Competition journals: July - Oct. 2006

(1) General - Scope of application

Dassonville, Keck et les autres : de la mesure avant toute chose, R. KOVAR (RTD eur. 2006, p. 213)

In this article, Robert Kovar proposes, ten years later, a calm reading of Community case law on measures having equivalent effect to quantitative export restrictions, and especially of the Dassonville judgment, which, according to the author, has been attributed exaggerated merits, and of the Keck and Mithouard judgment, which has come in for excessive criticism, which has not prevented it from constituting a perennial body of case law.

Non-competition clauses in European competition law, H. LESGUILLONS (RD aff. Int. 4/2006, p. 495-533).

In this article, Henri Lesguillons reviews in detail the status and regime of non-competition clauses in Community competition law, both as regards agreements and concerted practices subject to Article 81 EC and situations falling under Article 82 EC and as regards the implementation of concentrations. At the end of this analysis, the author comes to the conclusion that "the essentially formal indications provided by the competition authority are losing ground to the benefit of a development of a substantial, fundamentally economic orientation".

National champions and economic patriotism (Economic Problems, No. 2.903, July 5, 2006, pp. 2-33)

On the controversial issue of economic patriotism, we will read the dossier devoted to it in the journal Problèmes économiques.

Pharmaceutical industry and competition law: between present and future, E. DIENY (Contracts, conc., consom., August-Sept. 2006, Studies, p. 5)

At the very moment when the CFI, in a judgment of 27 September 2006, calls on the Commission to take into account the specificity of the pharmaceutical sector in order to assess the concrete effects of restrictions on parallel trade, the author of this article offers us a very complete overview of the various disputes in the pharmaceutical industry, both under Community and national law. He takes stock of the current situation and launches some avenues for future reflection on the protection and distribution of pharmaceutical specialities with regard to competition law, the future being, according to Emmanuel Dieny, the development of recourse to provisions on abuse of a dominant position.

Proposal for a concept: the crucial operator, M.-A. FRISON-ROCHE (D. 2006, doctr., p. 1895)

In order to resolve what she considers to be an excessive neutralisation of public undertakings and national champions, Marie-Anne Frison-Roche proposes the adoption of a new concept, that of crucial operator, characterised by the fact that, placing other operators in a situation of dependence by its very nature, the sector cannot function without it. Typically, this crucial operator is the one who owns critical infrastructure, is at the source of fundamental innovation or carries a systemic risk. Recourse to this notion of crucial operator would then have the ambition, if not to reconcile industrial policy and competition law, at least to avoid a sterile confrontation. In other words, it would be a matter of acknowledging the fact that there are operators who are essential to the development of certain sectors, of recognising that they need to be powerful, without necessarily being dominant, which implies that they should be given special treatment, by creating obligations and rights for them that are correlated with the crucial nature of this operator for the sector in which it operates, not only with regard to the public authorities, but also with regard to other operators, making it, in a way, a second-tier regulator.

Competition law and labour law in public procurement (Are employees justiciable before the Competition Council?), A. MAZIERES (Petites affiches, 27 Sept. 2006, No. 193, p. 8)

In a highly critical paper, the author offers an analysis of the interesting decision No. 06-MC-02 of 27 June 2006 (Collective crèches sector) under which the Competition Council ordered an association managing crèches in the Bouches-du-Rhône to suspend the application of an amendment to the employment contracts of its employees in order to ensure the smooth running of the next public call for tenders. Wondering about the division of the enforcement of competition offences between the judicial judge and the Competition Council, the author, observing that the latter cannot refer to the field of individual employment relations, concludes, in a questionable manner, that the Council has no competence to question contractual relations between employees and their employer. The author usefully recalls, without drawing all the consequences on the possible and desirable articulation between the various branches of law, that competition law, which applies only to economic operators, must, and can, be combined with the other branches of law governing the life of enterprises. On this decision, see also, Actualités du droit de la concurrence et de la régulation, L. RICHER (AJDA, 25 Sept. 2006, p. 1698).

Chronique Concurrence, Mise en œuvre des articles 81 et 82 CE (1er octobre 2004 - 30 juin 2006), J.-B. BLAISE and L. IDOT (RTD eur. 2006, p. 477)

In this column on the implementation of Articles 81 and 82 of the EC Treaty during the period from 1 October 2004 to 30 June 2006, the authors offer a very in-depth analysis of the case law concerning antitrust rules, but also of the reflections in progress during the same period. Developments are thus devoted to the ongoing debates on the possible revision of the approach to Article 82 EC or on the Green Paper on damages actions for breach of the EC antitrust rules.

