European and National Enforcement of EU Competition Law:
Sharing the Sovereignty?

Robert Lane
School of Law
University of Edinburgh

In this gathering I suspect there is little need to draw attention to the importance of EC competition law.
But if it was necessary, one need only point to the fine imposed two weeks ago by the European
Commission upon a cartel in the automotive glass market. The total fine was €1,384 million, thehighest single fine imposed by the Commission to date, including a fine of €869 million upon SaintGobain, a French manufacturer, which is the highest single fine imposed for a breach of competition
law anywhere in the world. To bring the matter closer to home, it also included a fine of €113.5
million for Asahi, a Mitsubishi company; it would have been double that but for a reduction owing toAsahi’s cooperation in the Commission investigation. And this is on top of a fine of €65 million for
Asahi in 2007. The arm of EC competition law is now a long one.
Community competition law is of coursed a many-headed beast, and we could spend many more days
discussing various of its aspects. My concern here is Regulation 1/2003,1 and the revolution it hasbrought about in the enforcement of the law. In particular, the decentralisation programme first
proposed by the Commission in its 1999 White Paper,2 which came into force with Regulation 1/2003
in May 2004 and marked a major departure from the previous scheme of (excessive?) centralised
control. We now have decentralisation, enforcement of the rules by 27+ administrative authorities, andcountless national courts. It is now shared. And it is very, very unlikely that we could ever go back to
the way it was. The question now is, what have we done?

We didn’t know at the beginning how the competition rules of Article 81 and 82 would be enforced.
That was left intentionally vague by the Treaty, and of course we know nothing in 1958 of the direct
effect of Community law, whether the courts would be involved at all. The decision was made in 1962
with the adoption of Regulation 173 that we would follow the centralised route. Articles 81 and 82
were to be enforced first and foremost by the Commission. And most important, we would follow theGerman model of central administrative, quasi-judicial authorisation of the exemption power of Article
81(3), exclusive authority to grant exemption being conferred upon the Commission.4 The role ofnational administrative authorities – if they existed – was purely secondary, and the role of national
courts unaddressed and unknown.
This centralised system was seen to be wholly necessary in guiding the discipline, new for some, ofcompetition policy and competition law. It was applauded by no less than Professor Robert Bork:

1

Reg. 1/2003 OJ 2003 L/1/1.
White Paper on Modernisation of the Rules Implementing Articles 85 and 86 of the EC Treaty, OJ 1999 C132/1.
3
Reg. 17/62 JO 1962, p 204.
4
Art 9(1): ‘Subject to review of its decision by the Court of Justice, the Commission shall have sole power to declare
Article 85(1) inapplicable’.
2‘In antitrust, it is possible to think the European Community has wisely not followed theAmerican example but has instead centralized all enforcement in a single government agency’.5
But it was immediately apparent that it was inefficient. The Commission simply did not have theresources necessary to discharge its responsibilities. Hence, the revolution of 1999.
At the heart of the changes was the surrender of the Commission monopoly of the power of exemption
under Article 81(3), henceforward to be ‘decentralised’. It meant the replacement of the German
system with a (French) system of exception légale: that is, an agreement, decision or practice which isprohibited by Article 81(1) is nonetheless valid from the date of its formation or adoption, without needof notification and authorisation (‘no prior decision to that effect being required’),6 provided that it
satisfies the criteria for exemption laid down in Article 81(3); and the determination of whether this is
so is to fall within the competence no longer solely of the Commission, but also of both national
administrative authorities and national courts.
This is what was truly revolutionary about Regulation 1/2003. The Commission had long guarded its
monopoly under Article 81(3). According to the 1999 White Paper, this monopoly, and the consequent
plethora of notifications to it, has been justified in order to enable the Commission to establish theuniform meaning and parameters of Article 81(3) – ‘to build up a coherent body of precedent cases, andto ensure that the competition rules are applied consistently throughout the Member States’. 7 Now
however, following more than 35 years of Commission activity and case law of the Court of Justice thelaw is ‘clarified’ and ‘more predictable’, 8 it consists of a ‘set of clear rules’9 and the conditions for
exemption under Article 81(3) ‘have been largely clarified by case-law and decision-making practice andare known to undertakings’. 10 The centralised system of Regulation 17 is therefore ‘cumbersome,inefficient and impose[s] excessive burdens on economic operators'11 and is `no longer consistent with theeffective supervision of competition’.12 The White Paper therefore supports the adoption of a ‘directly
applicable exemption system’ and ‘ex post control’13 whereby legislation adopted under Article 83 would
scrap the notification system (except for partial function production joint ventures, previously subject to
Article 81 but now absorbed into the Merger Regulation14 ) and require that all national competition
authorities and all national courts before which Article 81(1) was raised also apply Article 81(3). The
whole of Article 81, sundered by Regulation 17, would therefore be reunited, parties could rely directly
upon Article 81(3), and restrictive practices prohibited by Article 81(1) but which meet the criteria of
Article 81(3) would be valid and enforceable from the time they were concluded without need of a priordecision to that effect. Similarly, restrictive practices which meet the criteria of Article 81(3) and so arevalid ab initio would cease to be valid if, and at the point at which, the conditions for exemption were nolonger fulfilled. In other words, Article 81(3) would become directly effective.
This was a bold step indeed. It has been likened to ‘a lifelong devout Catholic suddenly converting
him/herself to Protestantism’,15 and must be read as an admission - according to the president of the5

