Examination of Witnesses (Questions 80-99)
Mr Onno Brouwer and Mr Georg Berrisch
29 NOVEMBER 2006
Q80 Lord Lester of Herne Hill: On the
question about the Commission being under-resourced in the Competition
Directorate, forgive my ignorance, is there any authoritative
study which will tell us what resources are allocated to what
my Lord Chairman has pointed out is at the heart of the Treaty
on competition policy, looking at whether the resources are adequate
and, if not, why not, and measuring it and so on. Is there some
great document that will tell us the answers to those questions?
Mr Brouwer: That has certainly often been debated
but I think it is probably a very good question for Mr Lowe, who
I understand is also coming to give evidence at the Committee.
Q81 Chairman: That is a question we should
direct to the Commission?
Mr Brouwer: Yes.
Q82 Chairman: What is your preferred
solution to the problem insofar as there is a real problem at
court level with the merger and acquisition process? Would you
take the CBI route of creating new judicial panels as an under
tier of the CFI, like the Civil Service Tribunal?
Mr Brouwer: We have had quite a comprehensive
discussion within the permanent delegation, and certainly we think
the discussion which the CBI has launched is very useful because
we need to have improvement with regard to merger cases, such
as on the timing as we are discussing, but one of the elements
we of course also debated and which was not on the agenda for
today, but which I do think is an important point, is the question
about whether you should not have the process where actually the
European Commission clears mergers but if it actually wants to
prohibit a merger, that goes to court and that the court then
takes the decision to prohibit or authorise. If you were to have
a system like for instance in the US, then you do not have an
issue the case being referred back to the Commission again when
the Court of First Instance annuls the decision of the Commission.
If the Commission wants to prohibit a merger, it then needs to
go to court and argue its case before the Court, and then you
are immediately in front of the Court and the Court decides.
Q83 Chairman: So that would be at the
end of stage one of the Commission's present process when they
have decided not to clear it but to carry the matter further?
They would then immediately, so to speak, prosecute their case
for it not going ahead before the Court, which would then take
the factual decision?
Mr Brouwer: I think it is fair to say that in
practice it would be a decision the Commission would take after
an in-depth investigation, so if after a phase two investigation
the Commission comes to the conclusion that there are no remedies
possible or no remedies have been offered which solve the competition
problem, then the Commission would say, "I have no choice
but to prohibit." However, at that stage the European Commission
would need to go to the Court of First Instance to actually argue
its case that this needs to be prohibited.
Q84 Chairman: I see. So the decision
would then be taken by the Court and not by the Commission?
Mr Brouwer: Yes.
Q85 Chairman: How much time would
that save at the Commission stage?
Mr Brouwer: It is difficult to say because I
think that you would still need in-depth investigation before
the Commission.
Q86 Chairman: Quite.
Mr Brouwer: But the advantage would be that
you are straight before the Court, which has to decide and have
a discussion on the remedies which may or not solve the situation.
That is one discussion we have had and you find that same element
in the evidence of, I do not remember if it was John Temple Lang,
Mr O'Donoghue or Bill Bishop. I think one of those also mentioned
that.
Q87 Chairman: That necessarily involves
therefore a much more intensive inquiry into the facts by the
Court because it has to take the factual decision which at the
moment it is merely reviewing.
Mr Brouwer: We have not explored this option
further within the permanent delegation because it is not a suggestion
that we have in front of us today.
Q88 Chairman: So we put that aside.
Mr Brouwer: If we put that aside and discuss
the suggestion of having a separate Competition Court under the
Court of First Instance, I must note that we have concluded that
there is one element which seems prohibitive to that idea which
is that it creates an extra layer in the Community judicial architecture.
We have a Court of First Instance which functions very well. There
is no credibility problem. The general perception of the customers
of the court in the CCBE is that the credibility of the Court
of First Instance is excellent. We only have a timing issue and
we do not think that creating an extra layer solves anything.
On the contrary, it makes procedures more complex. We rather think
that we should look at how the procedure within the CFI can be
made more efficient.