OECD peer review gives positive assessment on competition policy and enforcement in the European Union, S. SUURNÄKKI (Competition Policy Newsletter, 2006, No. 2, p. 7).

The OECD has just published the report on EU regulatory reform. It is a very detailed historical and current analysis of the implementation of competition law and policy in Europe. The report is available on the OECD website (www.oecd.org). It notes all the reforms that the European Commission has carried out and will carry out in the future in order to strengthen the legislative framework to meet the new requirements of the market, in particular by taking greater account of economic considerations in all the bodies of rules. The report concludes by proposing four options for regulatory reform: firstly, to clarify the relationship and articulation between the Community leniency programme and the national programmes, which has just been launched by the Commission; secondly, to adopt a more economic approach to the analysis of abuses of dominant positions, a reform that has also been initiated; thirdly, to increase the capacities of DG Competition in the economic field and finally, what can be considered the most innovative reform proposal, to apply sanctions to individuals, through coordination with the national authorities, in order to strengthen the repression against those who implement cartels in particular.

Economic analysis and antitrust damages, F. M. FISHER (World Competition, 2006, Vol. 29, Issue 3, p. 383).

Here is an article that is fairly well done and takes up several classic problems of economic theory on damages, more particularly those concerning private actions, including, for example, the question of triple damages or the prevention of unjust enrichment.

"Consumer detriment" and its application in EC and UK competition law, P. MARSDEN & P. WHELAN (ECLR, Oct. 2006, Vol. 27, Issue 10, p. 569)

La politique de concurrence de la Commission pour 2005 et les premiers constats de 2006, S. MEAR (Rev. Lamy dr. aff., sept. 2006, n° 446, p. 44)

Actualités du droit de la concurrence et de la régulation, L. RICHER, P-A. JEANNENEY and N. CHARBIT (AJDA, 12 June 2006, p. 1142; 25. Sept. 2006, p. 1697)

Activity of the Community courts in competition law (December 2005-January 2006), P. ARHEL (Petites affiches, 24 Jul. 2006, No 146, p. 20)

Chronique de droit communautaire de la concurrence, G. DECOCQ (RJ Com. 2006/3, p. 304)

Chronique de droit interne de la concurrence, C. CARON and G. DECOCQ (JCP éd. E, n° 39, Sept. 28, 2006, 2405, p. 1610)

Gazette de droit de la concurrence, edited by J. PHILIPPE and T. JANSSENS (Pal. Gaz., Sept. 13-14, 2006, pp. 2-26)

Chronique Droit de la Concurrence, L. IDOT et C. PRIETO (DRC, Jul. 2006, p. 719)

Chronique Concurrence, L. IDOT (Europe, Jul. 2006, comm. 215-221; Aug.-Sep. 2006, comm. 246-252)

Competition Chronicle, M. BAZEX, G. DECOCQ AND M. MALAURIE-VIGNAL (Contracts, conc., consom., July 2006, p. 25; Aug.-Sep. 2006, p. 29, Oct. 2006, p. 16)

Chronique Distribution, M. MALAURIE-VIGNAL (Contracts, conc., consom., Jul. 2006, p. 21; 2006, p. 36; Aug.-Sep. 2006, p. 26, Oct. 2006, p. 14)

Chronique Concurrence, E. CLAUDEL (RTD com., Apr-June 2006, p. 315-331)

Interview with Guillaume Cerutti, Director General of the DGCCRF (Gaz. Pal., 30 June-1 July 2006, p. 2).

Chronique Concurrence (RJDA, August-September 2006, p. 879; Oct. 2006, p. 990)

Chronique annuelle de jurisprudence communautaire, F. MALVASIO (RJEP/CJEG, August-September 2006, No 634, p. 315).

Preliminary results of Commission sector inquiry in payment cards industry raise competitions concerns, M. BRENNING-LOUKO, T. PANOVA, L. REPA and A.C. TEIXEIRA (Competition Policy Newsletter, 2006, n° 2, p. 12).