Bork, The Antitrust Paradox: A Policy at War with Itself, Free Press (1993), p 439.
Reg. 1/2003, Art 1(2).
7White Paper, para 76.
8
para 48.
9
para 51.
10
para 78.
11
para 42.
12
para 9.
13
paras 69 ff.
14
paras 79-81.
15
Nazerali and Cowan, ‘Modernising the Enforcement of EU Competition rules – Can the Commission Claim to bePreaching to the Converted?’ [1999] ECLR 422, 422.
6

Bundeskartellamt, a ‘capitulation’ 16 - that administration of the old system was well beyond theCommission's resources and ability. But alongside the changes to Article 81(3) were equally fundamental
changes to enforcement generally. Regulation 1/2003 proposed and requires not only the enforcement of
Article 81(3) but also the vigourous enforcement by national (administrative) competition authorities(NCAs) and by national courts of the entirety of Articles 81 and 82. One indication of the surprise andlack of preparedness of this proposal was that, at the time, there were only 8 (out of 15) member states
which had created national administrative authorities competent to enforce Articles 81 and 82. They
would have to do so, as would the 10 countries in the accession queue, for whom the whole culture ofcompetition was a new phenomenon. Once created, the NCAs would then be expected to pursue
anticompetitive conduct with the vigour, and the impartiality, which the Commission would wish. How
then to ensure this would be so? And was the Commission confidence and enthusiasm misplaced?

Uniformity
Under the new regime the competition rules are enforced by the Commission, by its fellow NCAs andby the courts. The great risk of this, and the excuse which justified the previous highly centralised
system, is, uniformity. How to ensure that the Commission, 27+ NCAs and countless national courts
get it pretty much the same. For if they don’t, Community law will apply differently from member
state to member state – or even within a member state – and this runs contrary to a fundamental
principle of the law, equality before it.
As a means of securing uniformity, Regulation 1/2003 makes the Commission primus inter pares:
under Regulation 17, an NCA (if it existed and if it applied Articles 81 and 82) could be pre-empted by
the launch of Commission action,17 and this has been retained under Regulation 1/2003:‘The initiation by the Commission of proceedings for the adoption of a decision … shall relieve thecompetition authorities of the Member States of their competence to apply Articles 81 and 82’.18

Further, an NCA is bound by (‘cannot take decisions which would run counter to’) an existing
Commission decision.19 This is clear enough when dealing with a particular case, but gives rise to ahost of practical difficulties in the context of similar, or very similar, cases, and whether in this context
a previous Commission decision is binding upon the national authority, is merely persuasive, or is ofno consequence.20
Otherwise uniformity is sought to be secured by a system of compulsory ‘close cooperation’21 between
Commission and NCAs: the Commission is obliged to forward to the NCAs the ‘most important
documents’ collected with a view to taking action, and other documents upon request;22 an NCA must
inform the Commission of any action it intends to take ‘under Article 81 or Article 82’23 and forewarn

16‘Perspektiven des Europäischen Kartellrechts’, a position paper delivered by Dr Dieter Wolf to the Frankfurter
Institut - Stiftung Marktwirtschaft und Politik, 8 July 1999.
17
Reg. 17, Art 9(3).
18Reg. 1/2003, Art 11(6).
19Art 16(2).
20
See e.g. the judgment of the House of Lords in the United Kingdom in Inntrepreneur Pub Company v Crehan[2006] UKHL 38, [2007] 1 AC 333.
21
Reg. 1/2003, Art 11(1).
22Art 11(2). This is a substantial change from previously, for it jeopardises the confidentiality purported to beprotected (Art 28) but was better protected under Reg. 17 – for example, the disappearance of the bar to using
information provided the Commission to make out an infringement of national competition law.
23
Art 11(3).

