Source: http://europedia.moussis.eu/books/Book_2/5/15/02/01/index.tkl?all=1&pos=189
Timestamp: 2018-06-22 18:30:27
Document Index: 436330372

Matched Legal Cases: ['§ 1', '§ 1', '§ 1', '§ 3', '§ 1', '§ 3']

Europedia - European competition network
15.2.1. European competition network
Council Regulation No 17 of 1962 laid down a system of supervision requiring restrictive practices affecting trade between Member States to be notified to the Commission in order for them to qualify for an exemption. The Commission thus had the exclusive power to authorise restrictive practices meeting the conditions of Article 81 (3) (formerly Article 85(3) of the EC Treaty, actual Article 101 of the TFEU). This system of centralised authorisation was necessary and proved very effective in establishing a "competition culture" in Europe at a time when the interpretation of Article 81 (restrictive practices) and Article 82 (abuse of a dominant position) was still uncertain and when the Commission was making an effort to integrate national markets which were still very heterogeneous. During the forty years of the existence of Regulation 17/62, however, a great number of individual decisions were made by the Commission applying the exemption criteria of Article 81(3) of the Treaty. National competition authorities and national courts are therefore nowadays well aware of the conditions under which the benefit of Article 81.3 can be granted. Individual exemption decisions taken by the Commission are thus no longer indispensable to ensure a uniform application of Article 81(3) of the EC Treaty. Moreover, a system of notifications, entailing a great scrutiny workload for the Commission, is no longer workable in a Union of 28 Member States.
Therefore, at the proposal of the Commission, Regulation 1/2003 replaced its absolute powers in the field of competition by a network of competition authorities, called the European Competition Network (ECN), which is a key plank of the new enforcement system]. Formed by the Commission and the competition authorities of the Member States, this network of public authorities applies the European competition rules in close cooperation, providing for an allocation of cases according to the principle of the best-placed authority, the objective being that each case should be handled by a single authority. In addition, the Commission consults an Advisory Committee on Restrictive Practices and Dominant Positions, composed of representatives of the competition authorities of the Member States.
The Commission may continue to adopt so called "block" exemption regulations by which it declares Article 81(1) of the EC Treaty (Article 101 § 1 TFEU) inapplicable to categories of agreements, decisions and concerted practices. It may still adopt individual decisions prohibiting serious cartels affecting trade between the Member States and having the effect of restricting competition. Where the Commission, acting on a complaint or on its own initiative, finds that there is an infringement of Article 81 or of Article 82 of the EC Treaty (Articles 101 § 1 or 102 TFEU), it may by decision require the undertakings and associations of undertakings concerned to bring such infringement to an end. For this purpose, it may impose on them any behavioural or structural remedies which are proportionate to the infringement committed and necessary to bring the infringement effectively to an end.
On their side, national competition authorities and courts are empowered to apply European law. They have the power to apply not only Article 101 § 1 and Article 101 of the Treaty on the functioning of the EU, which have direct applicability by virtue of the case-law of the Court of Justice, but also Article 101 § 3 of the TFEU. This means that national competition authorities are empowered to withdraw the benefit of a European block exemption regulation [see section 15.3.3]. National competition authorities may take the following decisions: requiring that an infringement be brought to an end, ordering interim measures, accepting commitments, imposing fines, periodic penalty payments or any other penalty provided for in their national law. National courts may apply European competition rules in lawsuits between private parties, acting as public enforcers or as review courts. They can apply Article 101 of the TFEU in three types of proceedings: contractual liability proceedings (disputes between parties to an agreement); non-contractual liability proceedings (disputes between a third party and one or more parties to the agreement); and applications for injunctions. In any case, national courts may ask the Commission for information or for its opinion on points concerning the application of European competition law.
Compliance with Articles 101 and 102 of the Treaty on the functioning of the EU (ex Articles 81 and 82 TEC) and the fulfilment of the obligations imposed on undertakings and associations of undertakings under Regulation 1/2003 is enforceable by means of fines and periodic penalty payments. The rules on periods of limitation for the imposition of fines and periodic penalty payments were laid down in Regulation 2988/74, which also concerns penalties in the field of transport. The imposition or non-imposition of a fine, and the amount thereof, depend in particular on the gravity of the infringement, its duration and the size of the undertakings involved. An intentional infringement usually leads to a heavier fine than when undertakings are simply guilty of negligence. Practices that have already in the past been frequently punished by the Commission also carry heavier fines, as the earlier decisions of the Commission and of the Court of Justice should have alerted undertakings to the unlawful nature of such behaviour. The Commission may also impose on undertakings and associations of undertakings fines where, intentionally or negligently, they supply incorrect or misleading information, do not supply information within the required time-limit or refuse to submit to inspections.