2. Agreements

2.1 Concepts and principles

Tricheurs au sein des cartels : un double jeu encore payant ?, C. MASSON and L. AYACHE (Petites affiches, 10 Jul. 2006, n° 136, p. 4)

In this paper, Charles Masson and Laurent Ayache examine the delicate question of taking into account the disruption caused within a cartel by cheaters, i.e. cartelists who do not really play the cartel’s game by not completely following the line of conduct adopted by the cartel. The authors do so in the light of the judgment of the Court of First Instance of the European Communities of 15 March 2006 in Case T-26/02 (Daiichi pharmaceutical), in which the Court held that the breach of the cartel’s obligations may constitute a mitigating circumstance, provided that the operator remains inactive, adopting competitive behaviour, or even actively disrupts the operation of the cartel.

Chronique de droit de la concurrence - Arrêt "O2 (Germany)/Commission", T. HENNEN (RDUE, 2/2006, p. 483)

In this column, the author goes back to the important judgment delivered by the Court of First Instance of the European Communities on 2 May 2006 in which it recalled, with regard to the assessment of the compatibility of agreements with Article 81(1) EC, that the analysis must be carried out in two stages and that as soon as it is accepted that the agreement does not have an anti-competitive object, the effects of the agreement should be examined at that stage and, in order to prohibit it, it is necessary to require from the outset that the elements establishing that the operation of competition has in fact been prevented, restricted or distorted to an appreciable extent be present. More specifically, the court stated that the test to be applied consists of a comparison of the competitive situation in the presence and in the absence of the agreement in question: ’the competitive process in question must be understood in the actual context in which it would occur in the absence of the agreement at issue, since the distortion of competition may, in particular, be called into question if the agreement appears to be precisely necessary for an undertaking to penetrate an area in which it did not operate’. See also on this judgment, the comment of G. DECOCQ in his Chronique de droit communautaire de la concurrence, (RJ Com. 2006/3, p. 304).

Entente et contrat : le trouble notionnel, Y. GUENZOUI (RTD com., Apr.-June 2006, p. 273)

Antitrust and sharing information about product quality, J. Han (Univ. of Chicago Law Rev., summer 2006, Vol. 73, Issue 3, p. 995).

How should article 81 EC address agreements that yield environmental benefits, H. R. BASARAN (ECLR, Sept. 2006, Vol. 27, Issue 9, p. 479).

2.2 Distribution

Internet and selective distribution, J.-P. VIENNOIS (Propriété industrielle n° 9, Sept. 2006, comm. 70)

In this very critical note, Jean-Pierre Viennois criticises the Competition Council’s use of the procedure for accepting commitments in the Festina case. A trader selling its products exclusively over the Internet, the company Bijourama, had complained to the Council about the refusal by Festina France to grant approval to its selective distribution network. At the end of this procedure, the Council finally decided that a supplier may select its distributors on the basis, inter alia, that they have a shop to receive the public and display the contractual products, i.e. by excluding from its network "exclusively Internet" sellers. What angers the author is the fact that, in the Council’s view, the absence of rules applicable to the sale on the Internet of the products supplied under Festina France’s framework contract for selective distribution constitutes a competition concern. Jean-Pierre Viennois sees this as an admission of the negative cartel theory ... We will also see on this case, The "exclusively internet" distributors, N. KOUCHNIR-CARGILL and C. GRASS (Les Échos, Oct. 2, 2006, p. 13)

Internet, Franchising and Business Law, H. KENFACK, (D. 2006, jur., p. 1901)

The distributor of mobile telephone subscriptions can be qualified as an agent, D. FERRIER (D. 2006, p. 2306).

L’obligation d’information précontractuelle et le contrat de franchise, J.-M. LELOUP (RJ Com. 2006/3, p. 312)

Chronique de droit de la distribution, S. LEBRETON-DERRIEN (RJ Com. 2006/3, p. 322)

3. Abuse of dominance

La réforme de l’article 82 du traité CE - Ateliers de la concurrence de la DGCCRF (Rev. conc. consom. 2006, n° 146, p. 3-19)

At a time when we are awaiting the European Commission’s first conclusions on the outcome of the public debate it has itself initiated on a new approach to the application of Article 82 EC, it is of the greatest interest to take note of the very rich discussion that took place at the Competition Workshop of 19 October 2005 organised by the DGCCRF. After a useful reminder by Me Anne Wachsmann of the current approach to abuse of a dominant position and its limits, and a no less useful presentation by Professor Patrick Rey of what an economic approach to Article 82 EC could be, in which the emphasis would be on the effects of behaviour, Mr Emil Paulis came to present the state of the Commission’s thinking and to outline what guidelines on Article 82 EC could be. Finally, Mr. Jean-Yves Art gave the counterpoint of the point of view of large companies.

