# C_2007140EN.01001502.xml

| 23.6.2007 | EN | Official Journal of the European Union | C 140/15 |
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23.6.2007

EN

Official Journal of the European Union

C 140/15

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Reference for a preliminary ruling from Supreme Court (Ireland) made on 20 April 2007 — The Competition Authority v Beef Industry Development Society Ltd, Barry Brothers (Carrigmore) Meats Ltd

(Case C-209/07)

(2007/C 140/25)

Language of the case: English

Referring court

Supreme Court

Parties to the main proceedings

Applicant: The Competition Authority

Applicant:

Defendants: Beef Industry Development Society Ltd, Barry Brothers (Carrigmore) Meats Ltd

Defendants:

Questions referred

‘Where it is established to the satisfaction of the court that:

| a) | there is overcapacity in the industry for the processing of beef, which calculated at peak throughput, would be approximately 32 %; |
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a)

there is overcapacity in the industry for the processing of beef, which calculated at peak throughput, would be approximately 32 %;

| b) | the effect of this excess capacity will have very serious consequences for the profitability of the industry as a whole over the medium term, |
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b)

the effect of this excess capacity will have very serious consequences for the profitability of the industry as a whole over the medium term,

| c) | while, as reported, the effects of surplus requirements have not been felt to any significant degree as yet, independent consultants have advised that, in the near term, the overcapacity is unlikely to be eliminated by normal market measures, but over time the overcapacity will lead to very significant losses and ultimately to processors and plants leaving the industry; |
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c)

while, as reported, the effects of surplus requirements have not been felt to any significant degree as yet, independent consultants have advised that, in the near term, the overcapacity is unlikely to be eliminated by normal market measures, but over time the overcapacity will lead to very significant losses and ultimately to processors and plants leaving the industry;

| d) | processors of beef representing approximately 93 % of the market for the supply of beef of that industry have agreed to take steps to eliminate the overcapacity and are willing to pay a levy in order to fund payments to processors willing to cease production, and |
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d)

processors of beef representing approximately 93 % of the market for the supply of beef of that industry have agreed to take steps to eliminate the overcapacity and are willing to pay a levy in order to fund payments to processors willing to cease production, and

the said processors, comprising ten companies, form a corporate body, (“the society”) for the purpose of implementing an arrangement with the following features:

| 1. | plants (called “goers” ) killing and processing 420,000 animals per annum, representing approximately 25 % of active capacity would enter into an agreement with the remaining companies (called “stayers” ) to leave the industry and to abide by the following terms; |
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1.

plants (called “goers” ) killing and processing 420,000 animals per annum, representing approximately 25 % of active capacity would enter into an agreement with the remaining companies (called “stayers” ) to leave the industry and to abide by the following terms;

| 2. | goers would sign a two year non-compete clause in relation to the processing of cattle on the entire island of Ireland; |
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2.

goers would sign a two year non-compete clause in relation to the processing of cattle on the entire island of Ireland;

| 3. | the plants of goers would be decommissioned; |
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3.

the plants of goers would be decommissioned;

| 4. | land associated with the decommissioned plants would not be used for the purposes of beef processing for a period of five years; |
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4.

land associated with the decommissioned plants would not be used for the purposes of beef processing for a period of five years;

| 5. | compensation would be paid to goers in staged payments by means of loans made by the stayers to the society; |
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5.

compensation would be paid to goers in staged payments by means of loans made by the stayers to the society;

| 6. | a voluntary levy would be paid to the society by all stayers at the rate of EUR 2 per head of the traditional percentage kill and EUR 11 per head on cattle kill above that figure; |
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6.

a voluntary levy would be paid to the society by all stayers at the rate of EUR 2 per head of the traditional percentage kill and EUR 11 per head on cattle kill above that figure;

| 7. | the levy would be used to repay the stayers' loans; levies would cease on repayment of the loans; |
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7.

the levy would be used to repay the stayers' loans; levies would cease on repayment of the loans;

| 8. | the equipment of goers used for primary beef processing would be sold only to stayers for use as back-up equipment or spare parts or sold outside the island of Ireland; |
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8.

the equipment of goers used for primary beef processing would be sold only to stayers for use as back-up equipment or spare parts or sold outside the island of Ireland;

| 9. | the freedom of the stayers in matters of production, pricing, conditions of sale, imports and exports, increase in capacity and otherwise would not be affected, |
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9.

the freedom of the stayers in matters of production, pricing, conditions of sale, imports and exports, increase in capacity and otherwise would not be affected,

and that it is agreed that such an agreement is liable, for the purpose of application of Article 81(1)EC, to have an appreciable effect on trade between Member States, is such arrangement to be regarded as having as its object, as distinct from effect, the prevention, restriction or distortion of competition within the common market and therefore, incompatible with Article 81(1) of the Treaty establishing the European Community?’

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