Case T-355/13 easyJet Airline Co. Ltd. v Commission: Complaints, Abuse and National Competition Authority

The judgment of the General Court of 21 January 2015 in EasyJet Airline Co. Ltd. v Commission, T-355/13, EU:T:2015:36, contains some interesting things about:

  • the Commission’s discretion to reject complains about breaches of the competition rules and judicial review of that discretion on the one hand and how the Commission and
  • how national competition authorities interact in the framework of the “European Competition Network” on the other.

A few facts first.

easyJet Airline Co. Ltd, a low cost airline operates flights to and from Schiphol Airport, Amsterdam (Netherlands). In 2008, easyJet complained to the Dutch competition authority claiming that the operator of Amsterdam-Schiphol airport breached national legislation governing aviation and the law on competition in the way it set passenger and security service charges.

The Dutch competition authority decided to rejected those complaints by relying on the Netherlands law governing aviation and by resorting to its priority policy, which allows it to give different degrees of priority to the individual cases with which it deals. Those decisions became final at national level.

In January 2011, easyJet lodged a complaint with the Commission, claiming that the charges set by Schiphol were discriminatory and excessive and amounted to an abuse of a dominant position in the internal market. It referred to the complaints lodged with the Netherlands competition authority and maintained that that authority had not taken any final decision on the merits of easyJet’s complaint under competition law.

In May 2013, the Commission rejected the complaint because, inter alia, a national competition authority had already dealt with it. Article 13(2) of Regulation No 1/2003 provides that the Commission may reject a complaint relating to anti-competitive conduct in the case where that complaint has already been dealt with by a competition authority of a Member State. EasyJet challenged the rejection of its complaint before the General Court.

In its judgment, the General Court rejects easyJet’s action and affirms the Commission’s decision to reject the complaint.

The Commission’s discretion and judicial review

The General Court first set out a few general principles which apply when reviewing a Commission decision rejecting a complaint.

It recalled that the Commission, which is entrusted by Article 105(1) TFEU with the task of ensuring the application of Articles 101 TFEU and 102 TFEU, is responsible for defining and implementing the EU’s competition policy and for that purpose has a discretion as to how it deals with complaints (see judgment of 16 October 2013 in Vivendi v Commission, T‑432/10, EU:T:2013:538, paragraph 22 and the case-law cited). The Court of Justice has also pointed out that Article 13 of and recital 18 in the preamble to Regulation No 1/2003 reflect the broad discretion which the national authorities joined together in the network of competition authorities have in order to ensure an optimal attribution of cases within the latter (judgment of 14 February 2012 in Toshiba Corporation and Others, C‑17/10, EU:C:2012:72, paragraph 90 – Disclaimer: I acted as co-agent, representing the EFTA Surveillance Authority in that case). Given the role assigned to the Commission by the TFEU in defining and implementing competition policy, the Commission, a fortiori, also has a broad discretion when applying Article 13 of Regulation No 1/2003.

It held that the case-law relating to the assessment of the EU’s interest shows, however, that the Commission’s discretion is not unlimited. The Commission must take into consideration all the relevant matters of law and of fact in order to decide on what action to take in response to a complaint. More particularly, it must consider attentively all the matters of fact and of law which the complainant brings to its attention (see judgment of 17 May 2001 in IECC v Commission, C‑450/98 P, EU:C:2001:276, paragraph 57 and the case-law cited).

The Court continued it follows from settled case-law that, where the institutions have a broad discretion, respect for the rights guaranteed by the legal order of the European Union in administrative procedures is of even more fundamental importance; those guarantees include the duty of the competent institution to examine carefully and impartially all the relevant aspects of the individual case (see judgment of 17 December 2008 in HEG and Graphite India v Council, T‑462/04, EU:T:2008:586, paragraph 68 and the case-law cited). However, review by the Courts of the Commission’s exercise of its discretion must not lead them to substitute their assessment of the European Union interest for that of the Commission, but must focus on whether the contested decision is based on materially incorrect facts, or is vitiated by an error of law, manifest error of appraisal or misuse of powers (see judgment of 15 December 2010 in CEAHR v Commission, T‑427/08, EU:T:2010:517, paragraph 65 and the case-law cited).

With regard to the judicial review of a Commission decision based on Article 13(2) of Regulation No 1/2003, the Court found that the purpose of that review is to verify that the contested decision is not based on materially incorrect facts and that the Commission has not erred in law, made a manifest error of assessment or misused its powers in finding that a competition authority of a Member State has already dealt with a complaint. It is necessary, by contrast, to bear in mind that review of decisions of the competition authorities of Member States is a matter for national courts alone, which perform an essential function in the application of EU competition rules.

The Court then applied those principles in deciding whether the expression ‘complaint … which has already been dealt with by another competition authority’ contained in Article 13(2) of Regulation No 1/2003 must be understood as allowing the Commission to reject a complaint in a case where the competition authority of a Member State has previously rejected the same complaint on priority grounds.