From harm to competitors to harm to competition: one more effort please, D. SPECTOR (European Competition Journal, Aug. 2006, Vol. 2, Issue 2, Special issue to article 82, p. 145).

Generally speaking, the reform of Article 82 EC continues to mobilise the doctrine to a large extent. The European Competition Journal devoted a special issue to it in August 2006. In his article, David Spector, commenting on and analysing the elements of the Commission’s Discussion Paper on Article 82 EC with regard to exclusionary practices (discounts, tying, predatory pricing), considers that, despite some progress, the Commission’s approach is not sufficiently focused on demonstrating an infringement of competition. More specifically, the author indicates that it still partly presupposes infringement of competition when an infringement on competitors is demonstrated, even though other elements are necessary, such as, for example, the demonstration that the loss of competitors’ market shares does indeed reduce the overall competitive pressure on the dominant undertaking, a type of analysis also conducted in American case law. By relying on elements of classical or more recent microeconomic theory, the author then identifies certain risks of the elements presented in the Discussion Paper and deduces certain consequences for the analysis of competition authorities. He concludes by underlining the advantage that would result from taking competitors’ costs into account in the analysis in order to strengthen and simplify the study of the causal link between harm to competitors and harm to competition and to refine the assessment of the competitive situations examined.

Other articles in this issue include Dominance - the lost child? How effects-based rules could and should change dominance analysis, T. EILMANSBERGER, in which the author analyses the consequences that the reform of Article 82 EC will have on the assessment of dominance, both from the point of view of the criteria used and the link between the position and the abuse. By extension, it also discusses the role and significance, necessarily less so, of market shares in future analyses. Reference is also made to Article 82 rebates: four common fallacies, F. P. MAIER-RIGAUD ; How to test for abuse of dominance, K. FJELL & L. SØRGARD and Eternal Sunshine on a Spotless Policy? Exclusive Dealing under Article 82 EC, P. LUGARD.

Still on the reform of Article 82 EC, read carefully: The wood began to move: an essay on consumer welfare, evidence and burden of proof in article 82 cases, R. NAZZINI (Eur. Law Rev., Vol. 31, Issue 4, p. 518), which focuses on the issues of standard and burden of proof, which are indeed crucial in view of the reform of Article 82 EC.

Prokent/Tomra, a textbook case? Abuse of dominance under perfect information, F. MAIER-RIGAUD et D. VAIGAUSKAITE (Competition Policy Newsletter, 2006, n° 2, p. 19)

Very interesting comments on the Commission’s decision penalising an abuse of a dominant position by TOMRA for having set up exclusive agreements, retroactive rebate systems and quantitative obligations on its partners, thereby closing off the market to competitors, and the presentation of TOMRA’s defence strategy, which called into question the Commission’s economic analysis.

Interoperability Information and the Microsoft Decision, R. J. HART (Eur. Int. Prop. Rev., July 2006, Vol. 28, Issue 7, p. 361).

Critical commentary on the Microsoft decision, as the decompilation obligation imposed by the Commission on Microsoft exceeds, according to the author, what is provided for in Article 6 of the Software Directive No 91/250.

La dominance collective : myths and reality, F. FONTAINE (JCP éd. E, n° 30, 27 Jul. 2006, 2153, p. 1316)

La pratique de ciseau tarifaire dans la téléphonie devant la Cour de cassation : à propos de l’objet de la preuve à administrer, M. CHAGNY (Comm. com. électr., sept. 2006, n° 129, p. 40)

Loyalty rebates and proof of foreclosure effect, A. WINCKLER and S. GENEVAZ (RLC, 2006/8, No. 546, p. 20)

Comparative analysis of the US and EU approach and enforcement of the essential facilities doctrine, A. STRATAKIS (ECLR, Aug. 2006, Vol. 27, Issue 8, p. 434).

