop a coherent competition policy common to all Member States.

Case 13/61 Kledingverkoopbedrijf De Geus en Uitdenbogerd v Bosch and others [1962] ECR 89, issued under the interim provisions of the Treaty (Articles 83, 84 and 85), and which decided that Articles 104 and 105 TFEU, which confer powers respectively on the national authorities and on the Commission for the application of Article 101, are based on the assumption that this provisions are operative from the entry into force of the Treaty.

Regulation No 17/62

Regulation No 1/2003 of 16 December 2002, on the implementation of the rules on competition laid down in Articles 101 and 102 of the Treaty repeals and replaces Regulation No 17/62. The aim of the regulation is both to simplify and decentralize the application of EU law in the European Union.

Regulation No 1/2003 set up what is known as a system of legal exception to enable direct applicability of the competition rules by empowering the competition authorities and courts of the Member States to hold Article 101(1) inapplicable without the need for notification. This decentralized scheme, which conferred an essential role on the national authorities, included the creation of a network of competition authorities to ensure a certain degree of unity in the application of EU law thanks to the close association between the various authorities. The Commission and the authorities of the Member States now enjoy parallel jurisdiction for the application of the EU competition rules. This power is exercised within the context of two fundamental principles of European law: primacy and direct effect. Article 3(1) of the regulation provides that where the competition authorities of the Member States or national courts apply national competition law to practices that may affect trade between Member States, they shall also apply Article 101 or Article 102 TFEU. In order to ensure a uniform application of the EU rules, Article 3(2) stipulates that the application of national competition law may not lead to the prohibition of agreements, decisions by associations of undertakings or concerted practices which may affect trade between Member States but which do not restrict competition within the meaning of Article 101(1) of the Treaty or which are covered by a “block” exemption regulation. The Union, however, maintains a residual field of competence to the national rules: the Member States may adopt and apply on their own territory stricter national laws which prohibit or sanction unilateral conduct engaged in by undertakings .

The national authorities have the power, when acting on their own initiative or on a complaint, to adopt four types of decision: requiring that the infringement be brought to an end, an order for interim measures, the acceptance of commitments or the imposition of fines, periodic penalty payments or any other penalty provided by their national law. Although the power to take a non-application decision as to substance (either because the conditions of infringement are not met, or because the conditions of exemption are) is reserved to the Commission, in such a case, the national authorities may decide that it is not necessary to act . Article 6 of the regulation gives national authorities the power to apply Article 101 and 102 TFEU. The conditions for implementation of that provision are stipulated in a Commission notice .

The Commission finally sees its powers of investigation increased in full respect of the rights of defense enshrined in EU case law: the regulation provides specifically that undertakings cannot be forced to admit that they have committed an infringement.

E.g. the rules on restrictive practices in France.

Case C-375/09, Tele2 Polska, Judgment of 3 May 2011, LawLex201100000948JBJ.

Commission Notice No 2004/C 101/04 of 27 April 2004 on the cooperation between the Commission and the courts of the EU Member States.

Regulation No 1/2003

On 20 October 2011, the Commission published a Guidance on Best Practices applicable to proceedings in matters relating to restrictive agreements and abuse of dominant position , which covers neither State aid, nor cases dealt with in the context of leniency procedures . The Best Practices reflect the Commission's point of view taking account of its experience in the application of Regulation No 1/2003. They do not call into question the texts and regulations or the interpretation by the Court of Justice and do not create any right. They only give clarifications on the various stages of the procedure: investigation, written and oral phase, rights of defense, commitment procedure. The conditions for rejection of a complaint and the use of information sent to the Commission in the course of the procedure are subject to particular treatment.

Thr Best Practices ensure that the parties are better informed of the status of proceedings and facilitate the interaction between them and the Commission department dealing with their case. The Commission undertakes to: open formal proceedings as quickly as possible, i.e. as soon as the initial assessment is concluded, so that the scope of the investigation and the identity of the parties concerned are known as early as possible ; organize State of Play meetings at key stages of the procedure ; provide to the parties key submissions by the plaintiffs (such as a non-confidential version of the complaint) and third parties as of the investigation stage of the proceedings ; publicly announce the opening and closing of proceedings, the notification of the Statement of Objections and the publication of guidance on the conduct of the commitments procedure. At the Statement of Objections stage, the parties will be better informed regarding the main parameters taken into consideration for the setting of fines, particularly concerning the value of sales affected by the infringement and the periods the Commission intends to take into account . The Notice on Best Practices provides for the systematic publication of its decisions rejecting complaints or a summary thereof .

The Commission has also issued a list of best practices for the submisson of economic evidence and data which provides the criteria to be complied with in economic and econometric submissions and gives useful indications on how it will use the results .

Commission Notice No 2011/C 308/06 on best practices for the conduct of proceedings concerning Articles 101 and 102 TFEU, OJEU C 308 of 20 October 2011, 6.

The draft notice adopted in January 2010 had been provisionally declared applicable pending the results of the consultations.

Points 60 - 66. The mechanism will apply inter alia to cartel cases - but only after the oral hearing -, to commitment procedures and where the Commission intends to reject the complaint.

European Competition Law

174. Best Practices

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Les notions juridiques connexes

174. Best Practices

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Les notions juridiques connexes

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