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Archive for April 7th, 2017

Jurassic case law?

with 6 comments

Given our justified absence from the Antitrust Spring Meeting it was only today that I became aware of comments by a former DG Comp Director General, Philip Lowe, referring to the EU Courts’ case law as “Jurassic” [GCR subscribers can read more about them here].

We were planning to comment on two interesting Opinions from AG Wahl issued yersterday, but reading the comment above triggered some thoughts that I think are worth sharing here, if only because you will rarely hear them. The people who still today hold grudges about my earlier posts on the Commission’s Legal Service and on CJEU President Judge Lenaerts will most likely disagree with this one too, but, hey, the reason for this blog is precisely to foster discussion.

Describing the case law as outdated, ordoliberal (one of the most abused and misunderstood notions in competition law commentary) or nonsense often makes lawyers score brownie points with peers and clients. And they are easy points, because it is not like the Court is going to intervene in the debate to defend itself. In my view, however, that criticism is misplaced, unhelpful and misleading. My personal views follow:

On necessary criticism

  1. First of all let me make clear that I view the criticism of the case law as useful and necessary, even when misplaced. Much like what happens with the press and politics (see here), having lawyers and academics –or Advocates General- commenting on cases and suggesting improvements is indispensable. Judges do not live in an ivory tower (actually some of them do work in an oddly gilded one) and without criticism and friction there would be less progress and fewer refinements. However misplaced the comment, I think the Courts would do well to listen, and, as far as I know, they do.

On being realistic and objective

  1. Second, I certainly do not think the Courts always get it right. How could they? Does anyone? The Luxembourg Courts, like any Institution or organization where human input is the main factor (including the Commission, law firms and companies) are far from perfect. Justice is supposed to be always blind, and fair, and etc., but justice is administered by Judges, who are human, some of whom are better qualified than others, some of whom have pre-established views, some of whom are more hard working than others or care more than others.
  1. Actually, and my experience on this has been consistent, once you get to know from up close any institution, organization (company, university, friend) or person you very much admired, you demystify them and their flaws become more apparent. After 10 years dealing with the Commission and the Courts, the ideal image of the Institutions that I had in my mind as a student is no longer there. I have had good and bad experiences with both, sometimes one simply agrees or legitimately disagrees, other times one may be surprised, disappointed or frustrated. I have been there and have had moments (including some pretty recent ones) where you feel you lost your innocence. But having had victories, defeats and a fair deal of frustration is, I would like to believe, what that makes me more objective.
  1. I do disagree with some Judgments (funnily enough, that happens mostly with the ones I lose) and we actually run a blog where we tend to comment on the contentious cases on which we disagree, much more than with the ones we agree, as some of you have noted in the past. I disagree, for example, with some of the case law on exchanges of information and concerted practices (e.g. T-Mobile and its fruits) or with the recent case law on “behavioral selectivity” in State aid and Pablo has been vocal when it comes to the case law on fidelity rebates. Much of this is inevitable, for we all know what happens with legal principles (see here). And we will continue to voice out our disagreement in individual cases because we think it may perhaps contribute to some advancements.

On the real status of the case law

  1. In spite, or because, of the above, a general criticism of the case law or of the Courts is entirely wrong and wholly unfair. For all the flaws of some individual cases, the case law, also in the competition field, is for the most part an exercise of common sense. And if there is an Institution that has crucially and steadily contributed to European integration (largely) isolated from petty politics, with clear ideas and progressive Judgments, that has been the Court of Justice.
  1. The case law is not Jurassic, it is simply not as comprehensive and systematic as we would ideally like it to be and, admittedly, sometimes not as consistent as it may appear. But it arguably can’t be. The Courts decide on the cases, facts, theories and pleas brouught before them, they don’t write competition law textbooks. As brilliantly explained by Pablo here, the reason why the most controversial part of the competition case law (abuse of dominance) remains somehow unsatisfactory has to do with the paucity of cases and, importantly, with the very few preliminary references in the area. It is only in preliminary references that the Court of Justice has the opportunity to craft consistent analytical principles and frameworks (which nevertheless are not always followed upon -think for instance of the “indispensability” requirement in all cases related to “access- ; we should come back to this one day). The preeminence of direct actions against Commission decisions, the margin of discretion granted to the Commission in this setting and certain litigation strategies have resulted in some not entirely consistent Judgments. Also, a careful analysis of the case law unequivocally shows that it does evolve, it is not Jurassic nor fossil, it evolves at its own pace, following consensus. Recent cases like Post Danmark I or Cartes Bancaires, for instance, are good examples. On closer look, the case law makes much sense than is tipically said. In my certainly personal view, failing to see or acknowledge that hinders our ability (and credibility) to advance some refinements of that case law.

On where the real risks lie

  1. The only risk for the case law to one day become outdated has to do with the ongoing de-legalization of EU competition law. We are now at a stage where the law is perceived as an inconvenience. The Commission prefers to deal with cases on a very factual basis (to maximize its chances on appeal) and to favor out-of-court negotiated solutions), particularly on the most complex cases. Analytical legal frameworks are largely ignored and replaced by remedy negotiations. As rightly noted by General Court Vice-President Marc van der Woude only days ago (MLex suscribers can read it here), there are areas of competition law that are disappearing from the judicial radar screen, with the risk that the case law may stagnate. That is the real problem. As the GC seems to be acknowledging, this is also a result of parties perceiving that going to Court would not yield results, and recent signals suggest something may be about to change. Admittedly, the shift in the center of gravity may lead to more preliminary references and more CJEU intervention on the law, which would be useful, but I would rather not sideline the competition experts also sitting in the General Court and the detailed guidance and that comes from annulment actions.

On how to improve judicial review, and the appearance of judicial review

As everything, judicial review in the competition sphere may be subject to improvements, but not all of them depend on the Courts; some depend on the Commission’s policy and some depend on the ability of applicants and of other parties to judicial proceedings, but there are a couple of things that could be done.

  1. To me, the most important issue is transparency. I have made this point before (see here, particularly the comments, and here). Judicial review and lawyering (and the assessment of lawyers’ work) would significantly improve if Court submissions/briefs were public and if there were recordings or transcripts of hearings. This would favor the Court above everyone else. The criticism would diminish, as external observers are often unaware of the care with which some (not all) Judges and clerks analyze and understand every argument and detail in a given case. As an example, some of my colleagues had a hearing this week that, regardless of how it is eventually decided, revealed a thorough understanding and study on the part of the reporting Judge that would surprise most. Making Court submissions public would, by the way, also have the side effect of spurring some more consistency on the part of the Commission..
  1. There are other issues, but admittedly much harder to change, which have to do with how Judgments are written. I, for one, like it much better when I read Judgments such as this one or this one than when you read the ones we are most accustomed to.

To be sure, I am not saying that judicial review is deficient or that these two issues are very problematic; more than anything they are misleading to external observers and may hide the reality that there are many less problems than people usually believe.

On what anyone should do to have an informed opinion on this

  1. My advice on this is threefold: (1) Don’t pay much attention to what I say 😉 ;(2) buy this book by Fernando Castillo and Eric Gippini that we will review here next week, (3) watch this space for Pablo’s new book explaining the evolution of EU competition law as a story of interaction between the Commission and the Courts.

Written by Alfonso Lamadrid

7 April 2017 at 10:13 am

Posted in Uncategorized