The Gazette 1985

GAZETTE

SEPTEMBER 1985

Article 86 i8 The most important recent application of Article 86 was in the IBM 5 9 case in which the Commission's proceedings were suspended last year following an undertaking by IBM to modify certain of its business practices in the EEC. Without going into the complicated details of this case, I should like to focus attention on its illustration of two important features of our law and policy under Article 86. Firstly, we sometimes make product or service market definitions which are charac- terised as narrow, in circumstances where an undertaking attains market power through the placing on the market of its own products and services. In the IBM case the Commission took the view that IBM had a dominant position in the supply of the two key products for its System/370 range (the central processing unit and the operating system) with the result that it was able to control markets for the supply of compatible products. In the car industry, the Commission has taken the view that a manufacturer may have a dominant position for the supply of certificates of conformity for its own vehicles where such certificates are required by national law for the registration of an imported vehicle for use on the roads. The second point illustrated by the IBM case is the Commission's concern that technology should be as widely disseminated as possible, within the limits of industrial and other property rights, and that companies seeking to take advantage of the economic opportunities of the computer age should not be inhibited by the actions of dominant undertakings. For the rest the concerns expressed in Article 86 cases have not varied greatly over the years: dominant undertakings should not be allowed to abuse their market power further to reduce or distort residual competition or to interfere with the market integration goal. By way of example, the Commission has found abuses to have consisted in discriminatory, excessive and predatory pricing, tying by various means, refusals to deal and interference with trade between Member States. In the specific field of mergers, regard is had to the extension or reinforcement of dominance. The Community competi- tion rules do not object to size or market power: they seek rather to impose certain obligations on those undertakings which are shown to have dominant market power. Enforcement The Commission, and particularly its Directorate- General for Competition, cannot be expected to shoulder the whole burden of enforcing the Community's antitrust rules. As developed over the years in the Court of Justice's case law and the Commission's own endeavours, these rules now form a large corpus of law applicable to a wide variety of situations. Enforcement of Community law is shared between the Commission, custodian of the Treaties 40 , and the courts and tribunals of the Member States which apply directly effective provisions of Community law. Articles 85 and 86 are applicable by the national courts 41 and all over the Community these provisions are frequently raised in litigation. However, the time has come to decentralise enforcement further. I shall look briefly at the types of case which could be dealt with at national level and then at what needs to be done to provide a legislative framework for decentralisation to prevent disparity of treatment and forum shopping as between the Member States. 274

Firstly, where the law is well-established and no complicated transnational fact-finding or economic analysis requiring knowledge of market conditions in several countries is required, national courts should begin to assume more of the enforcement burden and the Commission will have to consider, in appropriate cases, informing a complainant whose case seems plausible that the Commission is not the most convenient forum for his action. This is tantamount to declining jurisdiction, at least initially. The Commission could not renounce its jurisdiction definitively and it might be necessary for various reasons to take up such a case at a later stage. The Commission would remain available to the national court for any assistance the Commission might be able to give in accordance with the law and the Commission's policy of full co-operation with all national bodies. In certain cases in which the Commission felt called upon to comment on issues raised in a case which had implications for the general Community interest, it could intervene in a case as an amicus curiae 42 . The Commission would devote its scarce resources to cases involving policy considerations, in which the law is not settled, where use of the Commission's fact-finding powers is more likely than national discovery procedures to uncover the evidence, or simply where the Commission considers that in the Community's public interest it should take up a case. The Commission would also maintain its monitoring of competitive conditions in the common market and would undertake investigations on its own initiative where appropriate. In addition, the Commission would remain the only body empowered to grant exemptions under Article 85(3) 43 . Certain rules would have to be common to all the Member States before the Commission would view with confidence any further decentralisation of the enforce- ment of competition law. In several Member States courts have decided that an action for damages or an injunction may be brought for violations of Articles 85 and 86 44 . Plaintiffs throughout the Community should face a common core of rules relating to procedures, remedies and the seeking of assistance from the Commission. In this way, the principle of equal treatment throughout the Community would be respected and forum shopping discouraged. I am particularly sensitive to the dangers of providing better justice for parties with the money and the time to shop around the Member States for the best judicial deal. There must be no second-class justice under Articles 85 and 86. This means in practice that some harmonisation is necessary in such fields as interim relief, damages, privilege, discovery and other fact-finding procedures. This list is far from exhaustive and I am aware that this is likely to prove a controversial project. Nevertheless, decentralisation is necessary and a common framework for the application of Community rules is indispensable. On top of this whole structure will sit the Court of Justice, available to national courts via Article 177 of the EEC Treaty. The Court will ensure in the final alaysis that the law is applied and developed in a uniform manner. The proposal for a court of first instance on issues of fact and law in Commission competition decisions, with final appeals on points of law only going to the Court of Justice, recently put forward in the Commission's programme for 1985 45 , is designed to alleviate some of the burden placed on the Court of Justice by the quantity and complexity of cases under Articles 85 and 86.