Memorandum by the Competition Law Association
1. NEED FOR
ACTION AT
UNION LEVEL
Is there a need for an EU Competition Court distinct
from the Court of First Instance (CFI)?
Under the current procedure, the Commission,
and more precisely the Competition Directorate General, is responsible
for enforcing the competition rules of the Community Treaties
in order to ensure that competition in the EU market is not distorted.
Appeals against Commission decisions are heard by the Court of
First Instance (in Luxembourg) and appeals against CFI judgments
can be brought to the European Court of Justice (ECJ). In 2001,
a fast-track procedure was created allowing the CFI (and the ECJ)
to give priority to specific cases and usually having only one
round of written pleadings and a more extensive oral hearing in
an attempt to compensate for the abbreviated written proceedings.
Cases may be considered under the accelerated procedure where
there is a "particular urgency" and depending on the
"circumstances of the case".
Member States throughout the European Union
have different practices with regard to appeals against first
instance decisions in competition matters. For example, in the
United Kingdom, OFT Competition Act 1998 decisions and Competition
Commission merger decisions are respectively appealed to, or judicially
reviewed by, the Competition Appeal Tribunal (CAT), a specialist
judicial body with cross-disciplinary expertise in law, economics,
business and accountancy; whereas in France, decisions of the
Conseil de la Concurrence may be appealed before the Paris court
of appeal (Chambre economique et financiere), a non competition-specialist
body. Generally, it takes 8 months for the Paris court of appeal
to make a decision from the date the Conseil de la Concurrence
gave its decision. The Competition Appeal Tribunal has a target
timetable of six months from registration of proceedings to judgment
on the main issues or termination of the case without a main hearing,
although complex and competition cases have taken nearly as long
as 16 months. Merger judicial reviews have taken a matter of weeks
before the CAT, and the first case (IBA Health) was disposed of
by the Court of Appeal as well within a total period of less than
six months.
Throughout the European Union, therefore, there
are appeal tribunals which are specialist competition judicial
bodies and others which are simply a part of the judicial system.
However, there is an increasing trend in member states where competition
and merger law cases are significant in number to allocate these
cases to judges with experience in the field if not a specialist
court. In the UK, for example, all competition cases must be started
or transferred to the Chancery Division, if they are not within
the jurisdiction of the CAT.
Another relevant trend, at least in the common
law jurisdictions, is case management. Case management is also
a feature of the CFI's procedure. But there is no case management
conference at the beginning of the process where the target date
for the hearing and decision is discussed, as in the CAT.
The lengthy duration and the causes of that
delay have been well documented. For example, the annual reports
of the ECJ and CFI contain the statistics on the time taken for
competition, state aid and merger cases as well as the overall
caseload. A recent article[26]
by Bo Vesterdorf, CFI President, has discussed the causes of delay
in the CFI and debated the merits of the potential solutions.
The main causes of delay can be seen to be translation,
case management deficiencies (including the availability of judges
with competition law experience) and the workload of the CFI (and
ECJ).
It is not the choice of the language of the
case by the parties that necessarily results in delay through
translation. It is rather CFI (and ECJ) convention that the working
language of the court is French. This normally requires the translation
of every pleading into French. Even when the CFI chamber is capable
of using English as its normal language and does so on case by
case basis, on appeal to the ECJ, President Vesterdof has indicated
that the ECJ requires the CFI to translate its judgment into French
for the purposes of the working language of the ECJ.
The present practice of the CFI is understood
to favour the allocation of competition cases to a CFI chamber
with at least one judge with competition law experience. However,
the number of judges in this category is inevitably limited as
the selection of judges is a matter for national governments.
Consequently, finding a chamber with an appropriate judge without
delay, or over-burdening relevant judges, is a problem.
Apart from the language issues, the main cause
of delay is the workload of the CFI. The statistics indicate that
the workload of the CFI to-day exceeds that of the ECJ when the
CFI was created in 1989. With 27 member States in 2007, the workload
of both courts can be expected to increase more and more over
time. It can be predicted in the longer term that the ECJ will
be under pressure to transfer more categories of cases to the
CFI, the most likely being certain categories of references. The
staff judicial panel has removed a large number of cases, as will
the Trade Mark judicial panel. However, these cases are not normally
as burdensome as the other cases before the CFI, including competition,
state aid and merger cases. In the longer term, therefore, the
workload of the CFI can be expected to produce further delays,
despite the successful efforts made in the last few years to accelerate
its decisions.
Against this background, President Vesterdorf's
article has provided a useful starting point for the debate on
potential solutions for improving the speed of competition and
merger cases in the CFI. The options include doing nothing, creating
a special chamber for merger cases or for all competition cases,
or establishing a judicial panel with the same scope.
While in an ideal world, a specialist Competition
Court would be the ideal solution with the maximum benefits to
the CFI appeal system for competition and merger cases at the
Community level, in reality this will take time. Institutional
changes are political events that require careful discussion and
preparation. However, a specialist competition court should be
a long term goal. In particular, a specialist competition court
can select its own working languages (which can be adopted by
the CFI on appeals on a point of law), exploit the efficiencies
of case management and take advantage of specialist expertise.
In the meantime, the creation of a specialist
competition and merger chamber would be a step in the right direction
and should be instigated immediately. It should be able to achieve
many of the benefits of a specialist competition court but will
be dependent for expertise on the current judges appointed to
the CFI. As CFI judges are appointed by national governments,
the allocation of particular national judges to a specialist chamber
might be controversial. The only way to overcome this will be
the eventual creation of a new competition judicial panel with
the judges chosen regardless of nationality but by reference to
expertise.
