Random thoughts
In the past few days I haven’t been very diligent at keeping up with posting. My bad conscience has led me to write the hastily written random thoughts below. I might come back to develop some of them in posts to come:
1) On joint v individual assessment of (incriminatory v exculpatory) evidence in cartel cases. For some time now I have been (intermittently) attempting to finish a lengthy piece about evidence in cartel cases (surprisingly enough, there are only a handful of publications worth reading on this subject). One of the interesting things I’m observing is that EU Courts and the Commission [please note that I’m being critical with them; as some of you have reproached me, that doesn’t happen so often] is that whereas the principle of “joint assessment of evidence” is consolidated and very much followed when it comes to assessing the evidentiary value of incriminatory items, the same cannot be said about exculpatory ones.
In most cases, a bunch of elements are put together and assessed jointly in order to declare that an undertaking has committed an infringement. I’ve nothing to object to this logical approach (even more so in cartel cases otherwise these could hardly be brought). My concern on this particular point is limited to the fact that [in another illustration of the tendency of many legal principles to expand themselves until a point of absurdity that eventually must lead to their nuancing] the principle of joint assessment of evidence is often resorted to as an easy escape to avoid discussing individual evidential items that the parties consider worth discussing. In my view, the Commission and the Courts should always first engage in the individual assessment of each evidentiary item, and only then (once the value or lack thereof of every standalone item is established) move on to the joint assessment of all available evidence.
Interestingly, the contrary tendency can at times be observed regarding the assessment of exculpatory evidence. I’ve come across a few Judgments that address exculpatory items one by one concluding that “x is not in itself sufficient to rebut whatever”, that “y is not sufficient to prove whatever” or that “z cannot on its own lead to whatever conclusion”. The “joint assessment” of x, y and z as exculpatory items sometimes just doesn’t happen. For some examples, take a look at recent cases in which parties tried to rebut the AEG (parent liability) presumption (which, btw, turned 30 a few days ago). I hope to develop –and substantiate- my thoughts on this soon.
2) A suggestion to improve the Court’s rules of procedure. Nicolas has lately pushed for reform of EU Courts’ rules of procedure regarding conflicts of interest. We have not agreed much on that issue, but I too have a suggestion to improve the rules of procedure. Unless I’m wrong, the current rules do not envisage any sanctions nor any other sort of legal consequences for parties that provide the Courts with false information to (let’s leave misleading aside, for the concept is arguably too wide, for lawyers at least). Most legal systems do envisage such rules. Imagine the Court were to ask a question (written or oral) to a party, and that the information given in response were not only inaccurate, but untrue; should that not have any consequences?
3) A solicited response to Nico’s views about the effect on trade between MS criterion. In a recent post Nico referred to the effect on trade criterion, complaining that in the eBooks case the Commission had not undertaken any serious assessment, and had swiftly concluded that the conduct at issue did affect trade between Member States. He wisely noted that I’d probably have a divergent view, and I do (he knows me well…). If you ask me, in that case the effect on inter-State trade was crystal clear, as the Commission’s reasoning in paras. 91 and 92 (noting that the conduct at issue was implemented in the whole of the EEA and that agency agreements covered UK, France and Germany) sufficiently shows. Nico says that “[w]ith this kind of reasoning, everything may affect trade between Member States (though I understand Alfonso has a dissonant view on this”. Since I’m asked, my view is that with that reasoning, practices that are implemented throughout the EEA and that manifest themselves with a certain intensity in 3 Member States will be deemed to affect trade between Member States, which, to me, could not be more logical. In fact, as the Decision shows, no party ever challenged this specific point.
4) A great read. Finally, I confess my (very) geekish action of the month: I’m currently reading R.Odonoghue and J. Padilla’s book on The Law and Economics of Article 102 from beginning to end, as if it were a novel (in my defense: I hadn’t done that in a very long time). The book is a monument; it’s smart, balanced, exhaustive, very well thought and written and deserves (although doesn’t need) all possible publicity. Hats off to the authors. In fact, as soon as I’m done publishing this post I’ll send both authors an invite to participate in our currently lethargic Friday slot section.