it at least 30 days prior to taking any formal decision;24 thus can the Commission intervene if it sees fit.
The Commission has adopted a notice on the manner with which it cooperates with NCAs addressing
allocation of work and the provision of assistance to and from the Commission and amongst the NCAs
themselves. 25 An investigation by any one authority is sufficient grounds for another to suspend its
own and to reject a complaint. 26 Underpinning this extensive collaboration is a ‘network ofcompetition authorities’ (European Competition Network, or ECN) initiated informally at the time of
the adoption of Regulation 1/2003 by a joint statement of the Council and the Commission.27 Made upof the Commission and the 27 national authorities, the ECN now boasts annual meetings between the
Director-General of DG Competition and the heads of all NCAs to discuss important policy issues,‘plenary meetings’ for discussion of general issues, working groups and 13 sectoral subgroups.28
In order to support the NCAs and the national courts in their new task, the Commission adopted six
notices on various ways in which it would cooperate with them and how they ought to cooperate
amongst themselves. They address:• cooperation within the network of competition authorities;29• cooperation between the Commission and national courts;30• the handling of complaints;31• guidance relating to novel questions on Articles 81 and 82 (‘guidance letters’);32• the concept of effect upon trade;33 and• the application of Article 81(3).34
The key question then becomes, whether any of this works.
At the very outset there are a number of problems:
Regulation 1/2003 provides expressly that ‘competition authorities of the Member States shall have thepower to apply Articles 81 and 82 of the Treaty in individual cases’ and lists the decision-making
powers of NCAs in this respect. 35 This puts into operation the decentralisation programme andauthorises NCAs to enforce Articles 81 and 82. But Article 5 does not do this by itself. What happens
in an NCA does not exist? Well, it must, because the Regulation says so: member states are obliged to‘designate’ the NCA (or NCAs) ‘responsible for the application of Articles 81 and 82’, 36 and by
implication, create it if it doesn’t exist. To this extent the member states control the matter still. Andeven in an NCA exists, it may well still require an underpinning in national law to give it the power the
Regulation wishes it to exercise. For example, in Cyprus the Commission for the Protection ofCompetition (Επιτροπή Προστασίας Ανταγωνισμού) was not designated a ‘competition authority’ in

24

Art 11(4).
Commission Notice on cooperation within the Network of Competition Authorities, OJ 2004 C101/43;
buttressed by Notice on the handling of complaints by the Commission under Articles 81 and 82 of the EC Treaty,
OJ 2004 C101/65.
26
Reg 1/2003, Art 13.
27
Council of the EU, Doc 15432/02 Add 1, 10 December 2002. The ECN thus has no formal basis and createsneither rights nor obligations.
28
For banking, securities, insurance, food, pharmaceuticals, professional services, healthcare, environment,
energy, railways, motor vehicles, telecoms and media.
29
OJ 2004 C101/43.
30
OJ 2004 C101/54.
31
OJ 2004 C101/65.
32
OJ 2004 C101/78.
33
OJ 2004 C101/81.
34
OJ 2004 C101/97.
35
Reg 1/2003, Art 5.
36
Reg 1/2003, Art 35.
25

accordance with Article 35, and so cannot apply Articles 81 and 82. In the Czech Republic,
jurisdiction over telecommunications was expressly transferred away from the Czech Office for theProtection of Competition (Úřad pro Ochranu Hospodářské Soutěže), rendering it incapable (in Czechlaw) of acting in that field; the Commission responded with the initiation of enforcement proceedings
under Article 226 of the Treaty in order to compel the Czechs to re-amend the law, and they did so in
2007. Most surprisingly, under the GWB the Bundeskartellamt could adopt orders to terminate
infringements of Articles 81 and 82, but there was no power to impose a fine (as there was for a breachof German competition law), until the law was amended in 2005.37 An NCA may be able to copeabsent national law. In Belgium, for example, the Autorité belge de concurrence has begun to accept
commitments analogous to Article 9 for Commission, even though there is no power under Belgian law
to do so. They rely upon the Regulation to give it that power. But we cannot count on this.
This is only the beginning. Part of the decentralisation strategy is to seek to ensure the widest possible
enforcement of Articles 81 and 82. The Regulation therefore not only creates the power for national
authorities to do so, it imposes an obligation upon them to do so. Article 3(1) provides:‘Where the competition authorities of the Member States or national courts apply national competition law toagreements, decisions by associations of undertakings or concerted practices … which may affect trade
between Member States … they shall also apply Article 81 of the Treaty to such agreements, decisions orconcerted practices’38

and‘[w]here the competition authorities of the Member States or national courts apply national competition
law to any abuse prohibited by Article 82 of the Treaty, they shall also apply Article 82’.