Q89 Chairman: In the most basic terms,
what is your solution? New chambers within the CFI? New bespoke
competition adjudging chambers?
Mr Brouwer: The suggestion of the CCBE is to
have additional resources, so a number of additional judges because
there are also other cases to be dealt with by the CFI, so to
have additional judges, and then it would make sense to constitute
a special chamber or formation within the CFI. We have no strong
views as to what name should be given to the formation. What counts
for us is to have sufficient resources and judges who have good
experience in this field, and to be able to allocate these resources
to these cases, combined with better case management, so that
a number of practical procedural steps are taken which may help
to speed up the decision-making.
Q90 Lord Bowness: In a sense, one of
the questions has been answered but if we have the additional
panels that you have just been talking about, they presumably
in the first instance would inherit the existing rules of procedure
of the CFI?
Mr Berrisch: My Lord Chairman, I do not think
that it would be necessary that they would inherit the rules of
procedure of the CFI. Certainly they could adopt their own procedural
rules. I must admit I have not looked into the procedural rules
of the new staff tribunal but I think there would be greater flexibility
for them to adopt their own procedural rules.
Q91 Chairman: We are not talking about
new judicial panels. I think Lord Bowness is asking about new
chambers within the existing CFI.
Mr Berrisch: I am sorry, my mistake. Then of
course they would inherit the procedural rules. They would have
the procedural rules, but of course the procedural rules as they
currently exist allow for a certain flexibility that is not always
completely exploited. We discussed internally in the CCBE issues
of case management where you could improve matters and speed up
things, and I think some of them could be done within the framework
of the existing procedural rules; others you probably would have
to change the rules.
Q92 Chairman: I do not know if you have
managed to read Sir David Edward's contributions in his written
evidence but there is a cri de coeur theme throughout
his statement that it is high time that the Courts, both the ECJ
and the CFI, were regarded as capable of deciding their own procedures
without having detailed political control so that any change in
the rules has, for the most part, to be agreed in Council. Is
this a view that your body takes too?
Mr Berrisch: We are aware of that request for
more flexibility and more autonomy. I think the outcome of the
discussion on that in our delegation is that one needs to probably
draw a line because there are certain procedural rules on how
you deal with cases where obviously the courts should have autonomy
and should be able to decide for themselves how they want to deal
with procedures, but there is another area—and there I think
one needs to draw a line—where we say if these are rules
which have to do with access to justice or which are more fundamental,
then normally courts do not draft those rules themselves. If we
look on the Continent, certainly the fundamental procedural rules
are found in statutes or are codified and then the courts have
internal rules of how you deal with procedure, so you have the
legislature which determines the fundamental rules on what the
policies are, and I think one needs to draw a line there.
Q93 Chairman: And the CCBE regard the
line as being drawn in the correct place, do they? They do not
see any case for further autonomy for the Court?
Mr Brouwer: I think we do see a case for further
autonomy for the Court. What we are saying is that you must then
have a clear understanding of where one draws the line, what is
determined by the Courts and what is determined by the legislature.
Q94 Lord Lester of Herne Hill: Can I
ask you some quite different questions. On the rule-making power,
the Court I know more about is the other European Court at Strasbourg.
They do make their own rules of court and they are not constrained
by anything the political institutions have to do with it, and
it does not seem to be in any way disadvantageous that they have
the inherent power to make their own rules. I do not know if you
are aware of that. I cannot see any objection, in principle, to
the Court having its own autonomy in making procedural rules.
That is my first question. Is that correct? The other is going
back to your point, Mr Brouwer, about another way of tackling
this would be if the Commission had to seek a kind of injunction
or stop order directly from the Court. Would that not mean that
instead of the Court, as at present, having a judicial review
power where it sees that there is evidence on how the Commission
could have come to its conclusions but it does not come to its
own merits decision on the facts? Would it not change the entire
nature of the process and cause more delay, in that the Commission
would be terrified that the Court would not make the order and
therefore it would have to be really clear as to what it was doing,
which would cause further delay, and the Court itself would need
to gets its hands into the merits of the case, which would require
again further delay on the part of the Court. I am puzzled by
whether that would be a solution to the problem we are looking
at. They are two quite separate questions; and I apologise for
that.
