Introduction
In late 2017(1), the Court of Justice (“CJ” or “Court”) assessed whether the courts of the Member States may declare an agreement void for breaching EU rules that prohibit agreements restricting competition, when the Commission has previously closed an antitrust investigation concerning that agreement on the basis of commitments imposed on the undertakings at stake and without establishing the existence of an infringement to such rules.
It is worth mentioning at the outset that the Court took an affirmative answer and the conclusion reached, although it was set out in a broad, concise and apparently harmless way, may cast substantial doubts and concerns.
Summary of the case and of the judgment
The case was referred to the CJ for a preliminary ruling by the Spanish Tribunal Supremo in the context of a dispute between Gasorba, S.L. (“Gasorba”) and Repsol Comercial de Productos Petrolíferos, S.A. (Repsol) concerning an agreement for the operation of a petrol service station in the Alicante province. Under the agreement, Gasorba, in its capacity as lessee and distributor, was required to use Repsol as its sole supplier for a period of 25 years, and Repsol periodically communicated to Gasorba the maximum retail selling prices of fuel and permitted the latter to apply discounts provided they were covered by its own commission and thus without impacting on Repsol’s revenues.
The Commission initiated a proceeding under Article 101 Treaty on the Functioning of the European Union (TFEU) against Repsol and found that that the long term supply agreement raised concerns as to its compatibility with that provision given that it might create a significant foreclosure effect on the Spanish retail fuel market.
To address the Commission’s concerns, Repsol committed inter alia to: (i) refrain in future from concluding long term exclusivity agreements; (ii) abstain from interfering in the retail fuel price (without prejudice to the indication of maximum or recommended prices); (iii) offer the service station tenants with ongoing contracts such as the one concerned financial incentives to early terminate their agreements; and (iv) refrain for a long period from acquiring independent service stations for which it did not yet act as a supplier. These commitments were made binding to Repsol by a Commission decision of 2006 adopted under Article 9 of Regulation (EC) No. 1/2003(2).
Following this decision, Gasorba brought an action against Repsol before Spanish courts, seeking the annulment of the agreement concerned and a compensation for damages on the ground that it was contrary to Article 101 TFEU. The case was dismissed by the first two judicial instances and then reached the Tribunal Supremo, which submitted two questions to the CJ essentially aiming to clarify if Article 16 of Regulation (EC) No. 1/2003 – laying down that, when ruling on agreements under Article 101 TFEU that were already the subject of a Commission decision, the courts of the Member States cannot take decisions running counter to the decision adopted by the Commission precludes a national court from declaring an agreement null when the Commission has accepted beforehand commitments concerning that agreement and made them binding in a decision taken under Article 9 of the said regulation.
The Court first stated that Article 16 of Regulation (EC) No. 1/2003 has the purpose of ensuring a uniform application of EU competition law within the Union’s scope, given that in a system of parallel and decentralised powers such as the one applying to antitrust matters, Article 101 TFEU (together with Article 102 TFEU, which bans abuses of a dominant position) is applied not only by the European Commission but also by the competition authorities and the courts of the Member States.
Notwithstanding the above, the Court’s judgment gives more weight to the nature of the decision rendered by the Commission in respect of the agreement between Gasorba and Repsol since, in a decision pursuant to Article 9 of Regulation (EC) No. 1/2003, the Commission closes the investigation subject to the imposition of a number of commitments proposed by the company concerned and does not take a position on whether there was any infringement to Article 101 TFEU.
The CJ further emphasised that Article 9 decisions are taken to respond to the competition concerns identified by the Commission after a «mere preliminary assessment» of the case and thus cannot “certify” compliance with Article 101 TFEU. The Court also relied its interpretation in recitals 13 and 22 of Regulation (EC) No. 1/2003 in so far as they provide that commitment decisions do not affect the power of the courts and the competition authorities of the Member States to apply Articles 101 and 102 TFEU.
In this light, the Court declared that Article 16 of Regulation (EC) No. 1/2003 must be interpreted as meaning that a commitments decision concerning an agreement does not preclude national courts from examining whether the same agreement complies with competition provisions and, if necessary, declaring the agreement null and void pursuant to Article 101 TFEU.