This presumes a vigorous enforcement of relevant national law, which may or may not be the case; andit works relatively well if the two are coordinated, but less so if they are not. There are especial
problems in two areas.
(a) Notification: The Community having abandoned the notification/authorisation procedure in favourof a directly effective Article 81(3), most member states have followed suit in their own law, amending
the system (if it existed) requiring notification and administrative authorisation in order to circumvent a
prohibition equivalent to Article 81(1) in national law. But Regulation 1/2003 did not, and could not,require it, and eight member states (Belgium, 39 Bulgaria, 40 Denmark, 41 Spain, 42 Italy, 43 Cyprus, 44
Latvia45 and Romania46) at first retained the old system. This would give rise to obvious problems incases where both Article 81 and its national equivalent are breached by the same material infraction,
Article 81(3) is satisfied, but an equivalent exemption provision of national law is not because of aprocedural failure of notification. The remedy in the regulation is a system of ‘parallel exemption’
whereby national law may not be applied in a manner which sets aside an agreement or practice whichmaybe anticompetitive but which fulfils the conditions of Article 81(3) or falls within a block
exemption.47 But the result is some confusion, and friction at the points of fine tangency between
37

Siebtes Gesetz zur Änderung des Gesetzes gegen Wettbewerbsbeschränkungen vom 7. Juli 2005, BGBl. I S
1954.
38
Reg 1/2003, Art 3(1).
39
Loi sur la protection de la concurrence, Art 7.
40Закон за защита на конкуренцията, Чп. 11-13.
41
LBK nr. 785 af 8. august 2005 om Konkurrenceloven, § 8(2).
42
Ley 16/1989, Art 3, 4.
43Legge Nº 287 del 10 ottobre 1990, Art 4.
44Νόμος 207/89, άρθ 4(3), 5.
45
Konkurences likuma, 11. panta 2. punkts.
46
Legea concurentia nr. 21/1996, Art 5(3).
47
Reg 1/2003, Art 3(2).

Community law and national law – especially where the latter is more rigorous. In fact most member
states have now fallen into line, leaving only four (Denmark, Greece, Italy and Latvia) still operating
the old notification system.
(b) Leniency: The Commission leniency programme has borne much fruit since it was introduced in
1996,48 betraying the existence of a number of cartels, some of them deeply entrenched. The stick isbeing wielded with greater vigour. But it is not difficult to appreciate the difficulty encountered in the
co-application of Community and national law in a member state in which there is no leniency
programme.
In September 2006 the ECN adopted a ‘model leniency programme’49 in order to ease the parallelhanding of leniency applications within the network. In December the Commission amended its
leniency notice for a second time,50 partly to adapt it to the ECN model. But as with exemption this has
no effect upon national law, and it remains that four member states (Denmark, Spain, Malta andSlovenia) have no leniency programme. Again, there are obvious problems for the co-application of a
Community and national prohibition where leniency is sought from and granted by the Commission but
is not, and cannot be, granted in the national arena. There is no equivalent of parallel exemption here.
The problem is particularly insurmountable where the national prohibition is founded in criminal law
and any question of leniency is a matter for the public prosecutor.

The European Competition Network
One of the unsung successes of the decentralisation programme is the European Competition Network(ECN), set up alongside Regulation 1/2003 and which underpinning the whole project. It comprises
the Commission and the principal NCAs of each of the 27 member states. Note that is was not set up
by Regulation 1/2003, and this is important. It was initiated at the coming into force of Regulation
1/2003 by a joint statement of the Council and the Commission; it therefore has no legal basis, itcreates neither rights nor obligations, it lacks any powers and has no institutional arrangements. This
flexibility is its greatest strength; for it is seen by its members as a tool at their service rather than amachinery for interference in their affairs. The ECN implements the formal cooperation mechanisms
provided for in Regulation 1/2003, and has developed periodic ‘plenary’ meetings several times a year,
a number of working groups and sectoral subgroups. It faces significant hurdles, not least linguistic,
but has become a quietly effective tool of cooperation. Preliminary data (below) indicate a healthy
working relationship amongst the administrative authorities within the ECN, and one which appears tobe deepening. This constant interaction has led to significant ‘spontaneous convergence’ of national
practice, and is some measure national laws. And this can be measured, as follows:

48

Commission Notice on the non-imposition or reduction of fines in cartel cases, 1996 OJ 1996 C207/4.
ECN Model Leniency Programme, 26 September 2006; unpublished.
50
Commission Notice on immunity from fines and reduction of fines in cartel cases, OJ 2006 C298/17. The
original 1996 notice was first amended in 2002; see OJ 2002 C45/3.
49

Convergence of National Law and Regulation 1/2003

Major Change introduced
by Regulation 1/2003
and/or Community practiceCorresponding National Law
Fully
Convergent

Partially
convergent

Amendments
in trainNo
convergencePT

BG, CY, RO

DK, GR, IT,
LV

RO

IT

1.

Abolition of notification;
Exception légale
(Article 1)

AT, BE, CZ,
DE, EE, ES,
FI, FR, HU, IE,
NL, LT, LU,
MT, PL, SE,
SI, SK, UK

2.

Parallel application ofCommunity and nationalrules(Article 3(2))

AT, BE, BG, CY,
CZ, DE, DK, EE,
ES, FI, FR, GR,
HU, IE, LT, LU,
LV, MT, NL, PL,
PT, SE, SI, SK, UK

3.