Chillin'Competition 
I totally agree about O’donoghue and Padilla’s book. It is insightful, comprehensive and forces the reader to undertake an active reading. Sort of “basic wardrove book”.
Antonio
7 November 2013 at 9:33 am
Great post. For your piece about evidence in cartel cases, I can recommend reading the CAT’s judgment in Tesco v OFT, paragraphs 115-136. For example: “A document is not made in a vacuum, however, and should not be construed as if it had been. If the CAT’s conclusion is that a document is unclear or ambiguous, even when read in light of the prevailing circumstances and other evidence, then any doubt as to the meaning of that document must be resolved in favour of the company.”
Although obviously different standards apply at the CAT, it is interesting to see how much weight it gives to witness statements compared to the GC and the ECJ. The phrase ‘even when read in light of the prevailing circumstances and other evidence’ seems to indicate the principle of joint assessment of evidence may lead to a different outcome as well.
Looking forward to seeing the article!
SH
7 November 2013 at 12:09 pm
My friend, the E-Books case concerns retail sales of e-books. And those products are not retailed accross borders, just like Fish and Chips, Frog Legs, or Tapas (or only to a non appreciable extent). The Commission has said this in many many many cases. So if the Commission has decided to change the approach, why not say it and explain it?
The fact that those firms are active in all the world gives no indication that trade is affected. Take the vertical aspect of the case (the sole proven actually). When Lagardère sells French E-Books to Apple for resale on french territory, this just cannot affect trade between Member States (+ there might be national copyright law hidden somewhere here)?
The sole conceivable angle would be to say that there was horizontal concertation between publishers from more than 3 MS to negotiate on same terms with Apple. But 1), the decision does not really bring proof of this concerted practice (remember, this is Article 9), so how can it conclusively talk of its effect on trade, or even better, from appreciable effect on trade?; and 2) this horizontal concertation between publishers sought to influence market competition in domestic markets for the retail sale of E-Books. The various national publishers simply sought to increase their negotation power with Apple. But this practice had no impact on markets, other than a string of distinct and insulated national markets. Think about it: if a UK fish & chips producer concludes with the French frog legs producer and the spanish main tapas producer an agreement with Google over the display of local food search results on respective national Google pages (in a joint bid to increase their bargaining power), this cant have an effect on trade between MS.
The point, more generally, is there was no clear trade – or just limited – to restrict with the impugned agency agreements and MFN clauses.
More generally, you said in your post that the condition of effect on trade is restrictively interpreted. Do you really sustain this? I mean, as you rightly point out in your post, the conditon is rarely disputed, even by parties. The staggering number of decisions rendered at the national level on 101 and 102 (as compared to decisions rendered only on national law) quantitavely goes against your interpretation. In my opinion, the condition of effect on trade is extensively – and desirably so – interpreted in the case law.
Nicolas Petit
7 November 2013 at 5:39 pm
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Random thoughts | 21st Century Competition
7 November 2013 at 6:02 pm
Nico, it doesn’t matter that the product isn’t traded accross borders:
– As explained in settled case law and in para 22 of the Notice on the effect on trade requirement “[t[rade between Member States may be affected also in cases where the relevant market is national or sub-national”.
As also explained in para 61 of the Notice, “[a]greements and practices covering or implemented in several Member States are in almost all cases by their very nature capable of affecting trade between Member States”.
– You use the example of Lagardère selling only in France, highlight the vertical aspect of the case, and conclude that a vertical agreement limited to a single Member State can never inter-State trade. I beg to disagree. Let me go back to the case law and the Commission’s Notice (read paras. 77 and particularly 86-88 under the heading “Vertical agreements covering a single Member State”!!)
Moreover, in the ebooks case the situation was different from your example; given than several MS were affected the relevant section is 3.1.4 of the Notice: “Vertical agreements implemented in several Member States”.
If you read those you’ll realize that the Commission hasn’t changed its position, not a bit, so there wasn’t much to be explained.
– And yes, I do maintain what I said in my commen to your post on “Collective amnesia”, in which (check it) I said that the effect on trade is a “meaningful jurisdictional criterion”.