Michelin’s position on the draft guidelines on the application of Article 82 EC, L. GUEELAND and J. PEYRE (RLC, 2006/8, No 607, p. 130)

Europe and the completion of the internal market: How can Article 86 of the EC Treaty play a useful role, N. LENOIR, D. ROSKIS, CH. MAY-DOREMUS (Gaz. Pal., No. 284-285, 11-12 October 2006, pp. 2-19)

4. RESTRICTIVE PRACTICES

5. Concentrations

Chronique, L’application du règlement sur le contrôle des concentrations (1er janvier 2004-31 décembre 2005), J.-F. BELLIS (JTDE, n° 131, sept. 2006, p. 205)

Through this column, the author retraces two very rich years in terms of Community merger control. The implementation of the new Regulation 139/2004 and the Commission’s notices on horizontal mergers, ancillary restraints, referrals to national authorities and the conditions for the "abandonment" of a merger are analysed in detail. Also, the focus is on the case law of the Commission and the Community Courts on unilateral effects, coordinated effects and conglomerate effects. Finally, the author examines remedies imposed by the Commission, which seems more inclined to accept only structural measures such as divestitures.

A Screening Device for Tacit Collusion Concerns, D. PARKER (ECLR, Aug. 2006, Vol. 27, Issue 8, p. 424)

Here is an interesting idea and a well-structured article to promote it. Explaining that the Herfindahl-Hirschman Index is biased when assessing the possibility of tacit collusion when examining a merger when market shares are asymmetric, the author proposes the use of another benchmark, the "Tacit Collusion Asymmetric Index". He describes its principle, virtues, limits and makes a retrospective application to two merger cases, including, of course, the Airtours case.

The acceptability of remedies under the EC merger regulation: structural versus behavioural, D. WENT (ECLR, Aug. 2006, Vol. 27, Issue 8, p. 455).

The author presents in this article a comprehensive review of the issue of categories of merger control remedies. After recalling the principles of the definition of two main categories of remedies, the author notes that, while structural remedies are primarily intended to resolve the problems that may arise from a merger, no solution should be ruled out as a matter of principle, a position that can only be endorsed in a field such as competition law. The author then identifies the remedies that case law has applied to the various categories of established competitive risks. No doubt such an inventory will be useful for both competition law theorists and practitioners.

On the same theme, see Behavioural remedies in EC merger control - Scope and limitations, A. EZRACHI (World Competition, 2006, Vol. 29, Issue 3, p. 459) and The merger remedies study - In divestiture we trust, P. PAPANDROPOULOS & A. PAPANDROPOULOS. TAJANA (ECLR, August 2006, Vol. 27, Issue 8, p. 443).

13 July 2006: First annulment of a Commission decision approving a concentration between Sony and BMG, J.-M. THOUVENIN (RMCUE, No 501, Sept. 2006, p. 524)

Merger control: Main Developments between 1 January and 30 April 2006, M. LOUGHRAN and J. GATTI, (Competition Policy Newsletter, 2006, n° 2, p. 41).

The protection of business secrecy in the field of mergers: the example of the Cegid/CCMX case, E. GARCIA-ROSADO and R. LESUR (RLC, 2006/8, No. 546, p. 20).

6. State aid

The scheme for the recovery of aid, M. BAZEX and S. BLAZY (Dr. adm., July 2006, No. 7, p. 21)

Commenting on the judgment of the Conseil d’État of 29 March 2006 in the case of the Centre d’Exportation du Livre Français, the authors recall the fundamental distinction between unlawful aid and incompatible aid, the consequences arising therefrom for the national court and the Community court and, in particular, the penalty for the recovery of aid which is unlawful because it has not been notified, which the national court must automatically impose even in the event of a subsequent decision of compatibility by the Commission. The authors thus wonder why the Conseil d’État referred the latter point, which has already been settled by case law, to the ECJ for a preliminary ruling. Would the Conseil d’État not want the ECJ to consider the relevance of such automaticity of the sanction in the event of failure to notify aid?

See also, Les difficultés de la récupération des aides d’État indûment allouées, note ss. EC, 29 March 2006, J.-M. GLATT (Petites affiches, 4 Jul. 2006, No. 132, p. 20).

Application de la jurisprudence Altmark par le juge administratif français (note ss TA Montpellier, 30 Sept. 2005), S. NICINSKI (AJDA 2006, p. 1346)

Guidelines on State Aid to Promote Risk-Sensitive Investments in Small and Medium-Sized Enterprises, J.-M. GLATT (Petites affiches, 9 August 2006, No 158, p. 3)

The exclusive right of Italian tax assistance centres to complete the declaration of workers’ income is contrary to Community law, C. PRIETO (JCP ed. E, No 31-34, 3 August 2006, 2184, p. 1370).

