Case T‑574/14

European Association of Euro-Pharmaceutical Companies (EAEPC)

v

European Commission

(Competition — Agreements, decisions and concerted practices — Parallel trade in medicines — Agreement operating a distinction between prices charged for products intended for resale in Spain and prices charged for products intended for export to other Member States — Request for re-examination of a complaint following judgments of the Court of Justice and the General Court — Article 266 TFEU — Rejection of a complaint — No Union interest — Cessation of the anti-competitive practice — Absence of persisting anti-competitive effects — Case being dealt with by a competition authority of a Member State — Obligations in relation to the investigation of a complaint — Article 105 TFEU — Article 7 of Regulation (EC) No 1/2003 — Procedural rights of a complainant — Obligation to state reasons)

Summary — Judgment of the General Court (Fourth Chamber), 26 September 2018

Competition — Division of competences between the Commission and the national competition authorities — Initiation of a proceeding by the Commission against an agreement, decision or concerted practice — Removal of the national competition authority’s power to penalise, through application of national competition law, the anti-competitive effects produced by the agreement, decision or concerted practice on the Member State’s territory — Restoration of the power of the national authority once the proceeding initiated by the Commission is concluded

Competition — Administrative procedure — Examination of complaints — Determination of priorities by the Commission — Account to be taken of the EU interest in investigating a case — Discretion of the Commission — Obligation to state reasons for the decision to take no further action — Review by the Court — Limits

Competition — Administrative procedure — Examination of complaints — Determination of priorities by the Commission — Commission’s duty to adopt a decision as to the existence of an infringement — None — Account to be taken of the EU interest in investigating a case — Discretion of the Commission — Limits

Actions for annulment — Judgment annulling a decision — Effects — Annulment of a Commission decision on a request for exemption — Obligation to adopt a new decision on the agreement notified under Regulation No 17 by reference to the date of notification — Entry into force of Regulation No 1/2003 no longer providing for a notification procedure — No effect

Article 266 TFEU provides for the sharing of powers between the judicial authority and the administrative authority, according to which it is for the institution that issued the act annulled to determine what measures are required to comply with a judgment annulling a decision. Annulment judgments given by the European Union Courts have force of res judicata with absolute effect as soon as they become final. This applies not only to the operative part of the judgment annulling a decision, but also to the grounds which are its essential basis and are inseparable from it. The principle of res judicata of a judgment extends, however, only to the matters of fact and law actually or necessarily settled. Thus, Article 266 TFEU requires the institution which adopted the annulled act only to take the necessary measures to comply with the judgment annulling its act. (see paras 48-50)

Partial annulment of an act of EU law is possible only if the elements which it is sought to have annulled can be severed from the remainder of the act. That requirement is not satisfied where the partial annulment of an act would cause the substance of that act to be altered, a point which must be determined on the basis of an objective criterion and not of a subjective criterion linked to the political intention of the authority which adopted the act at issue. The procedure for replacing an annulled act must be resumed at the very point at which the illegality occurred, the annulment of an act not necessarily affecting the preparatory acts. The annulment of an act concluding an administrative proceeding which comprises several stages does not necessarily entail the annulment of the entire procedure prior to the adoption of the contested act regardless of the grounds, procedural or substantive, of the judgment pronouncing the annulment. The author of the act must, therefore, have reference to the date on which it had adopted the annulled act with a view to adopting the replacement act. It may, however, rely, in its new decision, on grounds other than those on which it based its first decision. In addition, it is not required to rule again on aspects of the initial decision which were not called into question by the judgment annulling that decision. (see paras 51, 52)

Under the previous regime of administrative authorisation of Regulation No 17, only the Commission could adopt a decision subsequent to a request for individual exemption under Article 101(3) TFEU, it having no discretion as to whether or not to examine the request for an exemption. In addition, in accordance with the case-law, the fact that Regulation No 1/2003, which has since 1 May 2004 governed the implementation of the rules on competition laid down in Articles 101 and 102 TFEU, put an end to the notification procedure which previously existed has no effect on the enforcement of a judgment granting the application for annulment. According to the annulment judgment in question, the Commission was required to adjudicate on the request for exemption only ‘in so far as that request remain[ed] before it’. In other words, it was relieved of that obligation only if the applicant decided to withdraw its request. (see paras 57, 58)