Power to impose
structural remedies(Article 7)

AT, BE, CZ, DE, FR, RO, SE
ES, GR, IE, MT,
NL, SI, UK

BG, CYDK, EE, FI,
HU, LT, LV,
LU, PL, PT,
SK

4.

Power to orderinterim measures(Article 8)AT, BE, CZ, DE,
ES, FI, FR, GR,
HU, IE, IT, LT,
LV, MT, NL, PL,
PT, RO, SE, SI,
SK, UKLU

BG, CYDK, EE

5.

Power to adopt
commitment decisions(Article 9)AT, BE, CZ, DE,
DK, ES, FI, FR,
GR, HU, IE, IT,
LT, LU, NL, PL,
SE, SI, SK, UK

LV

BG, CY, PT,
RO

EE, MT

6.

Power to inspect
non-business premises(Article 21)

AT, BE, CZ, EE,
ES, FI, FR, GR,
HU, IE, LU, LV,
MT, NL, PL, RO,
SE, SI, SK, UK

DE

CY, LT

BG, DK, IT,PT

7.

Informal guidance

AT, BG, BE, DK, FI, IT, LT, SK
DE, IE, ES, LV,
NL, PL, PT, RO,
SE, SI, UK

CY

CZ, EE, FR,
GR, HU, LU,
MT

By comparison, cooperation with the courts appears to be less successful, but this is culturally adifferent matter.

Sharing the Workload
Regulation 1/2003 requires NCAs to inform the Commission of new cases as and when they encounter
them:‘The competition authorities of the Member States shall, when acting under Article 81 or Article 82 of theTreaty, inform the Commission in writing before or without delay after commencing the first formal
investigative measure. This information may also be made available to the competition authorities of the otherMember States.’51

This of course requires an NCA to assess, at an early stage, when they intend to ‘act’ under Article 81
or Article 82 (whatever that may mean). Presumably it does no apply where an NCA intends not tofollow up a complaint (because in is unmeritorious). But it does require an NCA to determine early on,
at least provisionally, whether a national matter of competition involves also the application of Article
81 or 82 – as of course they are required to do by Article 5. But it is not always an easy thing to do.
One of the Commission notices provides a useful ‘rule of thumb’, a presumption that trade is notappreciably affected by an agreement of or practice where:(a) The aggregate market share of the parties on any relevant market within the Community affected by
the agreement does not exceed 5 percent, and(b) In the case of horizontal agreements, the aggregate annual Community turnover of the undertakings
concerned in the products or services covered by the agreement does not exceed € 40 million.52
This is a measure of the ‘appreciability’ necessary to trigger the application of the Community
competition rules.53 But it is a very rough and ready guide, for the effect on intra-Community trade isnormally the result of a combination of several factors which, taken separately, are not necessarily
decisive.
How far NCAs have used the Notice presumption is not clear. But the number of new caseinvestigations initiated by NCAs and communicated to the network is considerable, as follows:
Number of case investigations initiated by NCAsof which the Commission has been informed
pursuant to Article 11(3) of Regulation 1/2003
May-December 2004
2005
2006
2007
2008 (to 31 October)

200
181
144
140
131
___

Total May 2004 - November 2008

796

The most faithful NCAs may be identified from the following table:

51

Reg 1/2003, Art 11(3).
Commission Notice – Guidelines on the effect on trade concept contained in Articles 81 and 82 of the Treaty,paras 52-53.
53
See Case 5/69 Völk v Vervaecke [1969] ECR 295.
52

Direction générale de la concurrence, de la consommation et de larépression des fraudes/Conseil de la concurrence (France)
Bundeskartellamt (Germany)
Mededingingsautoriteit (Netherlands)
Gazdasági Versenyhivatal (Hungary)
Konkurrencestyrelsen (Denmark)Comisión Nacional de la Competencia (Spain)
Autorità garante della Concorrenza e del Marcato (Italy)
Office of Fair Trading (United Kingdom)

Total

159
98
66
62
52
43
43
43
___
566 (of 796)

Ensuring consistent application of Articles 81 and 82 EC:
Article 11, paragraphs (3), (4), (5) and (6)Regulation 1/2003 requires national competition authorities to inform the Commission‘[n]o later than 30 days before the adoption of a decision requiring that an infringement be brought
to an end, accepting commitments or withdrawing the benefit of a block exemption Regulation’.54