7. Public sector (excluding State aid)

L’évolution de la prise en compte de l’analyse économique par le juge administratif, J.-F. CALMETTE (Dr. adm., Jul. 2006, n° 7, p. 13)

Recalling the very low use of economic analysis by the administrative judge until the 1960s and 1970s and, above all, the unsuitability of litigation for abuse of power in this area, the author notes that it is gradually being taken into account through litigation relating to competition. Thus, the Conseil d’État has been able to highlight a supply in relation to a demand, define relevant markets or draw up "cost-benefit" assessments. The author thus sees a certain anticipation of the administrative judge in the current influence of the economic analysis of the law (EDA), i.e. the consideration of the economic aspects of the rule of law and the use by the latter of the EDA. This is the case when the administrative judge applies the so-called "essential facilities" theory.

See also La distinction entre l’activité économique et l’activité hors commerce devant le Conseil d’État, M. BAZEX (Dr. adm., August-Sept. 2006, n° 8, p. 21)

Confirming also the increasing consideration of economic analysis by the administrative judge, Mr. Bazex notes however a divergence between the analysis of the competition authorities and that of the Conseil d’État on the question of the scope of economic freedoms. To the question whether a free advisory service provided by a public body in the context of the prerogatives of a public authority to public persons could infringe the principle of freedom of trade and industry, the Conseil d’État replied in the negative on the ground that such an activity did not constitute an activity of an economic nature in the absence of a commercial character (provision of a service free of charge to a public person). This approach runs counter to the method of analysis of both the Community and the French competition authorities, which does not take account of the public or private nature of the person carrying on the activity in order to qualify it as economic or not and to apply competition law or not. On the contrary, in the present case, the author finds that it is a consultancy service, which is not, as a matter of principle, outside the scope of trade and that the fact that the services in question are provided free of charge cannot exempt that activity from competition law.

General interest, competition and public service, E. FATOME, A. MENEMENIS, L. RICHER, M. LOMBARD and S. RODRIGUES (AJDA 2006, Dossier, pp. 67-90)

The marketing of tourist services by tourist offices in the face of competition law, note ss. CAA Marseille 10 Jan. 2006, A. CLAEYS (AJDA, 25 Sept. 2006, p. 1723).

Chronique Concurrence : interventions économiques des personnes publiques, M. BAZEX, P. BRUNET et P. SUBRA DE BIEUSSES (Contracts, conc., consom., août-sept. 2006, p. 14)

8. Procedures

8.1 General information

Chronique Droit de la Concurrence, L. IDOT et C. PRIETO (DRC, Jul. 2006, p. 719)

This column will focus on Laurence Idot’s commentary on Decree No. 2005-1756 of 30 December 2005 establishing the list and jurisdiction of specialized jurisdictions in matters of competition, industrial property and business difficulties. Beyond the apparent simplicity of the decree - eight commercial courts, eight regional courts and the Paris Court of Appeal have sole jurisdiction to hear cases involving the application of antitrust law - the author emphasizes the difficulties that the practical application of this text is likely to cause.

See also on this question, Competition: les juridictions se spécialiser, J.-L. Lesquins (Les Échos, 28 Sept. 2006, p. 16).

The judge, guarantor of the efficiency of the principle of prescription in French competition law (regarding the judgment of the Paris Court of First Instance, 1st ch. H, 23 May 2006, on the case of the construction of the hemicycle of the European Parliament in Strasbourg), L. DRIGUEZ (JCP éd. E, n° 36, 7 Sept. 2006, 2279, p. 1472)

In a particularly well-documented article, Laetitia Driguez returns to this very interesting decision of the Paris Court of Appeal handed down on 23 May 2006, in the case of the construction of the European Parliament’s hemicycle in Strasbourg, according to which the latter, going beyond established case law (Cass. com.., 19 June 2001, Bull. civ. IV, No 120), considering that a summons for a hearing addressed by a Council rapporteur to a respondent company constitutes an act interrupting the limitation period, has undertaken, in order not to confer on the principle of limitation a purely formal scope having no other consequence than to systematically deprive that principle of all effectiveness, to review, beyond the nature of the act liable to interrupt the limitation period, its purpose. In the present case, the Court held that, where the rapporteur sends, when the limitation period is about to run out, a letter of convocation to the CEO of one of the companies in question, even though he has all the information he needs to investigate, establish and punish the anti-competitive practices in question, the Court of Justice has held that the limitation period is running out, The Board may, in accordance with the procedure laid down in Article 2(2)(a) of the Staff Regulations and the Rules of Procedure of the Court of First Instance of the European Communities, issue a summons for the purpose of hearing the person summoned, on the understanding that the hearing of the person summoned has never taken place, which shall not constitute an act interrupting the statute of limitations. The Paris Court held that the sole purpose of the letter convening the hearing was to artificially extend the limitation period. The whole point of Laetitia Driguez’s comment is to show that the judge, on a literal reading of Article L. 462-7 of the Commercial Code, now requires that interrupting acts of prescription may be necessary for the prosecution of the offence, in short that they "tend" to that prosecution.