There is a long term need, therefore, to establish
a new EU competition court, which would be distinct from the CFI.
In the meantime, the CLA would welcome the creation
of a specialised chamber of the CFI for competition and merger
cases. This would help develop judicial expertise in competition
matters and especially merger cases and would help streamline
the system.
REFORM OF
THE CFI
Would reform of the rules and procedures of the
CFI be preferable to the establishment of a new court?
In order to create a EU competition court as
a judicial panel, the procedure set out in Article 225a of the
EC Treaty would have to be followed. Such a procedure requires
the Council to act "unanimously on a proposal from the Commission
and after consulting the European Parliament and the Court of
Justice or at the request of the Court of Justice and after consulting
the European Parliament and the Commission". As is clear
from the history of the judicial panel for staff cases (and that
proposed for patents), this process will take time especially
as the creation of a new judicial panel under Article 225a of
the EC Treaty, would require the unanimous approval of the 25
Member States.
While the process for creating a competition
judicial panel continues, possible reforms of the rules and procedure
of the CFI include:
— Reducing the choice of languages
of the case: Use of either English or French only as language
of the case.
— Improving the fast track procedure
and having a set of procedural rules specifically for competition
and merger law cases focused on streamlining the process and speed
of review (for example, less burdensome translation requirements,
limiting length of submissions). Eventually the specialist competition
court should be capable of relieving the CFI of public procurement
and state aid cases.
— Introducing a fee for appeals to
the CFI?
— Creating a chamber of the CFI specialised
in competition related matters.
2. JURISDICTION
OF THE
COMPETITION COURT
The Treaty of Nice inserted a new Article 225a
in the EC Treaty enabling the creation of "judicial panels
to hear and determine at first instance certain classes of action
or proceeding brought in specific areas". The decisions of
the judicial panels are subject to appeal on questions of law
only to the Court of First Instance and, in exceptional cases,
to review by the Court of Justice where there is a serious risk
of the unity or consistency of Community law being affected.
In 2003, the Commission proposed the creation
of two judicial panels to relieve the CFI of the considerable
volume of litigation relating to Community staff and patents:
the European Civil Servant Tribunal[27]
and the Court for the Community Patent[28]
The European Civil Service Tribunal was established by a Council
Decision of 2 November 2004 for the adjudication of disputes between
the European Union and its civil service. The CFI transferred
117 cases in which written procedure had not been completed to
the European Civil Service Tribunal. The creation of a EU competition
court under Article 225a would be a judicial panel set up to hear
competition cases at first instance.
The CLA supports the creation of a judicial
panel in the long term and advocates that a chamber of the CFI
specialized in competition matters be developed immediately. The
judicial panel for competition law should have jurisdiction over
all competition and merger law (Articles 81, 82, 86 EC and ECMR)
cases. To limit the specialist court or chamber to merger cases
would be to ignore the commercial importance of timely decisions
in many competition appeals and fail to fully exploit the expertise
and availability of the judges concerned.
3. COMPOSITION
OF THE
COMPETITION COURT
The composition of the judicial panel could
imitate that of the European Civil Service Tribunal with the expertise
of the judges sought being competition law. Nationality will be
irrrelevant.
4. APPEALS FROM
THE COMPETITION
COURT
The creation of a competition judicial panel
should not create an additional jurisdictional level at Community
level, provided that the rules of procedure make clear that a
further appeal from the CFI to the ECJ could not be brought without
the permission of the ECJ. The possibility of appeal to the ECJ
should be retained for exceptional cases to ensure the uniformity
of Community law.
5. FUTURE ROLE
OF THE
CFI
Should the CFI be given the jurisdiction to hear
preliminary references on community competition law?
Council Decision 2004/407/EC of 26 April 2004
transferred jurisdiction from the ECJ to the CFI with regard to
direct actions, other than infringement actions.
Under Article 225(3), the Court of First Instance
already has jurisdiction to hear and determine questions referred
for a preliminary ruling under Article 234, in specific areas
laid down by the Statute of the Court of Justice ("the Statute").
Where the Court of First Instance considers that the case requires
a decision of principle likely to affect the unity or consistency
of Community law, it may refer the case to the Court of Justice
for a ruling, under the conditions and within the limits laid
down by the Statute, where there is a serious risk of the unity
or consistency of Community law being affected.
National Supreme Courts are necessarily bound
by the CFI's preliminary ruling if no review procedure is taken
up by the ECJ.
According to the Statute, the reference for
review must be made within one-month of delivery of the decision
by the CFI and the proposal for review and decisions to open the
review procedure do not have suspensory effect. Although the period
for review by the ECJ delays the legal certainty of the preliminary
ruling of the CFI, this is essential to ensure that the uniformity
of Community law may be safeguarded.
The transfer of preliminary ruling competences
in relation to competition matters to the Court of First Instance
with the possibility of an exceptional review of its decisions
by the Court of Justice is likely to be the next step to reduce
the caseload of the ECJ. This question is independent of the merits
of the desirability of a specialist competition and merger law
judicial panel. Transfer of preliminary rulings in competition
law cases to the CFI, however, would consolidate the expertise
in that court which justifies further discussion.
10 November 2006
26 Bo Vesterdorf, "Judicial review in EC Competition
law: Reflections on the role of the Community Courts in the EC
system of competition law enforcement" (Competition Policy
International, Vol.1, No.2 Autumn 2005) Back
27
COM (2003) 705 final. Back
28
COM (2003) 828 final. Back
| 