In practice, NCAs submit 11(4) information by filling out a specific form developed for this purpose,summarising the main aspects of the case and describing the proposed decision in some detail. A draftof the envisaged decision itself, or a preliminary document such as a statement of objections,accompanies the form. Article 11(4) is sufficiently flexible as to the relevant procedural stage and thetype of document provided. The consequence is the frequency of prior information depends on theenforcement and procedural set-up in the various member states.
The ultimate instrument to ensure the consistent application of Articles 81 and 82 EC in cases dealt
with by NCAs is Article 11(6), according to which‘[t]he initiation by the Commission of proceedings … shall relieve the competition authorities ofthe Member States of their competence to apply Articles 81 and 82 of the Treaty. If a competition
authority of a Member State is already acting on a case, the Commission shall only initiate
proceedings after consulting with that national competition authority’.
This provision was taken from Regulation 17 with no change in substance, but it takes on far greater
importance in a context where all NCAs have parallel competences to apply EC law. Article 11(6), in
combination with the duty of NCAs to submit proposed decisions one month in advance (Article 11(4)),
gives the Commission an effective tool to take over a case from a NCA, even at a late stage. It is notentirely clear, as a matter of law, whether the opening of proceedings by the Commission automaticallydeprives NCAs of the power to continue investigating the case under their own national law. The
wording of Article 11(6) quite clearly refers to removal of the ‘competence to apply Articles 81 and 82
of the Treaty’ only. However the prevailing view seems to be that, once NCAs are deprived of ‘theircompetence to apply Articles 81 and 82’, they may not apply their national law either, as this would bein breach of Article 3(1), which requires NCAs to apply Articles 81 and 82 every time they apply
national law.

54

Reg 1/2003, Art 11(4).

Nevertheless, in practice NCAs will not carry on with a purely domestic case if the Commission opens
proceedings, thus withdrawing the EC law part of the case from their hands, in particular in the case ofagreements and concerted practices. since the convergence rule of Article 3(2) would still apply, theNCA would have little or no autonomy to decide the domestic case, and would be deprived of all themechanisms of assistance, consultation and exchange of information of regulation 1/2003. In addition,
the ne bis in idem principle would most likely prevent the NCA from applying an autonomous penalty
for the breach of domestic law. It is indeed rather the ne bis in idem principle, and not Article 3(1) of
the Regulation, that I see as a more serious argument against the possibility of continuing proceedings
based on national law alone once the Commission has opened proceedings on the same facts.
The use of Article 11(6) to remove the competence of a NCA which has already submitted Article
11(4) information must be seen as a sort of ‘nuclear option’ within the network. In practice theCommission has never used it. Not surprisingly, as frequent recourse to this exceptional tool would
undermine the system, introducing a hierarchical element in a supposedly equal partnership.

Judicial Enforcement:
The Role of National Courts
What of judicial enforcement of Articles 81 and 82? We didn’t know at the beginning whether the
courts would have any role in enforcement of the competition rules. It might have been a wholly
administrative procedure, the only judicial contribution being review by the Court of Justice ofCommission action. And of course we knew nothing, in 1958, of direct effect. But that came in 1963,55
and by 1974 we knew that Articles 81 and 82 were matters to be enforced in and by national courts.56
But here is the odd thing. The Court of Justice long resisted invitations to say exactly what thisrequired of national courts. It particular, it refused to confirm that, as a matter of Community law, abreach of Articles 81 and 82 gives rise to a right in reparation for injured third parties. All it would say
was that the nullity provided by Article 81(2) for an agreement prohibited by Article 81(1) is‘absolute’57 and ‘[s]ince the nullity referred to in Article [81](2) is absolute, an agreement which is nulland void by virtue of this provision has no effect as between the contracting parties and cannot be set
up against [n’est pas opposable aux] third parties.’58 Otherwise it left the civil consequences to be
determined by national law.59 Now this may be compatible with the national judicial autonomy which
is a feature of the enforcement of Community law, but it leads to a serious risk of variation,
disequilibrium and forum shopping. It was only in Courage v Crehan60 in 2001 that the Court wascompelled to pronounce a view. Crehan is now cited as authority for a right in damages for breach of
Article 81. True, the Court said:‘The full effectiveness of Article [81] of the Treaty and, in particular, the practical effect of the prohibition
laid down in Article [81](1) would be put at risk if it were not open to any individual to claim damages forloss caused to him by a contract or by conduct liable to restrict or distort competition.
…[A]ctions for damages before the national courts can make a significant contribution to the maintenance ofeffective competition in the Community.’61

55

Case 26/62 van Gend en Loos v Nederlandse Administratie der Belastingen [1963] ECR 1.
Case 127/73 Belgische Radio en Televisie v SABAM [1974] ECR 51.
57
Case 22/71 Béguelin v GL Import Export [1971] ECR 949, at para 29; Case 319/82 Société de Vente deCiments et Bétons de l'Est v Kerpen & Kerpen [1983] ECR 4173, at para 11.
58
Case 22/71 Béguelin, ibid, at para 29.
59
Case 319/82 Kerpen & Kerpen, infra, at para 12.
60
Case C-453/99 Courage v Crehan [2001] ECR I-6297.
61
at paras 26, 27.
56