Commission action in the area of competition is controlled, from the legal standpoint, by the Court of Justice, which can rescind or amend any formal Commission decision, i.e. negative clearances, decisions granting or refusing an exemption, orders to put an end to infringements, etc. [see section 4.1.5]. The Court may also confirm, reduce, repeal or increase the fines and penalty payments imposed by the Commission, but it admits that the Commission enjoys a margin of discretion when fixing the level of the fines imposed in the case of an infringement of the competition rules [Case T-155/06]. Any natural or legal person in respect of whom a decision has been taken may institute proceedings before the Court, as may any other person directly and individually concerned by a decision of which he is not the addressee. The Commission's competition policy is controlled, from the political standpoint, by the European Parliament [see section 4.1.3], which adopts positions on its guidelines and scrutinises its annual report on competition.
In practical terms, the competition authorities of each Member State are required to work closely with the Commission and the competition authorities of the other Member States so as to guarantee the maintenance of a system which ensures that competition is not distorted and promote uniform application of the competition rules. The competition authorities of the Member States must, when acting under Articles 101 or 102 of the TFEU (ex Articles 81 or 82 TEC), 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 other Member States. The information of the Commission is also mandatory in case of a decision requiring that an infringement be brought to an end, accepting commitments or withdrawing the benefit of a block exemption Regulation. National competition authorities may also exchange between themselves information, including any confidential information, necessary for the assessment of a case that they are dealing with under Articles 101 or 102 of the TFEU.
The Commission is empowered throughout the Union to require such information to be supplied as is necessary to detect any agreement, decision or concerted practice prohibited by Article 101 TFEU (ex Article 81 TEC) or any abuse of a dominant position prohibited by Article 102 TFEU (ex Article 82 TEC). Undertakings are obliged to answer factual questions and to provide documents, even if this information may be used to establish against them or against another undertaking the existence of an infringement. The Commission is also empowered to undertake such inspections as are necessary to detect any agreement, decision or concerted practice prohibited by Article 101 of the TFEU or any abuse of a dominant position prohibited by Article 102 (TFEU). It is in particular empowered to interview any persons who may be in possession of useful information and to record the statements made. Officials and other persons authorised by the Commission are empowered to enter any premises where business records may be kept, including private homes. The competition authorities of the Member States must cooperate actively in the exercise of these powers.
Where the Commission, acting on a complaint or on its own initiative, finds that there is an infringement of Article 101 or of Article 102 of the Treaty on the functioning of the EU, it may by decision require the undertakings and associations of undertakings concerned to bring such infringement to an end. For this purpose, it may impose on them any behavioural or structural remedies, which are proportionate to the infringement committed and necessary to bring the infringement effectively to an end. The initiation by the Commission of proceedings for the adoption of a decision relieves the competition authorities of the Member States of their competence to apply Articles 101 and 102 of the Treaty. If a competition authority of a Member State is already acting on a case, the Commission must only initiate proceedings after consulting with that national competition authority.
In order to ensure the effective enforcement of the European competition rules and the proper functioning of the cooperation mechanisms contained in Regulation 1/2003, the competition authorities and courts of the Member States must apply Articles 101 and 102 of the TFEU where they apply national competition law to agreements and practices which may affect trade between Member States. In order to create a level playing field for businesses, the application of national competition laws may not lead to the prohibition of such agreements, decisions and concerted practices, if they are not also prohibited under European competition law. The notions of agreements, decisions and concerted practices are autonomous concepts of European competition law covering the coordination of behaviour of undertakings on the market as interpreted by the European Courts. However, Regulation 1/2003 does not preclude Member States from implementing on their territory national legislation, which protects other legitimate interests provided that such legislation is compatible with general principles and other provisions of European law. This is particularly the case of legislation which prohibits undertakings from imposing on their trading partners, obtaining or attempting to obtain from them terms and conditions that are unjustified, disproportionate or without consideration.
In any national or European proceedings for the application of Articles 101 and 102 of the TFEU, the burden of proving an infringement of Article 101 § 1 or of Article 102 of the TFEU (burden of proof) rests on the party or the authority alleging the infringement. The undertaking or association of undertakings claiming the benefit of Article 101 § 3 of the TFEU must bear the burden of proving that the conditions of that paragraph are fulfilled.
In accordance with Articles 53 and 54 of the Agreement on the European Economic Area, the European Commission must verify whether the cases referred to it come under these articles. It must act in cases likely to affect inter-State trade within the EEA, and also when the practices in question threaten to upset trade between one of the EU States and one or several of the EFTA States, on condition that the companies in question achieve over 67% of their combined turnover for the EEA on the territory of the EU. On the other hand, the EFTA Surveillance Authority decides in cases involving firms whose turnover on EFTA territory is equal or above 33% of turnover on EEA territory, except when trade within the EU is affected. Responsibility is shared out in the same way for negative clearance applications concerning a dominant position. European-scale concentrations naturally remain under the responsibility of the Commission. The latter has laid out in a Regulation the details of the implementation of the competition rules established in the EEA Agreement [Regulation 3666/93].