Chillin'Competition

In December 2010 we wrote a post on the General Court’s Judgment in Case T-427/08, CEAHR v Commission. Our post interpreted the Judgment as effectively limiting the Commission’s discretion to reject complaints.

That post concluded with the following opinion: “this is a most welcome judgment. Indeed, whereas previous case law imposed upon the Commission the burden of  “considering attentively all the matters of fact and of law which the appliccant brought to its attention”, the General Court has, by virtue of its in-depth review, turned those words -until now a mere formality- into a real, practical, obligation”.

But now we’ve read last Thursday’s Judgment in Case T-119/09, Protégé v Commission (concerning an appeal against a decision rejecting an abuse of dominace -sham litigation- complaint against Pernod Ricard) (available here, but only in French) (how wouldn’t we read a competition Judgment in which the relevant market is the one for Irish whiskey?) and I’ve realized that perhaps we were wrong.

The Protégé Judgment makes it clear that the strict analysis of the Commission’s exercise of its discretionary powers carried out in CEAHR was an exception. Certainly Protégés theory of harm doesn’t appear to be a particularly solid one to say the least (in this sense, the contested Decision and the Judgment are quite understandable). What is surprising is not the outcome of the case, not even the GC’s reasoning; what strikes me is that the Judgment does not make a single reference to the former precedent in CEAHR. In our view, by completely ignoring CEHAR the GC might have effectively overruled it.

The overruling becomes more explicit with regard to one particular point. You may recall the suggestion in paras. 155 and 174 of CEAHR that when an alleged infringement affects several Member States there could be a sort of presumption of “EU” (why do we still say “Community” when we talk about this topic?)  interest. In Protégé the GC makes it very clear that this is not the case.

In sum, we are still governed by Automec. The Commission can very much decide what’s interesting and what’s not provided that it doesn’t mess up big time  incur in a manifest error of appraisal in dealing with the factual elements that it may put forward to justify a rejection.

By the way, we have heard through the gravepine that the upcoming hearings on the De Beers distribution case may feature some interesting discussions on the notion of Community EU interest. We’ll stay alert.

So, to those who read our post on CEAHR: never mind.  To the Commission: false alarm.