But Crehan was an uncommon case, the damages sought by a party to the agreement (a lease to a tiedhouse) owing to loss caused him by its oppressive terms. The Court appears to have presumed theexistence of a remedy in damages in English law (which had not in fact been established, and theauthorities indicted otherwise)62 which was denied Mr Crehan solely because he was a party – albeit
non in pari delicto - to the objectionable agreement. The Court went on to determine that ‘[t]here
should not therefore be any absolute bar to such an action being brought by a party to a contract which
would be held to violate the competition rules’.63
Crehan is therefore not direct authority for the availability of damages to injured third parties. Thatfollowed finally in 2006 in Manfredi,64 in which the Court has now confirmed:
a)

b)
c)

there is a remedy in damages for injury suffered by a third party by a breach of Article 81
where there is a ‘causal relationship’ between the two, causation to be determined by nationallaw;
the principle of effectiveness requires that damages are available not only for actual loss
(damnum emergens) but also for loss of profit (lucrum cessans); andthe principle of equivalence requires that exemplary damages be available if similar domestic
remedies so provide, subject to prevention of unjustified enrichment.

This leaves the remedy still a matter for national law but bites fairly deeply into the freedom of
manoeuvre that law continues to enjoy under it. Some variance remains, not least the determination of
causation left still to national law. This is illustrated best by Brasserie du Pêcheur,65 the seminal case inwhich the Court of Justice established a general right in reparation in circumstances in which member
states unlawfully deprive a person of his of her Community law rights; the case involved two
companies, a French company (Brasserie du Pêcheur SA) seeking damages from Germany and an
English company (Factortame Ltd) seeking damages from the United Kingdom. Factortame eventually
recovered damages (of some £55 million plus costs) in the English courts66 but Brasserie du Pêcheurrecovered nothing because it failed to meet the (higher) standard of causation required in Germanlaw.67 It is true there is nothing in the Community to mirror the bonanza for lawyers which obtains in
America as a function of the treble damages rule introduced by the Clayton Act;68 yet there is still an
invitation to forum shopping where a successful claim in some member states may result in exemplary
damages (Ireland), and it others it cannot. Still, Manfredi may open the floodgates to a remedy whichis still astonishingly underdeveloped. This is a course which now has the enthusiastic support of theCommission, which commissioned a major comparative study on damages for breach of Articles 81
and 82 from the law firm Ashurst, which produced its report in August 2004,69 and published a Green
Paper in December 2005,70 and now a White Paper in April of this year,71 to facilitate, and encourage,
recourse to private damages actions.
62

This is because a contract which infringes Art 81 is in English law not only void but illegal, so barring
recovery by a party to it either in reparation or in restitution; see Gibbs Mew v Gemmell [1998] EuLR 588 (CA).
63
Case C-453/99 Crehan, at para 28.
64
Cases C-295 etc/04 Manfredi v Lloyd Adriatico Assicurazioni [2006] ECR I-6619.
65
Cases C-46 & 48/93 Brasserie du Pêcheur v Germany and R v Secretary of State for Transport, ex parte
Factortame (No 3) [1996] ECR I-1029.
66
Factortame v Secretary of State for the Environment, Transportation and the Regions [2002] EWCA Civ 22,[2002] 2 All ER 838.
67
BGH, 24. Oktober 1996, BGHZ 134, 30.
68
15 U.S.C. § 15.
69
Study on the conditions of claims for damages in case of infringement of EC competition rules; consisting of acomparative report, an analysis of economic models for the calculation of damages, and a national report (withexecutive summary) from each member state.
70
Damages actions for breach of the EC antitrust rules, COM(2005) 672; see also the Commission Staff working
paper, SEC(2005) 1732.

Regulation 1/2003 contains provisions on cooperation between Commission and national courts
analogous to, but different from, the cooperation with and amongst NCAs. This is necessitated by thefact that administrative authorities and courts do fundamentally different jobs. First, the Commission
cannot pre-empt the courts in the same way as it can an administrative authority, for that would be todeny the direct and prompt effect of Articles 81 and 82. The Regulation addresses this by providingthat national courts are bound by an existing Commission decision72 and ‘must avoid giving decisions
which would conflict with a decision contemplated by the Commission in proceedings it has
initiated’.73 This is in large measure an attempt to codify the case law of the Court developed in the
Masterfoods case.74 The clear preference is that a court ought to defer to the Commission and so stay
any civil/commercial proceedings in which there is a risk of incompatible outcome, but this solution
does not always work well in practice. To assist, the Commission or an NCA may submit written
observations to a court in the course of litigation before it and may, with permission, appear as amicus
curiae;75 this derives from German practice, in which the Bundeskartellamt appears frequently, and to
persuasive effect, before national courts in cases in which the national competition law (the Gesetz
gegen Wettbewerbsbeschränkungen (GWB)) is in issue.76 Further, national courts must transmit to theCommission copies of any (written) judgment involving Community competition law77 and may ask it
for assistance and guidance on any relevant question or issue.78 The Commission undertakes to provide
them with informal ‘guidance letters’ when novel questions arise before them79 and has adopted a
specific notice on cooperation with them.80
But unlike the healthy administrative cooperation which seems to have developed within the ECN, thejudicial limb has proven less effective. The number of judgments transmitted to the Commission, as
required by Article 14(2), at present numbers a mere 164 cases, as follows:
Notifications made by national courts under Article 14(1) of Regulation 1/2003
France42
Germany
35
Spain
33
Netherlands
17
Belgium
17
Austria10
Sweden3
United Kingdom 3

