Provisional text
ORDER OF THE PRESIDENT OF THE GENERAL COURT
12 July 2017 (*)
(Interim proceedings — Competition — Antitrust — Regulation (EC) No 1/2003 — Article 18(3) — Decision requesting information — Application for interim measures — No urgency)
In Case T‑371/17 R,
Qualcomm, Inc., established in San Diego, California (United States of America),
Qualcomm Europe, Inc., established in London (United Kingdom),
represented by M. Pinto de Lemos Fermiano Rato and M. Davilla, lawyers,
applicants,
v
European Commission, represented by H. Van Vliet, G. Conte, C. Urraca Caviedes and M. Farley, acting as Agents,
defendant,
APPLICATION pursuant to Articles 278 and 279 TFEU for the grant of interim measures, seeking the suspension of operation of Commission Decision of 31 March 2017 relating to a proceeding pursuant to Article 18(3) and to Article 24(1)(d) of Council Regulation (EC) No 1/2003 (Case AT.39711 — Qualcomm (predation)),
THE PRESIDENT OF THE GENERAL COURT
makes the following
Order
Background to the dispute, procedure and forms of order sought by the parties
1        In the context of an antitrust investigation, the European Commission sent on 30 January 2017 a request for information to Qualcomm Europe, Inc., a wholly-owned subsidiary of Qualcomm, Inc. (together: ‘the applicant’).
2        The deadline for a reply to this request for information was 27 February 2017.
3        In its response dated 13 February 2017, the applicant asked the Commission to revoke the request for information, to clarify the scope and subject matter of the investigation and, if necessary, to adopt a new request for information limited to what was truly necessary for the Commission’s investigation.
4        In the following weeks, the applicant and the Commission corresponded with each other. In any event, the applicant did not then provide the information requested.
5        On 31 March 2017 the Commission adopted a decision relating to a proceeding pursuant to Article 18(3) and to Article 24(1)(d) of Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles [101] and [102 TFEU] (OJ 2003 L 1, p. 1) (Case AT.39711 — Qualcomm (predation)), which was notified to the applicant on 4 April 2017 (‘the contested decision’).
6        Pursuant to Article 1 of the contested decision, the applicant was obliged to provide the information requested in the questionnaire annexed to the decision by either 12 or 26 May 2017. Pursuant to its Article 2, the applicant, if it failed to supply the complete and correct information requested within the period prescribed, was to incur a periodic penalty payment of EUR 580 000 per day of delay.
7        The questionnaire is largely identical to the request for information of 30 January 2017, though some questions were amended and new questions added.
8        The deadline for answering questions 1, 2, 6, 8, 9 and 10 was set by the contested decision as 26 May 2017 and for the other questions as 12 May 2017.
9        Following a request by the applicant in which it asked for an appropriate extension of the time limits, the Deputy Head of Unit/Case Manager responded on 26 April 2017 that the Commission considered the time limit to be adequate and proportionate but, ‘as a matter of courtesy’ the Commission agreed to receive the answers to questions 1, 2, 6, 8, 9 and 10 by 9 June 2017 and to the other questions by 26 May 2017.
10      On 15 May 2017 the Hearing Officer, following a request by the applicant of 8 May 2017, extended the deadlines. Accordingly, questions 1, 2, 6, 8, 9 and 10 had to be answered by 30 June 2017 and the other questions by 16 June 2017.
11      In subsequent correspondence between the applicant and the Commission following a meeting on 30 May 2017, the Deputy Head of Unit/Case Manager allowed, inter alia, the applicant to provide by 30 June 2017 the answers to some of the questions for which the Hearing Officer had extended the time limit for response to 16 June 2017 in case the applicant is ‘not able to provide all requested information by 16 June 2017’.
12      By application lodged at the Court Registry on 13 June 2017, the applicant brought an action for annulment of the contested decision.
13      By separate document lodged at the Court Registry on 13 June 2017, the applicant brought the present application for interim measures, in which it claims, in essence, that the President of the General Court should:
–        suspend the contested decision;
–        in the alternative, suspend the periodic penalty payment;
–        order the Commission to pay the costs.