Mr Brouwer: I think that on the last question
we agree that it would be a fundamental change of the system we
have.
Q95 Chairman: We are not really exploring
that at this inquiry.
Mr Brouwer: That is why we did not look into
that in more detail in our delegation. We know that this is a
recurring topic. It is on the table and because in sanction decisions
(Article 81, Article 82) the fines are becoming so high, I think
it will come on the table again, but it will be a very fundamental
change.
Q96 Chairman: But Lord Lester's other
point about Strasbourg and why can the Court not look after its
own procedural rules?
Mr Berrisch: We have not debated that in detail
in the delegation, going through the rules of procedure which
rules we would put into the first category where we think they
should not be within the autonomy of the Court and which rules
we would put into the second category. One way one could certainly
resolve this is to have a debate about that and see what concerns
access to justice. For example, there are certain rules that you
find both in the statutes at the moment as well as in the rules
of procedure, on applications to intervene; who has a right to
intervene. You might think that who has the right to intervene
in the Court as a third party concerns access to justice and that
should be regulated not by the Court itself but by the Community
legislature.
Q97 Lord Lester of Herne Hill: I am sorry
to interrupt but why on earth is that so because the Court is
bound by the European Human Rights Convention, and notions of
access to justice? Why can we not trust the Luxembourg Court in
the way we trust the Strasbourg Court to be able to deal with
that properly? Why does it have to be the Community legislature
which lays down questions like whether a third party should be
able to intervene? That seems to be exactly the sort of issue
you leave for the judges to decide in their own rule-making.
Mr Berrisch: I would have come to the conclusion
that who is allowed to intervene under which conditions, broadly
speaking, is interpreted by the Court as something for the legislature
to decide. How to handle interventions, what time limits you have—for
example what limits you impose on an intervener as regards the
type of issues of the particular case the intervener can address
and how long his intervention can be—that is something that
the Court should then decide.
Q98 Lord Jay of Ewelme: This is a rather
different point. Two things struck me in your written submission—and
thank you very much for making it so brief—you say that
you advocate specialised chambers and you say that specialised
chambers would "promote development of specific expertise
in the field of competition law". Then later on you also
advocate something we have touched on (and is clearly an issue
we are going to have explore further) that we should be looking
not just at merger issues but also other aspects of competition
law. My question may betray a slight ignorance about the way in
which the chambers operate, but would you envisage there would
be a chamber for mergers and a chamber for state aid, so in other
words you would have series of chambers which would become expert
in different aspects of competition law. Is that the sort of model
that you are envisaging?
Mr Berrisch: I think that would be a difficult
model to pursue just taking into account that currently you have
five chambers at the Court. You probably would not have every
chamber made a specialised competition chamber. We do not even
think you would need to have in a competition chamber of five
judges five competition experts. It would be sufficient that those
who are the reporting judges and primarily responsible for the
case are the competition experts. They will then have an expertise
both in the field of law, in the economic issues that repeatedly
arise, but also in handling these cases. We believe it could also
be of benefit to have these specialised chambers for other areas
of the law because if you go to a specialised judge in an area,
that normally helps not only to get better decisions but also
to speed up the decision-making. As I said earlier, I frequently
do anti-dumping cases and these cases are allocated to all the
different chambers you have at the Court and to different judges.
If you have six or seven of these cases coming in per year, and
they are more or less rotated, then the chances that a judge does
two cases within his or her tenure at the Court are fairly limited.
Judges have to get used to the cases and used to working in that
area of the law, and that certainly does not speed up the process.
Q99 Chairman: I am astonished that it
does not already operate on the basis of horses for courses. Cases
should go to chambers where the relevant expertise lies. Does
that not already happen to any extent?
Mr Berrisch: To my knowledge that does not happen,
but this is a question that is probably better addressed to the
judges from the Court. The reasoning behind that has always been
the wish to have uniformity of Community law and uniformity of
the case law of the Court and therefore have chambers dealing
with all types of cases.
| 