Ireland
Portugal
Denmark
Italy
Lithuania
Finland
Total

2
2
1
1
1
1
___
168

We know this is underreported. Requests for assistance number in the teens. And the Commission has
yet to be invited to appear before a national court as amicus curiae. Part of this is the jurisdictional
difference between courts and NCAs. For example, the obligation that consideration of a breach ofnational competition law be extended to drawn in Articles 81 or 82 if they are joined, applies not only
to NCAs but equally to the courts. But how are courts expected to do this? Courts respond to a suit
71

Damages actions for breach of the EC antitrust rules, COM(2008) 165 final.
Reg. 1/2003, Art 16(1).
73
Ibid.
74
Case C-344/98 Masterfoods v HB Ice Cream [2000] ECR I-11369.
75
Reg 1/2003, Art 15(3).
76§ 90 II GWB.
77
Reg. 1/2003, Art 15(2).
78Art 15(1).
79
Notice on informal guidance relating to novel questions concerning Articles 81 and 82 of the EC Treaty thatarise in individual cases (guidance letters), OJ 2004 C101/78.
80
Notice on the co-operation between the Commission and the courts of the EU Member States in theapplication of Articles 81 and 82 EC, OJ 2004 C101/54.
72

brought by a party, seeking a private remedy. It is not for the court to extend the action beyond thatraised by the pursuing party or parties. And there is no better example than Ireland, in which, uniquely,
breaches of national competition law and Articles 81 and 82 are criminal offences.81 There have been
several successful prosecutions for breaches of Irish law, some of which very probably edged into
Community law. But how on earth is an Irish judge to draw in Community law when the matter is notraised by the public prosecutor? Or, how is a national criminal court in any other member state to draw
in Community law when it is not a criminal matter there?
The creation of specialist national courts may be party the answer, for specialist judges speak the samelanguage as their counterparts elsewhere. But that of course is a matter for national law, and it has notproved to be a wholly popular course:
Specialist national courts
for civil proceedings
in competition matters

YES
BE, DE, DK, ES, FR, SK, UK

NO
AT, BG, CY, CZ, EE, FI,
GR, HU, IE, IT, LT, LU,
LV, MT, NL, PL, PT, RO,
SE, SI

It remains that the Commission and national judges remain, in some measure, two solitudes. It remains
to be seen if the Commission’s enthusiasm for private enforcement can be translated into real progress.

Final comment
It must be borne in mind that not all competition law has been exposed to the great decentralisatation
experiment. The Commission retains exclusive jurisdiction over mergers and takeovers which have a‘Community dimension’,82 although even here the matter has become slightly permeable.83 Article 86
preserves significant Commission control over services in the general economic interest, and the whole
field of state aids remains firmly under Commission control. These were matters which could not be
entrusted to national authorities. But the general field is now given over to this new complex andpolychephalous enforcement. And the die is now cast. Unless the Court of Justice is minded to find
Regulation 1/2003 unlawful for inconsistency with Article 81, a possibility (and no more) suggested by
the German and Austrian governments,84 Community competition law underwent its most significant
change in 40 years in May 2004. And if nothing else is certain, the genie is out of the bottle for good,for a Council of 27 (acting by qualified majority vote) 85 is unlikely ever to agree to the degree ofcentralised enforcement achieved by Regulation 17. The wisdom of it is not yet proven, but there iscertainly not (yet) grounds for the despair that many predicted.

81

Competition Act, 2002, ss 6 and 7.
Reg. 139/2004 OJ 2004 L24/1, Art 1.
83
See Arts 9 (the ‘German clause’) and 22 (the ‘Dutch clause’).
84
Stellungnahme der Bundesregierung zum Weissbuch der Europäischen Kommission über die Modernisierung
der Vorschriften zur Anwendung der Artikel 81 und 82 EGV, 29. Oktober 1999; Österreichische Position zum
Weissbuch der Europäischen Kommission über die Modernisierung der Anwendung der Art. 81 und 82 EG-V,
undated.
85
EC Treaty, Art 83.
82