8.2 Regulation 1/2003

Challenges facing the EU network of competition authorities: insights from a comparative criminal law perspective, B. PERRIN (Eur. Law Rev., Vol. 31, Issue 4, p. 540).

This is another very comprehensive article which gives an overview of the difficulties raised by the ECN in view of the differences between this system and the traditional way of cooperation between Member States. The author expands on the elements relating to the exchange of information and discusses classic but sensitive issues such as the disparity between States with regard to investigative powers, the protection of the rights of the defence and the leniency procedure. He concluded by indicating what he considered to be the most legally sound directions for the various issues under discussion. Some of these solutions are based on Community case law, such as the use of evidence limited to that which can be obtained in each Member State’s own procedures. Others, such as a levelling up of the protection of the rights of the defence or amendments to Regulation 1/2003 on the exchange of information, are likely to be more cumbersome to put in place.

Unforeseen consequences of article 3 of EU regulation 1/2003, M. C. LUCEY (ECLR, Oct. 2006, Vol. 27, Issue 10, p. 558).

8.3 Sanction Policy - Clemency - Settlement - Undertakings

La réparation des dommages concurrentiels, M. Debroux (Les Échos, Oct. 11, 2006, p. 16)

In this brief commentary on the judgment of the Nanterre Commercial Court of 11 May 2006 in the Arkopharma case, in which Arkopharma sued Roche and its parent company Hoffmann-La Roche for compensation for the damage it claimed to have suffered as a result of the "vitamins" cartelIn this case, which was heavily sanctioned by the European Commission in November 2001, Michel Debroux draws readers’ attention, in a very enlightening manner, to the risks involved in the solution adopted by the Court of First Instance on the question of the so-called "passing-on defence" argument. That argument, which consists in maintaining that the direct victim of a cartel (in practice, the purchaser of the goods or services which are the subject of the cartel) cannot be compensated if he has been able to pass on his additional costs to the next level in the production chain, is accepted in the present case. While it has the merit of preserving the principle of compensation limited to the damage actually suffered, i.e. the principle of ’compensatory’ damage, as opposed to ’punitive’ damage, it is not a question of whether or not it should be limited to the damage actually suffered.The main consequence of this argument in defence is that, where the additional costs of the cartel are passed on in full to final consumers, compensation for competitive harm is likely to be only virtual, since it is considered that the first victim of the cartel, whether a wholesaler or distributor, who is moreover the one who has the greatest incentive to seek compensation, has not ultimately suffered any direct damage.

The Commission’s fines in competition law in the face of censorship by the European judge, D. HENRY (Cah. dr. eur. 2006, n° 1-2, p. 34)

Because fines imposed are the main instrument of the Commission’s action, in the absence of criminal and civil sanctions in Community law, the author makes a particularly detailed empirical analysis of the Commission’s sanctions policy from 1998 to 2004. He thus retraces in a very methodical way all the factors taken into account by the Commission when it imposes a financial penalty and then lists the arguments and factors used by the CFI and the ECJ to reduce the amount of the fines imposed by the Commission. In particular, it is interesting to note that, while the CFI has jurisdiction to annul, reduce or increase a fine, it generally confines itself to ascertaining whether the factors relating to the duration of the infringement or to gravity have been properly assessed. Noting thus that the undertakings penalised had every interest in bringing actions before the CFI in order to have their penalties reduced, the author wonders whether the Court of First Instance’s policy might change and decide to increase the fines imposed by the Commission at the risk, however, of violating its prohibition of ruling ultra petita.

Penalties for price fixers: an analysis of fines imposed on 39 cartels by the EU Commission, C. VELJANOVSKI (ECLR, Sept. 2006, Vol. 27, Issue 9, p. 510).