14      In its observations on the application for interim measures, which were lodged at the Court Registry on 26 June 2017, the Commission contends that the President of the General Court should:
–        dismiss that application;
–        reserve the costs.
15      According to the Commission, the applicant provided on 16 June 2017 its reply to the questions which were due on that date.
Law
16      It is apparent from reading Articles 278 and 279 TFEU together with Article 256(1) TFEU that the judge hearing an application for interim measures may, if he considers that the circumstances so require, order that the operation of a measure challenged before the General Court be suspended or prescribe any necessary interim measures, pursuant to Article 156 of the Rules of Procedure of the General Court. Nevertheless, Article 278 TFEU establishes the principle that actions do not have suspensory effect, since acts adopted by the institutions of the European Union are presumed to be lawful. It is therefore only exceptionally that the judge hearing an application for interim measures may order the suspension of operation of an act challenged before the General Court or prescribe any interim measures (order of 19 July 2016, Belgium v Commission, T‑131/16 R, EU:T:2016:427, paragraph 12).
17      The first sentence of Article 156(4) of the Rules of Procedure provides that applications for interim measures must ‘state the subject matter of the proceedings, the circumstances giving rise to urgency and the pleas of fact and law establishing a prima facie case for the interim measure applied for’.
18      Accordingly, the judge hearing an application for interim relief may order suspension of operation of an act, or other interim measures, if it is established that such an order is justified, prima facie, in fact and in law, and that it is urgent in so far as, in order to avoid serious and irreparable harm to the applicant’s interests, it must be made and produce its effects before a decision is reached in the main action. Those requirements are cumulative, so that the application for interim measures must be dismissed if one of them is not met. Where appropriate, the judge hearing such an application must also weigh the competing interests (see order of 2 March 2016, Evonik Degussa v Commission, C‑162/15 P-R, EU:C:2016:142, paragraph 21 and the case-law cited).
19      In the context of that overall examination, the judge hearing the application has a wide discretion and is free to determine, having regard to the specific circumstances of the case, the manner and order in which those various conditions are to be examined, there being no rule of law imposing a pre-established scheme of analysis within which the need to order interim measures must be assessed (see order of 19 July 2012, Akhras v Council, C‑110/12 P(R), not published, EU:C:2012:507, paragraph 23 and the case-law cited).
20      Having regard to the material in the case file, the judge hearing the application considers that he has all the information needed to rule on the present application for interim measures without there being any need first to hear oral argument from the parties.
21      In the circumstances of the present case, it is appropriate to examine first whether the condition relating to urgency is satisfied.
22      In order to determine whether the interim measures sought are urgent, it should be noted that the purpose of the procedure for interim relief is to guarantee the full effectiveness of the final future decision, in order to prevent a lacuna in the legal protection afforded by the EU judicature. For the purpose of attaining that objective, urgency must be assessed in the light of the need for an interlocutory order in order to avoid serious and irreparable damage to the party seeking the interim relief. That party must demonstrate that it cannot await the outcome of the main proceedings without suffering serious and irreparable damage (see order of 14 January 2016, AGC Glass Europe and Others v Commission, C‑517/15 P-R, EU:C:2016:21, paragraph 27 and the case-law cited).
23      It must be pointed out in that regard that while, in order to establish the existence of such damage, it is not necessary for the occurrence of the damage to be demonstrated with absolute certainty, it being sufficient to show that damage is foreseeable with a sufficient degree of probability, the party seeking interim measures is nevertheless required to prove the facts forming the basis of his claim that serious and irreparable damage is likely (see order of 14 January 2016, AGC Glass Europe and Others v Commission, C‑517/15 P-R, EU:C:2016:21, paragraph 37 and the case-law cited).
24      In the present case, the applicant brings forward, in essence, two arguments to establish that it will suffer serious and irreparable harm.
25      In the first place, it submits that the amount of work required for replying fully and accurately to the questions as requested by the contested decision is ‘enormous and entails significant financial costs’. These costs, although inherently difficult to quantify, are estimated by the applicant at no less than EUR 3 million for ‘thousands of working hours of more than 50 [employees of the applicant] and approximately 16 external legal and economic advisors, and electronic document management service providers’.