Article 7 of Regulation No 1/2003 does not give the 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. In order to assess the Union interest in further investigation of a case, the Commission must take account of the circumstances of the individual case, especially the matters of law and fact set out in the complaint referred to it. In particular, it must, after evaluating with all due care the matters of fact and of law put forward by the complainant, weigh the significance of the alleged infringement as regards the functioning of the internal market against the probability of its being able to establish the existence of the infringement and the extent of the investigative measures necessary in order to fulfil in the best conditions its task of ensuring the observance of Articles 101 and 102 TFEU. Given that the assessment of the Union interest raised by a complaint depends on the circumstances of each individual case, the number of assessment criteria to which the Commission may refer should not be limited, nor, conversely, should the Commission be required to have recourse exclusively to certain criteria. In view of the fact that, in an area such as that governed by competition law, the legal and factual context may vary considerably from one case to another, it is possible to apply criteria which may vary considerably, and not predetermined criteria which must be applied, or to apply criteria which had not hitherto been envisaged or to give priority to a single criterion in assessing the Union interest. The Commission may take a decision to take no further action on a complaint for lack of a sufficient Union interest not only before commencing an investigation of the case but also after taking investigative measures, if that course seems appropriate to it at that stage of the procedure. The Commission’s discretion is not unlimited, however. First, in order to assess the Union interest in further investigation of a case, 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. In that regard, 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, in particular, the duty of the competent institution to examine carefully and impartially all the relevant aspects of the individual case. (see paras 71-76)

The Commission is under an obligation to state reasons if it declines to continue with the examination of a complaint. Since the reasons stated must be sufficiently precise and detailed to enable the General Court effectively to review the Commission’s use of its discretion to define priorities, the Commission must set out the facts justifying the decision and the legal considerations on the basis of which it was adopted. Review by the Courts of the European Union of the Commission’s exercise of the discretion conferred on it in the handling of complaints must not lead them to substitute their assessment of the Union interest for that of the Commission, but seeks to verify that the contested decision is not based on materially incorrect facts and is not vitiated by an error of law, manifest error of appraisal or misuse of powers. The General Court cannot substitute its own assessment of the Union interest for that of the Commission by considering whether criteria other than those applied by the Commission in the contested decision should have led it to conclude that there was a Union interest in continuing its investigation of the case. In the case of the rejection of complaints, the Commission’s assessments concerning allegations of infringement of Article 101 TFEU or Article 102 TFEU involve complex economic appraisals, all the more so when the Commission carries out prospective analyses, the review of which by the Courts of the European Union is limited to verifying whether the relevant rules on procedure and on the statement of reasons have been complied with, whether the facts have been accurately stated, and whether there has been any manifest error of appraisal or a misuse of powers. (see paras 77, 78)

The statement of reasons for a measure must be appropriate to the measure at issue and must disclose in a clear and unequivocal fashion the reasoning followed by the institution which adopted that measure in such a way as to enable the persons concerned to ascertain the reasons for it and to enable the competent Court of the European Union to exercise its jurisdiction to review legality. (see para 91)

The procedure initiated following a complaint does not constitute adversary proceedings between the companies concerned; it is a procedure commenced by the Commission, upon application, in fulfilment of its duty to ensure that the rules on competition are observed. It follows that the companies which are the object of the investigation and the companies which have submitted a complaint are not in the same procedural situation and the latter cannot invoke the right to a fair hearing. The complainants must, on the other hand, be given the opportunity to defend their legitimate interests in the course of the procedure initiated by the Commission and thereby be closely associated with that procedure, even if the procedural rights of the complainants are not as far-reaching as the right to a fair hearing of the companies which are the object of the Commission’s investigation. Third parties cannot claim a right of access to the file held by the Commission on the same basis as the undertakings under investigation. The complainants’ right of access is limited solely to the documents on which the Commission bases its provisional assessment and does not have the same scope as the right of access to the Commission file afforded to persons, undertakings and associations of undertakings that have been sent a statement of objections by the Commission, which relates to all documents which have been obtained, produced or assembled by the Commission during the investigation. (see para 93)

The Commission may decide that it is not appropriate to investigate a complaint where the alleged practices have ceased. In addition, the Commission may find that there is no longer a sufficient Union interest when the undertakings concerned agree to amend their conduct in a manner conducive to the general interest. However, in deciding to take no further action for lack of Union interest on a complaint against practices alleged to be contrary to the FEU Treaty, the Commission cannot rely solely on the fact that those practices have ceased, without having ascertained that anti-competitive effects have ceased and, if appropriate, that the seriousness of the alleged interferences with competition or the persistence of their consequences has not been such as to give the complaint a Union interest. That finding only applies where the Commission bases its decision on the fact that the alleged anti-competitive practices have ceased. (see paras 109, 115)

Having regard to the system of cooperation established by Regulation No 1/2003 between the Commission and the competition authorities of the Member States, it must be held that the Commission may, without committing an error of assessment, presume that the national authorities have the ability to implement effectively the rules, standards and policies forming the EU legal framework. (see para 127)

See the text of the decision. (see paras 124-135)