In this article, the author conducts a study of the sanctions imposed by the Commission on cartels between 1998 and 2004, comparing the principles set out in the Commission’s guidelines on this point with practice and assessing the impact of the leniency programme and of the appeals before the Community courts on the amount of sanctions. From the conclusions reached by the author, it will be noted in particular that the Commission’s sanctions are determined arbitrarily, without reference to the profits of the guilty company or the losses of the victims. Above all, the author considers that the leniency system is generous and that it pays for an undertaking, in order to keep its penalty as low as possible, first to cooperate with the Commission and then to contest the amount of the fine before the Community courts.

Consolidating Antitrust Damages in Europe: A Proposal for Standing in Line with Efficient Private Enforcement, J. RÜGGEBERG & M. P. SCHINKEL (World Competition, 2006, Vol. 29, Issue 3, p. 395).

The purpose of this article is to warn Europe against a development that could lead to some of the difficulties that the United States is facing in the field of private actions, characterized by the jurisprudence of the Supreme Court ARC America, Illinois Brick and especially Hanover Shoe, or to a risk of fragmentation of litigation. The authors then propose that Europe should adopt a consolidated and centralized system, which would be based on a central authority, a priori the competition authority. The latter, as amicus curiae, would conduct an investigation to assess the extent of the damage caused by the infringement. The amount would then be proposed as an opinion to the court, which would be responsible for assessing and apportioning the individual damages. Such a solution would, according to the authors, have the advantage of unity, simplicity and efficiency and would continue to make use of the crime detection potential of the private prosecution system. In the same issue of World Competition, on the same theme, we read Towards a Constructive Public-Private Partnership to Enforce Competition Law, S. W. WALLER (p. 367).

Recent developments in French competition law - Commitments, leniency and settlement procedures - The French approach, L. CARSWELL-PARMENTIER (ECLR, Nov. 2006, Vol. 27, Issue 11, p. 569).

Invoking leniency: a strategic advantage for companies, S. CHOLET and V. SELINSKY (Rev. Lamy dr. aff., June 2006, n° 331, p. 55)

Les nouveaux instruments des autorités de concurrence : lémence, transaction, engagements - Ateliers de la concurrence de la DGCCRF (Rev. conc. consom. 2006, n° 146, p. 37-61)

9. REGULATIONS

Actualités du droit de la concurrence et de la régulation, L. RICHER, P-A. JEANNENEY and N. CHARBIT (AJDA, 12 June 2006, p. 1142; 25 Sept. 2006, p. 1697)

10. International policy

Les défis de la mondialisation pour les pays développés en matière de concurrence, F. SOUTY (Rev. économique et sociale, No. 1, March 2006, pp. 27-38)

In a very didactic article, François Souty offers an overview of the main issues and challenges of competition policy that cut across the subject, not only in the transatlantic dialogue between the United States and Europe, evoking the opposition between the American-Darwinian and regulatory interventionist conceptions, but also within developing countries, which are traversed by demands for "special and differentiated treatment", the only one likely, according to its promoters, to take into account the more or less advanced degree of maturity of their economies. Taking part in the debate, François Souty resolutely pleads in favour of a differentiated development of competition law, not only through a variable-geometry application, but also through the adoption of more interventionist purposes, inspired by ordoliberal concepts, intended to stimulate the competitive process through the emergence of competitors. On the same issue, we will also see the interesting dossier devoted by the ILEC (Institute for Liaison and Consumer Industry Studies) in its Bulletin No. 373 of July-August 2006 to the issue of "Competition Law and Globalization", which is available on the Institute’s website (http://www.ilec.asso.fr/).

Multilateral, regional and bilateral approaches to competition policy, P. ARHEL (Petites affiches, 19 July 2006, No. 143, p. 13).

In this very well-documented paper, Pierre Arhel proposes to review competition policy in the context of the WTO, which we know is no longer part of the Doha Round of negotiations since 2004. Competition policy is now marked, pending the return of the issue of implementing a multilateral competition framework to the agenda, by the proliferation of bilateral or regional agreements. Following a review of the place of competition policy in the WTO, the author focuses on assessing the compatibility of multilateral approaches with regional or bilateral approaches.

Competition policies, N. JALABERT-DOURY, L. NOUVEL and I. SIMIC (RD aff. Int. 4/2006, p. 535)