26      Given the length of proceedings before the General Court, the applicant would be exposed to penalties in the ‘range of several millions of euros’ if it failed to respond fully and in good time. Moreover, the applicant could only recover the expenses incurred in the context of the main and the current interim proceedings but not ‘the enormous financial cost it has incurred so far and continues to incur in trying to respond to the unwarranted and disproportionate requests contained in the contested decision’.
27      According to its own submissions, the applicant alleges by its first argument a damage of a pecuniary nature.
28      In that regard, it is necessary to bear in mind the settled case-law according to which damage of a pecuniary nature cannot, otherwise than in exceptional circumstances, be regarded as irreparable since, as a general rule, pecuniary compensation is capable of restoring the aggrieved person to the situation that prevailed before he suffered the damage. Any such damage could be recouped by the applicant’s bringing an action for compensation on the basis of Articles 268 and 340 TFEU (see order of 23 April 2015, Commission v Vanbreda Risks & Benefits, C‑35/15 P(R), EU:C:2015:275, paragraph 24 and the case-law cited).
29      Where the harm referred to is of a financial nature, the interim measures sought are justified where it is apparent that in the absence of those measures, the applicant would be in a position that could jeopardise its financial viability before final judgment is given in the main action, or where its market share would be affected substantially in the light, inter alia, of the size and turnover of its business and, as the case may be, the characteristics of the group to which it belongs (see order of 12 June 2014, Commission v Rusal Armenal, C‑21/14 P-R, EU:C:2014:1749, paragraph 46 and the case-law cited).
30      However, in the present case the applicant does not claim that its financial viability would be at risk or that its market share could be affected substantially. Furthermore, it does not give any explanation as to why it would be impossible to seek compensation for the alleged financial costs it would suffer by answering the questions.
31      In as much as the applicant invokes as a prejudice ‘the enormous financial cost it has incurred so far’, it must be recalled that, according to settled case-law, the purpose of proceedings for interim relief is not to ensure reparation for damage already suffered (see order of 29 July 2011, Cemex and Others v Commission, T‑292/11 R, not published, EU:T:2011:402, paragraph 42).
32      Accordingly, it must be concluded that the first argument cannot establish urgency.
33      By its second argument, the applicant claims that it would suffer ‘further serious and irreparable damage due to the enormous disruption … for the main business responsibilities of a number of key employees, as well as external advisors currently advising [the applicant] on various ongoing matters’.
34      In that respect, the applicant submits that answering the questions would put particular strain on its finance department, which, according to the applicant, is essential to its operations.
35      In order to illustrate the ‘enormous amount of work’ that needs to be done by its finance department, the applicant refers to the difficulties it would face by answering the first question of the questionnaire.
36      According to the applicant, ‘at least’ 120 boxes stored in an off-site warehouse facility would need to be reviewed and ‘only a few’ of its employees had the necessary ‘extensive and historical knowledge of [the applicant’s] accounting practices … and would need to review every document contained in each of these boxes’. Accordingly, ‘these employees [would be] thus unable to perform most of their main functions’.
37      The applicant concludes that it finds itself in the ‘invidious position of having to choose between dedicating key human resources to respond to the contested decision in order to avoid the enormous daily penalty of EUR 580 000 and the risk of fines under Article 23(1)(b) of Regulation No 1/2003, or dedicating those resources to run its business (as well as comply with its obligations under various financial and accounting rules). The disruption caused by the contested decision to [its finance department] could damage [the applicant] as a corporation, as any regulatory penalty [the applicant] could bear would be significant and cause irreparable harm, both from a financial and a reputational perspective’.
38      In that respect it must be noted, in the first place, that it is not clear to what kind of ‘regulatory penalty’ the applicant is referring in its submissions. In as much as the ‘regulatory penalty’ is meant to refer to the periodic penalty of EUR 580 000 and potential fines for supplying incorrect, incomplete or misleading information or not supplying the information within the required time limit, it needs to be recalled that these sanctions can only be imposed by a decision based on Articles 23 and 24 of Regulation No 1/2003. Such decisions can be challenged in the context of an action for annulment, potentially combined with a request for interim measures. It is therefore premature to claim, at this juncture, that the execution of the contested decision would imply an imminent danger of exposure to sanctions which could cause serious and irreparable harm to the applicant (see order of 29 July 2011, Cemex and Others v Commission, T‑292/11 R, not published, EU:T:2011:402, paragraph 36).