First of all, the Court held that a a literal interpretation of Article 13(2) of Regulation No 1/2003, in the light of the plain meaning of the expression ‘complaint … which has already been dealt with by another competition authority’ allows the Commission to reject a complaint in the circumstances of this case, namely when a competition authority of a Member State has rejected the complaint on priority grounds. The Court found that that expression is broad in scope in that it is capable of including all cases of complaints which have been examined by another competition authority, whatever may have been the outcome. The legislature has thus chosen not to limit the scope of that article solely to cases of complaints which have already been the subject of a decision by another competition authority.

Secondly, the literal interpretation of Article 13(2) is, the Court held, consistent with the general scheme of Regulation No 1/2003. Article 13(2) of the regulation must be read in the light of paragraph (1) of that article, which provides that the Commission may reject a complaint in the case where another competition authority of a Member State is dealing with it. Accordingly, what matters is not the outcome of the review of the complaint by that competition authority, but the fact that it has been reviewed by that authority.

The literal interpretation is also supported by recital 18 in the preamble to Regulation No 1/2003, which relates to Article 13 thereof (judgment in Toshiba Corporation and Others, EU:C:2012:72, paragraph 90) and which states that ‘[t]his provision should not prevent the Commission from rejecting a complaint for lack of Community interest, as the case-law of the Court of Justice has acknowledged it may do, even if no other competition authority has indicated its intention of dealing with the case’. Since the Commission may decide to dismiss a complaint for lack of Community interest, even though it has not been dealt with by a competition authority of a Member State, the Commission may, a fortiori, reject a complaint reviewed by that authority which has been rejected by the latter on priority grounds.

The Court also found that the notice on cooperation within the network of competition authorities, which is designed to implement the provisions of Regulation No 1/2003 also supports the literal interpretation. Paragraph 20 of the notice states that, ‘[i]n Article 13 of [that regulation], “dealing with the case” does not merely mean that a complaint has been lodged with another authority. It means that the other authority is investigating or has investigated the case on its own behalf’. It does not, however, give any indication as to the finding reached by the competition authority of a Member State. Paragraph 22 of that notice expressly contemplates the case in which a complaint has been reviewed by a competition authority but rejected for reasons other than the investigation of the substance of the case; it gives the example of a case in which the authority was unable to collect the evidence necessary to prove the infringement, and states that it is important to be flexible in allowing another authority to carry out its own investigation and to deal with the case itself. The Court of Justice has, moreover, recognised the broad discretion which competition authorities enjoy in order to ensure optimal allocation of cases, stating, with regard to Article 13(1) of that regulation, that each authority has the possibility, but is not under any obligation, to reject a complaint which it has received, where another authority is already dealing with the same case (judgment in Toshiba Corporation and Others, EU:C:2012:72, paragraph 90).

National Competition Authorities and the European Competition Network

The Court’s judgment also contains insights into the role of national competition authorities in the enforcement of EU competition law and the role of the European Competition Network.

The Court held that Article 5 of Regulation No 1/2003 comes under Chapter II relating to powers and sets out the decisions which may be taken by the competition authorities of the Member States when applying Articles 101 TFEU et 102 TFEU in individual cases. The first paragraph of Article 5 of the regulation thus provides that those authorities, ruling on the substance, may, acting on their own initiative or on a complaint, take the following decisions, namely require that an infringement be brought to an end, order interim measures, accept commitments and impose fines, periodic penalty payments or any other penalty provided for in their national law. Article 5 (2) of that regulation provides, ‘[w]here on the basis of the information in their possession the conditions for prohibition are not met [national competition authorities] may likewise decide that there are no grounds for action on their part’. In answer to the question whether national competition authorities were entitled to take a decision finding that there had been no breach of Articles 101 TFEU or 102 TFEU, the Court of Justice has stated that Article 5 of that regulation is to be interpreted as restrictively defining the decisions which those authorities may take (judgment of 3 May 2011 in Tele2 Polska, C‑375/09, EU:C:2011:270, paragraphs 19 to 30 – Disclaimer: I acted as co-agent, representing the EFTA Surveillance Authority in that case).

The Court also held that Article 13(2) of Regulation No 1/2003, which comes under Chapter IV on cooperation, provides only that the complaint must have been dealt with by another competition authority, but not necessarily that a decision must have been reached in relation to that complaint. Accordingly, that provision does not necessarily require that a decision must have been taken by the competition authority of a Member State that has already rejected the complaint. Consequently, even if it were to be supposed that the rejection of a complaint by a competition authority of a Member State on priority grounds does not constitute a decision within the meaning of Article 5, the Commission could apply, in such a case, the provisions of Article 13(2).

