Chillin'Competition

Relaxing whilst doing Competition Law is not an Oxymoron

On Case C‑547/16, Gasorba and others v Repsol (and, more importantly, on the nature of commitment decisions)

with 3 comments

Expected outcome

Last week the Court delivered a preliminary ruling in Case C‑547/16, Gasorba. Together with Case C‑248/16, Austria Asphalt (which came out in September) it is a very serious contender for the Most Predictable Ruling Award 2017.

In essence, the preliminary reference asked whether a national court can take action under Articles 101 and 102 TFEU where the European Commission has already accepted commitments in relation to the same practice.

In a very brief judgment (serious contender for that category too), the Court clearly ruled that it is – of course – possible for a national court to examine the compatibility of practices with EU competition rules in instances where the European Commission has closed a case with a commitment decision within the meaning of Article 9 of Regulation 1/2003.

I do not see how the Court could have come to a different conclusion. Regulation 1/2003 is crystal clear on this point – I remember discussing Recitals 13 and 22 of the Regulation, which could not be more explicit, back in 2005, when I was a teaching assistant in Bruges. I do not feel there has ever been any doubt (or expectation that the Court would see things differently).

I am sure some people will criticise this outcome – it may perhaps be argued that this outcome creates legal uncertainty, or that it reduces the incentives to offer commitments.

To which I am tempted to reply: if the outcome of the ruling is deemed undesirable, what should change is Regulation 1/2003, not a Court ruling echoing the unambiguous choice made by the legislature.

The Court, however, does not rule that commitment decisions are entirely irrelevant in proceedings at the national level. The judgment clarifies that national courts are expected to take into account the preliminary assessment of the Commission in a commitment decision, and this as an expression of the principle of sincere cooperation (or loyalty) enshrined in Article 4(3) TUE.

Because these weeks my research work is taking me to the old days, I thought immediately of the Lancôme ruling of 1980, in which the Court considered the status of the ‘comfort letters’ issued by the Commission under Regulation 17, and came to a similar solution. For younger readers: comfort letters are like commitment decisions avant la lettre (if you allow the cacophony and the bad pun).

More interesting than the ruling is the debate about the nature of commitment decisions. I have the impression that, to this day, these decisions are, for some reason, often taken as instruments stating what the law is. They are not. They are an expression of the discretion that the Commission enjoys when choosing which cases to pursue.

Because commitment decisions are about discretion, not about the interpretation of Articles 101 and 102 TFEU, they are only subject to limited review. Accordingly, the ‘preliminary assessment’ found in these decisions is, if at all, subject to the same ‘manifest error’ test that applies to the rejection of complaints.

In other words: curb your enthusiasm.

Written by Pablo Ibanez Colomo

1 December 2017 at 11:08 am

Posted in Uncategorized

3 Responses

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  1. Couldn’t agree more. We went round the houses on this point several times at the OFT when settling the first UK commitments cases and it always seemed crucial to me to keep this distinction clear.

    Becket McGrath

    1 December 2017 at 11:55 am

  2. Thanks Pablo, and I agree entirely.

    I would however add that I know from recent experience that commitment decisions are extremely difficult to challenge. Indeed they seem to be more difficult to question than Article 7 decisions. And given how hard it is to compel the Commission to act (you refer to “discretion” but that suggests a deliberate decision not to prosecute an acknowledged infringement, whereas “measure of appreciation” is perhaps more accurate) that might point to the existence of a “gap” on the complainant side. In my case the challenge was at least held by the Court to be admissible but there was great reluctance to take on the evident shortcomings of the commitment process.

    Therefore if Regulation 1 is to be revisited, we could probably between us come up with a list of desired improvements in the interests of a level playing field.

    Stephen Kinsella

    1 December 2017 at 1:12 pm

  3. I agree

    Luca

    4 December 2017 at 11:00 am


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