I did not question that the criterion is flexibly interpreted (as it rightly should be); what I said is that it’s not as expansively interpreted as the equivalent condition in the State aid domain, which almost renders it useless. That I maintain and will be happy to substantiate in another post (no time today..)
Finally, if parties rarely dispute that the condition is met that’s only because the Commission only takes on cases which do clearly affect inter-State trade. And that, in my view, only confirms my point that the Commission takes this condition seriously.
Alfonso Lamadrid
7 November 2013 at 7:15 pm
I agree with Alfonso that, from a practical standpoint, we have to warn our clients about the applicability of 101 even in cases where the goods/services in question are not actually traded across borders since this will clearly be the EC’s approach. I do think however that whether those goods/services CAN be traded across borders should matter. Indeed, if, as suggested in Nicolas’ example, it can be safely concluded that the goods/service CANNOT be traded across borders**, surely this should weigh in the determination. In such a case, I would tend to think that trade could only be affected if the agreement prevents foreign companies form establishing themselves in the country where the practice takes place (that is to say, in Nicolas’ example, if the agreement makes it harder for a Fish n’ Chips retailer to establish itself in Spain and start a Tapas business).
** Evidence does show however that frog legs may have traveled across borders at some point… : http://www.theguardian.com/science/2013/oct/15/wiltshire-dig-frogs-legs-eaten-british-before-french
ag
8 November 2013 at 9:45 am
Alfonso, concerning the second of yout thoughts in this blog there have been news on a Judgment rendered today which might be of interest
You wrote “Unless I’m wrong, the current rules do not envisage any sanctions nor any other sort of legal consequences for parties that provide the Courts with false information”
Check out paras 352 and 262 of a Judgment rendered today (T 551/08) in which the General Court omposes a fine of 10,000 euros on the applicant because its lawyers (very well known firm) gave false information to the Court.
It is not a fine strictly speaking, but an increase in the costs to be paid because they made the examination of the case more difficult.
The Cost of a Lie
12 December 2014 at 1:00 pm
It is strange that the Court did not use the possibility to increase the fine, which could have been more effective in quantitative terms, and has been hinted at in prior judgments (Shell or IBP, both concerning incorrect information during the administrative procedure, the latter in the context of a reply to the SO). May be an increase was not requested by the Commission. Or maybe the General Court preferred that the money went to its own accounts, since it may have to face in the future challenges for breach of the principle of undue delay (it took 6 years to decide the case). Yet, one can argue that the fact of having to pay this amount to the Court, even if limited in quantitative terms, may have more of a moral effect. Of course, on the assumption that having to pay a fine to the Court for lying carries any moral stigma in the Brussels Bar. Not to clear to me. The client may also consider that it shows that the lawyer did anything to win the case, including lying. And the lie costs only 10.00 euros, whereas if it had not been discovered the reduction would have been larger.
In any event, this is still the exception. Just to put one example, in T-540/08, of the same group of cases as H&R (candle waxes), Exxon based one of its two plea on a “witness statement” by one former employee which turned out to be clearly untruthful on the basis of emails coped during the inspections in the very premises of the applicant (paras 68-75). One may wonder how a sophisticated company such as Exxon could bet on winning a case on the basis of a demonstrably untruthful statement, but the point here is that the Court did not do anything about “the lie” (quite apart from rejecting the plea of course). Certainly, since the person was not a “real witness”, he was “protected” against the measures normally used for lying in court pursuant to the rules of procedure (and that is probably the reason why some applicants prefer these “exculpatory witness statements”), but one could have expected a somewhat tougher approach. There is an important difference between an inconclusive or controversial statement (in the sense of its sufficiency to prove something), and an untruthful one. Moreover, if the case is based on an inculpatory statement which turns out to be not sufficient (which is not as such an indication that it is incorrect either, we may just not know) the decision is annulled, which is already a price to pay (even if the company providing a statement may not be party to the proceedings, the price is paid by the institution which relied on it), providing incorrect exculpatory “witness” statements appears to come for free, since there is little in terms of sanctions to deter that conduct.
but some lies are still for free
15 December 2014 at 11:17 am
suuluez
CurtisBed
6 April 2017 at 3:22 pm