Alternatively, the Court found that the decision of the Dutch competition authority of December 2009 was a decision based on the second paragraph of Article 5 of Regulation No 1/2003. That provision covers all cases in which the competition authority of a Member State finds that the information in its possession does not allow it to conclude that the conditions for prohibition are met, without it being necessary for it to have ordered any preliminary measures of inquiry. It held that a finding that a decision by a competition authority of a Member State to reject a complaint on priority grounds constitutes a decision taken on the basis of the second paragraph of Article 5 of that regulation is consistent with the judgment in Tele2 Polska, (EU:C:2011:270), in which the Court of Justice found that that article restrictively listed the type of decisions which could be taken by a national authority. Any different interpretation would have the effect of depriving the competition authorities of Member States of the possibility of taking decisions to reject complaints on priority grounds, even though competition authorities do rely on such grounds when taking closure decisions which are more or less formal.

The Court went on that the literal interpretation is consistent with the mechanism of Article 13(2), which also provides that a competition authority of a Member State may reject a complaint where it has already been dealt with by the Commission. As the case-law has consistently recognised the Commission’s power to take decisions rejecting a complaint on priority grounds (see, for example, the judgment in Vivendi v Commission, paragraphs 22 to 25 and the case-law cited), a national competition authority may also reject a complaint which has been the subject of a prior rejection by the Commission on such a ground.

The Court emphasised that one of the main objectives of Regulation No 1/2003 is to establish an effective decentralised scheme for the application of EU competition law rules. Recital 6 in the preamble to that regulation states that, ‘[i]n order to ensure that the Community competition rules are applied effectively, the competition authorities of the Member States should be associated more closely with their application’. Recital 15 in the preamble to that regulation states, moreover, that ‘[t]he Commission and the competition authorities of the Member States should form together a network of public authorities applying the Community competition rules in close cooperation’. That regulation thus put an end to the previous centralised regime and, in accordance with the principle of subsidiarity, established a wider association of Member States’ competition authorities, authorising them to implement EU competition law (judgment of 8 March 2007 in France Télécom v Commission, T‑339/04, EU:T:2007:80, paragraph 79). ‘To ensure that cases are dealt with by the most appropriate authorities within the network’, recital 18 in the preamble to Regulation No 1/2003 states that ‘a general provision should be laid down allowing a competition authority to suspend or close a case on the ground that another authority is dealing with it or has already dealt with it, the objective being that each case should be handled by a single authority’.

The Court also found that the explanatory memorandum relating to Commission proposal COM (2000) 582 final for a Council regulation on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty indicates that the purpose of Article 13 was to remove the risk of duplication of work and the incentive for multiple complaints.

The Court also held that  Article 6 of Regulation No 1/2003 lays down that national courts have the power to apply Articles 101 TFEU and 102 TFEU. Requiring the Commission to review, as a matter of course, complaints rejected on priority grounds by competition authorities of Member States would be tantamount to transferring to the Commission the power to review the decisions of those authorities, which is a matter for national courts alone. While Regulation No 1/2003 created a cooperation mechanism between the Commission and those authorities (judgment in Tele2 Polska, EU:C:2011:270, paragraph 26), it did not provide for a mechanism by which the Commission would be substituted for national courts, which have an essential part to play in applying EU competition rules (recital 7 in the preamble to Commission proposal COM (2000) 582 final for a Council regulation on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty).

However, the Court stressed that its review of the Commission’s decision must not lead to an appraisal of the merits of the Dutch competition authority’s decision or of the procedure or methodology used by the latter, which assessment the Commission did not itself carry out, moreover, and which is a matter for the national courts.

Finally, the Court considered that the contested decision was sufficiently reasoned. It recalled that, according to settled case-law, Article 7 of Regulation No 1/2003 does not give a complainant the right to insist that the Commission take a final decision as to the existence or non-existence of the alleged infringement and does not oblige the Commission to continue the proceedings, whatever the circumstances, right up to the stage of a final decision (judgments of 18 October 1979 in GEMA v Commission, 125/78, EU:C:1979:237, paragraph 18, and of 17 May 2001 in IECC v Commission, C‑449/98 P, EU:C:2001:275, paragraph 35). By contrast, the Commission is required to consider attentively all the matters of fact and of law which the complainant brings to its attention (judgments of 11 October 1983 in Schmidt v Commission, 210/81, EU:C:1983:277, paragraph 19, and of 17 November 1987 in British American Tobacco and Reynolds Industries v Commission, 142/84 and 156/84, EU:C:1987:490, paragraph 20). Complainants are entitled to have the fate of their complaint settled by a decision of the Commission against which an action may be brought (judgment of 18 March 1997 in Guérin automobiles v Commission, C‑282/95 P, EU:C:1997:159, paragraph 36, and IECC v Commission, EU:C:2001:275, paragraph 35).

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