Brussels, 15/02/2012 (Agence Europe) - The Czech competition authority may bring sanctions against the effects of a global product cartel on the national territory before the country joined the EU; the European Commission was not competent to do this, even if the cartel ended after accession. In this ruling returned on Tuesday 14 February in Case C-17/10, the Court clarified the respective competences of the European Commission and the Czech competition authority in the examination and sanctioning of the effects of a global cartel from 1988 to 11 May 2004, in which Toshiba and other Japanese and European electro-technology companies were involved (see also EUROPE 10417 and 9351).
The case is a complex one: the European Commission first of all, and then the Czech competition authority, brought proceedings and applied sanctions against the members of the cartel after 1 May 2004, the date on which the Czech Republic joined the EU and European legislation entered into force in the country. The former examined the effects of the cartel at European level on the basis of European law, the latter did the same at national level under Czech law. The members of the cartel brought proceedings before the Regional Court of Brno against the Czech decision, arguing a violation of European competition rules (Regulation 1/2003). They argued that the Czech authority should have stepped aside to make way for the Commission, as its proceedings - subsequent to the date of accession - were brought after those of the Commission, which had also taken account of the effects of the infringement on the rules against a cumulation of sanctions for the same actions (“ne bis in idem”). Under these circumstances, the Czech Court asked the Court whether the Czech competition authority loses all competence to examine and penalise the effects produced before the date of accession.
First of all, the Court pointed out that neither the treaty nor the act of accession provide for a retroactive application of the Union's competition rules on anti-competitive effects produced in the country before its accession. As a result, these rules do not apply to these effects. It goes on to point out that in competition matters, the competence is shared between the Commission and the national authorities, but the latter are divested of competence and lose the opportunity to apply national law against cartels if the Commission has opened proceedings with a view to imposing a fine. However, this divestment is not permanent and the competence of the national authorities is restored once the proceedings brought by the Commission are completed. The national authorities may rule on the cartel on the basis of Union competition law, as long as they respect the Commission's decision. In this regard, the Court stresses that the competence of the national competition authorities is restored not only if the Commission decides not to apply the competition rules of the Union to a cartel, but also by all possible decisions which could be taken by the Commission on the basis of European law. As a result, the Czech competition authority was able to rule on the anti-competitive effects produced by the cartel in the Czech Republic prior to its accession to the EU.
Lastly, the Court confirms that the principle of “ne bis in idem” has not been violated. The Commission only penalised the consequences of the cartel in the European economic area, targeting only the member states, and not the effects of the cartel in the Czech territory prior to accession, which were penalised by the national authority. (FG/transl.fl)