39      In the second place, as regards the alleged ‘disruption’ of the business activities of the applicant, it should be borne in mind that the second sentence of Article 156(4) of the Rules of Procedure provides that an application for interim measures must ‘contain all the evidence and offers of evidence available to justify the grant of interim measures’.
40      Thus, an application for interim measures must, of itself, enable the defendant to prepare its observations and the judge hearing the application to rule on it, if necessary without any other supporting information, since the essential elements of fact and law on which the application is based must be found in the actual text of that application (see order of 6 September 2016, Inclusion Alliance for Europe v Commission, C‑378/16 P-R, not published, EU:C:2016:668, paragraph 17 and the case-law cited).
41      It is also established case-law that, in order to determine whether all the conditions set out in paragraphs 22, 23 and 29 above are met, the judge hearing the application for interim measures must have hard and precise information, supported by detailed and certified documents showing the situation of the party seeking interim relief and making it possible to examine the actual consequences which would be likely to result if the measures sought were not granted. It follows that that party, especially where it alleges harm of a financial nature, must provide, with supporting documentation, an accurate and comprehensive picture of its financial situation (see, to that effect, order of 29 February 2016, ICA Laboratories and Others v Commission, T‑732/15 R, not published, EU:T:2016:129, paragraph 39 and the case-law cited).
42      In the light of the requirements recalled in the preceding three paragraphs, it must be concluded that the applicant, which invokes, in essence, by its second argument damage of a pecuniary nature, has failed to demonstrate to the required legal standard that it would suffer serious and irreparable harm due to the alleged ‘disruption’ of its business activities.
43      In fact, it follows from the applicant’s submissions that the ‘burden weighs particularly heavily on a limited number of employees working in the … finance department’. According to the applicant, ‘only a few’ of its employees have the necessary knowledge and ‘these employees’ would need to review the documents stored in boxes and would be thus unable to perform most of their main functions.
44      However, the applicant does not claim that its finance department is essentially composed only of these few employees.
45      Furthermore, it is not entirely clear whether the claim that ‘the day-to-day tasks of those employees’, according to the applicant, are ‘absolutely essential for [its] operation[s]’ refers to the aforementioned group of employees or whether this refers in general to the employees within the finance department.
46      In any event, the applicant has failed to support its allegations by any further explanation, let alone documentary evidence.
47      In that respect, it is particularly important that the applicant has not submitted any information as regards the number of staff in its finance department. In the absence of that information, no assessment can be made of to what extent the functioning of the applicant’s finance department could be jeopardised by answering the questions.
48      Finally, the applicant, in arguing that the ‘disruption … could damage [the applicant] as a corporation’ does not specify either the nature or the magnitude of the alleged damage, making it thus impossible for the judge hearing the application for interim measures to assess whether the alleged damage could be considered as serious and irreparable.
49      In the third and last place, as regards the alleged reputational damage, it is unclear whether the alleged damage which, according to the applicant, would result from a ‘regulatory penalty’ is to be understood as the consequence of the contested decision, or of a fine or sanction imposed by the Commission for non-compliance with the contested decision, or of a sanction for non-compliance with further, non-specified ‘regulatory obligations’ to which the applicant alludes in the context of explaining the tasks of its finance department. In any event, any potential reputational damage which the applicant may suffer from the mere fact that the Commission has adopted the contested decision cannot, in itself, be a reason to justify urgency.
50      It follows from all the foregoing that the application for interim measures must be dismissed, as the applicant has failed to establish urgency, without it being necessary to rule on the prima facie case or even to weigh up the competing interests.
51      Under Article 158(5) of the Rules of Procedure, the costs must be reserved.
On those grounds,
THE PRESIDENT OF THE GENERAL COURT
hereby orders:
1.      The application for interim measures is dismissed.
2.      The costs are reserved.
Luxembourg, 12 July 2017.
E. Coulon
M. Jaeger
Registrar
President
* Language of the case: English.