Comment
In general terms the outcome of the decisional part of this case does not come as a surprise. However, it brings along a certain tension towards other rights with identical or superior strength, which the CJ should have identified and assessed to allow the national court to reach a thoughtful decision in the main proceedings and to deal with the doubts and concerns that the judgment necessarily triggers.
In our view the CJ was right to stress, as a starting point, that the ban on conflicting decisions imposed on national courts by Article 16 of Regulation (EC) No. 1/2003 whenever the Commission has previously issued a decision under Article 101 TFEU pursues the purpose of applying EU competition law effectively and uniformly. However, it remains to be said that in sanctioning proceedings this purpose cannot be isolated and deemed as an objective in itself. It needs to go hand in hand with a greater goal, which is to prevent a parallel system that leads to materially opposed decisions taken a little at a time to the detriment of defendants. Or, to put it in a broad and positive way: ensure compliance with the principle of legal certainty. The fact that the judgment does not even mention this aspect - let alone deal with it – is in our view open to criticism.
The need for criticism is reinforced because, although the decision making part of the judgment is only focused on the powers that the national courts retain in respect of agreements earlier tackled by the Commission in a commitments decision, the CJ also referred to the possibility of national competition authorities later deciding on the legality of the same agreements for the purposes of Article 101 TFEU.
It is undisputed that a decision taken by the Commission under Article 9 of Regulation (EC) No. 1/2003 does not take a stand on whether the agreement infringes competition rules. However, we cannot agree with the Court when, in practice, it seems to suggest that a commitments decision is not subject to a firm and coherent reasoning as to the gravity of the agreement at hand. The wide sense in which the CJ frames the answers given to the Spanish court raises the question of knowing whether, in a situation such as the one reported, national courts and agencies might in theory freely decide on the illegality of the agreement concerned and on the associated penalties when the Commission abstained from doing both.
It should be kept in mind that the Commission is not only the first entity to deal with the competitive implications of the agreement. The fact that it takes the lead on the investigation means that at first the Commission and the national competition authorities agreed and decided together, in the framework of the European Competition Network, that the Commission was the better placed authority to deal with the case. Additionally, according to the Commission’s consolidated practice, typically commitment decisions are not available if the Commission finds that the nature of the infringement calls for the imposition of a fine. Hence, contrary to the Court’s perception, any Article 9 decision is inevitably preceded by a substantive and sufficiently detailed analysis about the severity of the case.
If the Commission is the most suitable authority to act on an agreement for the purposes of Article 101 TFEU, and if after assessing such agreement it comes to the conclusion that it is not serious enough to justify the finding of an infringement and the imposition of a penalty, it does not seem that the prospect of decisions pointing to opposite directions coming from the two remaining entities potentially empowered to enforce that provision (national courts and competition authorities) is the best way to ensure the consistency that Article 16 of Regulation (EC) No. 1/2003 requires. If in fact the concern that drives the Court in this case is the uniform application of European competition law throughout the EU, it appears far more detrimental to that end if individuals that consider themselves harmed and unsatisfied with a commitments decision by the Commission fail to challenge it before the General Court through the appropriate action for annulment provided for in Article 263 TFEU, thus allowing the decision to crystallise and become res judicata, and are still allowed in the future to seek a distinct solution by means of an unrestricted involvement of the national courts and agencies.
The possibility of national competition authorities stepping in at a later stage prompts an additional difficulty. This is so because, in order to obtain the closure of the case from the Commission, the undertaking involved in the agreement had certainly put forward commitments that are robust and targeted to meet that institution’s concerns, which were then made binding by the Article 9 decision. If a company placed in this situation is later confronted with a new investigation carried out by a national competition authority envisaging the same agreement, the company will hardly have the possibility to produce further commitments capable of equally addressing the competition concerns this time raised by the national agency. And this inevitably leads to question if allowing a build up and succession of investigations will not ultimately force a conviction.
In a nutshell, the case law stemming from the Gasorba judgment represents a dangerous step towards some variants of the non bis in idem ban, as it opens the door to the possibility of a duplication of proceedings that may give rise to opposing outcomes issued by different entities in distinct moments and having as their object the assessment of one and the same conduct under the same rules.
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(1) Judgment of 23 November 2017, Gasorba and othores, C-547/16, EU:C:2017:891.
